Creative Class

That is what Nouriel Roubini is calling it. He predicts widening financial contagion across the banking and financial systems, and a prolonged U-shaped recession of the US and global economies. Don’t count on deposit insurance, he says, the FDIC will go broke. Interestingly, he sees this as a signal of the demise of three other key pillars of post-war American life - the end of America’s global empire, the unravelling of the Bretton Woods global monetary system, and the decline of the suburban way of life. Martin Kenney calls for a global New Deal. I agree. It will also take a new global spatial fix which can overcome the limits of spiky globalization and provide a workable alternative to the McMansions and SUVs suburban model- not just new models for housing but for stimulating consumption in ways that bolster the creative economy.

The spiky world and the rise of the mega-region make place more important then ever before. But what if your place is not part of a mega-region or a spiky center? Two places our team has thought a great deal about are Australia - where Sydney, Melbourne, and Brisbane do not form a mega-region - and Scandinavia, where Stockholm, Copenhagen, Oslo, and Helsinki are also too far apart. One idea is to deepen connective tissue and form “virtual” mega-regions of sorts.

U.S. Endowment takes on the even thornier issue of how rural areas can connect to spiky globalization which suggests “that individual rural communities will have an increasingly difficult time competing. Thus, the need to form ‘mini-regions’ built upon clustering of potential that if not ready to compete globally are vitally linked to mega-regions in a symbiotic relationship.”

Sounds reasonable to me: What do you think?

It probably feels about as good to be a banker today as it did to be running an Internet startup back in the day. That is, until the other shoe drops. Yves Smith reports on the ennui engulfing this season’s technique-arbitragers, finance professionals with “a narrow skill, like being able to structure CDOs…unable to land jobs” in the imploding financial services industry. Reports indicate that half of the people working in debt sales, trading, or research in NYC at the beginning of 2007 will be fired at the end of the year or won’t get a bonus. For fans of Leveraged Sell-Out and the Banker Method, this is not good news.

The similarities are not lost on those of us who participated in the technology tomfoolery in the early to late 90’s, where those who could hand-code HTML had a skill they could trade - albeit for a very brief period - for 80 large and on-site espresso. Smart people understand the half-life of the trix-y things they know, and act accordingly. Those that miss the phase shift take a more stable job or shift careers, leaping from the back of one hungry crocodile to the next like Pitfall Harry. A few even become entrepreneurs. Some follow the heat and light elsewhere, “…moving west or to Europe, including Russia, or to Dubai” according to Jeanne Branthover, managing director of Boyden Global Executive Search.

Technique without creativity is a commodity, and all that this entails. What’s of interest to me is the crucial intermingling between technique and creativity, and how people use the current foundation of technical work as a mechanism to learn, incorporate, and innovate. There are heaps more places to do that then ever before. It’s a spiky world. Where will innovation in the production of complex, mission-critical software applications, energy and the environment, or finance happen next? I suspect that innovation will go where the people go.

What’s creativity and what’s technique in your line of work? When will the particular tricks-y things you do become automata, or simply routine knowledge that represents the ticket to entry? If the talent in your industry goes elsewhere, will you switch locations, switch industries, or stay put?

Writing in the New York Sun, Harvard’s Ed Glaeser reviews Harm de Blij’s new book,“The Power of Place (h/t: Mark Thoma):

But the flat world experienced by the globe-trotting management consultant is only the wealthiest and most air-conditioned sliver of the globe … Place is powerful indeed. People born in America or Europe are much more likely to end up wealthy and healthy than people born in the developing world. Life expectancy in Sweden and Japan is over 80, while life expectancy in Zimbabwe is under 45. The success of New York reflects the power of place to foment creativity and productivity by speeding the flow of ideas.

In his book, Mr. de Blij addresses some of the most fundamental questions in geography: Are differences across space man-made or nature’s handiwork? Is globalization homogenizing the world, and is that a good thing? Should political power be held by large nation states or devolved to smaller geographic units?

Fareed Zakaria in Newsweek:

“Generations from
now, when historians write about these times, they might note that by the turn
of the 21st century, the United States had succeeded in its great, historical
mission—globalizing the world. We don’t want them to write that along the way,
we forgot to globalize ourselves.”