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What do international trade deals mean for your city?

Benjamin Barber says mayors need to be on the global stage? Here is a snag already within their own cities:

One important division of city government is Economic Development which incubates local talent and invests in conditions that attract business to the area. I have learned that in Toronto, Canada, at least, this is strangely not coordinated with the City's Procurement / Purchasing department i.e. the biggest potential customer in the area for these new innovative services, talent, products etc. (government is 20% of all spending). The two departments are FAR away from each other on the org chart. The Purchasing department simply goes for the lowest competent bidder, period; their main purpose being to block corruption / collusion by making decisions as universally agreeable as possible--the cheapest thing. (Not the most innovative, economically impactful, sustainable etc. thing). Long-term economic effects cannot be determined by this sole consideration. Apparently, this is the case with many cities in developed countries.

However, small new emerging businesses don't have the ability to bid as cheaply as the huge multi-nationals so they die out or move away--and then the city becomes less globally competitive without its talent. And it's unsure that the hodge-podge of financially efficient services that do run a city necessarily make it a great one. Further strangeness: city revenues are not from income tax (federal) or sales tax (state/provincial), but property tax. Which means that a city has to get people to move there and own real estate to really make money--i.e. bad when people leave.

Canada and the EU are in talks to form a free trade zone (Comprehensive Economic and Trade Agreement), which cities' aren't even at the discussion table for. However, this will open up even more contracts to outside competition. Does global competition make a city better or more economically messed up? Is this something mayors are even mandated to deal with?

Topics: City 2.0

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    Sep 29 2013: In a taped interview Obama asked Steve Jobs why he was going to China for production instead of staying in the USA. He said that the USA could not give him the amount of engineers, workers, facilities in the specified time period. Additionally, the government regulations, taxes, programs, and especially the unions would hold him up for years and cost him millions. He went to China and told them he needed XXX square foot of factory floor, 1,200 engineers, 4,000 laborers ( I forgot the real numbers these are mine ), and wanted to start in two weeks. The Chinese asked him if he wanted to be inland or beside the sea for his shipping purposes. He chose sea and the Chinese said will one week be alright.

    The point of this story is that cities cannot do the things that countries can do. As big as LA or NY are they could not have made these deals. Cities can say we have rail, deep water ports, transportation systems and that is about all. China was not concerned about union relationships .... government regulations are what they say they are .... taxes are what they say they will be ... no mayor anywhere could do this.

    In the USA international trade deals are usually to the benefit of cronies and political indebtedness. The cities do profit by taxes, employment, sales generation, etc...

    In short, cities are at the mercy of the country and their laws rules and conventions. None of which mayors can control.

    Good luck. Bob.
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      Sep 30 2013: You're totally right. Every time I read about how dexterous a country like Singapore can be in responding to organizing its policies, regulations etc. to galvanize all its parts to receive the benefits of trade for its locality (while being encouraging of international investment and business), it makes so much sense. All the parts are aligned and incentives are not in conflict.

      Jennifer Granholm the former Governor of Michigan has often cited the few cases where the country and the state cooperated, and it meant a huge difference in the turnaround of her state (retraining, retooling to make lithium batteries for cars). She has spoken about this Singapore example on NPR and here on the Daily Show: http://www.thedailyshow.com/watch/thu-september-22-2011/exclusive---jennifer-granholm-extended-interview-pt--2

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