Plugged In: Connectivity can be fast way to boost economy

By Joe Kashi, for the Redoubt Reporter

I’m reminded of the old bumper sticker, “Please let there be just one more pipeline boom, I promise not to p*** it away this time.” As any Alaska commercial fisherman or oil patch worker knows from experience, regional economies dependent solely on resource-extraction industries inevitably tend toward roller-coaster boom and bust economics.

At the moment, Alaska’s roller-coaster economy seems to be gathering downward speed as both oilfield and salmon-based primary industries slump. While oilfield and fishing industries will always be a critical and welcome part of our economic base, they respond to global market forces largely beyond our local stimulus and influence.

Modern information technology, if leveraged properly, can provide a third leg to our economic stool and gives a measure of control over our own local economic destiny. The Internet can help level the rural economic playing field.

Starting in about 1860, as the Industrial Revolution in America gathered steam (literally steam, back then), a fundamental shift occurred. The U.S. economy moved away from subsistence farming and an economy powered by limited animal and human muscle. Mechanical energy greatly multiplied the amount of useful work that a single person could do. Well-trained individuals became far more economically valuable, efficient, well-paid and productive.

The U.S. and some Western European economies entered a takeoff phase that bolstered both national strength and the overall living standards of most citizens. Economies now advanced by transitioning from low-income, muscle-based activities toward economies based on “information,” that promoted scientific and technical breakthroughs, efficiently directed mechanics and better coordination of effort through improved communications.

In the pre-Internet era, cities were needed because economic progress depended on large factories requiring thousands of skilled workers, and on the exchange of new ideas, advanced education and coordination through fast, accurate communication of information. In those days, that all happened face to face.

By the mid-20th century, the U.S. economy had become a primarily “information society.” Most social and economic advances were propelled by new technical developments and more efficient communications, substituting the speed of a telephone or radio for printed materials delivered by hand, requiring minutes, rather than hours or days, to accomplish something.

The Internet is now powering a revolution similar to the Industrial Revolution, but one in which congested urban areas are far less critical than in the 20th century. Value now comes from technology developers who, with sufficiently fast Internet connections, can work anywhere and across many time zones. Regions whose economies developed around new entrepreneurial technology companies became relatively immune to long-term economic decline. Information technologies became the new Gold Rush, but a Gold Rush that can occur anywhere and everywhere.

Business communication and the spread of knowledge, ideas and resources are becoming distance insensitive. Using a fast Internet connection, document imaging, and the telephone, I can deal just as quickly and easily with an insurance claims adjuster in Oklahoma as I can with someone a block from my office.

This allows many sorts of businesses and entrepreneurs to operate from less-expensive, more-pleasant areas that have attractive outdoor recreation advantages, such as the central Kenai Peninsula. Living and working in a more rural setting, of course, doesn’t appeal to everyone but neither does life in big cities.

Several medical specialists recently mentioned that they moved to the central peninsula because they could combine a highly professional medical practice at the locally controlled, newly upgraded Central Peninsula Hospital with living in an area with great outdoor recreational opportunities. As a result, local residents are no longer forced to seek specialized medical care in Anchorage. That improves both our quality of accessible health care and our local economy.

What’s needed to attract technology businesses to a more rural area, like the central peninsula? Exceptional outdoor recreational opportunities, a good cultural environment, good public schools that rank above average nationally, and truly high-speed Internet bandwidth are key.

The outdoor recreational opportunities on the Kenai Peninsula, whether hiking, fishing, kayaking or skiing at Tsalteshi Trails, are well-known and remain our most effective recruitment asset. To attract and retain young information-technology families, we’ll need to protect our outdoor resources and prevent overuse and depletion while simultaneously promoting them in an appropriate manner. That’s worked for Moab, Utah; Boise, Idaho; and other smaller Western cities.

Our cultural and art developments are strong for a fairly rural area, and our communities remain reasonably attractive. Again, though, we’ll need to protect and foster the attractiveness of our communities so they are not perceived as gas stops on the way to somewhere else. With the cultural and art attractions of Anchorage and Homer also within easy driving distance and new efforts taking hold locally, the central peninsula can probably compete adequately in this regard, but should not be complacent. Additional cultural and artistic programs underwritten by the business community and economic development groups would be helpful. This approach has worked well for Greenville, South Carolina; Mendocino, California; and other formerly depressed economies.

A critical infrastructure requirement is very high Internet speeds. Alaska once led the nation in its average Internet speed, but that was 20 years ago when Anchorage was the test location for now-ubiquitous DSL connections. Alaska is falling behind the average Internet speeds available in other parts of the U.S. Without the necessary Internet infrastructure, technology businesses cannot effectively do business here.

Information technology businesses are clearly the economic wave of the future. That makes widely available, affordable, high-speed Internet among most critical infrastructures for our future economic development. Fast Internet is more than simply streaming movies, it’s about developing a 21st century economy.

The central peninsula business community should team with local governments and utility companies to ensure that our area develops the Internet infrastructure, and possibly more-modern business development centers, necessary to be competitive, rather than continuing sole reliance on the boom-and-bust economics of resource-extraction industries. There’s much to offer in the local area, but our underlying infrastructure capabilities must rise to the challenge of modern business needs.

Local attorney Joe Kashi received degrees from MIT and his law degree from Georgetown University. He has published articles about computer technology, law practice and digital photography in national media since 1990. Many of his articles can be accessed through his website, http://www.kashilaw.com.

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