Ag is, isn't No. 1

Is ranching and farming still Montana's No. 1 industry?

There's been a little confusion and some discussion over that question lately.

Here's what spawned it:

Those opposed to a new Lewis and Clark County Fairgrounds layout fear the plan casts aside "things that poop" for RV shows and concerts. Why not honor the state's agricultural past, some said, and hang on to such events like horse racing?

And recently University of Montana economist Larry Swanson told a group of area leaders that natural-resource industries are giving way to human-resource jobs. That prompted a comment from one reader, who wrote to me that Swanson "had no standing." Another reader kindly forwarded a letter from U.S. Sen. Conrad Burns, reminding me that, yes, farming is the state's top industry.

Well, it depends on what damned lies, er, statistics, you believe.

One measure stick is gross state product. Apparently, gross state product, like gross domestic product or GDP, measures "gross output" minus "intermediate purchases." GSP is the accepted way of measuring an economy because it looks at the value industries add, according to Department of Labor and Industry economist Tyler Turner.

According to that, agriculture is 11th, right behind transportation and warehousing.

But if you look at total cash receipts, "ag" trumps all other industries, Turner says. This figure includes money spent on seed, a tractor, tractor repairs or other things that might show up as "intermediate purchases." It would also reflect government subsidies, a growing source of farmers' income.

It's also important to note, Turner says, that agriculture is very important to Montana's economy compared to other states. The only state in the West in which agriculture is a bigger part of the economy is California.

Whatever measure one chooses to use is bound to be subjective, Turner says. It also matters where we're talking about.

When it comes to the Helena area, there's ample evidence that hay balers have given way to laptops.

Payroll from ag-related activities makes up less than a penny of every locally earned dollar. Meanwhile, government jobs make up 40 cents out of every $1 earned.

- I sat down with a miner, logger, roughneck, coal miner and a few others the other day to talk about natural resources. Well, as industry spokespeople, they weren't sporting grease-covered dungarees. Neither

was I.

Although financial services and health care sectors may be growing faster, the natural resource industry hasn't frittered away, they said. It might be less important, said Bud Clinch of the Montana Coal Council, but only incrementally so.

He and others in the group talked about the unheralded benefits of "extractive" industries.

Natural resource jobs pay well and have a closer relationship to local communities. Mining profits might go elsewhere, just like Wal-Mart or Target, but the operations need equipment and maintenance, which is oftentimes local folks. Gas and oil tax royalties swell state coffers, employing some Helenans.

That led to talk about the disconnect between producers and consumers.

Wood, cement, gravel -- all the important elements in the growth boom -- have to come from somewhere, they point out. So does the gas at the pump, electricity in a home and food at the store. We flip the switch and expect the lights to go on, not giving a second thought to Ohm's Law or the western electricity grid.

Eastern Montana is experiencing a natural resources boom, they said, while western Montana has ushered much -- though not all -- of it out. (Swanson points out that western regional centers like Helena are booming, while many eastern towns are dying.)

Helena is more likely to open a new mine, than it is to get a Microsoft call center, said Dustin Stewart of the Montana Mining Association. In our area, Montana Tunnels expects to expand.

But maybe what was tolerable yesterday just isn't for today. Anyone remember I-147?

"On the Record" appears on Mondays, with additional columns online at www.helenair.com/blog/record/index.php. Lob comments, kudos or critical thoughts to 447-4075 or jason.mohr@helenair.com.