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Strategizing 'a national economy for Indian country'; PART FOUR

WASHINGTON - In this fourth part in a series drawn from a presentation at
the National Indian Business Association Annual Conference and Trade Show
in September, Chuck Johnson of Johnson Strategy Group Inc. in Albuquerque,
N.M. offers his thoughts on the strategic thinking behind economic
development:

So how do we build capacity [for the tribal evaluation of business deals],
how do we start? ... It starts with thinking beyond your boundaries. It
starts with a strategy ... with thinking about private infrastructure which
is not just a feasible infrastructure but convenient management
infrastructure. It talks about developing a [business] diversification
portfolio which is beyond just the usual "round up the suspects," or beyond
the usual financing. It talks about building the high-value business of the
future ...

The Warren Buffets of the world and the CALPERS - CALPERS is one of the
largest investors in the world, that's the California pension system - you
know, they use value measures to decide what to invest in. New industries,
vendors. Tribes can also use value measures in terms of deciding what to
invest in.

And they know this is not [about businesses] where you can drive by and
see.

It means, tribally, internal due diligence, so when the [business] deal is
shopped to the council, it's something that has basically an analysis of
the structure of the deal, and the structure of the financing, and why this
business fits that tribe, not just someone brokering a deal.

By the way, I would suggest when someone comes and brokers a deal and asks
for a fee, throw 'em out. Because they're concerned with their fee and
their commission, not the benefit to the tribe.

So it means the deal flow is moving internally within the tribe, and also
deal flow in structuring the investments is working so you have greater
leverage and you play off what economic sectors are going in ... There's a
triple bottom line. A financial return to the tribe and the entrepreneur, a
social return if you invest in businesses that provide a social benefit,
and a political return - because then the council becomes more confident
that it knows how to negotiate its best interests, internally it knows how
to pick the right businesses. And this is part of the bridge [a values-based bridge to tribal economic development].

So basically it [the bridge] is built on a unique kind of a platform and it
starts with nations nationally getting involved, the inherent sovereignty
and self-governance and the values of that - that's the building block ...
all the way up through to the organization having within the tribe the
management and technical capacity to be able to select wisely and also to
invest wisely and to build the social wellbeing of the tribe. The quality
of the tribe is not just a business quality, it's a social quality - the
tribal members.

If we look at housing, I've been involved with ONAP [Office of Native
American Programs] for the last six months on housing. Most of the housing
programs are built on ... the federal government will pay for your house.
Well if you admit that one of the key U.S. indicators of growth is housing
starts, one of the key indicators of family wealth is housing ownership -
being able to pay for a mortgage. So housing itself is an economic
indicator. The more home ownership there is within the tribe, the more
wealthy it is, the stronger the base of those families ... They actually
start at this foundation of exercising sovereignty and taking advantage of
sovereignty in terms of your dealings internally and externally.

Strategic planning is one of those terms that's bandied about, kind of
loosely, you know leniently, and I would suggest a few rules.

Nature doesn't reveal its secrets. You have to go looking for it. You have
to find out how the economy works for you. It's not just done by hiring
consultants to do feasibility studies on one-off projects. It's done by
digging in and finding out how your local and regional economy works.
Secondly you're living in the present with one eye to the future. The
Pechanga chairman [Mark Macarro, in a presentation prior to Johnson's]
basically said let's look beyond our boundaries, let's exceed our grasp.
But we can't basically live in the future. But we can structure it. Every
tribe can structure its own future.

The world is changing. Markets are changing. Global markets are changing.
Even tracking global markets is a whole dimension itself. And by the way
you can't think beyond your boundaries if you're weak at the core. If
you're depending on outside advisors for everything you do, your core is
weak. You've got to build the internal capacity to know how to evaluate the
environment, how to evaluate the economy, and how to select deals.

Doing nothing today lets your future be set by someone or something else.
In the first place, I remember in the '70s and '80s, it was always, you
know - what's the federal government doing? I would suggest there's a -
ever hear of attention deficit disorder? You know, kid has attention
deficit disorder? ... I call it federal attention deficit disorder.
Fed-ADD. Fed-ADD means you only think in terms of the annual appropriations
cycle of the federal government. So attention deficit disorder - you have
only an annual view, and you go back and spend all your time lobbying - not
that it's not your right - but basically you've gotta think beyond that
annual appropriations cycle, and to what the tribe wants to be in five or
10 years, which is a function of other approaches.

... You've got to have a dream that people can understand. What I would
suggest about this is that most tribes are coming out of a survival mode -
you know, the federal appropriations survival mode. One of the problems is
if you dream and you can't communicate to your tribal members, you're in
deep doo-doo. Because if the tribal members are mystified by your economic
analysis or stuff, they're not gonna trust you ... A tribe that did a
five-year economic strategy, and basically what they did [a tabloid-format publication] ... they did it in such a way that a tribal family could sit
down and see pictures of things and see images of stuff and see where
they're going and see their type of investments. You put a bulk-rate permit
on the back, go to the enrollment office and mail it to every tribal
member. If you trust your strategy, and trust your vision, you should have
the confidence to communicate it with every tribal member who might deeply
resent what's going on, or might suspect you're doing funny things with
their money. So if you can't communicate the dream, then you're going to
disconnect from your own membership, which is part of the first piece of
that foundation of sovereignty. The members elect the leaders.

... What you don't see is equally or more important than what you do see.
If you don't see proper market opportunities, if you don't see the
prospects of a better future, if you don't see how you can access national
global economies, basically you're not seeing the big picture. If your
boundary is just reservation development and the marketplace is out there,
with 10 million dollars of venture capital begging to be taken, with
markets for distribution of food and tribal products and tribal goods and
services, then basically if you don't see it you're never going to get it.
And so this is very important.