Introduction

Overview: 100% Focus on Big Business

This comprehensive analysis of Idaho's economic development strategies and programs provides irrefutable evidence of a stark reality: the state's economic development efforts are 100% focused on big businesses, with NO direct support for small businesses, particularly those with fewer than 20 employees. This finding is alarming, given the crucial role small businesses play in Idaho's economy. Our rigorous dual-perspective analysis, designed to eliminate all confirmation bias, yielded results that exceeded our initial expectations, revealing a complete absence of support for small businesses that is rarely seen in policymaking.

Methodology and Scope of Analysis

Our analysis focuses on the Idaho Department of Commerce, the lead economic development agency for the State of Idaho. Our analysis scrutinizes every word in their official documents and initiatives, including annual reports, strategic plans, incentive manuals, and other key publications. Crucially, we pay particular attention to the department's control over economic incentives and grants, as these financial levers are the primary drivers of economic behavior. The Department of Commerce, through its management of these incentives and its role as the lead agency, quite effectively sets the direction for the state's entire economic development strategy. By meticulously examining every major publication and financial allocation decision made by this department, we ensure a thorough assessment of how state resources and taxpayer dollars are being directed in the realm of economic development.

Our methodology was specifically designed to eliminate all confirmation bias through a rigorous dual-perspective approach. For each document and initiative, we conducted two completely independent analyses. The first sought to identify any shred of evidence, direct or indirect, of benefit or support for small businesses, no matter how minor. The second aimed to construct the best possible case for how the policy, program, or incentive serves big businesses - the apparent intended recipients.

This approach allowed us to thoroughly test our hypothesis from both angles with full confirmation for both perspectives. The results were striking. Despite our concerted efforts, we could find no evidence of support for small businesses. Conversely, the analysis for big businesses revealed a clear and overwhelming intent to serve their best interests. The completeness of this divide in our findings provides a robust foundation for our conclusions about the state's approach to economic development.

This dual-analysis method is arguably the most effective way to eliminate confirmation bias in our final assessment, allowing us to arrive at conclusions supported by exhaustive evidence. Our findings, detailed in the conclusion, reveal the extent of this bias and its potential consequences for Idaho's economic future. The depth of this analysis is particularly evident in the Mercatus section, which draws upon an impressive array of over 40 academic citations, providing a solid scholarly foundation for our findings.

The Economic Reality of Idaho's Small Businesses

According to the U.S. Small Business Administration's 2023 Small Business Profile for Idaho:

• Small businesses employ 56.3% of Idaho's private workforce.
• Businesses with fewer than 20 employees make up 97.6% of all small businesses in the state, numbering an impressive 184,095.
• These small businesses account for approximately 54.9% of all private-sector employment in Idaho.
• In 2021, small businesses contributed a net increase of 29,806 jobs, accounting for 86.0% of the state's total job growth.

This data underscores the critical importance of small businesses to Idaho's economic fabric.

The Three Pillars of Economic Development: A Critical Imbalance

The International Economic Development Council (IEDC), the world's largest membership organization for economic development professionals, emphasizes three essential pillars for a comprehensive economic development strategy: Business Attraction, Business Expansion, and Entrepreneurship. Our analysis reveals that Idaho's strategy is fundamentally unbalanced, focusing 100% on Business Attraction and Expansion while completely neglecting Entrepreneurship. We found no evidence, however small, of any state-level support for the Entrepreneurship pillar in Idaho's economic development strategy.

This creates a precarious "two-legged stool" approach to economic development. According to IEDC's established principles, this lack of balance undermines the stability and dynamism that a strong entrepreneurial ecosystem provides. By entirely overlooking the Entrepreneurship pillar, Idaho eliminates a crucial driver of innovation, job creation, and economic growth, severely limiting its overall economic potential and resilience. This is not merely our opinion, but a fundamental tenet of effective economic development as taught and promoted by the IEDC.

The Mercatus Center's Damning Indictment

The Mercatus Center at George Mason University, cited by Governor Brad Little to certify Idaho as the least regulated state, has produced research that fundamentally challenges the effectiveness of Idaho's economic development strategies. Their findings not only refute the purported benefits of the state's approach but also reveal these strategies as potentially harmful to Idaho's economic health. The irony is stark: Mercatus, the very source used to provide the foundational selling point to attract big business to Idaho, has conducted exhaustive research that undermines the validity of this economic development strategy. This contradiction highlights the disconnect between Idaho's economic development rhetoric and the empirical evidence on effective strategies.

Key findings of the study include:

• In 75-98% of cases, subsidies and incentives do not influence a company's location or expansion decisions, rendering most programs ineffective.
• These incentives often lead to economic distortions, inefficient resource allocation, and a regressive wealth transfer from average taxpayers to large corporations.
• The focus on attracting large corporations through subsidies represents significant opportunity costs, diverting resources from broader economic development or small business support.
• Despite their ineffectiveness, policymakers continue implementing these strategies primarily for political gain, claiming credit for "job creation" even when the economic impact is neutral or negative.

This research exposes a fundamental flaw in Idaho's economic development approach, suggesting that the state's strategies are not only failing to deliver their promised benefits but may be actively hindering overall economic growth.

Rethinking Idaho's Economic Future

This comprehensive examination exposes a critical flaw in Idaho's economic development strategy. Our analysis provides irrefutable evidence that:

• Idaho's economic development efforts are 100% focused on big businesses, completely neglecting small enterprises that form the backbone of the state's economy.
• According to the Mercatus Center's research, Idaho's strategies are not only ineffective but potentially harmful to the state's economic health. These policies fail to deliver their promised benefits and often result in economic distortions and inefficient resource allocation.
• By ignoring the crucial Entrepreneurship pillar of economic development, Idaho overlooks a significant untapped resource that represents nearly half of its economy.

In essence, Idaho is investing 100% of its economic development resources into strategies that have been proven ineffective or even detrimental, while completely neglecting a vital sector of its economy. This approach suggests that a substantial portion of Idaho's economic development budget is being misallocated if not entirely wasted. Our findings call for an urgent and fundamental reevaluation of Idaho's approach to economic development, one that acknowledges the importance of small businesses and entrepreneurship and aligns with proven, effective strategies for sustainable economic growth.