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Statewide Strategic Plan Outlines California's Shift to a "Production Economy"

August 03, 2011

Lt. Gov. Gavin Newsom hopes that by the fall, lawmakers will enact a comprehensive legislative reform of state economic development entities in order to begin implementing a plan for growth and competitiveness that builds on the diverse strengths of California's regional economies. The lieutenant governor last week presented the first statewide economic plan in more than 10 years, outlining steps to develop a new economic model that "embraces the shift from a consumption-based economy to a production economy focused on global trade."

The plan calls for consolidating state economic development functions into a single cabinet-level office to serve as both the entry point for business assistance and to integrate state efforts in support of regional economic strategies. State commissions would be replaced with a public-private advisory group modeled after the national Council on Jobs and Competitiveness.

In the first 30 days, a central "Strike Team" would be formed to help solve regulatory problems and within 90 days, Action Teams comprised of business and government leaders would be established to identify at least six demonstration counties to pilot implementing the recommendations.

Many of the report's recommendations align with the same "new economy" concepts often discussed by policymakers and researchers with much of the input derived from the Brookings Institution and the McKinsey Global Institute. Such strategies include: Gearing up exports, reinvigorating manufacturing, driving innovation, accelerating the clean economy, skilling up for opportunities, building infrastructure, and aligning with regional strengths.

Notably, the report points to successful state and international programs as models for each strategy outlined. For example, the report refers to Ohio's Third Frontier Program and the Ben Franklin Technology Partners as models for driving innovation. Chicago's Austin Polytechnical Academy and the Georgia Work Ready programs are offered as models for building a pipeline of educated, qualified workers.

An Economic Growth and Competitiveness Agenda for California, is available at: http://ltg.ca.gov/docs/LGN_Econ_Agenda.pdf