Monday February 28 1:45 AM ET
Govs. Investing in New Economy
By ROBERT TANNER Associated Press Writer
WASHINGTON (AP) - In an accelerating effort to tap into the new economy, governors are investing billions of state
dollars in programs and ventures ranging from online car registration to seed money for Internet startups.
At a gathering devoted to the challenges of the digital age, the nation's governors are rushing to catch up to the private sector.
``We know where we want to go. But how do we get there?' said Arizona Gov. Jane Hull.
The state leaders heard over the weekend from a parade of software and corporate executives, professors and
commentators at the winter meeting of the National Governors' Association. Some governors shared stories of their
successes.
``Some get it, some don't,' said Eric Schmidt, head of software manufacturer Novell Inc (NasdaqNM:NOVL - news)., who
spoke Sunday about technology's place in global competition. But in a world where ``the fastest learner wins,' things can
change fast, he said.
In her state-of-the-state address this year, New Jersey Gov. Christie Whitman proposed spending $165 million for
technological initiatives ranging from new training for welfare recipients to Internet incubators that help launch new companies.
``You can't just let it happen,' she said. ``You've got to be driving it.'
She is not alone. Almost all the governors have laid out spending initiatives emphasizing new technology. South Carolina's Jim
Hodges wants $500,000 to add a chief technology officer to his cabinet; California's Gray Davis proposed $75 million for
research at public universities to focus on the next generation of technologies; George Ryan of Illinois hopes to spend $1.9
billion on education programs, government services and venture capital investments.
In part, the spending proposals result from the booming economy itself and the record revenues flowing into the states. They
also are the governmental version of Wall Street's fascination with the e-world.
The governors' gathering mixed policy and how-to lessons: expanding broadband access, launching state Web sites,
reinventing postsecondary education, managing the reams of government information.
One model is Washington state, home to giant Microsoft and for two years ranked the top ``Digital State' by the Progress
and Freedom Foundation and No. 4 in the Progressive Policy Institute's ``New Economy Index.'
Businesses in Washington can calculate and pay taxes online through a program provided free by the state. Similar ideas -
from taxes to car registration to social services benefits - are being considered or put in place nationwide.
``How long will people wait in line at your driver's license bureau if they can buy the whole bloody car online?' New York
Times columnist Thomas Friedman asked the governors. ``If the United States of America doesn't become as efficient as
America Online, government will become irrelevant.'
Obstacles do remain, particularly the same questions of privacy and security that recently plagued the nation's biggest
e-businesses. For government agencies that maintain sensitive personal information, the question is crucial.
``Some hacker who had a lot of fun hacking into an e-commerce site (will say) it'll be even more fun hacking into the police
department and posting the names of all the johns arrested for soliciting a prostitute,' said Jeff Eisenach, president of the
Progress and Freedom Foundation, a group that once helped fund Newt Gingrich's college classes.
Privacy problems weren't ignored, but economic issues dominated for the governors. Sales tax on the Internet remains
unresolved. Economic development is a top priority.
``Government is always the last to catch up,' said Illinois' Ryan. ``If we don't invest now, we're going to be behind.'
The four-day NGA meeting began with a stern warning: The report on the new economy concluded that states must
aggressively refashion their governments if they want to continue to compete.
The NGA chairman, Utah Gov. Michael Leavitt, laid it out starkly: ``States can fight the changes and die, accept them and
survive, or lead and prosper.' |
