In Gov. Walker’s “Wisconn Valley” Vision, His State Anchors a New Tech Ecosystem

Foxconn Chairman Terry Gou shakes hands with President Trump.

Wisconsin Gov. Scott Walker appreciates that other Midwestern governors are looking enviously at him since the Badger State landed a commitment from Foxconn to build a huge plant there in the next few years.

But Walker carries his own envious gaze, and it goes way outside of the region: He wants Wisconsin to leverage the Foxconn investment in the state as a magnet for advanced manufacturing much as Silicon Valley, the Research Triangle in North Carolina and the Austin, Texas, region have emerged as digital-tech powerhouses over the last generation.

In fact, even as the Wisconsin state legislature and his critics are still chewing over the $3-billion package of incentives that he wants to give to Foxconn for building a $10-billion complex to assemble flat-panel screens and pledging up to 13,000 jobs, Walker is pitching his vision for creating what he calls “Wisconn Valley” in the southeastern part of the state.

“We want to go from my grandfather’s manufacturing into the 21st-century of manufacturing and beyond,” he told Chief Executive as the September 30 deadline for completing the deal neared.

“we’re talking about talent recruitment from across the country and around the world as a megatool for us to keep high-school and college graduates here. We want to move from a brain drain to a brain gain.”

“Because of the interest in Foxconn on a global basis, we’re talking about talent recruitment from across the country and around the world as a megatool for us to keep high-school and college graduates here. We want to move from a brain drain to a brain gain.

“We want investors and venture capital and talent. We’re going to do advertising—similar to tourism advertising—to attract visitors to the state as potential employees. To meet the sheer volumes [of jobs] we’re talking about, we have to bring more people into the state.”

Walker noted that Wisconsin already is no manufacturing slouch, ranking along with Indiana as the states with the largest percentage of employment dedicated to manufacturing. The governor also underscored that Foxconn’s selection of the state for what would be one of its largest facilities in the world isn’t some sort of serendipitous one-off: It’s the result, Walker stressed, of his long-term push of Wisconsin back into a fiscally sound position and of tax reforms and other economic-development policies that have benefited lots of companies.

Critics of the Foxconn deal, including some in Walker’s Republican Party, are focusing on the huge investments that Wisconsin will have to make in landing the Foxconn plant. These inducements include paying out $2.85 billion in cash over up to 15 years and giving the Taiwan-based manufacturer a deal that is 46 times greater than the largest amount previously offered to a manufacturer in Wisconsin. Already, state officials have moved to strengthen “clawback” provisions of the deal in case Foxconn doesn’t meet some minimum requirement for job creation.

Meanwhile, as he continues to maintain that the huge payout in incentives to Foxconn will be commensurate with the long-term economic benefits of landing such a huge plum, Walker also is promoting the broad impact the creation of Wisconn Valley could have throughout Wisconsin and beyond.

Recently, for example, Walker was in Green Bay, two hours and more from the region where Foxconn is likely to put its plant, meeting with a “huge roundtable” of local officials, Chamber of Commerce folks, college representatives and business people who understood the positive implications for their immediate area from the supply-chain demands that Foxconn will have that could lead to other new factories and employment gains throughout the state.

Similarly, Walker expects Wisconsin to draw employees heavily from metro Chicago, much as other recent new manufacturing plants just north of the state’s border with Illinois have sucked up available workers from that state. And though Illinois, with its awful fiscal situation, didn’t have a chance of being able to incentivize Foxconn to locate there, lots of entities in the Land of Lincoln will benefit from being adjacent to Wisconn Valley, ranging from O’Hare Airport to hotels.

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Dale Buss
Dale Buss is a long-time contributor to Chief Executive, Forbes, The Wall Street Journal and other top-flight business publications. He lives in Michigan.

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