Conventions: Economic Boosts
It’s been happening every four years since 1832 and, although the locations and activities have shifted, the results have always been the same. I’m referring, of course, to the conventions at which political parties officially select their presidential and vice-presidential candidates. But more specifically, I’m referring to that “something else” that political conventions provide—an economic boost to the host cities and surrounding areas.
In the past, conventions were heated affairs and were vital to the selection of a presidential candidate. Nowadays, most of that drama has been spent long before the delegates even convene. Indeed, for the past two decades, conventions have basically become carefully staged campaign events designed to favor a specific candidate. In addition, the conventions of the two major political parties have become made-for-media events, infomercials for platforms, and window dressings to showcase the contributions of particular individuals.
This year, the main beneficiaries of the conventions will be Barack Obama and John McCain, but the convention delegates will have little to do with that other than rubber stamping what has already been decided in caucuses and primary contests across the country.
What the delegates will have is an enormous impact on the economies of Denver and Minneapolis-St. Paul, as well as their neighboring areas. The 2004 national conventions drew a combined total of 9,800 delegates and alternates; that amount will likely be surpassed for 2008. The number of delegates and alternates will be dwarfed in size by the vast legions of non-delegate party officials, as well as guests, companions, and observers, plus the hordes of volunteers and a plethora of news media. Even the protestors will need places to stay and eat. When all the people associated with the two conventions are counted, the total number could reach beyond 90,000.
In other words, each convention is bringing a small city into the particular metro area where it is being held. All of these people will require accommodations, food, transportation, and myriad routine incidentals, not to mention the hundreds of private parties that will be a boon to local caterers, and the thousands of balloons, signage, and politically-oriented trinkets.
Providing such services, as well as the physical convention facilities, could boost the Denver and the Minneapolis-St. Paul economies by up to nearly $400 million. Moreover, the major television networks are spending some $6 million each to cover the conventions, with other media outlets pouring in still more cash.
To put on a national convention of this caliber typically requires the host city to raise approximately $40 million, though the operational budget usually exceeds that amount. Most of this money comes from national fundraising endeavors, but local businesses also often contribute. In addition, the federal government chips in $50 million or so to help provide for security.
A report by the Minnesota Department of Employment and Economic Development indicates that about 2,800 new jobs have been created to ensure the Republican convention operations run smoothly. A similar number was probably required for the successful functioning of the Democratic gathering.
During the two four-day conventions, Americans (and even the world) will have the opportunity to learn more about the candidates and their hopes and aspirations for the future of the country. Moreover, those who attend the events, or tune in or read about them, will come to know much more about Colorado and Minnesota through personal or media exposure. Tourism officials will be working to capitalize on this publicity by attempting to spread the word and encourage folks to return and take advantage of various opportunities available in their areas. If successful, their efforts could significantly enrich the two state’s tourism and hospitality industries for quite some time.
Not only will the cities and states become more widely known and appreciated, but area colleges and universities are likely to also reap rewards. As faculty members of the local higher educational institutions serve as resources for media analysis, a greater knowledge and appreciation of their schools can result and lead to increasing new student interest, which could eventually positively contribute to the economy.
With the economic benefits expected from these two key conventions, it is no wonder that approximately 40 cities across North America are building new or expanding existing facilities in efforts to compete for various major conventions and trade shows. Since organizers of such gatherings prefer to meet in different cities each year, the cost for these facilities could eventually be well worth it and be a boon to the local economies.
posted @ 07:55 PM CST [link]
Friday, August 22, 2008
The Greatest of the Great
Has the 2008 Beijing Olympics been the best ever? Has the 8-08-08 focus on the beginning date of the games had any significance other than that of prosperity and confidence—terms intricately associated with the number 8 in Chinese culture?
Those and many additional questions probably still remain to be answered, but for the estimated one billion people from around the world who watched the spectacular opening ceremonies (including half of all the television viewers in the United Kingdom) and countless individuals who have tuned in each day, the games have certainly been a great success and have lived up to the hype in numerous cases (and NBC is certainly pleased).
Former International Olympic Committee president, Juan Antonio Samaranch, predicted that the Games of the XXIX Olympiad would be the best in Olympic history. Chinese officials who planned and developed the facilities and activities associated with the every-four-year occurrence have definitely tried to validate his belief. So have the more than 10,500 competitors in the 302 events in 28 sports. One has certainly succeeded—the 23-year-old phenomenon Michael Phelps, who in approximately 40 minutes of swimming (including both the preliminaries and record breaking performances), did what no other Olympian has ever done.
His unprecedented success in capturing eight gold medals has been well documented by media from around the world and has been the talk of people from all walks of life—from the President of the United States, who personally congratulated him on behalf of America for his historic accomplishments, to other superstar athletes and celebrities, along with fans of all stripes, who cheered every stroke he made in the swimming cube.
As Phelps took center stage for the awarding of his eighth gold medal, he not only stepped into history, but also moved closer to the 18 total medal count of Russian gymnast Larissa Latynina. Phelps is expected to eclipse that record in 2012 at the London Olympics.
After receiving all of the recognition and accolades for his nonpareil performances, Phelps had indicated that his next goal is to return to normalcy. For him, that means sleeping in his own bed and eating juicy cheeseburgers. While he will soon be able to achieve those objectives, normalcy for him, at least for the next few years, will definitely be far different.
A superstar personality whose face is known worldwide, Michael undoubtedly has enormous earning potential through endorsements and personal appearances. Some analysts have estimated his endorsement income could reach as high as $100 million over his lifetime. He has been getting up to 50 pitches for products almost every day since exiting the pool and putting on dry clothes.
The world, and especially America, loves outstanding sports figures, and what they recommend immediately moves up the ranks of popularity. Of course, not all Olympic stars have benefited financially because of their achievements, but Phelps is one of a kind, who some have already labeled as the “greatest Olympian ever,” and his financial reward is certain to be significant.
The current athlete who has earned the most money from endorsements is Tiger Woods, whose considerable income from competitive golf was boosted by some $100 million last year from endorsements. The nation’s second most successful active golfer, Phil Mickelson, received $47 million in endorsements in 2007. Current Olympic basketball stars LeBron James and Kobe Bryant earned $25 million and $16 million, respectively, in addition to their 2007 NBA salaries. The “redeem team’s” success could result in an endorsement hike for these players.
Mark Spitz, whose seven-gold-medal performance in Munich in 1972 was broken by Phelps, became an instant celebrity which brought him a host of endorsements, significant in amount for that period. Following a short-lived television stint, he moved into real estate and became a popular motivational speaker.
What will happen to Phelps after Beijing and as he prepares for the next Olympics is unknown, but while he is riding on the top tier of athletic success, the potential for substantial reward from endorsements is definitely open. He already had some endorsements, and because of his new collection of Olympic gold and his enhanced popularity, that list is sure to grow exponentially. If history is a guide, his popularity may wane in the years ahead, as he does not have the frequent appearances on the world stage that are afforded Tiger, Phil, Kobe, and the other Michael before him. Nonetheless, the buildup to 2012 may make the interim swimming competitions more interesting than usual.
On the online networking site Facebook, nearly 800,000 people have officially declared themselves fans of Phelps, or Phans, as they like to call themselves. That’s a lot of buying power, and probably only a small portion of the total number around the world.
For every Olympian, there’s a story. For this affable young man, Michael Phelps, his began in childhood when he initially took up swimming and will certainly extend well beyond tomorrow. I, along with America, salute him for his accomplishments and wish him well in the future.
posted @ 08:22 PM CST [link]
Friday, August 15, 2008
Preparation is the Key to Success
As the end of summer draws near, the minds of students across Texas are beginning to focus on the educational opportunities that will once again be available this fall in the state’s public and private schools—from the elementary level to graduate studies (at least we hope they are).
While a major focus will be on the required courses of study, an equal amount of attention will likely be given to the destination offered by following various educational paths. Regardless of where students wish to put emphasis for making a living and making a life in the future, there is no doubt that the workforce of tomorrow will be different than today and that the jobs will demand substantial planning for any significant success.
The path to financial prosperity in the 21st Century depends heavily on education and training. A key aspect of preparing for the jobs of tomorrow involves basic communication, social studies, science, and mathematical skills. The initial steps in this approach begin at the grade school level and continue through high school graduation and into college or special vocational training.
The advantages of education from the perspective of both individuals and society have been well documented. Of particular note is the fact that students leaving high school without the right tools are unlikely to achieve success in either the workplace or in higher educational endeavors.
For more than a quarter century, there has been a student assessment program implemented across Texas. The merits of the present incarnation, known as the Texas Assessment of Knowledge and Skills (TAKS) program, can and should be legitimately debated, but it is the currently adopted standard by which students progress through grades and on to graduation. Its purpose is to identify the needs and strengthen the knowledge and skills of students in core academic areas in order to prepare them for the challenges they will face in the future. According to a TAKS report that was recently released from the Texas Education Agency, our schools are making good headway along this route.
Of the approximately 8,200 schools in the Lone Star State (including charter schools), nearly 90% received passing grades for 2008—12.2% achieved “exemplary” marks, 34.4% reached “recognized” status, and 42.8% were ranked “academically acceptable.” Sixty-six Texas elementary schools and 67 high schools failed to make the grade, while 46 middle/junior high schools and 15 multi-level schools were unable to reach the basic acceptable standard. A school can receive an unacceptable rating if a significant number of a particular socio-economic group fails even though most other students are achieving the desired results.
The TAKS report also revealed that Texas students are continuing to make steady progress in meeting state promotion requirements, particularly in reading, writing, and social studies, though science and math scores waned.
There were several notable demographic differences in the percentages of students meeting the minimum standard. Some 89% of Caucasian students passed the mathematics exams, while just 69% of African Americans and 75% of Hispanics had similar success.
The state passing average among students taking the science portion of the TAKS was 74%. The percentages of ethnic groups meeting the acceptable standard was African Americans—61%; Hispanics—66%; and Caucasians—87%.
Students considered economically disadvantaged fell below the average for all students in every exam category. Given the demographic shifts presently occurring in Texas, this pattern indicates the need for immediate action.
Over the next few years, many of the job openings will be in the professional or service-oriented fields, currently the two largest employment sectors. However, technically and science-oriented positions will also represent a significant portion of the overall employment opportunities in Texas.
Because the workplace of tomorrow will become increasingly complex and technologically advanced, it is essential that students be properly prepared. Poor performance in high school is a bad signal for future workforce opportunities and can have a detrimental financial impact on individuals and families. Moreover, it could negatively affect the overall economy of the state.
A notable competitive advantage for Texas in the future is our young and growing workforce. If the state is going to remain the nation’s job growth leader and stay on the cutting edge of the technologically-oriented world of tomorrow, students in our schools must recognize the value of proper preparation and extend all efforts to make the grade for their future success as well as for the future prosperity of Texas. Anything less will notably diminish the state’s long-range economic expansion prospects.
posted @ 07:58 PM CST [link]
Friday, August 8, 2008
Not Even Close!!
The Lone Star State has received numerous accolades through the years in recognition of its prominence in a wide variety of areas. This demonstration of leadership is nowhere more evident than in the progress Texas has made over the past five years in creating jobs.
In mid-2003, several states (including Texas) were facing economic challenges. The route Texas forged through these difficulties led the state to its current position as one of the best places in the country for business operations. In fact, the Lone Star State now serves as a model for other states seeking to enhance employment growth. From July 2003 to June 2008, Texas added nearly 1.27 million new wage and salary workers—more than any state during that timeframe.
From June 2007 to June 2008, Texas employers increased their payrolls by some 245,000 jobs, a 2.4% over-the-year percentage gain. As a result, the number of workers in the state reached 10.61 million. In this same period, the US experienced a non-farm employment net addition of 335,600 workers; Texas thus accounted for nearly 73% of the gain.
About 10.6% of the nation’s total jobs were created in Washington (35,500), with Colorado’s 32,200 new workers representing another 9.6% of overall US employment growth. Florida and Michigan suffered the greatest losses in the past year, -78,100 and -48,600, respectively.
There is a sharp contrast between the type of employees being added in the US and in Texas. Whereas about 95% of the jobs created in the Lone Star State have been in the private sector, almost half of the new jobs in the rest of the nation have been in the government sector.
From June 2007 to June 2008, the leading industry in Texas job growth was professional and business services, which added some 66,800 positions; trade, transportation, and utilities increased its number of workers by 42,900.
Much of Texas’ success in achieving its significant expansion in jobs over the past several years is due to the TexasOne Program established in 2004. This endeavor played a key role in opening employment opportunities, bringing approximately 25,000 new jobs into the state since its inception as well as more than $10 billion in capital investment.
Two other visionary endeavors have proven vital to the state’s job growth. They include the Texas Enterprise Fund, which has been touted as the nation’s largest and most successful “deal closing” fund, and the Emerging Technology Fund, which provides Texas with unique advantages in developing and commercializing new technological discoveries. In February 2008, Texas was named one of the top five biotechnology economic development areas in the nation.
Barnett Shale activities in the Fort Worth area are also providing a significant boost to job expansion. The overall effect of these activities is likely to be responsible for more than 108,000 jobs per year through 2015. Moreover, the energy sector is contributing to strong growth in other regions such as the Permian Basin and the Gulf Coast. High-tech manufacturing and related operations have recovered from a slump of a few years past and are now sparking growth in Central Texas and the Metroplex.
Recent data indicates Texas is still leading the way. From May to June of this year, the total gain in jobs across the US was 37,800. The number of wage and salary workers actually decreased in 16 states and was unchanged in one. There was some job growth in 33 states and the District of Columbia, but without the 47,700 jobs created in Texas during that time, the nation would have recorded an overall loss of approximately 10,000 jobs.
The July preliminary employment data for the nation, which came out last week, reported 51,000 fewer jobs. Information on Texas job growth will not be available for another week or so. Thus far this year, the US economy has lost jobs every month, while the Lone Star State has enjoyed consistent gains.
Despite difficult economic times, the business-friendly path Texas has forged is enabling employers to continue to create new jobs and increase investments in nearly all sectors, particularly construction, financial services, and leisure and hospitality. As a result of these opportunities, the employment picture in the Lone Star State is encouraging and optimistic.
posted @ 08:02 PM CST [link]
Friday, August 1, 2008
Steps in the Right Direction
It’s a fair statement to say the wind really blows in Texas—especially out west where I live and along the Gulf Coast, where it seems to never end. It’s also true that the ongoing economic vitality of the state can only be realized if infrastructure improvements keep pace.
Recent decisions by the Public Utility Commission of Texas (PUC) and announcements by various private entities are certainly steps in the right direction, helping ensure the future strength of the state’s economy.
A growing population and economy have contributed to expansion in the need for electric power in Texas. Virtually all of the new capacity built in the past few years has been in the form of natural gas-fired generation plants. In today’s market, high prices for natural gas and the state’s reliance on that fuel for electric power have combined to cause Texas consumers to pay some of the highest prices for electricity in the US despite the advantages of a competitive market.
As the need for power continues to grow, the state’s electric generation and transmission capacity must expand to ensure sufficient power is available for residential, commercial, and industrial use in the future. Moreover, this increase needs to occur within the context of high demand in urban centers with substantial environmental limits on the ability to accommodate large-scale generation projects. Ideally, new capacity would also help diversify the mix of input fuels used in the state.
In light of these issues, the PUC gave preliminary approval on July 17 to a plan to spend some $4.9 billion to ramp up the state’s power grid by adding a massive system of transmission lines connecting wind farms in West Texas and the Panhandle to power-hungry cities in the eastern part of the state. The additional 2,000 miles of transmission lines will enable the Texas economy to reap substantial rewards in the future from this renewable energy source. Transmission line construction projects now being considered by individual companies and private consortiums will also prove invaluable in making this objective a reality.
Not only is wind energy highly desirable as a mechanism to meet some of the emerging power requirements, but the construction, operation, maintenance, and royalty payments associated with the turbines and transmission lines also serve as crucial sources of business activity for rural areas. They create new jobs, reduce pollution, and lower overall energy costs. They also help protect the environment and conserve natural resources. Colleges in the windy parts of Texas are even starting training programs in this emerging technology.
The PUC plan is the biggest investment in clean and renewable energy in the history of our nation. The development of the new heavy-duty transmission lines marks the beginning of a process that eventually will increase the state’s wind transmission capacity to some 18,456 megawatts of power. Since one megawatt can power up to 500 homes under normal conditions, this amount will be capable of providing electricity to nearly 4 million residents in metropolitan areas such as Austin, Dallas, Fort Worth, and Houston, as well as other places.
Texas is already the national leader in wind-produced power, and for three consecutive years has increased its capacity more than any other state—around 57% in 2007. However, the lack of transmission lines, as well as congestion in many areas in West Texas, prohibits some of this electricity from being used to its full potential.
While the cost of these wind-power enhancements will be borne by energy customers ($3 to $4 more per month on bills), anticipated reductions in rates will likely offset the increases. The Electric Reliability Council of Texas (ERCOT) estimated that the investment could cut wholesale power costs by $3.4 billion per year.
Over the past decade, the Texas economy has begun to benefit from wind-produced electricity. In the decades to come, wind energy stands to become even more important. Recent steps taken by the PUC and various private operators are worthy of support as they will help secure the power required for anticipated growth in the population and business activity.
posted @ 07:55 PM CST [link]