Sunday, September 13, 2009

Industrialization in Texas: the Italian Model

I first discussed the Texas Industrialization Project back in July. Industrialization is important for Texas because industry provides jobs. Texas needs to plan for economic growth, and if the State of Texas will not do it, then it is up to the cities to do it.

I do not picture Plano, Texas, becoming thick with heavy industry, but it could become part of a web of small scale industries that spans the communities of Frisco, McKinney, Richardson, and Lewisville.

Francis Fukuyama, in Chapter 10 of his book, Trust, describes how central Italy in the 1970's and 1980's exploded economically "with the emergence of networks of small businesses making everything textiles and designer clothes to machine tools and industrial robots." He goes on to say, "Some enthusiasts of small-scale industrialization have argued that the Italian model represents and entirely new paradigm of industrial production, one that can be exported to other countries."

If the Italians can do this, then we can do the same if we have the will-power to do so.

He says, "Italy is the world's third-largest producer of industrial robots, and yet a third of that industry's output is produced by enterprises with fewer than fifty employees." Smaller companies are easier to capitalize, meaning smaller start-up costs.

Smaller costs means the cities and counties could do this kind of industrial planning without waiting for leadership at the state level.

These small companies in Italy could compete internationally because they could respond to changes quickly. They could compete against the giants of world industry because, "they specialized in machine tools, ceramics, apparel, design, and other activities that do not reward large scale."

We have enough talent in North Texas that we can compete internationally. We need to think for ourselves and work for our prosperity if our children are to have a future.

We need an Industrialization Plan and the Italian model could be a part of it.

Robert Canright

Trust, The Social Virtues and the Creation of Prosperity, by Francis Fukuyama, New York: The Free Press, 1995

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