Senator Herb Kohl's Speech

Economic Development in Rural Wisconsin:
Developing a 21st Century Response to Compete in Today’s Global Marketplace

October 26, 2011

Thank you, Eric, for that kind introduction. More importantly, thank you for the great job you do as Director of the SBA. You and your team at the Small Business Administration are to be commended for the tremendous work you do. We have the very best, most aggressive SBA offices here in Wisconsin. Doing thousands of loan guarantees for hundreds of millions of dollars doesn’t just happen. It takes dedicated, smart, business-savvy people to work with lenders and the public. I am so pleased to be here with all of you in Wausau at this conference today so we can talk about economic development in rural Wisconsin.

Agriculture is the largest economic force in the state and that makes rural Wisconsin a powerful economic engine. Nationwide, agriculture is one of the parts of our economy that runs a trade surplus with the rest of the world. While some people see rural America as symbolizing the past- in fact it is on the cutting edge of one the most internationally competitive parts of our economy. Far from being a sleepy backwater, rural America is a global powerhouse.

What we need to do now is unleash the energy of rural Wisconsin. To do that we need to work together, Democrats and Republicans, public and private sector, so that we can get back on track.
We can do that by freeing up credit for businesses. I supported programs that expanded small business lending and resulted in millions of dollars in new lending here in Wisconsin.

When Congress passed the Small Business Jobs Act last year it included loan incentives in the SBA loan guarantee program. These incentives led to an all time high in SBA loan approval levels, helping small businesses throughout the country obtain the capital they needed for their businesses. During 2011, small businesses in Wisconsin were able to get over $835 million dollars in loans guaranteed by the Small Business Administration. Almost half of these loan guarantees went to businesses located in rural areas.

We can help get rural economies going by cutting taxes and making it easier for entrepreneurs to get started. The Small Business Jobs Act provided small businesses with $12 billion dollars in tax cuts and credits so that they can stay profitable in tough times. In addition, I am working with other Senators to provide incentives to entrepreneurs to save money to start their own businesses. Because start up costs often keep entrepreneurs from turning their dreams into a bricks and mortar business, I co-sponsored the bipartisan Small Business Savings Account Act. This bill would allow individuals seeking to start a small business to save up to $10,000 annually and grow the savings tax free.

We can also get back on track by reducing energy costs and finding ways to make our businesses run more smoothly. Government can play a role in helping us all achieve these goals. Last year, Helene’s Hilltop Orchard, in Merrill, received a USDA Rural Development grant to help with the purchase of solar panels. These panels will produce 40% of the orchard’s energy, saving money and helping conserve energy at the same time.

In Janesville, MacFarlane Pheasants, the largest pheasant producer in North America, has worked with UW Whitewater’s Small Business center and the Wisconsin Department of Agriculture to help its business grow. MacFarlane sells its pheasants around the world, in Europe, the Middle East and Latin America. In order to do this successfully MacFarlane needed to understand how to price its products appropriately in those local markets, and figuring out these prices requires a great deal of technical expertise. MacFarlane’s owner, Bill MacFarlane, did what any smart business person would do. Rather than try to go it on his own, he sought out the best expert’s advice so that he could remain competitive. The help he’s received from the Wisconsin Department of Agriculture as well as the UW Whitewater Small Business Center has allowed him to improve MacFarlane’s business processes and also will help him move into new markets around the world. These two success stories show that a little help can go a long way.

We can bring opportunity to the rural economy by expanding access to international markets. Wisconsin farmers exported more than $2.4 billion in agricultural goods last year, supporting more than 17,000 jobs. Two weeks ago Congress passed free trade agreements with Panama, Colombia and most notably, South Korea. These agreements will remove tariffs and other trade obstacles so that Wisconsin businesses can export more dairy, meat and other products our state produces.

For rural Wisconsin the South Korean agreement is a huge opportunity. South Korea is the number two importer of U.S. cheese in the world – with a market that has been growing by almost 15% a year since the late 1990’s. The U.S. Dairy Export Council has an active office in Seoul that is working with Korean food companies to use more high quality American dairy products. It’s already the fourth largest market for all Wisconsin agricultural products – and we expect that market to only become more important now that the tariffs on nearly two thirds of U.S. farm exports will be immediately eliminated. I’m confident that these agreements will help both our small and large producers increase their business.

There’s no doubt that we need continued investment at the local level to get people back to work, and spending money in our economy. The President has proposed a commonsense, mainstream jobs plan that includes tax cuts for middle class working families, tax cuts for small businesses to help them grow and employ more people, and puts people directly to work in jobs building roads and bridges and teaching our children.
Recently, the Senate tried to pass part of that plan: a $35 billion infusion to cities and states to keep teachers in the classroom and cops on the beat but this bill was blocked.

When we come back from recess, we’ll vote on the second part of the jobs plan: $50 billion for infrastructure projects and $10 billion in seed money to start a nationwide infrastructure bank. Good infrastructure is critical for expanding rural development. Transportation funding is something that is supported equally by groups like the AFL-CIO and the Chamber of Commerce – and I hope that broad support will translate into bipartisan action.

Expanding markets and opening up access to credit: we have been working hard to give rural Wisconsin the tools it needs to be successful. But we know that it is you folks on the frontline of the economy that make this country successful – not us.

Thank you again for inviting me to be with you. As you know, I come from the world of business and have always worked to ensure that the needs of small businesses and the institutions that support them can readily approach my office and know that we are listening to their concerns. It’s been a tremendous honor to represent these interests in Washington where there is still much work left to do. I'm looking forward to hearing how this conference goes and hope the ideas generated by you can help improve the quality of life in our rural communities.


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