Editor’s note: WRALTechWire has reached out to a number of leaders seeking their analysis of the “Vision 2030” plan as unveiled by the NC Chamber last week. The state’s largest business organization believes the plan can create a roadmap that the state can follow to boost economic growth. Today’s analysis is from the John Locke Foundation. 

RALEIGH, N.C. – North Carolina’s need for new jobs is so great, state business leaders hope to raise $15 million over the next five years to put together a detailed plan that will address the goal.

There’s no good reason to object to the proposal the North Carolina Chamber unveiled last week as part of its Vision 2030 initiative. The business owners appear willing to foot the bill. It’s their money and ought to be spent as they see fit. They are more likely than a government agency to come up with a plan that helps improve the state’s business climate.

Nonetheless, it’s probably wise to be cautious about the likelihood that the project will lead to revolutionary ideas that will help North Carolina jump to the front of the pack in economic growth in the United States.

Why? Because the interests of those companies large enough to have clout within the North Carolina Chamber do not necessarily align perfectly with the types of policies that would set the stage for the most sustainable economic growth in the state.

Please don’t misunderstand my point. There’s no question about the motive. The Chamber undoubtedly will set out to find and promote the best policies for creating jobs in North Carolina. This is not a case of greedy “1-percenters” trying to find new ways to rob the poor.

I also stipulate up front that every person who is likely to be involved with this effort will have much more business expertise than I have. Put me in a room with these leaders, and I will be the one least likely to come up with a great idea.

Economic Freedom Is Critical

But it’s important to note that no one — not me, not a CEO, not a 30-year veteran of private- or public-sector economic development work, nor even a group of highly intelligent business veterans — can anticipate future business needs with more than a limited degree of certainty. Combine the words “economic” and “plan,” and you will be wise to treat any result with some skepticism.

There’s nothing particularly objectionable about the four “pillars” that will guide the Chamber’s work: education and talent supply, business climate, entrepreneurship and innovation, and infrastructure and growth leadership.

It’s entirely possible that some of the Chamber’s ideas might strike the heart of the target. For instance, a presentation associated with this week’s announcement quotes Red Hat president and CEO Jim Whitehurst: “Creating the culture of innovation and entrepreneurship necessary to be a world-class jobs leader will require a high degree of economic freedom with minimum government interference, regulation and taxes.”

Economic freedom is critical. To the extent that Chamber leaders can convince their government counterparts to get out of the way of those who drive economic growth, that will be a positive development.

What would not prove as helpful is the notion that tailoring a plan to benefit North Carolina’s current mix of industries and businesses — or even a new mix incorporating targeted “growth” industries — would meet North Carolina’s needs. Any plan set up with that goal in mind could end up shutting the door for industries no one has yet contemplated. If a current or future entrepreneur develops a brilliant idea that falls outside the plan, he might face a more difficult path toward success.

There are policies that would help the entrepreneur whom no one knows yet. She might be running a small business now. He might be running his fifth, sixth, or 20th business, still hoping to strike gold with an idea that will prove profitable. She might be tinkering with a gadget in her garage, or asking why no one has thought about developing a service that performs this or that function more effectively.

An Economic Growth Policy

To help these people, the ones who will launch the successful business endeavors of the future, North Carolina ought to consider replacing its economic “development” policy with an economic “growth” policy. As the John Locke Foundation’s Agenda 2012 documents notes: “Unlike economic development policy, economic growth policy would not focus on one business, industry, or region of the state over another but would adopt policies to maximize economic growth rates for the state. It is overall economic growth that creates employment opportunities, drives down unemployment rates, creates real prosperity, and lifts people out of poverty.”

“A well-known saying is that a rising tide lifts all boats,” the JLF Agenda document continues. “Creating the conditions for economic growth will create such a rising tide. Targeting favored businesses and industries in the pursuit of economic development sloshes water around, lifting some and sinking others. By replacing the decisions of entrepreneurs and investors in private markets with the decisions of politicians and bureaucrats, resources are misallocated, inefficiencies are created, and the state’s economic growth potential is reduced.”

Economic development policy relies on government “experts.” It’s not enough to replace that group with private-sector business “experts.” Instead, leaders ought to emphasize policies that push the government as far away as possible from the decisions about allocating scarce economic resources.

A tax system that reduces biases against entrepreneurship. A regulatory scheme and energy policy that limit undue burdens on businesses. An understanding that any plan developed today ought to be flexible enough to accommodate the “unknown unknowns” in the economy. These are other pillars of a successful North Carolina in 2030 and beyond.

Editor’s note: Mitch Kokai is director of communications for the John Locke Foundation.