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A Dimming North Star

May 28, 2012 By Héctor García, Fellow

Minnesota and the nation are looking for new formulas to manage the uncertainty created by the financial/economic crises and political impasse, which recently-effective measures do not seem to address any longer. Those formulas worked smoothly prior to the current era of globalization.

The Metropolitan Business Plan is an economic and entrepreneurship-development initiative, backed by the Itasca Project (a group of active and retired Minnesota corporate CEOs), the Regional Council of Mayors, national and state foundations and other influential organizations. The Plan, through the newly created Greater MSP, intends to reinvent the Twin Cities to attract more business, talent, investment and tourism; thus, it will grow the metro economy. It is also developing a TC entrepreneurship ecosystem by improving connectivity among entrepreneurs, innovative business plans and investors.

If linked to the opportunities of globalization, this new metro image would help the state manage uncertainty and provide the context within which effective economic decisions can be made. What is perceived as the dark side of globalization can be enlightened by a new mindset. The Twin Cities could be reimaged into a global metro area—a command center of globalization, as defined by authors Florida, Longworth and others.

In so doing, the largely untapped resources of immigrants would automatically be evident; they could then enhance the probability of success of the Metro Business Plan. Immigrants have always reenergized the U.S. economy. Yet, there are low expectations from the new wave of non-European immigrants and refugees; such expectations are wrong but self-fulfilling prophecies. Today’s immigrant youth, energy, creativity and ambition are much like those of past immigrants. In addition, a June 2011 Brookings Institution study found that the share of working-age immigrants who have a bachelor’s degree has risen and, for the first time in American history, exceeds the share of those without a high school diploma.

Minnesota can learn from its Fortune 500 corporations the revolutionary paradigm the latter adopted in recent years: Prizing cultural and national divergent perspectives breeds innovation and leads to more successful penetration of international markets. The paradigm shift experienced by these corporations can empower the state overall to better understand globalization and build relations with the emerging economies of Latin America, Asia and Africa.

Many immigrants have connections with high net worth individuals in their home countries who can invest, travel to, and buy services in Minnesota.

Perception of uncertainty and risk in the global economy is relative. There are nations with substantially lesser assets than the U.S., including Brazil and Mexico, which are at this moment growing their economy and middle class at high rates. U.S. corporations and banks are not investing and lending, though they have at their disposal trillions of dollars to do so; yet, a Saudi prince, considered to be the biggest foreign investor in the U.S., was asked by Fareed Zakaria on CNN if he was concerned about investing in this country; the prince answered that he continued to find the U.S. attractive.

Globalization is the new frontier and can help us regain the American pioneer spirit. We must seize the challenge and become global learners who continuously transform ourselves in order to enhance our capabilities and create what we truly want instead of what obsolete systems force us to do. As we learn to manage the implications of global interconnectedness and interdependence, we will generate win-win scenarios and rebuild the trust, which is essential to prosperous socio-economic-political systems.

Minnesota, more than ever, can become “l’etoile du nord” (the northern star), guiding the rest of the nation to an effective management of uncertainty, away from paralysis and towards an American renaissance. But first, we must renew our mindset, envision a Global Star Metro Area and tap immigrant resources to create it.

Héctor Garcia is former VP of International & Domestic Emerging Markets for Wells Fargo Bank.

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