If a sports team goes 0-for-2, well, it depends on which sport you’re playing.
If you’re a Major League Baseball team, you’ve got a 162-game schedule, so two losses in a row may not mean very much.
If you’re an elite college football program, it probably means your season is already ruined because instead of an invite to the four-team playoff for the national title, you might wind up with the Fast Eddie’s Used Cars Radish Bowl.
So what then should we make of the fact that the western part of Virginia is now 0-for-2 in applications for major funding programs from the Biden administration?
Last September, a coalition led by Virginia Tech failed to advance to the final round for up to $100 million in funding from the Build Back Better Regional Challenge.
This month, another coalition led by Virginia Tech failed to advance to the final round of the Regional Innovation Engines program, whose winners could receive up to $160 million over 10 years.
Winning either of these would have had a transformative impact on the economy in the New River Valley and beyond.
When the Build Back Better bid — which was based on expanding the region’s transportation industry — didn’t make the final cut, I theorized that it was squeezed out geographically by two places that did win: Southern West Virginia was awarded $62.8 million to develop a clean energy economy, while Richmond got $52.9 million to build out a pharmaceutical-based sector. I further theorized that the West Virginia bid was particularly appealing to a Democratic administration that is keen to develop green energy; doing so in a region historically based on fossil fuels seems even more so.
I don’t have a theory for why the most recent bid — based on logistics — fell short, but I do have some other observations.
First we need to step back and look at the big picture. What we’re seeing here are examples of what has come to be called Bidenomics, an inelegant-sounding phrase next to, say, the Reaganomics of decades past, but useful shorthand nonetheless. Biden wants to use the power of federal spreading to rebuild the nation’s economy, particularly in parts of the country that in years past have seen traditional industries decline or sometimes die altogether.
Think of this as a modern New Deal Lite. Republicans think this is entirely too much spending, but I haven’t heard any complain about the basic premise: that supply chains need to be “reshored” and that we need more economic growth in the so-called “heartland” as opposed to the go-go high-tech metros on the coasts. When Donald Trump was president, he said much the same thing, he just didn’t have a big push of federal spending to carry that out. (On the contrary, his initial budget proposed to cut funding to the Appalachian Regional Commission, even though Appalachia had been one of the regions that supported him the most, but that’s a topic for a different day.) Biden is a poor communicator, perhaps the weakest I’ve seen in the White House, so he hasn’t done a particularly good job of connecting the dots to his policies, although the recent embrace of the term “Bidenomics” is at least a move in that direction.
Whether Bidenomics is good economic policy or not is something we may not know for decades yet — do all these investments really do what they set out to do? In the meantime, we can say this with some certainty: The administration has not used these grants to curry political favor (except perhaps in a few exceptions we’ll come to). If it were, it would shower this money on either Democratic states or swing states. Of the 21 Build Back Better awards, though, 12 went to states that voted Republican in 2020. Of the 16 National Science Foundation finalists, seven are in Republican states. There is absolutely zero chance that the grants to North Dakota and Wyoming will tempt those states to vote Democratic, but there is some chance that those grants might help build a new economy.
Here is what I notice as I look at the winners in the first two big competitions: Some communities have won in both.
The two programs were run by different arms of the multitentacled federal government, so this duplication probably wasn’t intentional. This overlap may simply show us which parts of the country are doing the best job positioning themselves for the future economy (or at least writing killer grant proposals), but I feel compelled to gently raise the question anyway: Is this overlap a good idea?
Here are those double winners:
Osceola County, Florida
Build Back Better awarded $50.8 million “to accelerate the growth of the specialized semiconductor cluster at NeoCity,” a technology park near Kissimmee, south of Orlando.
NSF likewise named the NeoCity Semiconductor Technology Accelerator as a finalist (it’s unclear how many communities will wind up as actual winners).
This is of possible relevance to us because U.S. Sen. Mark Warner, D-Virginia, and Gov. Glenn Youngkin have pushed Virginia as a site for semiconductor manufacturing, but Osceola County has scored these awards.
Build Back Better awarded $50 million to H2theFuture, a project led by the Greater New Orleans Development Foundation, “to transition the regional hydrogen energy sector by closing the cost gap between green hydrogen (produced from renewable energy sources) and other forms of hydrogen used today, which rely on fossil fuels.”
The NSF likewise named Louisiana State University in Baton Rouge the “Engine for Louisiana Innovation and Transition of Energy University” which intends to “support energy transition and decarbonization through technology and talent development across Louisiana’s industrial corridor.”
Louisiana, which has a lot of offshore oil, seems intent on making sure it has a future in a renewable energy economy. Earlier this year, Shell gave LSU $27 million to create an Institute for Energy Innovation at the school.
Binghamton, New York
Build Back Better awarded $63.7 million to a coalition led by the State University of New York at Binghamton with a goal to “accelerate innovation in battery technology and to transform New York’s Southern Tier into a global hub of energy storage manufacturing.”
The National Science Foundation likewise designated SUNY-Binghamton as a finalist for its “New Energy New York Storage Engine” project.
The more we rely on renewable energy, the more energy storage — i.e., batteries — we’ll need, since the sun doesn’t always shine and the wind doesn’t always blow. These awards suggest that Binghamton might be a national center for such technology; they certainly suggest that Binghamton wants to be.
Meanwhile, the FuzeHub project in Albany — about two hours away from Binghamton — was named an NSF finalist for “a materials innovation engine for manufacturing sustainability.”
All these may be quite worthy projects, and New York is our fourth biggest state, so we shouldn’t be surprised that there are a lot of proposals coming out of the Empire State, but here’s where my political antennae go up: New York is the home of Senate Majority Leader Chuck Schumer. I’m sure he’s not tired of all this winning.
Build Back Better awarded $25 million to the Life Sciences Manufacturing coalition, led by the North Carolina Biotechnology Center in Durham, “to strengthen its life sciences manufacturing cluster by investing in a more robust pipeline of biotech talent across the state and expanding those opportunities to underserved and historically excluded communities.”
The NSF likewise designated as a finalist a life sciences project led by the Wake Forest University School of Medicine in Winston-Salem to pursue “innovation in regenerative medicine clinical manufacturing.”
Maybe we need an M.D. or a Ph.D. to understand what all this means in scientific terms, but any of us can understand what this means in economic terms: Here are two big federal investments in building up the life sciences sector in North Carolina, a sector that the Roanoke Valley and New River Valley are also trying to develop.
El Paso, Texas
Build Back Better awarded $40 million to the West Texas Aerospace and Defense Manufacturing Coalition, led by the University of Texas at El Paso “to strengthen America’s aerospace and defense manufacturing capabilities by integrating legacy manufacturers in West Texas into the aerospace and defense (A&D) supply chain.”
NSF likewise designated as a finalist the University of Texas at El Paso for an aerospace and defense project.
Now, there’s no use fretting about awards we didn’t win, but we can ask some questions as we head into the next big thing: the competition to be designated a regional technology hub. The CHIPS and Science Act calls for the Commerce Department to designate “at least 20” locations around the country as regional technology hubs and eligible for a total of $10 billion over five years.
We have multiple locations preparing to enter bids.
Lynchburg and Southwest Virginia have allied themselves in a bid based on nuclear energy — Lynchburg is a center for nuclear technology firms, Youngkin has proposed Southwest Virginia as a site for a small nuclear reactor. (See the story by Cardinal’s Matt Busse about this proposal.)
The New River Valley and Danville are working on a proposal based on additive manufacturing. (See Matt Busse’s story today on this.)
Richmond is pushing a bid on artificial intelligence.
Hampton Roads is also expected to make a bid.
The deadline for applications is Aug. 15 and there may well be other bids; these are just the ones that have been made public.
Warner, one of the key authors of the CHIPS and Science Act, has made it clear he’d like to see Virginia win one of the tech hub designations. Politically, you’d think the Commerce Department of a Democratic president would want to keep a senior U.S. senator happy — although that didn’t seem to matter with the Build Back Better and National Science Foundation awards.
Perhaps all these bids will be judged on their own merit. In theory, that’s the best thing, right?
However, if someone in Washington is looking at all the awards, here’s the real question to consider: If the goal is to spread economic growth around the country, is it better to make sure that these awards go to different communities than ones that have won before, or is it better to hedge our bets and double down on certain communities — or maybe even triple down?
That fits into a debate among some economic development professionals: How much should we invest in economically distressed communities versus how much should we invest in midsize communities that have more going for them economically? In other words, should we just write some places off?
That seems a grim way to think of things, but even federal dollars are finite, although sometimes it doesn’t seem that way. For those economically distressed communities that might be in danger of being written off, there’s a Bidenomics plan for them, too — the Recompete program, for which much of Southwest and Southside is eligible. Applications for that are due Oct. 5.