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Banking Professor Honored by Community, University & Shares Thoughts on Economy


In August, Dr. Harry M. Davis, professor of finance and past chair of the Department of Finance, Banking and Insurance at Appalachian State University was presented the Wade Brown Award for Community Recognition by the Boone Area Chamber of Commerce.

In recognition of his service to the North Carolina banking industry and to Appalachian, the Walker College of Business is working toward creating an endowed professorship in Davis’ name. In an interview in his office in Peacock Hall, he shared some thoughts about the economy, globalization, education and his personal accomplishments.

What is your economic forecast for the next five years for the High Country and for North Carolina?

We’re going to experience historically slow growth in the U.S. and North Carolina economy. North Carolina will do better than the national economy. Employment growth in North Carolina exceeds 2 percent, whereas it’s less than 2 percent at the national level. Surely in the next 24 months we’re going to enter a recession that will last up to 10 to 12 months, or for as long as 24 months. It will be shallow and relatively short. Recovery [from the Great Recession] is now the fourth longest in the post-World War II period. Generally when expansions go that long, you have to have a recession before too much longer. There will be a bubble burst – a student-loan bubble burst – that will lead to a recession.The biggest problem with our economy is we cannot get enough growth to have a positive impact on salaries and wages, so incomes are not growing rapidly. The middle class is definitely getting smaller relative to both ends of the spectrum. We have the slowest productivity rate in this recovery than any other in 65 years. If you can’t get productivity growth, that’s what is needed for the middle class. It leads to higher salaries and wages. Without it they don’t get those increases. The very rich get those increases because their increases are caused by other things. And, of course, the poor get left out altogether.

Why is productivity down?

One reason productivity is so low, the post-war baby boomers are retiring at an incredible rate. They have tremendous experience and knowledge and are taking it out of the workforce. People coming into the workforce have good skills but they don’t have experience and knowledge and the knowledge and experience base is dropping. As a result, we have a decline in the rate of productivity.

What is the most crucial issue facing our state at this time?

Our secondary education system – both in the U.S. and in our state – is failing. It does a poor job educating the youth of this state. Clearly, in some places it does an incredibly good job, but the average is not very good. Another problem we’ve got, we turned our junior college and community college system into preparatory schools for the university system. We deserted or failed generations of high school students who didn’t want to go to college. We didn’t train them. We didn’t give them access to training. We didn’t support the technical skills.

What is the most valuable tool Appalachian can give students to succeed in the real world?

Skills that can be used every day in the business place. Everyday skills – Excel skills, Word skills, PowerPoint skills, math. Technology is changing so rapidly, the knowledge base is changing so rapidly, you have to have those skills to thrive. Another thing we can’t give them but somebody needs to, is a work ethic. If you work hard, you will succeed.

We talk about our students competing in a global economy. What are your thoughts about opportunities outside our borders?

There are plenty of opportunities outside of the U.S. Asia has high rates of economic growth. The trick is, if you have a foreign language, particularly in Asia, you will be a very valuable employee. There are higher rates of economic growth there, there are jobs there.

Do you agree there is a negative backlash surrounding global expansion for U.S. businesses, and if so, what impact will that have on students’ opportunities in the long run?

Globalization is a great thing for the general population. International trade is a wonderful thing to raise income levels around the world. If we block trade, all we do is slow our growth and everyone else’s. If we attempt to block trade in any meaningful way, other countries will attempt to block trade with us, which will slow down world growth and which will hurt our students’ chances for getting jobs in the international market.

What are your thoughts about private-public partnership (P3) applications for our campus?

One of the biggest shortcomings of higher education is it has not partnered more frequently with the business community. We should bring the two together – knowledge and money – to make the best innovations to help mankind. The two working together could achieve far more than the two working separately. If universities enter into such arrangements, and actually benefit financially, wouldn’t that be the best possible thing for scholarship funding, research funding? All the things we think are important?

What was the most rewarding time in your teaching career at Appalachian?

I lost most of the sight in both of my eyes about four months ago. I can’t read anymore but I’m going right on – still working, still teaching, still lecturing, still giving public speeches. But I’ve invented ways to do it. So, it’s a real challenge. I had no idea I’d be working this hard at this point in my life. So in some ways this may be the most rewarding time in my entire life in the sense that I get up every morning trying to figure some way to deal with this disability. It’s been very positive for me to keep looking for more ways to get around it. So every day I do that, and every day I find another way to get around it, I feel that much better. So, in a lot of ways this may be the most rewarding time in my whole career. When I can give a public speech in an auditorium to several hundred people and I can do that and I can hardly see and they clap at the end, I feel pretty good – particularly when they want me to come back.

What personal accomplishment are you most proud of?

The university and the North Carolina Bankers Association have jointly agreed to set up a professorship in my name here at Appalachian State University called the Harry Davis Professorship of Banking. That is my crowning achievement.