via Morning Edition, NPR

As the Mayor’s Conference takes place in Washington D.C., city governments are dealing with severe problems at home — from high unemployment to funding cuts. Steve Inskeep talks to Mick Cornett, the Mayor of Oklahoma City, about how his city has managed to avoid some of these problems.

via The Baltimore Sun


Baltimore Inner Harbor from Federal Hill – photo by ktylerconk on Flickr

Frustrated by Maryland’s high rate of health disparities, state leaders are proposing a new attack — one more commonly associated with economic development. Gov. Martin O’Malley’s 2012-2013 budget will include funding to create Health Enterprise Zones, where doctors and community groups in areas with large health disparities, such as Baltimore, could add medical and support services for minorities. Tax credits and other financial incentives would be available to spur interest.

The plan is designed to save lives and healthcare dollars, according to Lt. Gov. Anthony G. Brown, who last summer formed a work group on disparities led by Dr. E. Albert Reece, dean of the University of Maryland School of Medicine.

“Maryland has world-class hospitals, top medical schools and one of the highest rates of primary-care physicians per capita, and yet we continue to see disparities in health care and outcomes among Maryland’s racial and ethnic communities. It’s clear that a lack of access to primary care in many communities is a significant factor driving these disparities,” Brown said, adding that funding is in the governor’s budget proposal, which has yet to be released.

According to state and national data, the disparities are many: In Maryland, the infant mortality rate among blacks is almost three times that for whites, the incidence of new HIV infections among blacks is almost 12 times that of whites, and Hispanics are more than four times as likely not to have health insurance as whites. Moreover, nearly twice as many African-Americans suffer from diabetes as whites, and hospital admission rates were three times higher for blacks with asthma and 41/2 times as high for blacks with hypertension. Treating such illnesses is costly, according to the work group, which cited data showing nearly $230 billion in direct medical costs could have been saved from 2003 to 2006 if there were no racial and ethnic health disparities.

The proposed program would work something like economic enterprise zones, where businesses receive subsidies to create jobs and activity in certain areas. The health zones program would be a pilot, available in two or three geographic areas. New and existing primary-care practitioners could receive loan assistance repayment; income, property or hiring tax credits; and assistance in installing health information and other technology. Subsidies would be capped, likely in the tens of thousands of dollars. Local health departments might get involved in recruiting participants.

Brown said he would push to expand the program statewide if it proves successful in a couple of years — not a given, considering the logistical and cultural complexity of the problems. For example, residents of some neighborhoods don’t have easy access to grocery stores that sell fresh fruit and vegetables, or don’t visit the doctor until there is an emergency. Reece said many groups have tackled disparities, but the work group wanted to focus its attention on chronic diseases responsible for 80 percent of health costs. They drilled down to a few key maladies that often have “ripple” effects. They include diabetes, hypertension and asthma.

“We decided to identify … areas where we thought we could make an effective impact within a reasonable time frame,” he said. The health enterprise zones approach is unique, he believes. Work group members got the idea from a similar program built around children’s needs in the community of Harlem in New York City. Program applicants are likely to come predominantly from rural and urban area where disparities are most pronounced.

In Baltimore, studies show a 20-year gap in life expectancy between upper-income, predominantly white neighborhoods and poorer, predominantly minority neighborhoods. Recently, city health department officials began working with community leaders in 55 neighborhoods to identify the most pressing health needs and develop plans to tackle them. The state’s zones would complement these efforts, Reece said. His work group also proposed other elements to promote health and track outcomes.

The group suggested Health Innovation Prizes with small financial rewards and public recognition for individuals and groups that improve health and well-being in their community. The group also recommended tracking disparity data for programs that already exist for primary care physicians and hospitals. Incentives and penalties assessed through these programs could eventually be linked to disparities.

Reece said the prize and the enterprise zones are two things Maryland can do now to help reduce disparities in a few key geographic and health areas. If legislation to create the zones is passed during the current legislative session, the details will be worked out by the state Department of Health and Mental Hygiene.
Already, Dr. Joshua M. Sharfstein, department secretary, supports the move: “The creation of Health Enterprise Zones will help communities target resources to have the most powerful impact.”

meredith.cohn@baltsun.com

By Motoko Rich
via nytimes.com

Private Sector Gets Job Skills; Public Gets Bill



When companies are deciding where to build new facilities or whether to expand in places where they already have factories or offices, states compete to shower them with incentives like tax breaks and help buying land. Increasingly, companies have come to expect that state and local governments will pay for job training, too.

For Sunday’s paper, I wrote about a $1 million customized training program that North Carolina designed for the benefit of Caterpillar, Inc., the global industrial equipment maker. The company opened a new plant in Winston-Salem in November, and the state is paying to train nearly 400 workers who will make axles for mining trucks.

North Carolina is also spending about $1.5 million to train workers for a new Honda Aircraft plant in Greensboro. About 163 workers went through training at Guilford Technical Community College in various areas including jet assembly and electrical system installation in the hopes of securing a job. Because Honda delayed the opening of its production lines, some of those workers, like Kent McDaniel, featured in this report from the video journalists at Purple States, decided to seek work elsewhere. Others, like Linda Merritt, stuck it out and are now working at Honda.

By Mark Fidelman, Seek Omega
via BusinessInsider.com

H.R. 2930 or the “Entrepreneur Access to Capital Act,” would provide companies the ability to raise up to $1 million (US) to fund projects and companies. The bill will ease fund raising restrictions and regulations on both companies and investors.

So if you are a start up in need of an early round of financing, you no longer need to ask friends and family, you can ask friend of friends or their extended network for seed capital. And that’s where companies like Kickstarter will have an advantage over Angel Investors.

Let’s face it, the Professional Angel community is insular. They invest in each others deals, they invest in similar types of deals, and they invest in who they know. Why? Because it’s safe and they have a legitimate need to protect their client’s capital. But that has led to a lack of investment diversity and has created an investment “group think” that is limiting the potential of the community.

Conversely, sites like Kickstarter and IndieGoGo enable people with a diversity of knowledge, skills and experience to fund projects and receive rewards for helping entrepreneurs. It’s called crowdfunding and it allows almost anyone to give money to an entrepreneur to complete a project.

In some aspects it’s like American Idol. Because it enables anyone to vote (by making a prescribed monetary pledge) and become a fan of a project (by following it). At the end of 30 days if the pledges don’t meet the minimum requirement as set by the entrepreneur, then the money is refunded to the investors. If the project funding goals are met, then the project moves forward, but with an important added fan base.

Today on crowdsourcing sites, project funding ranges between $100 – $8000 and pledges a fraction of that amount. But if H.R. 2930 passes, you can bet crowdfunding sites like Kickstarter will quickly move into the business of helping entrepreneurs raise Angel levels of capital ($100,000 to $1 million) .

So why will the Professional Angel Investment community die? Because, if entrepreneurs are given a choice between raising funds through an opaque, arduous and slow Professional Angel route versus a much more efficient, diverse and knowledgeable path, the latter will win ever time.

Case Study: KickStarter
Rather than speculate, I decided to invest in a Kickstarter project myself to understand how it all works. I chose an iPhone/iPad game called Stop Those Fish by Eye Interactive for three reasons.
First, I know the founder of Eye Interactive and he sent me an invite email to participate. Second, I could tell that Eye Interactive’s new game was creating buzz from my personal network which provided me with social proof (due diligence). Third, his first game Zombi Samurai reached #3 on the charts making it one of the most successful games in the last few months.

I asked Jason Seldon, Eye Interactive’s founder why he decided to raise funds from Kickstarter versus taking a more traditional route through Angel’s or friends and family. Seldon responded, “I believe Kickstarter’s value goes way beyond their stated value proposition of being a new way to fund creative projects. In addition to helping individuals and small businesses fund these creative endeavors, I believe it is also a way to generate tremendous pre-release buzz for a new product and to build a fan base prior to launch.”

Seldon continues, “It gives early adopters a unique sense of ownership over a new product. In our case, project backers actually get their names in the game credits. So it really encourages a deep connection with consumers. In a sense, you are building a street team comprised of all of your project backers prior to product launch. These individuals can then serve as brand ambassadors to help make your newly launched product a success.”

What the Crowdfunding Critics Have to Say
If the bill passes, the first objection you’ll hear from critics in regards to crowdfunding sites is the opportunity for scam artists to commit fraud and place unsophisticated investors at risk of losing their capital.
My reply to objection # 1 is twofold. First as we’ve seen with Wall Street, even sophisticated systems that are heavily regulated are subject to fraud. In this case, several hundred billion. Second, because sites like Kickstarter do their own background checks, make the process transparent, and allow potential investors to see who has invested (social proof), the risk is mitigated by a number of check points. I’m not saying it’s fool-proof, in fact I am positive we’ll see fraud at some point, but the benefits of crowdfunding far outweigh the potential for fraud.

The second objection I hear is that new start-ups will lose the coaching and networking opportunities from a professional Angel investor. In the short run, I agree with this objection. But in the near future, crowdfunding sites will overtake those basic functions and eventually crowd source the networking, intelligence and strategy aspect the Angels provide today. More, crowdfunding sites like Kickstarter will enable virtual teams to sign on (think eLance meets Kickstarter) to help start-ups fill talent quality gaps.

Who else will H.R. 2930 benefit?
Besides start-ups, crowdfunding sites, and mom and pop investors, companies like Angel List, and Bolstr will offer nearly anyone the opportunity to participate in an investment round.

For example, if the Social Customer Relationship Management (SCRM) start-up Nimble wanted to quickly raise a round of capital, Angel’s List could convert Nimble’s followers to investors by offering them a chance to participate in their next round of funding. If the new bill passes, I suspect Angel List will provide a swipe your credit card platform to participate.

As a quick aside, I’d like to touch on is the rich analytics and statistical information these crowdfunding sites can potentially track. Imagine giving start-ups the ability to see how many page visits, clicks, and conversions they’ve had to their page. More, who is referring potential investors to the page? Which segments of social networks seem to be supporting the idea the most? What is the sentiment of start-ups product?

That information could be used for a variety of purposes from improving the business idea to increased transparency.

The Professional Angel community will quickly lose its wings if H.R. 2930 passes. You can bet on it.
Sites, like Kickstarter, IndieGoGo, Angel List, and Bolstr will offer superior services through the crowd sourcing of funding, talent and the ability to organically build a fan base. These crowdfunding sites will eventually offer superior access to intelligence and strategy than professional Angels provide today. The crowdfunding process is much more transparent but potentially more dangerous than traditional Angel financing.

Read more: http://www.seekomega.com/2011/11/if-this-bill-passes-the-angel-investment-community-is-dead-and-companies-like-kickstarter-take-over/#ixzz1f8vBiwwN

via The Wall Street Journal

By Conor Dougherty

AUSTIN, Texas—As the nation grapples with stubbornly high unemployment, Texas’s political and high-tech capital shows one way to create good jobs for people who didn’t go to college: Attract highly skilled entrepreneurs, and watch the companies they start hire lower-skilled workers.

Praxis Strategy Group, an economic-development consultancy, estimates Austin added 50,000 “middle-skill” positions in the past decade. These are jobs that require a two-year associate’s degree or the equivalent work experience, and pay a median wage of $17.30 an hour, or $38,000 a year. That pace of growth is roughly four times faster than the nation’s as a whole, three times that of New York and Portland, Ore., and twice that of Phoenix.

Austin’s success in creating middle-class jobs runs against the grain of national trends. As America’s shift from manufacturing to the service sector has accelerated, economists have noted a hollowing out of such jobs.

In recent decades, a select number of brain hubs like Austin have attracted a higher percentage of well-educated workers and a lopsided share of new investment and young companies. In 1970, the top 10 most-educated metropolitan areas among the nation’s 100 largest had an average of 23% of workers holding a bachelor’s degree or higher, compared with 10% in the bottom 10, according to an analysis of Census data by Harvard University economist Edward Glaeser. The 13-percentage-point gap has widened every decade since, and had doubled by 2010.



Click on the interactive graphic to see the growth in middle-skill jobs from 2001 in Austin and other regions.

Beyond creating new middle-skill jobs, such brain hubs have generally higher incomes and for the most part have performed better through the recession. In Austin, the 7.1% average unemployment rate in 2010 was well below the nation’s during the same period.

Of course, Austin also has a fast-growing population, which helps create jobs in any economic environment. And it’s not as if other cities can create a more-educated populace overnight.

Still, Austin’s success in creating middle-level jobs shows how a well-educated work force can raise the fortunes of lesser-educated workers as well. Raleigh, N.C., has benefited from the same dynamic.

One consequence of the economy’s shift away from production toward brain work is that companies are constantly seeking new ways to break down high-value intellectual tasks into smaller, cheaper bits. Much the same way that assembly lines created millions of new jobs by reducing mass production to a sum of tasks, employers in Austin and elsewhere are constantly breaking down higher-skill jobs to “create new middle-skill, middle-income specialties,” according to a recent report by the McKinsey Global Institute.

Take Homeaway Inc., a vacation-rental service founded here in 2005 that went public this year. Its rapid growth allows entry-level employees to substantially raise their income, said Brent Bellm, the company’s chief operating officer.

Mr. Bellm points to customer-service representatives, who earn from $25,000 to the low-$30,000s range and field phone calls and e-mails from people using the company’s website. About one-third of them are promoted annually to areas such as a security team that monitors the site for fraudulent listings and removes shoddy properties. “In a few years, you can go from the high 20s to the 50s,” he said.

Simply put, rapid growth boosts the value even of workers who have a limited education but possess knowledge of a company’s systems.

Enrico Moretti, an economist at the University of California, Berkeley, notes that highly educated cities see faster wage growth for less-educated citizens as well as the high fliers. One reason is that that many lower-level employees use the most productive technologies and act as complements to more-expensive and highly-educated workers, making it much easier for companies to raise their wages faster than overall inflation.

Another force, Mr. Moretti notes, is called “human capital spillovers,” a fancy way of saying that many “middle skill” workers begin to acquire skills that are much more valuable than their overall education level might suggest.

That’s how Douglas Kanneman went from a bored retail clerk feeling grim about his prospects to a computer-equipment technician with a four-bedroom house and the chance to let his wife work part-time while looking after their two children.

Mr. Kanneman, 37 years old, began his working life like a lot of people who didn’t go to college—at a retail store with low pay. Looking to better his prospects at 25, he went to community college for computer training and eventually landed a customer-service job at SolarWinds in Tulsa, Okla., which makes software that controls companies’ information infrastructure like computers and phone systems.

Later, when SolarWinds moved to the tech hub of Austin, Mr. Kanneman went with it. As the company grew, he worked his way into the better-paying information-technology department. A year ago, he did something that he said validated the worth of his new skills: He quit for a higher-paying job elsewhere in Austin, and with overtime can now earn more than $90,000 a year.

“It proved that I was worth as much as I thought I was,” Mr. Kanneman said.

Write to Conor Dougherty at conor.dougherty@wsj.com

By A.G. SULZBERGER, NYTimes
ULYSSES, Kan. — Change can be unsettling in a small town. But not long ago in this quiet farming community, with its familiar skyline of grain elevators and church steeples, the owner of a new restaurant decided to acknowledge the community’s diversity by adding some less traditional items to her menu. Cheeseburgers. French fries. Chicken-fried steak.

“American food,” the restaurant owner, Luz Gonzalez, calls it. And she signaled her move by giving her Mexican restaurant a distinctly American name: “The Down-Town Restaurant.”

Such fare was all but extinct in a place where longtime residents joke — often with a barely disguised tone of frustration — that the dining options are Mexican, Mexican or Mexican. After the last white-owned restaurant serving American favorites closed this year, it fell to one of the recent Hispanic arrivals to keep the burgers-and-fries legacy alive. Ms. Gonzalez even enlisted the help of neighbors to teach her to cook more exotic dishes — like potato salad.

For generations, the story of the small rural town of the Great Plains, including the dusty tabletop landscape of western Kansas, has been one of exodus — of businesses closing, classrooms shrinking and, year after year, communities withering as fewer people arrive than leave and as fewer are born than are buried. That flight continues, but another demographic trend has breathed new life into the region.

Hispanics are arriving in numbers large enough to offset or even exceed the decline in the white population in many places. In the process, these new residents are reopening shuttered storefronts with Mexican groceries, filling the schools with children whose first language is Spanish and, for now at least, extending the lives of communities that seemed to be staggering toward the grave.

That demographic shift, seen in the findings of the 2010 census, has not been uniformly welcomed in places where steadiness and tradition are seen as central charms of rural life. Some longtime residents of Ulysses, where the population of 6,161 is now about half Hispanic, grumble over the cultural differences and say they feel like strangers in their hometown. But the alternative, community leaders warn, is unacceptable.

“We’re either going to change or we’re going to die,” said Thadd Kistler, a lifelong resident who recently stepped down as mayor. “This is Ulysses now, this is the United States now, this immigration is happening and the communities that are extending a hand are going to survive.”

After years in which mostly white communities throughout the region used gimmicks to lure new residents with limited success, like offering free land or lengthy tax abatements, many are wondering if this unexpected multicultural mix offers one vision of what the future of the rural Great Plains may look like.

“The face of small towns is changing dramatically as a result,” said Robert Wuthnow, a Kansas-born Princeton professor who studied the Hispanic influx for his book “Remaking the Heartland: Middle America since the 1950s.” “The question is: Is this going to save these small towns?”

There has long been a strong Hispanic presence throughout the region, which is rich with difficult work in meatpacking plants and on farms, feedlots and oil fields. But over the last decade, as their population in the rural Great Plains spiked by 54 percent — a figure comparable to gains in metro areas in the region — Hispanic residents have pushed from hubs like nearby Dodge City, Garden City and Liberal into ever smaller communities, buying property on the cheap, enticed, many say, by the opportunity to live quiet lives in communities more similar to those in which they were raised.

In the sparsely populated western half of Kansas, every county but one experienced a decline in the non-Hispanic white population, two-thirds of them by more than 10 percent.

At the same time, a vast majority experienced double-digit growth in Hispanic population, more than offsetting the declines in seven counties and many smaller cities and towns. Those places with the highest percentage of Hispanic residents tend to have the lowest average ages, the highest birth rates and the most stable school populations.

“These towns, I don’t know what they would do without Mexicans,” said Oscar Rivera, a Honduran immigrant who lives in a community of a few hundred people and travels through rural parts of western Kansas selling prepaid phone cards used to call overseas. “It would be like ghost towns.”

One such town is Bazine, about two hours from here and little even by the standards of its neighbors. The decaying strip of downtown stores was abandoned long ago, and empty houses dotted the surrounding streets. A few years back, the high school closed and the building was sold on eBay. There was talk about shutting the elementary school as well.

“The decline was happening,” said Patricia Showalter, the mayor, standing inside the little post office she runs. “And then the Hispanic people came.”

For the first time in more than a half century, the population grew in the latest census, inching up to 334 as the Hispanic population jumped to 86 from 4. Now every house in town is occupied. A new church, La Luz del Mundo, just opened. Though there are no new businesses on Main Street, some entrepreneurial newcomers sell homemade tamales door to door.

And, most importantly to those who had watched the town become ever older, the school enrollment is growing.

In neighboring Ransom, which is almost entirely white, the student population has declined to 34 from 62 in the last eight years. Meanwhile, in Bazine, the numbers have increased to 46, up from 35. The average age in Ransom is 15 years older than in Bazine.

In Ulysses, which grew a modest 3 percent over the last decade, much appears unchanged by the years. Livelihoods are still tied to the earth, where people grow wheat and corn in the dusty soil, drill for the generous deposits of oil and gas beneath the surface and feed cows inside muddy pens that line the roads. Churches — there are more than a dozen — still play an important role, and the pace is still slower than what one usually experiences in a bigger city.

But the influx of Hispanics, a majority of whom were born in Mexico, has left an unmistakable impact.

Rachel Gallegos remembers that as a young girl she was the only Hispanic student in her class and her parents’ Mexican restaurant was the first Hispanic business in town. Now, Hispanics make up two-thirds of the school population and own bakeries, clothing stores, car dealerships and computer repair shops, some catering to Hispanics and others simply filling vacant niches.

And when children become adults, a time when residents have historically headed to bigger communities seeking opportunity, her family was becoming rooted in the community — Ms. Gallegos said that of her nine siblings and their two dozen children, all but a couple remained.

Ginger Anthony, director of the Historic Adobe Museum, which chronicles the history of the onetime frontier town, discussed the changes with dismay, pausing repeatedly to reiterate that she did not want her criticism to seem “politically incorrect.” She is so unnerved, particularly by illegal immigrants, that she recently started locking her door — saying that the police-beat column in the local paper disproportionately features Spanish surnames.

“This wave of new people coming into the Midwest, it’s not always a good thing,” she said, as a co-worker nodded in agreement. “If you talk to the average working person, a lot of them are sort of fed up. Our town isn’t what it was.”

But Hispanic residents here say they have been mostly well received, even if the non-Hispanics sometimes keep their distance. There are exceptions, like when students at a neighboring high school showed up to a basketball game in sombreros and tossed tortillas onto the court.

Jose Olivas, a longtime community developer with Mexican American Ministries, said that it took years of pressure to hire Hispanic employees at schools and at some businesses. Now employers are taking Spanish lessons, and expressing preference for bilingual job applicants.

“For a while you had to be careful,” Mr. Olivas said. “But they’ve really changed their attitudes.”

Mr. Kistler, the former mayor, agreed that there were culture clashes, but said they were slowly dissipating.

“At first every community, including Ulysses, was very unwelcoming, but a lot of that was because we wanted to hold on so tight to what we were,” he said. “In the last five years, we’ve really seen that they’re here, they’re staying, they’re part of the community. We’ve kind of gotten used to each other.”

Part of that has been dictated by demographics.

At the hospital in town, exactly half of the 102 babies born last year were Hispanic. And in a telling sign of the future of the community, 13 babies were listed as having one white and one Hispanic parent.

This article has been revised to reflect the following correction:

Correction: November 15, 2011

Because of an editing error, an article on Monday about the growing Hispanic population in small rural towns throughout the Great Plains misstated, in some editions, the population for one of the towns, Ulysses, Kan. In the 2010 Census, the population was 6,161, not 6,933. And also because of an editing error, the article referred incorrectly in some editions to the decline in the non-Hispanic white population in western Kansas. It declined in all counties but one (Ellis County) — not in all counties.