Mines to Minds: Building Knowledge-Based Prosperity in Montana

High human capital is critical to future success. Forty years ago, Montana’s per capita income ranked in the middle of the states. Now we are near the bottom. Here’s why.

Montana’s traditional economic base of agriculture, forest products, and metals has dramatically declined and has no prospects for future growth. This is the result of global long-term economic trends. For primary products and most material goods, productivity grows faster than demand. Hence, these products command a declining fraction of consumer dollars.

Concurrently, as America becomes ever more wealthy, the demand for quality education, high-end services (accounting, architecture, art dealers), and leisure all increase. On these fronts Montana has great potential — especially if the state’s leaders recognize it and foster a favorable environment.

America has changed dramatically since MSU professor Carl F. Kraenzel published The Great Plains in Transition in 1955. He identified the major problem afflicting our region as the “social cost of space.” Markets were remote and travel expensive in both time and money.

Essentially, absentee owners treated Montana as a colonial economy. While many did well producing and exporting primary products, that time is gone. No policies can bring it back. How may we progress?

by John A. Baden, Ph.D.

Full Story: http://www.free-eco.org/articleDisplay.php?id=441

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Many thanks to the Montana Chamber of Commerce for bringing this story to our attention. Russ