Yepsen: Want Economic Growth in Iowa?
David Yepsen is one of those writers than can be difficult to draw a bead on, but today he writes an article about economic growth in Iowa that is a good read.
I want to bring up three of the points he writes will encourage people to start new businesses:
• Provide help in offering health insurance.
The inability to provide health insurance is one of the “main
deterrents” to people who want to start their own businesses, Dickel
said. The state could help by developing insurance pools for a new firm
to use until it is able to provide health insurance on its own. The new
institute might be an organization that could do that.
• Revamp the Values Fund.
Lawmakers are trying to do that this week, and Dickel said part of
their work needs to include ways for the fund to help start-up Iowa
companies, not just big established firms. Lower thresholds for numbers
of jobs to be created after getting a grant would help, she said.
• Break down financial barriers.
Iowa's lenders are a conservative lot, but if they hope to have much of
a business in another generation, they've got to help grow Iowa's
economy today. That means taking more risk and being more aggressive in
making loans to entrepreneurs. It also means just providing easily
accessible financial and management advice.
What Yepsen is getting at is the notion that we need to find ways to
help individuals mitigate risk when starting a new business.
That's a hard sell in this political climate where the GOP-controlled
legislatures (and Fed) are doing what they can to make sure that all
risks are placed squarely on the shoulders of individuals.
Starting a business is an even greater risk – suddenly you can't count
on having health insurance, nor any assistance in saving for retirement.
Some people will be just fine taking on those extra risks, but that
decision is much harder when you have to support a family as well as
expose that family to the financial risks that starting a business
entails – particularly in a place like rural Iowa where there the
chance of a person obtaining venture funding or economic development
grants is very near zero.
If we want to encourage people to chance on starting their own
businesses, we need to take action to help individuals mitigate the
risk of starting a business.
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