PITTSBURGH — This is what life in one American city looks like after an industrial collapse:

Unemployment is 5.5 percent, far below the national average. While housing prices sank nearly everywhere in the last year, they rose here. Wages are also up. Foreclosures are comparatively uncommon.

A generation ago, the steel industry that built Pittsburgh and still dominated its economy entered its death throes. In the early 1980s, the city was being talked about the way Detroit is now. Its very survival was in question.

Deindustrialization in Pittsburgh was a protracted and painful experience. Yet it set the stage for an economy that is the envy of many recession-plagued communities, particularly those where the automobile industry is struggling for its life.
Pittsburgh’s transition has been proceeding for decades in fits and starts, benefiting some areas much more than others. A development plan begun in the 1980s successfully used the local universities to pour state funds into technology research.

Entrepreneurship bloomed in computer software and biotechnology. Two of the biggest sectors are education and health care, among the most resistant to downturns. Prominent companies are doing well. Westinghouse Electric, a builder of nuclear reactors, expects to hire 350 new employees a year for the foreseeable future. And commercial construction, plunging in most places, is still thriving partly because of big projects like a casino and an arena for the Penguins hockey team.

Microsoft is dying. So is Boeing. Both might take decades to finally unravel, and with some luck one might survive, but the writing is pretty clearly on the wall.

Computing is increasingly switching to huge centrally located servers interconnected by the Internet to small and cheap netbooks that either run a cheaper version of Windows, if running Windows at all. Whether it's by Google's hand or some other upstart's, Microsoft's cash cows are dying. The company has yet to form a new quasi-monopoly to farm.

Boeing, as part of the 787 program, has outsourced almost all of the manufacturing and design of its aircraft. This lofty plan to globalize airline production—and the ancillary ability to grub for tax breaks and union concessions—has proven remarkably incapable of producing aircraft. What it has produced is a wonderful incubator for Boeing's future competitors in places like China and India.

Seattle—and by extension Washington State—should be well poised to adapt. The University of Washington is already one of the finest public research universities on the planet and the city of Seattle's largest employer. No other public university draws in as much extramural grant funding—about a billion dollars per year.

Thanks to this decades long investment in scientific and technological research—mostly funded with out-of-state dollars, but seeded with well-invested state money—the University is constantly, quietly and persistently spinning off small companies incubating new ideas. Did you know that as a citizen of the state of Washington, you get first dibs on all that intellectual properly being generated in Seattle? The royalties amount to tens of millions of dollars per year. In a typical year, R&D at the University results in about ten new companies being started in Washington State. These companies hire workers, provide high-quality jobs and, unlike Boeing, don't require an ongoing state subsidy to operate. Many grow and succeed. Out of them will come the future Boeings and Microsofts of the Washington State economy.

Cities and states that invest in scientific and technical research succeed. Those that don't fail. Keep that in mind, when weighing the true costs of the Governor's 'no new taxes' budget, that cuts to the bone all state funding for higher education.

Beyond being a petty and anti-Seattle political triangularization, this is the definition of a false economy; something that provides a short term political benefit for our obviously inept governor at the cost of the future economic growth of Washington State.

It seems like a pity for our Democratic governor and Democratic supermajority in the state legislature to piss away decades of effort and investment. I can't say I'm surprised. All I can say is (and this only me, not the SECB or the Stranger saying this) I wish Rossi had won. At least then I wouldn't be left to only feel despair at where our state is heading.