Here we go again:

General Motors is now going to offer buyouts to another 46,000 employees, while it's beginning to look like the smart guys at Cerebus Capital Management missed stuff like the recession and high oil prices when they did their due diligence before buying Chrysler.

Meanwhile, Michigan's unemployment rate for December inched up to 7.6 percent, easily the highest in the nation, nearly a full point above floundering Mississippi. And prospects of a national recession keep growing … as if we weren't already in trouble.

With all this grim news in mind, I went over late last week to moderate a panel at the 2008 Annual Collaboration for Entrepreneurship meeting in Ann Arbor. It’s the area’s big gathering of entrepreneurs. I was told there were twice as many people there this year as last, and certainly the hall at the local community college was a beehive of Type A personalities buzzing around wearing intense expressions and brandishing business projections.

The panel I ran wound up talking about why some start-up businesses locate in Michigan and, conversely, why others don't. My fellow panelists made up a pretty good cross section of Michigan's emerging entrepreneurial economy.

They included: Neal Clinthorme, Co-Founder of Xoran technologies, which makes CT scanners for ear, nose and throat physicians; Michelle Crumm, Co-Founder of Adaptive Technologies, which is in the alternative energy business; and Andrew Wykes, at IDV solutions, an artificial intelligence software company.

We had an audience of around 50 hard-driving types who brought added dimension to the conversation.

Reasons people gave for locating in Michigan varied all over the lot. Some said it was simply because their founders lived in Michigan. Others, manufacturing-based and therefore interested in knocking pennies per unit off the cost of making stuff, spoke about taking advantage of the existing manufacturing infrastructure that could get jobs done cheaply and quickly.

Some spoke about the quality of the work force, whether skilled blue collar workers or university grads. "Oddly, even though this appears to be not a very competitive market for very highly qualified engineers and technicians, we bite and scratch to find every one. We’re especially interested in finding people who are imaginative and fearless and who can help us innovate," said Crumm. His Xoran is a spin-off from the University of Michigan, and a number people in the room spoke about how technology transfers from university laboratories seed new business start-ups.

So why don’t companies locate in Michigan?

The litany and the list were very long indeed. There is very little venture capital around these days, and what’s available is mostly on either coast. They complained of inadequate infrastructure to help new companies, such as lawyers, accountants, bankers (people were especially grumpy at these) and proven managers.

We have a statewide culture that is much too risk-averse. Somebody located in Lansing suggested, "Lansing is not a well known center for high tech." while another participant pointed out that the resources in biology and life sciences at nearby Michigan State were as strong as any place else in the country.

Many complained about the state's efforts to help entrepreneurial companies. "They're well intentioned," one audience member said, "but they are very bureaucratic and really don’t understand what we’re all about." Others warned that investing public dollars in private enterprises is intrinsically conflict-laden. This was however, distinctly a minority view.

The showcase presentation at the conference was given by Dave Morin, founder and CEO of Cielo MedSolutions. Started in 2005 and now with nine (!) employees, Cielo makes electronic medical records software that automatically reminds physicians to remind patients to get their flu or pneumonia shots or screen for lead in the blood of younger kids. "There is so much to remember about health care and there’s so little time to deliver these services in the typical brief office encounter, so automatic patient-specific prompts are a huge timesaver," says Dr. Jean Malouin, Assistant Professor at the University of Michigan Department of Family Medicine.

I asked Morin how he feels about having his company located in Michigan. "Great," he says. "I live in South Lyon, so it’s close to home, and this kind of company helps diversify the Michigan economy." His greatest frustration is the "craziness" of information technology in the health care field, which deals with doctors who are increasingly pressed for time and is often dominated by big, expensive software companies whose products are too expensive and clumsy for smaller physician practices.

"What about the state?" I asked. "Through Ann Arbor-SPARK (the local economic development organization), we received a 21st Century Jobs Fund investment that matched a grant we received from a venture capital firm. That was great, but the bureaucracy and the paperwork were complicated and difficult to get through. But at the end of the day, they came through for us."

I have to confess I know Dave Morin pretty well -- he was the vice president for technology in my former newspaper company, HomeTown Communications Network, Inc. And he’s a great example of the kind of folks I saw at the meeting last week: Smart, intense, innovative, modest (in a Michigan kind of way) and very hard-working (another part of Michigan’s culture.)

True, our economy may be contracting just now because of the ongoing transformation in the auto industry, but if the entrepreneurs now beavering away in Michigan are any indication, we’re on the way to creating a much healthier, more diversified economy.

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Editor’s Note: Former newspaper publisher and University of Michigan Regent Phil Power is a longtime observer of Michigan politics and economics, and a former president of thr Michigan chapter of the Nature Conservancy. He is also the founder and president of The Center for Michigan, a centrist think-and-do tank. The opinions expressed here are Power’s own and do not represent the official views of The Center. Power welcomes your comments at ppower@thecenterformichigan.net