Salt Lake City, The Grand America Hotel — Yong boisterous entrepreneurs learning how to “network”, could be an accurate description of the first part of the mingling session before Governor Herbert prepared to give his talk at the Utah Billion Dollar Startups conference. It seems in this hall the word “entrepreneur” is synonymous with tech-start-up. I met just one gentleman who was operating a brick and mortar business, and he attended because his wife was invited.

I met a young man who is attending BYU who already works for a tech startup in Utah County which will prevent patients from being re-enrolled in hospitals after released. It will enable doctors to communicate and diagnose patients problems virtually before they become a big problem which would require a hospital visit. “Medicaid is starting to crack down on the number of patients that are being re-enrolled into hospitals, this system will reduce revisits by up to 75%.” He believes the startup will be a huge success.

Another young man was working on a platform for small businesses to sell each other’s products in virtual shared stores. He was connected to his colleagues virtually, they were located in different states, he is the only Utahn. He was decked out in a beautiful white suit. He couldn’t disguise his scant interest in my little magazine and blog. But I wasn’t offended, he obviously came to connect with money.

Filling the large hall, Governor Gary Herbert was introduced as, “The man who has lead Utah out of the great recession to the best economy in the U.S.!”

Governor Herbert began his talk telling attendees how former Governor Rick Perry said that every Governor in the United States is trying to “catch up” to Utah. Herbert said Utah has the greatest economy in the nation, and most Governors wake up each morning trying to see what they can do to, “be more like us.” The Governor calls himself the,” CBO of Utah, Chief bragging officer.” Herbert believes what has made Utah such a great business environment is how the government, “stays out of the way.” of business. He says that Utah has some of the best tax rates, the least amount of regulation, and we support small businesses. Herbert mentioned an article in the New Yorker magazine from one year ago, pointing out how class mobility is no longer possible in the United States, with one exception. They concluded class mobility was still alive and well in Utah. The New Yorker Magazine recently wrote a follow-up piece about how Utah became the “next silicon valley.”

“Utah is a great place to raise a family, and its a great place to do business.”  He concluded.

I would need to add one caveat which might rain on Herbert’s parade, which is, these things are true, if you are working for a big corporation.

Herbert has not been a governor of the small entrepreneur, nor a governor who likes aid or assist Utah farmers. Maybe Utah is a great place to start a tech company, especially in Utah County, but Herbert’s claims of Utah being a place where, “the free market operates with a level playing field.” is simply untrue. Herbert and his State Legislature and the men in power in Utah operate in a good ol boys circle, giving out favors to their friends. Corporate cronyism runs rampant under Herbert’s watch. The discovered corruption of John Swallow and Mark Shurtleff, our former two Attorneys General, is just the tip of the iceberg. In an excellent piece of journalism by former KSL reporter John Daily, titled “Large donations raise questions of Influence in Governor’s Race.” Daily  began to expose the level of cronyism when Hebert was running for reelection and at the same time accepting bids to reconstruct I-15. Herbert’s greatest campaign contributors were those who received the contracts for construction, and those who received the most face time with the Governor.

Corporate Cronyism in Utah

Herbert and his buddies have given millions to giant corporations like Scheels and Cabela’s to have them build their giant facilities in Utah and undermine the existing local retailers in outdoor retail economic sector. The dollars and handouts Herbert generously doles out to corporate entities also coincidentally flow into Herbert’s coffers for campaign contributions.

Like all political leaders Herbert wants to take a lot of the credit for the success of Utah’s economy. It was nice how he did say, “The government doesn’t create jobs, its entrepreneurs who create jobs.” It’s clear that the reason Utah’s silicon slopes are so successful is because there are plenty of smart, educated, hardworking people in Utah who want to contribute their talents to build the companies for which they are employed. Brigham Young University, Utah Valley University and the University of Utah produce plenty of ambitious graduates who don’t really want to move to silicon valley, but instead build something meaningful in their own backyards. Which leads me to the next story on the panel of four billion dollar Utah tech company owners who Herbert introduced. (this story will be available at 1:30 PM).