Federal dollars alone can no long fuel region's job growth

By Robert McCartney
Sunday, August 22, 2010

Sharp cuts in defense jobs announced recently by the Pentagon present a wake-up call for the Washington region that it's time once again to work to reduce our dependence on federal dollars for the area's prosperity.

Virginia politicians of both parties are competing to see who can agitate loudest to block the reductions, which will hit especially hard among Northern Virginia high-tech companies and in the Hampton Roads area.

My parochial, booster self wants to see the politicians succeed. But my high-minded self -- which, in this case, is also the realistic one -- says we should just accept that some streams of federal funds that have nourished our area are going to dry up. The U.S. Treasury is running too large a deficit for us to think otherwise.

Instead of presuming that we can stop the evolution, we should adapt to it. That means finding ways to expand our share of jobs and contracts in the private sector.

Bobbie Kilberg, president of the Northern Virginia Technology Council, said the Obama administration's push to shrink federal contractor spending and bring it inside the government puts thousands of jobs at risk in our area -- especially among small- and middle-size firms that are usually a dynamic part of the economy.

"I am really very nervous about it," Kilberg said. "We definitely need to grow aggressively our [private] business-to-business market."

Of course, it's mainly up to the companies to hustle to find more private-sector work. But their success or failure will affect the economic health of the entire region. Politicians, business groups and other civic leaders should lend them a hand.

Here's why that's necessary: Local businesses looking for new, non-government customers will be entering a less familiar and more competitive marketplace. They won't benefit as much from geographic proximity to the capital.

I'm not saying we should give away a lot of tax dollars to lure companies to the Washington area. I am saying we should take steps to make the region more attractive to companies that might want to create jobs here, especially good-paying jobs in tech industries likely to grow over time.

Three top challenges to address are traffic (big surprise), affordable housing and what's called STEM education -- training in science, technology, engineering and mathematics.

The region has dragged its feet solving those problems, partly because the steady gush of federal dollars has made us complacent.

"We have just sat back and assumed companies would come here because of the federal government," said Stephen Fuller, director of the Center for Regional Analysis at George Mason University's School of Public Policy. "When you don't have to work so hard to get rich, you can get fat and lazy. This region is going to have to work harder to maintain its position."

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