Columbus CEO magazine recently interviewed Mark Kvamme, the California venture capitalist who helped design and implement JobsOhio, John Kasich’s signature economic development initiative. Mixed in among the questions about his super-exciting personal life and his fantastic investments, was a question about his work with Governor Kasich:
Working with the governor on JobsOhio, what do you think about the way the organization operates now and its prospects for the future?
Mr. Kvamme first attempts to differentiate JobsOhio from the Ohio Department of Development (ODOD), claiming that the new semi-private entity is better than the former state-run economic development entity because the ODOD was constrained by its inability to spend money on travel and other expenses required to attract international employers.
“First of all, at the Department of Development, who’s going to be flying to Russia on state business?” asks Kvamme. “Ain’t going to happen. Who’s going to fly to China?”
Who is going to fly to Russia on state business? Well, that would be Lt. Gov. Lee Fisher, who also led the Ohio Department of Development under Governor Strickland. In July 2007, soon after taking office, the Strickland Administration sent Fisher and other Ohio development officials to Magnitogorsk Russia. And in 2010, the ODOD organized a business mission to China.
But it wasn’t just individual trips. Under Governor Strickland, the Ohio Department of Development’s Global Markets Division operated 11 international trade offices around the world. These were fully-staffed, full-time offices that aggressively marketed Ohio as location for foreign investment. They also provided services to Ohio companies looking to export to those regions.
Governor Strickland’s first budget increased spending on these office by 10%. And in 2007, the ODOD opened new international trade offices in Australia, India and, yes, China. Kasich’s new Development Services Agency now operates only 8 international trade offices.
Kvamme’s second attempt to sell the benefits of the new JobsOhio model is just as flawed. “During recessions,” Kvamme claims, “the Department of Development was not funded at all, because the government didn’t have any money.”
Not funded at all? A quick look at Strickland’s second biennium budget shows that this is a complete load of BS. During the height of the Great Recession, overall funds budgeted for the Ohio Department of Development actually INCREASED, from $1.8 billion in Taft’s last budget, to $2.24 and $2.25 billion in Strickland’s first and second budgets.
John Kasich appointed Mark Kvamme to lead the Ohio Department of Development in January, 2011. In March he was moved to the Governor’s Office as Kasich’s adviser on job creation, where he helped design JobsOhio to replace the ODOD. Mark Kvamme spent months running the ODOD and then helped to design its replacement, but he still doesn’t know even basic information about how it worked or how it was funded?
I guess it’s no wonder that JobsOhio continues to be plagued by problems around its constitutionality. I guess we shouldn’t be surprised that JobsOhio continues to struggle to shroud itself in a secrecy. And I guess no one is shocked that, just as we predicted, JobsOhio’s lack of transparency and accountability has led to scandalous stories about undocumented spending and conflicts of interest.
Worst of all, since JobsOhio took over economic development activities for the state, Ohio has fallen farther and farther behind the rest of the nation in job creation.
The Columbus CEO Magazine is owned by the The Dispatch Printing Company.