MARYLAND AND THE NEW WORLD ECONOMY: CHALLENGES AND OPPORTUNITIES
State governments in recent years have assumed major new responsibilities for the promotion of economic development. Confronted by massive shifts in economic fortunes, a serious decline in U.S. competitiveness and in the fortunes of key industries and regions, and a federal government that has foresworn interest in efforts to promote regional development, the states have stepped into the vacuum to protect their citizens and their tax bases.
Maryland has been no stranger to these efforts. To the contrary, it has been a leader in adopting a number of business promotion and human capital programs. Yet, with some notable exceptions, it remains far from clear whether the general public, or even some of the state's public and private leadership, fully appreciates the new economic situation the state faces at the present time and the challenges this brings with it.
The purpose of this Occasional Paper is to help fill this gap. More specifically, the paper seeks to:
- Document the major social and economic trends that are shaping the context for state policy both in Maryland and other parts of the United States at the present time;
- Assess the implications these trends have for the kinds of economic development policies states like Maryland should pursue;
- Examine the advantages and disadvantages Maryland enjoys in the light of these developments; and
- Outline the steps that might usefully be taken to improve the state's economic prospects for the years ahead.
Broadly speaking, five major points form the basic message of this Paper:
- First: Fundamental changes have taken place over the past two decades in the economic situation facing the United States and Maryland. We are living in a new economy that differs fundamentally from what existed even two decades ago.
- Second: These changes have important implications for the way states and local governments approach economic development. We have entered a new era in economic development promotion that goes well beyond the old "smokestack chasing" approaches of the past.
- Third: Maryland has significant advantages in this new era, many of which it has already begun to exploit;
- Fourth, Maryland also faces a number of crucial challenges, at least some of which it has not yet fully faced up to;
- Fifth: To meet these challenges, Marylanders must work together in support of coherent statewide policies that take account of the new circumstances and make full use of the state's considerable resources. This is a time for Maryland to avoid both defeatism and complacency and to meet the considerable competition it faces.
The balance of this paper explores these five basic points in more detail.
