Creative Economy AZ (My Take)

Based on the Gangplank Futurespective, one thing I promised myself to investigate was Creative Economy AZ.  This is an initiative to raise 1/10th of cent sales tax for the next 20 years to help fund the arts.  I spent a fair amount of time researching what they had online, but felt it was best to meet with those working hard on it before passing judgement.

A few weeks ago I met with Amy Heisler from Metro Phoenix Partnership for Arts and Culture and Sophie O’Keefe-Zelman from First Strategic to talk about the Creative Economy AZ Initiative.  Amy is extremely passionate about arts and culture in Arizona and it shows.   I didn’t learn too much new about the initiative as they do a great job outlining what they are about on their website, from the problem to the solution and on taking action.

I agree with the stated problem.  However, I don’t agree with the solution.  We are in one of the worst economic fiasco’s of this century, both federally and as a state.  With a state budget deficit of several billion and climbing I see little to no chance for this initiative to pass.  Beyond that, I think that it actually puts creatives in a bad light.  It makes creatives look like in the toughest time, that they are the first in line to look for a hand out.

Maybe, I am old fashioned, but this just doesn’t seem right.  I wish that the millions being put into PR, legal fees and lobbying for this initiative were instead being put into efforts to unite the creative class in metro Phoenix.  We are already seeing pockets of people working together to affect radical change in their area of influence.  Imagine if we were to put concentrated effort into getting people to support the arts that are already here and the movement that is already happening?

My Take: Our arts are severely underfunded, but raising taxes to support them in this economic climate is not the right approach.

That said, there is nearly always more than one path to reach an intended destination.

Slashing K12 Budget, Getting Real is a Bitch

Many people asked me what I thought about State Legistlator approving a nearly $140 million cut in soft capital budget for K-12 education.  I never like to see education getting it’s budget cut.  However, it’s time to get real.  Getting real is a bitch.  We are $2 billion in the hole this year and another $3 billion in the hole next year.  We don’t have a line of credit internally to borrow from anymore.  At this point we are looking to private banks for funding.  The state of Arizona is in severe economic crisis and everyone is going to have to dig in and take it in the shorts.  I think the current cuts to education have been kind.  They could have been much, much worse and I suspect they will be in the future.

I call this opportunity.  You see in every circumstance of hardship, we have the opportunity for the human spirit to shine through, creativity to spark and innovation to spur change in ways we could never imagine when we are fat and happy.  Am I  scared for our educational system?  Hell yes. So while, being pinned back in the corner like an angry dog with no options out but to fight is not where we want to be; I know that Arizonian’s have a hell of a lot of fight in them.  I am excited to see them fight off this downturn and emerge on the other side as the leader of the pack.  Laughing at other states still stuck in the dark ages of education because they didn’t have to scrap just to stay alive.  I’ll put my money on the angry, hungry and desperate in any fight.  I say.. Bring it on!

What are your thoughts?

The Arizona We Want Where Doing Takes Ten Years

Dr. Lattie Coor, started a Think Do Tank (Center for the Future of Arizona) after stepping down as president of Arizona State University in 2002.  I never really paid attention, but recently this Do Tank spun an initiative called The Arizona We Want.  It seemed light on substance and heavy on buzzwords, but I was open to being surprised.  I found a podcast from ASU talking with Lattie on the subject and decided to tuned in.

I learned that this Do Tank on day one decided to never tackle more than three issues and to always go after the most important.  Guess what the most important issue they could find in 2002 was?  Poor high school graduation rates in poor Latino schools.

So like all good “Do” tanks they first thing they did was lots of talking.  Years of it in fact.  What did this talking result in?  Hiring a consultant of course.  So they picked out Jim Collins author of Good to Great and hired him to help out.  Now that it is nearly 2010 they almost have that initiative in full swing.

Part of all this talking got them to the point where they found out that Arizona had no Vision Statement.  Of course, this took them until 2005 (3 years) to figure out.  So they decided to start phase 1.  What was phase 1?  Collect all the recent policy report’s (about 50) recommendations and decide what the values of the state should be based off that.

Fast forward to 4 years later, and they have decided that maybe they should ask the people instead.  So what did they do?  Hire another consultant of course.  This time they hired Gallup to help them collect what the people of Arizona want, the citizen voice.  This poll showed that we have a great “level of attachment” and of course this means everything is A OK right?  The Arizona Republic even did a big spread on the report, therefore it HAS to be going in the right direction.

The DO Tank now is going to take the next 18-24 months to talk it over.  At which time I suspect they will hire another consultant to help implement something.  If they wait long enough, the economy might already be in recovery and then they can just take credit for it.

At this point, I am not sure how Lattie can with a straight face consider this a *DO* anything.  I am all about patience and the long term vision, but seriously.. talking for 5 years?  WTF!  Never mind, that good leadership while getting feedback from the people isn’t about letting the majority be the guiding force for all decision making.

So what exactly do they hope to get from implementing this thing?

1. that every candidate for local/state government will frame what they want to do around this report and it’s goals

2. that all arizona organizations will align their goals to this report and it’s goals

3. that creation of coalitions and strategic alliances will form around this report and it’s goals

Well batman, let me break you the bad news.  Lofty goals like that don’t get done by hiring consultants or sitting around talking.  So either re-think your lame ass strategy or get off out of your little “Do Tank” and get to work.

One thing that was overwhelming from the study was that K-12 education needs serious fixing.  Everyone is concerned that graduates are not career/university ready or able to compete globally.  Oddly Gangplank decided to tackle this problem some 8 months ago and already has a number of active programs in place and is heading an East Valley educational summit to accelerate change in the system.  We had the unfortunate disadvantage of not being able to hire a consultant or run expensive studies.

The one thing that I found the most disturbing was that they are looking at ASU to be the primary implementer of change around this study and that they believe ASU will fix Arizona.  I’m not sure when this became the mission of ASU, last I checked they were still struggling providing quality talent to meet the current workforce demand.  The more things change, the more they stay the same.

Phoenix Citizens Seriously Under Represented

Sam Richard has an excellent piece over at the Downtown Phoenix Journal on Size Does Matter.  He discusses how messed up the boundaries and representation for the City of Phoenix currently is.

This is a serious problem. Let’s add perspective….

Mesa: 437k people, 7 mayor/council.. 1 to 66,000 representation
Chandler: 247k people, 7 mayor/council.. 1 to 35,000 representation
Gilbert: 207k people, 7 mayor/council.. 1 to 30,000 representation
Average from these 3 cities 1 to 43,670 representation

Phoenix: 1.5m people, 9 mayor/council.. 1 to 167,000 representation

For Phoenix to get back in alignment with some of its East Valley counterparts it would need to increase to 34 mayor/council seats.

I hope this helps focus just how poorly Phoenix citizens are represented in their local government. Chicago and New York having 50 doesn’t seem so silly now does it…..

We Have To Stop Laughing At California Now

We can’t make fun of the Terminator Govenenor or bad discussion making in California for much longer. As currently we are knocking on their doorstep to take over first place as the state with most fiscal problems.  The down side, is it will get worse before it gets better.  The upside we aren’t entirely helpless.  Maybe its time to take this as an opportunity to get creative or hell even innovate?  We have an unbalanced economy.  Let’s use this crisis to assure we fix that.

Our revenues and expenditures are completely out of line with one another.  We have trouble raising taxes because the 2/3 voting requirement.  We have mandates for health care and education that prevent from wholesale slashing of those budgets.  We can’t ignore the problem, because the economy wont be fixed in the near future.  So, what are you doing to get involved to help come up with creative solutions?  Are you working with your local government to change its situation?

So What Exactly Is Keeping You In Your Current Mortgage?

The bailout had it all wrong.  It attempted to fix problems in the system by letting the very people that got us in trouble apply the fix, THE BANKS.  Don’t get me wrong, I think everyone who has over extended themselves, put themselves in a fully leveraged position and made poor debt decisions have a part to own up to.  It was however the banks that put people in a position to make poor choices, in the name of their own greed.

I have talked to several people around town and hear a common scenario.  Buyers are under water.  Not because they bought a $300,000 home when they could only afford $240,000, but because they bought a $300,000 home they could afford that is now simply worth $180,000.  The $60,000 they put down as good borrowers (20%) is completely lost.  On top of that they are in the hole an additional $60,000 of equity.  They can make the monthly payment no problem as they had always intended to.

So what is the problem?  The problem is that their current house payment is $1600/mo, but they can rent the identical house in their same neighborhood for $800/mo.  That is a difference of $800/mo or $9600/year in cash flow.  The chances that in the next 7 years the equity of the house will rise by $60,000 to get them above water is virtually none.  So why on earth is the borrower staying in this home?  To save their credit score is a likely answer.  You have to ask if someone said they would pay you $67,200 in cash and relieve $120,000 in unsurmountable debt to ruin your credit score for 7 years would you take it?

The above person might qualify for the Obama 125% refinance plan, but at best that might only make their payment $1300/mo.  Not to mention that the banks are not just making the refinances happen.  They refuse to live up to their side of the bailout.  If instead a plan was in place to force lenders to readjust principle balances (not interest rates) to a point where the home owner was not completely underwater then perhaps the home owner might full well consider staying in their home.  At this point, I think someone in the above situation has NO SENSIBLE reason to stay in the home.  They have far more to gain crushing their credit and walking away.  Taking the positive cash flow and investing in their future.  If the bank were in the home owners situation they would certainly walk away.  It’s a business decision.  Sounds cold, but the current bailout isn’t helping much of anyone.  If we are going to throw money at the problem at least lets be pragmatic about it.

What are your thoughts?