Smith: Under new leadership, what’s in store for Missouri’s economy?

What’s next for Missouri after the Republican sweep of state offices and the election of Donald Trump?

Ahead are challenges and choices. Whether you’re a farmer or a university student, you will feel the decision making process.

Let’s start with trade. The top three importers of Missouri-made products are Canada, Mexico and China – in that order. If a wall is built on America’s southern border and trade pacts are discarded with China, there are other places where those countries can go to replace Missouri goods.

Here’s what’s at risk: General Motors sells a majority of its cars in China, and GM has plants in the Kansas City and St. Louis areas. Beyond that, hundreds of Missouri businesses export everything from motorcycles to vaccines for veterinary medicine – not to mention corn, soybeans, beef, pork and, of course, beer.

My advice on trade: Go slow to not upset a delicate state economy.

Let’s talk health care. Despite the Affordable Care Act and employer plans, there is still a large segment of Missourians (20 percent) who do not have a health care plan. What that means is that taxpayers continue to handle a large portion of the bill when the patient can’t afford to pay.

According to a Commonwealth Fund study, Missouri ranks 36th overall in health care performance. We rank 38th in avoidable hospital use and costs, 40th in healthy lives and 33rd in health care access.

My advice: This is a crisis situation. Missouri needs to be front and center in the conversation as the affordable health care is repealed and replaced.

Let’s talk education. Missouri is 48th in spending per pupil in primary and secondary schools, according to a survey of Census Bureau data by Governing Magazine in August 2016. The story for higher education is just as bleak, with all of the states surrounding Missouri doing a much better job in a number of categories.

At the University of Missouri-Columbia, substantial portions of the campus are under what’s called delayed maintenance. To repair the buildings would cost hundreds of millions of dollars.

My advice: Make education spending a priority. Education is not only good for our children, but it attracts business.

As it is, Missouri does not take in enough money to cover its expenses. Our new governor’s first job will most likely be to cut about $200 million from the budget. This has the potential to further undercut health care and education in the state.

My advice: Think carefully before cutting, and enact a revenue plan that will match expenses.
Other states, notably Ohio, have done so. The reality in Ohio under Gov. John Kasich is more nuanced than what he’s said on the political stump.

Certainly, Kasich had the good fortune to be governor during a national economic recovery from a recession. But perhaps there are lessons to be learned from his work with the Ohio legislature.

Whatever the case, Missouri must have a vision for its future. Our current lack of planning has our state in a race to the bottom. And that does little to attract business.


Randall Smith

Randall D. Smith is the Donald W. Reynolds Chair in Business Journalism at the Missouri School of Journalism and is the founder of Missouri Business Alert. He can be reached at smithrandall@missouri.edu.

 

 

 

 


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