This represents a regrettably myopic vision of what the state ought to be doing in this vital policy area. The undeniable fact is that state government's most important role in ensuring the ability of California industry to compete successfully in the global market has nothing to do with organizing trade fairs or alerting companies to export opportunities. For no matter how useful export promotion activities may be, they are no substitute for sustained public investment in schools, infrastructure, economic adjustment assistance programs and other projects geared to nurturing the strengths of the California economy. Likewise, in his exhaustive 1990 work, The Competitive Advantage of Nations, the Harvard Business School's Michael Porter demonstrates how investments in education, worker training programs, and infrastructure far and away represent state government's most essential function in economic affairs. Sadly, though, the basic factors underlying California's industrial prowess have uniformly deteriorated in the last decade.
Public schools seem less able to produce graduates able to function in modern industry.
A once vaunted transportation system is routinely strained beyond capacity, and other critical elements of the state's infrastructure have grown decrepit. Without question, public officials have flunked in their efforts to nourish the roots of California's economic dynamism, contriving instead to act as though the state had somehow gone broke amidst the longest period of uninterrupted economic growth in this century. Now that the need for austerity is finally real, the situation can hardly be expected to improve. Still, the arrival of a new governor during a fiscal crisis of unprecedented magnitude presents a useful opportunity not just for reassessing the programs set up by previous administrations but for devising a bold, new strategy for ensuring that California industry will remain competitive in the new global market. Part of this strategy will require the implementation of comprehensive economic development policies that are often discussed but seldom adopted.