May 21, 2004

Last modified May 21, 2004 - 1:37 am

By ED KEMMICK
Of The Gazette Staff

Larry Swanson deals with economics and demographics, but when he talks about trends and the prospect of change in Montana, his conclusions have a psychological ring to them.

You could summarize his position by saying - though he didn't use the term himself - that we seem to be suffering from a lack of self-esteem.

Speaking to a gathering of civic leaders Thursday morning at Deaconess Billings Clinic, Swanson presented a mountain of statistics showing that in the areas of Montana where most Montanans live, population growth, incomes, employment levels, construction activity and other economic indicators have been booming along for at least a decade.

"This is not decline, I'm sorry, as much as we wish it was true, and sometimes I think we do," Swanson said.

In Montana, he said, discussions about economic development, tax reform, education spending and community planning usually begin with the assumption that Montana is a poor state where everything is getting worse.

"Why are we languishing in our pessimism?" he asked.

He answered that question, and raised dozens more, during a five-hour "Montana on the Move" forum put on by the city of Billings and Celebrate Billings, a group of local businesses and organizations that is trying to shape the future of the community. About 50 business and government leaders attended the forum.

Sponsored by the Center for the Rocky Mountain West and the Public Policy Institute, both at the University of Montana, and the Foundation for Community Vitality, in Billings, the forum was part of a series of similar meetings being held around the state.

Former Missoula Mayor and Montana House Speaker Dan Kemmis, director of the Center for the Rocky Mountain West, said the goal of Montana on the Move is to combine the power and ideas of the state's seven regional urban centers to take advantage of changes reshaping the Rocky Mountain West.

Kemmis said he has been "tremendously inspired and heartened" by indications that community leaders are willing to work together to set the direction of the state.

"We've outgrown that easy sense that somebody else was going to make things work," he said. "There is nobody else out there."

Swanson, associate director of the center, explained that Montana, traditionally thought of as divided into eastern and western halves, is better understood as divided into three parts - 21 counties west of the eastern front of the Rocky Mountains, 21 plains counties in Eastern Montana and 14 central counties between the eastern front and the plains.

The trouble is, he said, most statistics used by politicians and planners are statewide statistics, and when you average the rapid growth of Western Montana with steep declines in Eastern Montana, you get very small numbers that obscure the real picture.

Besides looking at a three-region Montana, Swanson said, it is also necessary to think of the state as driven by the economies of the seven sub-regional economies clustered around Billings, Bozeman, Helena, Missoula, Great Falls, Butte and Kalispell. Over the past decade, 85 percent of economic growth in Montana was urban in character, and that trend is picking up speed, Swanson said.

In addition, 85 to 90 percent of the state's population lives in or around those seven urban centers, and in those centers personal incomes tripled between 1990 and 2000. Given that kind of growth, he said, "Can we afford to sit around and talk about economic decline?"

Just as important as recognizing that the economy is relatively strong is recognizing what has made it strong, Swanson said.

The same trends affecting Western and central Montana have been at work along the Rocky Mountain Front from Texas to Calgary, Alberta. With the aging of the United States population and a resulting drop in the birth rate, population growth is mostly the result of migration from region to region, and people have been moving to the intermountain West for 10 years.

That migration fueled economic growth in the 1990s, Swanson said, and the five-state Rocky Mountain region - Montana, Wyoming, Idaho, Colorado and Utah - now has the fastest personal-income and employment growth in the country. Those trends of migration and economic growth are projected to continue for at least another decade and maybe two decades, he said.

That gives Montana a chance to build its economy in ways that will leave it strong and stable when that growth cycle finally peters out, Swanson said.

The Legislature and most politicians tend to focus on the traditional economy based on minerals, timber and agriculture, Swanson said, but those facets of the economy are in decline everywhere in the West. They are an important part of the economy, he said, but they won't be driving the economy in 10 to 15 years.

That economy will be fueled by the sectors that have been booming in Billings for a decade or so - the health-care industry, business and professional services and "human resource-based jobs" in general.

He said people traditionally disdain "service" jobs in comparison with natural resource jobs, ignoring the fact that service jobs - which include everything from doctors and lawyers to engineers and communications workers - have made the Rocky Mountain West economy so strong.

But policymakers continue to place emphasis on natural resources and on doing something to help those parts of the state that have been in decline for decades.

"What's happening in Montana is we're focusing on the bottom of the chart," he said.

Swanson and Kemmis said the wiser course would be to stop relying on "top-down" economic development policy and allow the urban centers, on their own and working together, to develop customized plans that meet their needs and the needs of employers in each region.

After Swanson made his presentation, the civic leaders broke into small groups and came up with ideas for what Billings should do to take advantage of demographic and economic trends. The conclusions of the five or six groups were quite similar.

Almost all of them listed tax reform as a priority, and several specified the need for the Legislature to grant local governments the right to ask their citizens to approve local-option sales taxes.

Other common themes were the need to tailor workforce training and education to meet the specific needs of existing and potential employers, the importance of bringing various organizations and interest groups together to work on economic growth and the need for long-range planning.

Ed Kemmick can be reached at 657-1293 or ekemmick@billingsgazette.com