Governor Deval Patrick’s proposed $1 billion biotech package embodies an economic bet. It assumes that state government can successfully pull the levers of industrial policy; that state government, better than private investors, can pick winners. Will it work? What will happen if it doesn’t work? What happens if California becomes the ultimate destination? These are among the hard questions few policymakers seem to ask as they rush to open the public treasury. What kind of commitment will the Commonwealth be making? And what does it mean for sensible tax policy that benefits all firms and sectors rather than one component?
The problem with state subsidies is that that create constituencies that can never retrench once the “sunk costs” are made. Indeed there are a number of stakeholders waiting for approval of the governor’s biotech bill. And surprise! The $1 billion price tag won’t be enough. Here’s a report from Mass High Tech http://masshightech.bizjournal…
There are plenty of stakeholders with plans riding on Gov. Deval Patrick’s proposed $1 billion state investment in life sciences — from the people for whom life-saving innovation is being developed to the scientists, educators, entrepreneurs and businesses depending on state support to thrive and commercialize.
Yet for all of the political wrangling, public discussion and media attention since Patrick introduced the bill in May, the bill has yet to move through the state Legislature, receive funding or prompt state officials to name a new executive director to the agency slated to manage the bulk of funding associated with the life sciences bill.
And even as the bill moves toward passage “early next year,” say some state officials, other state and industry officials are starting to think that $1 billion isn’t enough.
“What’s at stake with this legislation is whether or not Massachusetts continues to lead the world and the United States in the life sciences area,” said Jack Wilson, president of the University of Massachusetts.
UMass stands at a strategic intersection of the Bay State’s life sciences ecosystem and is seeking support from the bill to fund life sciences projects with an estimated price tag of more than $100 million…
State Rep. Daniel Bosley, a member of the group, noted the bill may not call for enough funding. Bosley is chairman of the state’s Joint Committee on Economic Development and Emerging Technologies, one of three legislative panels holding hearings on the life sciences bill.
“Going into this, I thought that $1 billion was a lot to spend,” Bosley said. “But it’s not enough.”
Is this another Big Dig in the making? Or is it yet another example of state government hubris?