I think one of the key challenges of the next generation is to transform the relationship between person and community from that of consumer to that of member. Some forces seem to be pushing us in that direction — the interest in urban living and urban redevelopment, for one thing — but the fragmenting of socioeconomic groups, and that old American mantra of pulling up roots and moving if you don’t like it here, are pretty powerful forces working against the idea of being a participant, not a buyer. So I can’t quite see where it’s going to go

You also mentioned that one key to dealing with the complexity of economies is to understand and internalize externalities. Some techniques that have been successfully used in this regard can be found at http://www.justeconomicsllc.com

I don’t want to sound overly cynical, but I think the most basic function of Economic Development is to improve the community’s tax base and resources for the future. I am convinced that most Economic Development departments don’t really care that people have a job; they are more worried about the taxes that come from a new hire’s income or the bump in property tax evaluation or a new shop’s ability to sell stuff.

Now that I threw that out there, I think it’s important to realize that local governments are transitioning into a new reality. The last few years, local governments, facing fewer resources, have been put in a position to only do those things that provide a positive impact to the local government’s bottom line. As an example, think of all the local government swimming pools that have closed down. Elected officials or community critics continue to tell local governments to be “run more like a business”. Part of that mantra comes the requirement that local government services start putting out statistics showing where the money is being spent and what is being accomplished.

The problem with the concept of statistical reporting, espeically in economic development, is that we are only focused on what we can control, which is usually outputs, not outcomes, which hold the real meaning. Like you said, we can talk and report ad nauseum about how many trips/visits/handshakes were made during the past year. But, in the end, did we make our economy any better? That is hard to measure because for every statistic saying “yes”, we can find one that says “no” and I think intellectually, we struggle to find the connections between the statistics we like and those we don’t, and when we do find that connection, we finally come to the realization that there is probably not a damn thing we can do about it, or at least, we need to work to develop new relationships with new groups to start to move the needle of progress.

And, in the end, isn’t that the real problem? Local economies are either being grown or shrunk by people, not the local government. Local governments do a dis-service when they think or act or believe that they can solve every problem, they simply can’t, even though they are often asked to do so. By the same token, residents put their local governments in a bad spot when they believe and ask local governments to solve every problem that exists.

So, what do we do? I am not sure, but I think it’s safe to say local government is still highly relational; ok, political. Our residents end up losing or gaining faith in us if they know who we are and what we do. We simply have to be willing to tell our stories and to tell our residents that we can only do so much and we have to use the tools we have to move the ball forward.