First – please pass this along to your civic and community groups, your mayor, city council, county commissioners, fire and police chiefs, school district friends and family members. Pass it along to the owner/operators of small businesses and not-for-profit agencies. Pass it along to your co-workers. It may be a key to your community’s future.
In every community, county, and nation, the economy is often discussed as if it were an uncontrollable weather pattern—something to endure or to attempt to predict. In reality, economies – including your own, local economy – don’t just happen; they are caused.
An economy is not a natural phenomenon; it is a reflection of choices. As the climate is weather over time, economies are choices over time.
Whether those choices are effective or ineffective, the state of our local markets is simply the cumulative result of human decision-making.
Better vs. Bigger: Defining the Mission
To lead effectively, we must first distinguish between two terms that are often mistakenly used as synonyms:
- Economic Development means “Getting Better.” This is the internal work. It asks: What are we doing to improve the standard of living for the residents and businesses that are already here?
- Economic Growth means “Getting Bigger.” This is the work of scale. It asks: What are we doing to recruit more residents and businesses to our area?
A healthy community recognizes that growth and development are inseparable: growth provides the capital to fund development, while an improving quality of life creates the foundation for growth to remain both attractive and sustainable.
The Identity Shift: You are a Community Builder
Regardless of your specific industry or professional title, if you are a senior decision maker or a business owner, you and your team members are in the economic development and growth business.
You are a Community Builder, an integral part of the infrastructure of your region. You are not a passive observer of the local economy; you are one of its primary authors. Leadership is not a magic trick; it is the journey of sharing the path with others to ensure collective stability.
The Three States of an Economy
At any given moment, a local economy exists in one of only three states: Growth, Plateau, or Decline.
The Myth of the Permanent Plateau
You may recall my observation that too many things in America don’t get done because too many people who should know better are either lazy, unimaginative, fearful or selfish … or some combination of those four.
A plateau often feels like stability. It’s the comfortable middle ground where things aren’t getting worse, but they aren’t necessarily getting better. However, a plateau is a lazy mathematical illusion. It is a comfortable complacency. You cannot maintain it for an extended period. Markets are dynamic—influenced by aging infrastructure, shifting demographics, and global competition. Sooner or later, a plateauing economy must tip. It will either move toward growth or slide into decline.
The Dark Road of Decline
A declining economy is unacceptable to any citizen who values their community’s future. To accept decline is to embrace a victim mentality, convincing ourselves that the world has passed us by.
I’ve rolled through a lot of towns that look like they’ve been ghosted by prosperity and are now just sitting on the porch in their pajamas, waiting for a high-strength prescription of “Vitamin Dignity” and a thirty-year intervention. If these towns walked into a clinic, the therapist would take one look at the boarded-up windows and the “internecine warfare” in the city council and immediately order a “code blue” for their collective self-worth.
They have been in a toxic relationship with “the way things used to be” for so long that they’ve forgotten they have the power to change now and change the future.
Tip O’Neill famously observed that “all politics is local.” I would take it a step further: All economic destiny is local. Citizens and elected officials can whine about the federal mandates in D.C. or the predatory pricing in a foreign capital, but those are just variables. The choice to either author a new chapter or remain a victim is made right here, in our own council chambers, boardrooms, and community centers. If the destiny is local, then the responsibility is local.
When, because of choices … choices … an economy declines, and people are thrown out of work, it triggers a predictable descent into varying levels of despair, hopelessness, and poverty. As economic opportunity vanishes, crime rates inevitably spike.
We saw this play out with devastating clarity in the timber-dependent counties of Oregon and Washington following the 1990s decline. As the Northwest Forest Plan (1994) led to a 26% drop in timber employment and the loss of up to 32,000 jobs, the “dark road” became a reality:
- The “Family Stress Model” in Action: In counties like Grays Harbor (WA) and Douglas (OR), the loss of living-wage jobs led to “anticipatory anxiety” and a loss of control. This manifested in domestic violence and child abuse rates that soared significantly higher than statewide averages.
- The Methamphetamine Epidemic: Economic despair provided fertile ground for chemical escape. Rural isolation and abandoned mill sites became the primary infrastructure for clandestine meth labs. By the mid-90s, property crimes (burglary and theft) spiked in these regions as citizens struggled to fund addictions born of hopelessness.
- Crimes of Necessity and Poaching: As legitimate work vanished, displaced workers turned to “environmental crime,” such as tree poaching, illegally harvesting old-growth cedar and fir simply to survive.
Top 10 Crimes That Increase During Economic Decline:
- Burglary: Increase in residential and commercial break-ins.
- Larceny-Theft: A rise in “crimes of necessity,” such as shoplifting food or essentials.
- Domestic & Intimate Partner Violence: Economic stress frequently escalates into domestic conflict.
- Child Abuse and Neglect: Financial strain is a documented driver of increased domestic maltreatment.
- Motor Vehicle Theft: Driven by the high resale value of parts in a struggling market.
- Financial Fraud & Scams: Desperation makes citizens vulnerable to predatory schemes.
- Drug-Related Crimes: Substance abuse often becomes a tragic coping mechanism for unemployment.
- Robbery: The risk threshold for violence lowers when individuals feel they have nothing to lose.
- Internal/Employee Theft: Increased financial pressure leads to higher “shrinkage.”
- Vandalism: Vacant properties from foreclosures become targets for property damage.
The Engine of a Balanced Economy
To achieve growth, there is a specific order of operations: A viable, vibrant and growing private sector must exist to support any growth in the public sector. If you have a declining private sector paired with a growing public sector, you have created a false economy. Without a private engine to provide the proceeds, the public sector—and the community infrastructure it supports—will eventually fail.
The Lifecycle of Dominant Sectors: Lessons from the Pacific Northwest
Strategic growth requires an understanding of Dominant Sectors—those industries with a disproportionate share of financial and political influence. In the Pacific Northwest, I have witnessed the cycle of Rise, Peak, and Decline play out in three primary sectors:
Fishing: The Unraveling of the Coastal Pulse
During my childhood years in Oregon, fishing was the rhythmic heart of coastal towns. It wasn’t just about the commercial hulls hitting the water; it was an entire, vibrant ecosystem. It was the craftsmen who built the boats and the mechanics who serviced them; it was the motels that buzzed with eager tourists, the cafes where the day’s catch became a community’s livelihood, and the gas stations that kept the whole machine moving. But following the environmental impact of El Niño and the aggressive overfishing by foreign interests, that heart began to fail. Today, I continue to be saddened when I visit those coastal communities. Too many so-called leaders have simply rolled over, surrendering to the tides of despair. Instead of charting a new course, they have allowed their communities to fracture, where they, along with too many citizens, are now engaged in open, bitter conflict with one another while the foundation of their shared home washes away.
Agriculture: The Dismantling of the Orchard
Our orchards were once the literal gold of some Pacific Northwest valleys, but the market was eventually poisoned by the predatory math of foreign interests. I observed that the sector entered a sharp decline when overseas competitors began dumping pears and apples into the world market at prices lower than what the average local orchardist in Oregon and Washington could even grow them for. This wasn’t a failure of heart or hard work or quality; it was a structural collapse. When it becomes cheaper to ship fruit across an ocean than to harvest it from a tree in your own backyard, you aren’t just facing a bad season—you are witnessing the dismantling of a dominant sector by global forces that local families cannot defeat with “business as usual” thinking.
Timber: The Cost of Complacent Laughter
The timber industry once provided the unwavering backbone of the regional economy, until it was felled by a perfect storm of environmental pressures and the federal protection of the spotted owl. I vividly recall standing before a room of timber industry leaders in the 1990s, giving a speech on the necessity of strategic thinking. I briefed them on my observations about dominant sectors and encouraged them to look past the short-term, instantaneous gratification of the immediate harvest. I urged them to use their peak influence to reinvent their industry before the descent began. They laughed. They truly thought the idea of their industry’s decline was a joke. That laughter has since been replaced by the haunting silence of shuttered mills, community despair, high unemployment … all sobering reminders that when people choose complacency over strategy, the entire community eventually pays the price. As it turns out, it’s not funny after all.
The Illusion of the Tourism Economy
When these historical sectors decline, many communities make the easy, lazy choice: they pivot entirely to a tourist economy.
I do not say this from the detached perspective of an academic. I grew up very poor. My family survived by following the fruit, moving from one harvest to the next just to keep a roof over our heads. I know exactly what it feels like to live at the mercy of a season and a market you cannot control.
Because of that upbringing, I have immense respect for the people who do the “dirty boots work” today … the waitstaff, the housekeepers, and the seasonal laborers who keep tourist towns running. But my history also gives me the clarity to say this: a tourism-dependent economy is a fragile foundation for a community. It is:
- Seasonal: Creating “feast or famine” cycles that leave families—families like the one I grew up in—vulnerable for half the year.
- Subject to External Forces: As COVID-19 proved, a global event can evaporate a tourism economy overnight, leaving a community with no backup plan and no safety net.
- Low-Wage: Tourism jobs are typically minimum wage plus tips.
- Ultimately Exploiting The Workforce: Many of the people who work in tourism-based economies cannot afford to buy a home in the very communities they serve. As I have noted elsewhere, if you are an elected or appointed official in a community where your own team members cannot afford to live, that is not leadership … it is exploitation.
You cannot build a strong, balanced economy or a high standard of living for your residents solely on a sector that relies on seasonal, low-wage labor. Relying on tourism as your primary engine isn’t a strategy for a two-to-five-generation legacy; it is a strategy for permanent subsistence.
The Generational Mandate: A Strategy for the Centuries
I implore my students and clients—whether in the public sector, not-for-profit agencies, or for-profit companies—to take a strategic position. We are not building for the next quarter or the next election cycle. I submit that your job is to create a strong, viable, balanced economy for two to five generations from now.
This requires:
- Escaping the complacency of the plateau.
- Rejecting the despair of decline.
- Moving beyond the “short-term giddiness” of a dribble of new housing starts or small business openings. While these are important, they must be part of a larger, balanced whole.
A Plea for Maturity
Politics and political tribalism have no place in this effort. I am aware of communities throughout the Pacific Northwest and in other states where so-called ‘leaders’ are fomenting hate, discontent, and divisiveness, and where community members are engaged in mutually-destructive internecine warfare.
The safety of our families, the stability of our homes, and the prevention of the “dark road of decline” are not partisan issues. They are human ones. Building an economy for two to five generations from now requires adult decision-makers who can put aside tribalistic, adolescent bickering in favor of collective peace, tranquility, and quality of life.
The Inventory of Possibilities: A Framework for Action
The antidote to the “lazy choice” and political noise I propose is an Inventory of Possibilities:
The Inventory of Possibilities: A Vision-Led Framework
The antidote to the “lazy choice” of tourism and the “internecine warfare” of local politics is a rigorous, objective assessment of what is actually possible. However, an inventory without a vision is just a list of parts. To build a strong, balanced economy, your inventory must be viewed through the lens of your Collective Vision—a commitment to quality of life and public safety that transcends tribalism and useless political dogma.
I challenge you to establish a regular forum where key influencers – the adult decision-makers – gather to design the next half-century. The rule for these gatherings is absolute: Adolescent tribalistic divisiveness stops at the door.
Politics and the short-term embarrassments of petty bickering and local feuds have no place in a viable economic strategy. Every proposal must pass through the Two-To-Five-Generation Filter: If this idea doesn’t serve our great-great-grandchildren, it is discarded. This is shifting the focus from the next election to the next century. In these sessions, the community must define, in granular detail and as a matter of written, immutable policy, what it requires for its quality of life and its public safety.
1. The Asset Audit: Mapping the Foundation of the Vision
To build for future generations, you must first know exactly what is in your inventory today. This is more than a simple list of buildings and bank accounts; it is a rigorous assessment of Human Capital and Functional Infrastructure.
What is the specific, often hidden, expertise of your workforce? We aren’t just looking for degrees; we are looking for the “know-how” that exists in the hands and minds of your citizens. Simultaneously, you must audit your infrastructure—not just the roads and sewers, but the digital bandwidth, the available square footage, and the transit capacity. If you don’t know your assets, you are just guessing at your future. Your vision dictates which assets matter; if your vision is a tech-hub, your “bandwidth” is more critical than your “warehouse space.”
2. The Dominant Sector Audit: The Reality Check
This is where the “adult decisions” become difficult. You must look at your current economic engines and be brutally honest about where they sit on the lifecycle curve: Rise, Peak, or Decline. If your town is still trying to resurrect a timber or fishing industry that has been in structural decline for thirty years, you aren’t leading; you are engaged in a form of economic nostalgia.
Stop trying to breathe life into a sector that has already peaked. I have seen the cost of that laughter in the 1990s—it leads to the “dark road” every time. A visionary citizenry identifies what is fading to clear the path for what is coming. The vision is the “North Star” that allows you to let go of the past without falling into despair.
3. Target Imports: Strategic Recruitment for Quality of Life
“Getting bigger” requires recruiting more businesses, but it must be done with surgical precision. This is about identifying high-value sectors that are a natural fit for your unique geography and the Quality of Life standards set in your collective vision.
Don’t just recruit anyone with a checkbook; recruit the industries that want what your community already provides, and that respect the standard of living you’ve committed to protect. If you have a workforce skilled in precision manufacturing or a geography that supports specialized tech, go after those sectors. This is the bridge between Economic Growth (recruitment) and Economic Development (improving the standard of living for those who are already here).
4. The Creation Engine: Realizing the Vision from Within
The final piece of the inventory is the mechanism that turns local innovation into a future dominant sector. A community cannot survive on “seasonal subsistence” or the “lazy choice” of tourism alone. You must build a Creation Engine that provides the two things every entrepreneur needs: Capital and Mentorship.
This engine is designed to build year-round, living-wage industries that don’t evaporate when the first frost hits or the next global crisis arrives. By investing in your own people and providing the wisdom to help them scale, you ensure that the wealth created in your community actually stays in your community. This is how a collective vision for a “balanced economy” becomes a physical reality.
From Victimhood to Action
Your economic destiny is not a matter of luck. It is a matter of choosing to build a strong, balanced economy that protects your citizens. Do an inventory of possibilities. Act like an architect of the future. Build something that will still be standing for your great-great-grandchildren.
Remember: there are only two kinds of people: those who plan and those who must live with someone else’s plan. Learn more about creating your community’s future in my book: The Guidant Path: Creating The Path Ahead
If you have a problem you’d like to discuss in a confidential, no-obligation Zoom visit, you can self-schedule it by clicking on this button:
Additional Reading
Economic & Industry Foundations
- Clark, C. (1940). The Conditions of Economic Progress.
- Pacific Northwest Economic Region (PNWER) (2020). COVID-19 Tourism Impacts Summary.
- Romer, P. M. (1990). “Endogenous Technological Change,” Journal of Political Economy.
- Rostow, W. W. (1960). The Stages of Economic Growth.
- Schumpeter, J. A. (1942). Capitalism, Socialism and Democracy.
- Travel Oregon Industry Report (2021). The Economic Impact of Travel in Oregon.
Social Impact & Crime Statistics
- American Journal of Epidemiology (2022). Economic Hardship and the Risk of Child Maltreatment.
- Association of Certified Fraud Examiners (ACFE). Occupational Fraud: A Report to the Nations.
- FBI Uniform Crime Reporting (UCR) Program. Annual Reports on Larceny and Theft.
- National Institute of Justice (NIJ). Economic Distress and Intimate Partner Violence.
- Stanford Center on Poverty and Inequality. The Great Recession and Crime Trends.
- United Nations Office on Drugs and Crime (UNODC). Impact of Economic Crisis on Crime.
- U.S. Department of Justice (DOJ). Vacant Properties, Vandalism, and Community Safety.
