Posted on 04/05/2006 9:02:13 AM PDT by cicero's_son
Indiana Is Open for Business Mitch “the Blade” Daniels is putting the state on the free-market cutting edge.
By Bret Swanson
There’s about to be a building boom in Indiana, which is desperate good news for a state that has been severely challenged by the global manufacturing shift and years of ambivalent leadership.
The chief architect of the boom is the state’s decisive Governor Mitch Daniels, President Bush’s former budget director. In Washington, Daniels drew scorn from congressional big spenders, acquiring the nickname “the blade” for his cost-cutting and privatizing ways. (The moniker could just as easily apply to his sharp wit and intellect.) The spenders in Washington, however, won those battles — big time — swallowing the blade and earning today’s enmity from the Republican base. But now Daniels is back home and in charge, and he is engineering a turnaround of an entire state with sophistication.
In the state’s short legislative session, just completed, Daniels achieved two sweeping victories. The first is the nation’s most aggressive telecommunications deregulation, which will spur hundreds of millions of dollars of investment in invisible infrastructure — the “fibers and frequencies” of the digital age, as Daniels describes it. The second is a $4 billion privatization lease of the Indiana Toll Road and the new I-69 interstate. This will fund the largest-ever upgrade of Indiana’s visible infrastructure: its antique roads and bridges.
Indiana is more dependent on manufacturing than any other state in the union. Low-cost Asian manufacturing and the troubles of Big Auto in nearby Detroit have drained employment in Indiana and depressed income growth. Daniels’ telecommunications reform was thus a major component of his strategy to connect Indiana to global markets, to diversify the state’s economy toward services, technology, and life sciences, and to make the state’s manufacturing base more productive.
Indiana’s telecom laws had not been updated since 1985, while the state’s Utility Regulatory Commission has administered some of the most severely anti-investment rules and price controls in the nation. But in a single leap, Indiana has moved from the back of the pack to number one in terms of the modernity of its telecom regime. By the end of this month, most of the state’s obsolete telecom rules will lapse. By 2009, the industry will be almost totally deregulated in the state.
An Indiana-wide video-franchise process was also adopted to replace the fragmented and wasteful cable TV franchising system that has 300 towns and counties telling global communications firms what to do. The new system opens up the investment valves by granting easy and quick approval to new providers of broadband communications services. With the reform, companies like Verizon and AT&T are now planning major new build-outs of the world’s most advanced fiber-optic links to homes and businesses in the state. Cable TV companies will be forced to respond in a beneficent upward spiral of new technology and consumer choice that could boost state economic output by more than half a percentage point annually for the next five years.
Ironically, Daniels’ “Major Moves” plan to lease the Indiana Toll Road, the seemingly more tame and obvious measure, turned out to be far more controversial. It passed by a single vote with just 15 minutes remaining in this year’s legislative session. Weeks before anyone had heard of Dubai Ports World, the bid by Australian-Spanish consortium Macquarie-Cintra to manage Indiana’s 157-mile stretch of I-80/90 had already ignited a xenophobic melee in the heartland. But unlike the DP World roll-out, Daniels had actually sought bidders for the Toll Road. His proposition was simple: The winning contractor will pay Indiana $4 billion for an asset that has never been profitable in government hands; the state gets to keep that asset; the contractor upgrades the asset with new technology and an additional $4 billion in improvements; and the state gets to fund a decade’s worth of other major infrastructure projects, some of which have been on the drawing board for twenty years. (Just last year Chicago leased its “Skyway” to Macquarie-Cintra for $1.8 billion. The Skyway connects Indiana’s Toll Road to Chicago, thus yielding a seamlessly managed road from Ohio to the Windy City.)
The day after this deal squeaked through the legislature, the Indianapolis Star concluded that “the protectionist, xenophobic rhetoric … used to fight the lease was an embarrassment to the entire state.” But Daniels won the day, sending a loud message to foreign investors that Indiana is indeed open for business.
I love it, too.
This is an exciting time to be living in Indiana. We finally have a Governor who is willing to start DOING instead of just TALKING.
I think so, too.
The Dem's are convinced that they are going to take over the House in 2006 and re-take the governor's mansion in 2008. Just like the national dems, they offer no solutions, just impotent criticism of everything Mitch does.
I think that by the time elections roll around, Hoosiers will start seeing the benefits of the change that Mitch is promoting.
I am very happy with Daniels so far.
Those feelings haven't really worn off. This toll road deal sounds like a bad move. And he's also put no brakes on local taxes and bonding, which is out of control. And unless I've missed it he's proposed nothing to solve our biggest & most obvious problem -- a very lackluster public education system.
Am I being too hard on our Governor?
When I first heard about Major Moves I was thrilled and thought, "What a gift."
I was shocked when there was so much controversy over this and predictably it came from the Democrats. As far as I was concerned this was a none political issue and a big win for the state.
I have not seen the Democrats come up with any better ideas and so far they have done a great job of dragging this state into negative numbers.
If so I'd enjoy hearing what you think -- I don't want to be too hard on Gov. Daniels if he doesn't deserve it.
You weren't too hard on him. Neither was I. You obviously LIVE in Indiana and see what this guy is doing on a daily basis.
No, you are not being to hard on our Govenor, just honest.
68skylark:
I do think you're being too hard on Daniels.
Remember what he inherited--almost 20 years of bloated budgets, political corruption, and economic stagnation. Under the Democrats' watch, we went from one of the highest per capita income states, to one of the lowest.
In just 2 years, we've gone from being a business backwater to being one of the most business-friendly states in the country.
The toll road lease was a stroke of genius. It fully funds our infrastructure development for 10 years--WITHOUT RAISING TAXES! It will also get I-69 built, something the Democrats never even contemplated.
As for education, wait until next year. I asked him recently what his next "major move" was going to be, and he said "Education, Education, Education." He wants to deregulate school districts to allow for more competition.
Frankly, I think he's the best Governor Indiana has ever had.
And he's doing all of this despite intense opposition from the Democrats, the unions, and the other "usual suspects."
Give the guy a chance!
I posted this on another thread, but people in my town that supported one-term Mitch have actually gotten their yard signs back out and put a big X over the sign.
Another "time zone conservative," I see.
Abortion on demand? Gay marriage? High taxes and higher spending? No problem.
But ask me to change my clocks 2x a year, and I'll get really outraged!
Sheesh.
With "conservatives" like you, who needs liberals?
Great. Why not go all the way and order some "Pat Bauer for speaker" bumper stickers?
Another "as long as there's an 'R' by his name Republican," I see. Massive corporate welfare? Yeah!!!! Tax the rich? Sure!!!! Eminent domain peoples' family farms to make it easier to get from Canada to Mexico in a straight shot when other good alternatives existed? Hell yes! He's a Republican!
With "Republicans" like you, who needs democrats?
I'm glad to get your pro-Daniels point of view.
It's hard for me to ignore his tax increse proposals. But if he's really going to try to do something good about public education -- which is a mess -- I'll have a much better opinion of him.
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