Internet Update

October 2003

Q&A: Bob Taft on Ohio's Knowledge Economy

Gov. Bob Taft examines a model of the Wright Flyer in July at the 2003 Dayton Air Show, which celebrated the Wright Brothers' contribution to aviation technology. (Photo by Chris Kasson /Office of the Governor)

Accelerating the transition of Ohio's knowledge economy is Governor Bob Taft's top priority. In 2002 he launched the Third Frontier Project, which will invest $1.6 billion in state funds over the next decade to spur high-tech research and development. Part of the money comes from Ohio's share of the tobacco settlement; part of it comes from capital and general revenue funds. On November 4, Ohio voters will be asked to approve Issue 1, which will authorize $500 million in state bonds to finance additional Third Frontier initiatives.

RESEARCH ENTERPRISE: You have stated that your top priority is creating high-tech jobs and transforming Ohio's economy. Why?

TAFT: We've lost more than 100,000 manufacturing jobs in recent years. Too many in our young, working age population have been leaving the state. Our per capita income was growing before the recession, but it was growing at a slower rate than other states. If we're going to preserve quality of life, if we're going to have a vibrant economy, if we're going to keep our kids here in Ohio, we have to accelerate the transition of our economy to a more dynamic one based on research and innovation.

We have to build on the strong research organizations that we have in the state. We can build on our strengths to create more higher-paying jobs, to form partnerships between research organizations and businesses, and accelerate the advance of the knowledge economy in Ohio. That's the goal of the Third Frontier Project.

RESEARCH ENTERPRISE: After the Master Settlement with the tobacco industry, a lot of states launched high-tech development programs. How can Ohio succeed in the midst of that competition?

TAFT: We have to make investing in the knowledge economy a priority at the state level. We are already investing $25-30 million a year in tobacco settlement monies. We're investing $50 million a year in capital budget monies. We're putting additional general fund dollars into the high-tech economy. The final piece is Issue 1, the bond issue that will be on the ballot November 4. It will generate $500 million over a ten-year period to compliment these other funds. We're talking about a $1.6 billion commitment over ten years, that we believe will leverage an additional $4.5 billion in private sector investment and federal research dollars.

We need to promote strong partnerships among Ohio's research organizations, universities, and businesses. Wright State is involved in a great example of that, the Genome Research Institute in Cincinnati. Wright State is cooperating with Wright-Patterson Air Force Base, Procter & Gamble, and other organizations to establish a world-class center where businesses can work side by side with universities, not only on the research (and attracting more federal research money which provides good jobs) but also with helping companies to innovate and create new products.

RESEARCH ENTERPRISE: The initial phase of the Third Frontier Project involves strategic investment of state funds to stimulate economic growth. Beyond the grants, isn't the project also meant to stimulate new ways of working?

TAFT: The state investment will prime the pump, but the initiative also has to come from local institutions from each region in the state. In Dayton, you have companies working together closely with universities. That has to happen in every region of the state.

The state can provide funding and overall leadership, but ultimately, we need our universities to focus on research and development relevant to the knowledge economy - helping new businesses to start up, encouraging faculty to participate in new businesses where appropriate, and also working with large established companies to help them innovate and stay ahead of the curve.

RESEARCH ENTERPRISE: You've traveled widely throughout the state to promote research and development. What have you learned about Ohio's capacity for growth in the knowledge economy?

TAFT: I've learned that we have a lot more than people think or know that we have. Part of our challenge is to view ourselves as a state with strong activity and tremendous potential in important areas of the high-tech economy.

Wright State's strength in the biosciences and information technology are just two examples. Dayton has an extraordinary concentration of information technology companies -- companies like Reynolds and Reynolds, Lexis-Nexis, and NCR are working closely with universities. We need innovative partnerships like these in every region of the state. We also need to fully utilize the Air Force Research Laboratory's (AFRL) potential as an engine for Ohio's knowledge economy.

We have a lot going on, and we need to promote it very aggressively. We need to promote collaboration among different regions of Ohio, among different research institutions, and between research institutions on the one hand and businesses on the other.

RESEARCH ENTERPRISE: How do you keep the faith in the future in tough budget times like this?

TAFT: Through this very difficult budget period, we've had almost unanimous support in the General assembly for Third Frontier Project initiatives. We've been able to preserve the tobacco settlement dollars that are going into biomedical research. We've been able to preserve our Third Frontier Action Funds, which are general revenues. The legislature has already approved the first two installments of our bricks-and-mortar capital project, which provides dollars for Wright Centers of Innovation. With enactment of the ballot initiative in November, we will have a very strong program in place that will compete favorably with what any other state is doing.

I believe we will see the benefit immediately in the form of additional federal dollars coming into our state, which will provide more R&D jobs. These in and of themselves are high-paying jobs. That's the short-term benefit. The long-term benefit is more innovative and successful employers, large and small, providing good paying jobs for Ohio citizens and keeping our best and brightest college graduates at home. "Every year Wright State graduates a lot of talented people. We want to keep those graduates here at home by ensuring that Ohio remains an excellent place to work.

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