Creative Class

Would a ban on fast food restaurants in our cities and towns help lower the rate of heart disease? Would a program to collect Dog DNA from poop left on our streets and sidewalks help us target negligent owners? Could we harness our own bio-mechanical energy to charge our cell phones, even our cars? Does ‘redshirting’ children, holding them back so that they can enter grade school at an older age, wreak havoc on social security programs? Would local stock markets for regions no larger than Barrie, or Muskoka, help citizens allocate capital more efficiently to businesses that need financing? Could we switch our dietary habits from cow to kangaroo to help save the planet?

If you think I’ve just stolen and plagiarized part of the manuscript for the yet unpublished Freakanomics 2.0, you’d be wrong. These are the hypotheses and real life programs that earn brilliant and bizarre minds recognition in The New York Times’ “Year in Ideas.� If these few examples tickle your fancy, try “spray on condoms� on for size (not literally- these bespoke coital solutions are not yet widely available). Human ingenuity never ceases to amaze, eh?

One thing that stood out for me while reading these stories was how many of these truly remarkable ideas came from Canadians - three from Toronto academics and scientists alone. For The New York Times, where Canada’s parliamentary crisis earlier this month barely registered a blip on their radar, that is a pretty impressive showing from the Great White North, and I believe it speaks to the creative incubator that Toronto has become. Read the article and take notice of where many of these ideas began. There is perhaps no better indication of a “creative city� than the brilliant ideas it fosters and develops, and some of my favorite creative cities - San Francisco, Montreal, Washington, D.C., Minneapolis, and Boston, as well as my hometown, the T-Dot, get plenty of love.

Jamie Galbraith says planning is the cure for America’s problems (via Planetizen).

“Planningâ€� has been a dirty word in American politics for decades. For the hard-line right, planning destroyed freedom: it was the “road to serfdom.â€� Anti-planners also thought it a failure; for them the collapse of the U.S.S.R. was due to “central planning.â€� But without public planning, who is in charge? Lobbyists who represent the private planning of the great corporations. The public interest ceases to exist, and the public sector becomes nothing more than a trough at which private interests come to feed.

What the government needs most today is to regain an independent capacity to think. The government needs a way to imagine the future that is not dominated by lobbies or even by Congress so long as Congress is dominated by lobbies. Planning is a process: thinking, coordination, action. What is the long-term national interest? What specific targets must be met? What is the best way to do it, and who plays what role? …

Markets do not design new systems—new patterns of transport and housing, new technologies for electric power, for vehicles, for heating and cooling. To design a system, to put the pieces together, to identify the most promising lines of attack and take steps to achieve them: that is the planner’s role.

My PhD is in urban planning, so many might think I’m a proponent. But I’m more than just a little bit worried about planned solutions. Much of the time I find myself argeeing with Jane Jacob’s views on the subject - planning is a poor second to complex, self-organizing processes. And our economy, society, politics, and geography are surely a lot more complicated and complex than in her time. I’d like to believe that government can become independent of lobbyists and regain its independent capacity to think, but the realist in me asks: Is that really possible under our current system?

Maybe what we’ve been calling culture war has actually been class war.

In RISE, Richard posits the Creative Class as an entity that’s not yet self-conscious and is tied to the new creative (i.e., high tech, etc.) economy. I think the emergence of the creative economy and creative class have been met with resistance in the form of class warfare. We tend to think of class warfare in terms of rich vs. poor, but this is between the classes of the old economy vs. the creative class.

It’s played out in America’s politics as the old economy warriors took over parts of the Republican Party with anti-intellectual, anti-science, anti-elite rhetoric and used them to resist change. Those in the old economy used the culturally conservative demonization of the 1960s to organize against the emergence of the creative class which is intellectual, scientifically oriented, and tends to be highly educated. People tied to the resource-based, Fordist economy, whether Rust Belt working-class “Reagan Democrats” or oil barons, have been fighting against the new social and economic realities. The Bush administration, with its giveaways to resource-based corporations and resistance to science has been a last bastion of resistance. The automakers attempt for a bailout is another symptom of this reaction.

The battle lines haven’t always been clear because the nature of the war hasn’t been well understood by either side. We have to be careful about making assumptions or ascribing value judgments. Newt Gingrich and Karl Rove were clearly part of the creative class, regardless of which side they’re on. Tom Delay and John Dingell were clearly not. Both Clintons, Al Gore, and Obama are clearly creative class. By G.W. Bush’s job description he should be, but not his nature, so he’s hard to define. Bush Sr. and Bob Dole were essentially non-combatant leftovers from an earlier era. It’s hard to say about Reagan or McCain, who fell into both camps.

Obama seems to have captured the Creative Class vote, and may create Judis & Teixeira’s “Emerging Democratic Majority” if his policies succeed in supporting the new economy. The Republicans are faced with going the way of the Whigs unless they can abandon the class warfare and open up to the new economy and the creative class.

With all the talk about Obama’s governing from Left, Right, or Center, I haven’t seen much talk about specifics. The leftish website “Politics Done Right” has an interesting chart and discussion of the policies on the President-elect’s website.

Most of this discussion, moreover, has dwelt in the realm of tactics, presentation and salesmanship rather than grand strategy…

In the case of Barack Obama, however, I would argue that there is not as much need to worry about tactics. If his campaign was any indication, Obama is not much of an outsourcer — he will dictate the tone of his administration. Moreover, we actually have quite a bit of information about what his longer-term goals are.

Lots of Creative Class economy stuff here - education, urban policy, research, infrastructure. While I’m pleased with the range and content of the proposals, I worry about the sheer numbers. What do you think?

The lost decade is often talked about in Japan. From 1990 to 2000, the Japanese economy was stuck in the aftermath of a burst housing bubble and the inability to channel investment into the “next big thing.” Of course that was the Internet. Today the U.S. is in a similar situation. We are in a post-housing bubble, a credit and banking crisis. We also face the difficult choice of figuring out the next big thing to invest in. If we miss it or do not get it right we will be Japan in the 1990s and Germany, Singapore, China, and Denmark will lead the next economic expansion. Where to put the money? The answer is simple - it’s The New New Deal. The Obama administration has a chance to set America on the right course. The question is… will it?  Will they cave in the old New Deal (bail out the auto industry) or can they embrace the New New Deal? What is the New New Deal? According to Jefferey Sachs:

• The development of mass-market, battery-powered autos that achieve at least 100 mpg of gasoline on fleets by the year 2015.
• An efficient power grid that can carry renewable energy - solar from the Mojave Desert and wind from the Great Plains - to the population centers of the U.S.
• A utility industry that can reduce 80 percent of emissions per kilowatt on newly built power plants by 2016. For the U.S. to achieve this it will have to decrease consumption and increase investment. One policy to help would be for a gasoline tax to keep gas prices high to reduce consumption and create tax revenues to fund R&D. I would suggest a tax that would keep gasoline prices at $4.00 a gallon rising by 50 cents a gallon over the next four years. This would create the incentives to invest in our energy efficient and sustainable future.

Michael Lind argues that the United States is embarking on its fourth great political (and economic) cycle (h/t Jerry Mayer).

The election of Barack Obama to the presidency may signal more than the end of an era of Republican presidential dominance and conservative ideology. It may mark the beginning of a Fourth Republic of the United States. In the past generation Bruce Ackerman, Theodore Lowi and I, in different ways, have used the idea of “republics” to understand American history… As I see it, to date there have been three American republics, each lasting 72 years (give or take a few years). The First Republic of the United States, assembled following the American Revolution, lasted from 1788 to 1860. The Second Republic, assembled following the Civil War and Reconstruction (that is, the Second American Revolution) lasted from 1860 to 1932. And the Third American Republic, assembled during the New Deal and the civil rights eras (the Third American Revolution), lasted from 1932 until 2004…

[W]hat causes these cycles of reform and backlash in American politics? I believe they are linked indirectly to stages of technological and economic development. Lincoln’s Second American Republic marked a transition from an agrarian economy to one based on the technologies of the first industrial revolution - coal-fired steam engines and railroads. Roosevelt’s Third American Republic was built with the tools of the second industrial revolution - electricity and internal combustion engines. It remains to be seen what energy sources - nuclear? Solar? Clean coal? - and what technologies - nanotechnology? Photonics? Biotech - will be the basis of the next American economy. (Note: I’m talking about the material, real-world manufacturing and utility economy, not the illusory “information economy” beloved of globalization enthusiasts in the 1990s, who pretended that deindustrialization by outsourcing was a higher state of industrialism.)

Naturally, the Americans alive during the founding of new American republics have other issues on their minds. The Civil War was fought over slavery, not steam engines, and the New Deal, for all of FDR’s commitment to nationwide electrical power fed by hydroelectric dam projects, was animated by a vision of social justice. The broad outlines of technological and economic change merely provide the frame for the picture; the details depend on the groups that emerge victorious in political battles.

That is why it is too early to predict the outline of the Fourth American Republic. Its shape depends on the outcomes of the debates and struggles of the next generation. But it is possible to speculate about its life span. If the pattern of history holds, the Fourth Republic of the United States will last for roughly 72 years, from 2004 (or, if you like, 2008) to 2076. And if the pattern of the past holds, we will see a period of Hamiltonian centralization and reform between now and 2040, followed by an approximately 36-year long Jeffersonian backlash motivated by ideals of libertarianism and decentralization.

And even if I am right that the new era began four years ago, historians are likely to identify the first president of the Fourth Republic of the United States as Barack Obama, not George W. Bush. Obama may join Washington, Lincoln and Franklin Delano Roosevelt on the short list of American presidents who, thanks both to their own leadership and the fortuitous timing of their elections, presided over the refounding of the United States. Yes, he can.

This is an intriguing formulation. But I think the breakpoints are confused and the time-lines or cycles longer. FDR’s time was one of a maturing and fairly well-understood period of industrial capitalism. While the Depression was deep and devastating, one could already see that demand stimulating via higher wages, infrastructure building, and home ownership were key building blocks for economic realignment and stimulation.

Today is much more like the mid-19th century and the time of Lincoln - the rise of a wholly new economic system and the large-scale class divides it produced. It is very difficult to even imagine the broad infrastructure or system architecture required to propel this emergent system of idea-driven, creative capitalism.

One thing is for certain: The old era will have to give way before the new era can take shape. The rise of industrial capitalism required a revolution in agricultural productivity and the mass shrinkage of farm-based employment. Remember Herbert Hoover’s mantra - “a chicken in every pot and a car in every garage.” Food had to become cheap to free up consumption and demand for cars and industrial products. The revolution in agriculture freed up capital and labor that could be redeployed in then expanding industrial economy.  The rise of single-family home ownership and the auto-oriented suburb then closed the consumption circuit of Fordism.

Building the next economy and a new republic will require a similarly fundamental transformation of the core sectors of Fordism. This is more than creating new technology and building a new green infrastructure. We will need to massively shrink the cost for consumption of houses and cars.

The new system will be unable to emerge if people are spending the overwhelming amount of their incomes on housing (mortgages plus maintenance, utilities, taxes) and auto-expenses. To do so, we will need to make the housing system much more flexible, massively increase the productivity and efficiency of housing production (I’ll be writing more on this soon), and enable people to become far less dependent on cars. Only this kind of massive shift in the underlying architecture of society will free up sufficient income and demand for the next new things and enable us to begin to build the new infrastructure which can set innovation and economic growth on a new trajectory. Who in the Obama administration is even thinking along these lines?

The clock of history is always ticking. Eventually, the place or places that can set in motion this shift will accure first-mover advantages similar to those that the U.S. gained in the late 19th and 20th centuries. Can this happen in the U.S.? Can Obama help catalyze this broad shift, or are we still too early in the historical process? What about entrenched U.S. interests - the insitutional rigidities the late Mancur Olson wrote about - can they be overcome and recast? Washington remains locked in a conversation which entails propping up the Fordist economy - a housing finance bailout, an auto bailout, a homewner bailout - when instead what is needed is to free up capital from these sectors and massively redeploy it into others. And if not the U.S., where and when might this happen? How long will it take?

Civic Analytics ponders the questions and crunches the numbers.

Kevin Drum hits on a fundamental shift (via Andrew Sullivan):

Despite all the grief she’s gotten, I continue to think that the selection of Sarah Palin as John McCain’s running mate represents the breaking of a consensual cultural barrier far more fundamental than most people realize. … She was chosen purely at the level of celebrity, and an awful lot of people seemed to be just fine with that.

I fear he’s right.

Mark Cuban, over at the Huff Post, takes Obama to task on his old guard economic team:

It’s great to see President-elect Obama aggressively taking on the economy prior to his taking office. Unfortunately, the economic advisory team that he has put together looks more like a semester’s worth of great guest speakers for an MBA class than an economic advisory team that can truly help him… Notice anything missing?  Not a single entrepreneur.

Ottawa’s 2009 municipal budget was just released, and the arts, culture, and heritage community is reeling. After realizing that the city would require an either $59 million decrease in spending or increase in revenue, Mayor O’Brien brought out the axe. It is not surprising that in a budget where the words ‘arts’ and ‘culture’ can be found less than 10 times respectively, buried on page 52 is a 42 percent cut to all arts, culture, and heritage investments as well as a complete retraction of festival and event investments.

A close inspection of the budget reveals that the “adjustment to cultural services” is the most expansive, and highest impact (in terms of dollars) single-cut of anything offered in the 5-part Options for Reduction or Revenues package, other than adjusting underperforming bus routes. Yet while the rationale concerning the transit cuts enjoys a 5-page deliberation, the rationale for “Adjustment to existing services” - the category under which the arts, culture, and heritage cuts are relegated - is breezed through in less than a page, the final paragraph of which is:

All of the services identified for adjustments may be considered essential to individuals or specific groups in the city. However, compared to the multitude of services and programs the City provides, these proposed adjustments do not seriously impact the functioning of the city, nor do they compromise general public safety.

As a member of the Arts and Culture community in Ottawa, and author on this website, my opinion on the cuts won’t shock you. For all of the reasons that thinkers like Richard, Charles Landry, and Glen Murray have espoused, these cuts are a bad idea. The budget-in-question never once profiles the region’s rich cultural economy, nor does it consider expansion of its cultural industries in any of its economic forecasting, or leveraging the momentum that it’s been building within the global festival community. For having such an uninhibited willingness to cut arts, culture, and heritage investments, there doesn’t seem to be as great an effort from the city to understand arts, culture, and heritage contributions in any nuanced kind of way. One page certainly doesn’t do them justice. This kind of cut may save in the short term, but if money is the only currency being considered then the city is doomed to waste a lot of it.

To workers in the affected areas within the cultural industries: how can these challenges be overcome with a positive net impact on the arts, culture, and heritage sectors? Another sector that is getting hit hard by cuts is housing - they are facing similar questions. Feeling the pinch of restricted access to debt markets more than most, social enterprise models are becoming increasingly employed to generate capital in the housing world. Can the city and these arts, culture, and heritage bodies work together to leverage the currency and momentum that they already have into shared and re-invested profit? How do we encourage a modicum of cultural planning in our municipal budgets? Could budgets like these bring about a shift in the way that the arts, culture, and heritage are financed in general?

And now, as always, some music.