"The United States of America is on the verge of losing its competitive advantage," economist Richard Florida wrote last fall in a Harvard Business Review article based on his new book, "The Flight of the Creative Class: The New Global Competition for Talent." "It is facing perhaps its greatest economic challenge since the dawn of the industrial revolution." Even more provocatively, he later declared that "Terrorism is less a threat to the U.S. than the possibility that creative and talented people will stop wanting to live within its borders."
This might sound like the sort of breathless hyperbole regularly used to prop up glaring deficiencies in otherwise flimsy policy papers. Yet there's more than a little menace to Florida's proclamations when you consider that the professor of public policy at George Mason University published "The Rise of the Creative Class" only three years earlier. In that book, he described with earnest, unabashed exuberance the prominence of the very same class in what he calls the new "Creative Age."
In fact, the ideas in Florida's 2002 book have come into vogue and gained a certain amount of status over the past few years, with dog-eared paperbacks of "Rise of the Creative Class" landing on the desks of a disparate (and sometimes desperate) range of professionals: urban planners, community redevelopers, economists, gay activists, financers, curators, developers, musicians and so on. And don't forget the local and regional politicians, especially if said politician lords over a small- or medium-size inland city that makes up one of the postindustrial rustlands spread all too generously between the two coasts.
That book, Florida's first, highlighted an energetic, mobile, economically productive "creative class" that emerged in force after the bubble economy of the '90s -- a class whose members range from idea-creating professionals such as scientists, designers and entertainers to knowledge workers in business, law and healthcare who use their creative capacity to solve complex problems. According to Florida, this new class includes 38 million Americans, and the creative sector makes up more than 30 percent of the overall labor force.
For cities to remain strong, or to rebound from postindustrial neglect, Florida prescribed artistic and cultural development; this would attract members of the new flourishing, prospering class. His emphasis on a thriving, music-filled nightlife and a populace of artists and scenesters ignited the imaginations of developers and planners around the country. His book provided tables that ranked cities on the key components that, according to Florida, make up the trinity of successful development: technology, talent and tolerance. "The Rise of the Creative Class" quickly became ammunition for thinkers whose similar ideas had been steamrolled by machine politicians already bought and paid for by traditional businesses and developers, whose orgiastic fantasies of castle-like sports stadiums and big-box retailers have taken over the horizon.
Florida also runs a thriving consultancy and has traveled the world preaching the gospel of the creative class to rapt government officials desperate to resurrect their sputtering economies. But while Florida has found his share of enthusiastic devotees, it hasn't been all lattes and laptops. Writers such as Karrie Jacobs questioned Florida's popularity in an April 2005 article in Metropolis Magazine titled "Why I Don't Love Richard Florida": "I don't think Florida is wrong. It's just that his distillation of creativity into the kind of prescription routinely proffered by management consultants makes me fairly sure that what he's selling is not the virtues of creativity but rather the ingredients of a formula."
And countless Republicans and conservatives have taken umbrage at the suggestion that economic vibrancy no longer resided in traditional development strategies or that the road to economic recovery did not involve reopening a steel plant but soliciting young people with tattoos and piercings. Those even further to the right blanched at Florida's notion that successful resurgence was predicated and even helped by concentrations of gay and ethnic populations. Clearly, the thought that queers and people of color were anything but talking points to scare the populace into reelection on an gay-marriage-cum-anti-immigrant platform was completely beyond the pale.
Florida recently took time to talk with Salon about "The Flight of the Creative Class," which reconceives his urban diagnosis to fit a global scale. The competition for talent, writes Florida, is no longer between U.S. cities but between cities around the world. Not only that, but the long-standing advantages the U.S. has traditionally had in attracting such talent is slipping away due to reactionary government obstacles and, perhaps most important, the ongoing and increasingly divisive culture war in the country.
Your first book, "The Rise of the Creative Class," was so optimistic about the potential of what you termed the "creative economy," but this new book is almost alarmist in nature. You argue that the U.S. is facing a potentially crippling economic crisis if it doesn't improve the ways in which it attracts and retains creative workers.
I've studied competitiveness for 25 years and the current economic threat is by far the gravest competitive threat to ever face the United States. It's far more significant than the challenge posed by Japanese or Asian competition in the '90s because it's aimed at the crux of our advantage, which is our ability to attract the best and brightest talent. Everyone is frightened of letting terrorists into the country when it's actually more likely that they're keeping out the next Einstein. Look at the amount of attention given to Social Security, look at the attention given to building football stadiums -- and you can't even get a conversation going about attracting and retaining talent!
How did this book come about? At first glance it seems so different from the domestic focus on the American cities in your first book.
After I finished "The Rise of the Creative Class" I was invited to the Knowledge Wave conference in New Zealand. The speakers were Robert Putnam [author of "Bowling Alone"], [Stanford professor] Paul Romer, and me, plus all these heavyweights from around the world. Later they arranged a lunch with the director Peter Jackson [of "Lord of the Rings" fame] and a tour of his Wetta Studios.
When I asked him why he chose New Zealand to build his state-of-the-art studio instead of L.A. or elsewhere in the U.S., he said, "I decided I could build this incredible digital film production complex in Wellington. And not only could I attract talent from around the world because we have a great project and great people and a great location -- there's the sun and the beautiful surroundings and the beautiful city -- but it's small enough so there weren't the kind of distractions you would find in L.A." Distractions like a lot of congestion, people who don't come to work, people who don't have to work all day to afford a house ...
He said, "What we could do here is build a team, while in L.A. everyone is moving from project to project. What I'm trying to do is build an actual company that's around for a long time. It's for people who want to work for a company that has a continuous stream of employment." And he said he could get people from Australia, from Germany, from France, from the Soviet Union or the former East European block and from the United States. They all wanted to work at the studio.
And so I put that into my head and I started to think and I started to travel around a little more and it just dawned on me that the competition between Pittsburgh and Austin, Cleveland and Seattle, St. Louis and San Francisco, wasn't just a national competition. In fact, the competition for talent was global.
Which is the same type of global expansion that's happened in many industries.
Right, it was like what had happened in the auto industry 20 years ago, when you had French auto producers, Italian auto producers, Japanese auto producers and the big three here, and they all competed for national market share. But then that market went global -- as did the market for TVs and the market for telecommunication devices and the market for computers -- and then companies had to compete on a world scale. The same thing is happening with cities and the talent they compete for.
And when all this hysteria about national security, homeland security started to happen, I realized that what really drove the United States to its position of greatness wasn't the fact that we had a big market or lots of raw materials or our American ingenuity. What really made America great for the better part of a century and a half has been our openness to people from all over the world. That's what built our textile industry, that's what built our railroad industry. It was because we accepted people like Andrew Carnegie in the steel industry, David Sarnoff in the electronics industry, Adolphus Busch in the beer industry, and so on.
And according to analysts' statistics for the high-tech revolution, 30 percent of the companies in the Silicon Valley area were founded by an Indian or someone born in a Chinese-speaking country. Whether it's eBay or Yahoo or Google or Hotmail, what drove America's high-tech revolution and other industries was the ability to attract the world's best talent.
But what are the current problems the U.S. faces in terms of attracting that sort of talent? What's the difference between now and, say, five years ago?
There are two factors interacting here. The first, which would have happened anyway, is that other countries realized how important talent is and cities in those countries have become really effective in competing for talent. So the playing field has been leveled. In the past, people would have said, "Absolutely, my first choice is to move to New York or Boston or San Francisco or Seattle or Chicago ..." Now cities like London, Dublin, Amsterdam and Stockholm have become extremely attractive to talented people, not because of any particular public policy but because of the way they've developed over the past decade. And I'm not just talking about the relocation of Americans, I'm talking about the location decisions of people on a world scale.
The second factor is that -- obviously spurred by this so-called threat of terrorism -- we've become far more restrictive in our ability to absorb and attract foreign talent. The numbers are all there, showing the decline of foreign students in the U.S. and the decline in the number of visas issued. So many foreigners have visa troubles now, even great scientists, artists and musicians. And once they're living and working in the U.S., they can't go home to visit relatives for five years because if they're not a resident they have to get their visa renewed every time they enter or exit the country. Which means it's a huge problem to leave the U.S. even for a short period of time because they're not sure they'll be able to get back in again. Not surprisingly, there's a general sense in the world that the United States isn't as welcoming.
In your first book you state that diversity and especially the presence of a large gay community in a city indicates a level of tolerance that is a prerequisite for urban redevelopment in the creative era. In this book focused on the global creative economy you write that the concentration of foreign students is a leading indicator.
I call students the canaries of the global talent flow. The United States has the largest single number of foreign students, and we actually are very, very, very significantly concentrated among Indian students and Chinese-speaking students. But, for example, only 4 percent of our total student population is made up of foreign students, while in Australia 22 percent of the student population is composed of foreign students.
And in particular, the recent U.S. restrictions have hit hard at foreign students who compose the critical backbone of our high-tech industries. We couldn't have high-tech industries in the United States -- no matter how much we want to say we would -- without foreign-born engineers and computer scientists. We just wouldn't have them. We couldn't run them because we don't produce enough talent of our own. Fifty percent of the computer scientists in the United States are foreign-born, which is a huge number. But it makes sense. If you have a billion kids in India and China and a billion kids are trying to learn engineering and math and computer science, there are going to be a lot of really talented and smart kids, even if they're distributed at the same ratios as U.S. kids. And in the past that gave the U.S. a great advantage because we were able to attract the lion's share of the brightest, most technically sophisticated, entrepreneurial, motivated kids in the world.
So are you saying that a country like China or India might supplant the U.S. in terms of attracting talent sometime in the future? I told a friend about your Peter Jackson moment and he laughed and said, "It's not like a few hive workers from the film industry leaving for New Zealand is going to impair the U.S. economy."
No, it's not that any one country is going to emerge as the next great superpower and attract all the best talent. It's not like "It's going to be the EU" or "It's going to be China." That's silly. But if these increasingly competitive countries take 2 to 3 to 4 to 5 percent of the talent that used to come here, when you add that up over 10 to 20 countries, that's a huge loss.
And what's happening, of course, is that India and China and the Chinese-speaking countries are focusing on retaining their kids and attracting back their expatriates. And at the same time, Canada and Australia, Toronto, Vancouver, Montreal, Sydney, Stockholm, Melbourne, London and Dublin are all trying to get a toehold on attracting really talented people from all over the world. So the global competition for talent is escalating just as the global competition in automobiles or electronics escalated two decades ago.
We've never seen labor markets on this scale that are so strongly global. And the United States is at a tipping point where we might lose our historical advantage. This book sounds the alarm. We better wake up because we can no longer take this for granted.
So how do current issues with regional and urban development fit into all this? In the book you call this one of the most potentially dangerous unrecognized or unaddressed factors.
Cities are the places that attract talent. I mean, consider that 90 percent of GDP comes out of metropolitan areas. And yet somehow some people think that we don't need cities. Not only do we have to open our borders, we have to strengthen our cities massively because they're the cornerstones of our ability to compete for talent. But for the past four years the Bush administration has done everything to prevent that, from huge decreases in infrastructure spending to drastic cuts in block grants.
And now most cities aren't equipped to compete anymore. The only policy we seem to have to revive our cities is to build another stadium. What does that have to do with attracting foreign talent? Who cares? No one cares. I've never met one foreign-born person that said "a new stadium" was an important factor when deciding where to live and work. The national government is clueless and our cities would rather be distracted by sports mania instead of paying attention to more serious issues.
My anecdotal evidence suggests that this is already starting to have a big impact. In terms of conversations and interviews I've had all over the world, it's quite clear that the competition for talent isn't just U.S. cities against other U.S. cities, it's the world. When I talk to people around the world, they might say, "Oh, New York is my favorite city." Or maybe they have one or two other U.S. cities -- "Ah, I like Chicago a lot, I like San Francisco a lot," or "I like Boston a lot and I like D.C. a lot." And then you start to hear a bunch of foreign cities. And now when you talk to young Americans graduating college, when you ask them where they want to move, after they get through their four or five top U.S. cities, it's quickly "I'll move to London or I'll move to Dublin or I'll move to Sydney or I'll move to Melbourne."
The policies and ideas of the Bush administration, as well as those coming from most Republicans and the conservative movement, seem diametrically opposed to what you're saying is needed to attract talent and prosper in the creative economy.
Once I heard a former high-ranking member of the Bush administration on economic policy, when asked about immigration and national security, say, "If it comes down to a question of national security and economic growth, we will always choose in favor of national security. I don't care if it means that the next Bill Gates can't get in ..." And that's a view shared by many members of the administration, at least what we've seen in policy.
But the bigger issue is not the Bush administration. The bigger issue is the class divide, which is destroying our country. And that divide is between people who are members of the creative class and fortunate enough to migrate from Pittsburgh or Cleveland or Buffalo or St. Louis to these great thriving creative centers like New York and Boston and Washington and San Francisco and Chicago and Los Angeles. Those people are doing just fine. But the people left behind got really pissed off and got angrier and angrier and madder and madder, and they looked at these cities filled with single people, filled with young people, filled with successful people, filled with immigrants, filled with people cohabitating, having fun, vibrant night life, filled with gay people, and they said "Enough's enough!"
The blame for this situation also goes to the Democrats, because when the Democrats were in power President Clinton, whom I admire greatly, did not build a society that provided a way for these people to become part of the creative economy. So it's this anxiety that's grown up as a result of the rise of the creative economy -- whose benefits are extraordinarily concentrated among a relatively small group of people in an even smaller group of regions -- that's ripping this society apart. And that's what political polarization really is. It isn't just an issue between red and blue states, it's a political polarization which has underneath it a new economic geography of class. And it's terrifying.
You don't win friends on either side of the aisle by using the "C" word. No politician likes to go there.
People have attacked me for using the word "class." Actually, what my critics have done most of the time is try to make my argument appear elitist, and that's not what it is. What I'm saying is that there's this new class of people, the creative class, with a different relationship to the economy, who generate a lot of value and, as this book suggests, are also getting paid a heck of a lot of money for doing it while the whole rest of the economy gets left behind. So this class divide is becoming starker.
Here's the way I look at it: You go to any part of the United States, and you know when you're in a creative class neighborhood or when you're not in a creative class neighborhood. You know it, you feel it, it's there. You don't have to believe it's a class, but you know it. I know it, you know it, I feel it. I could even feel it in Australia, you could feel it when you went into certain kinds of communities.
This is a true class divide -- economic in its roots, with social and cultural implications. In the U.S. it's very concentrated in particular communities and particular regions and particular neighborhoods. The great failure in this country, and the great risk to this country, is that no one is willing to talk about how to move across that class divide, so you have Democrats and Republicans equally throwing gasoline on the fire.
And while most of my friends on the left will point an accusatory finger at George Bush, I actually think George Bush is doing exactly what he's supposed to do. He and the Republicans are supposed to reach out to the people who are scared and anxious and say, "The past was better for you. Why do you want a future that resembles Washington, or L.A. or Manhattan? Why do you want all these crazy gay people running around and yuppie nightlife and single people and your kids moving there and their marriages breaking up? You want your good old family values back, don't you?"
The failure is on the left because they're the people who are supposed to be making a case for a proactively inclusive future. And why can't our left today -- instead of saying we're going to appeal to blue-collar voters by saying, "Well, what we're going to do is scale back women's rights and we don't even want to talk about gay rights" -- why can't the left do what you're supposed to do? Which is what Franklin Roosevelt did.
What Franklin Roosevelt did, and this is by the way of an analogy, during the New Deal, which was brilliant, I mean freaking brilliant, is he said, "I'm not going to fan the flames of class warfare. I'm not going to side with business or labor. I'm not going to close the factories nor am I going to give giant tax breaks to the robber barons." Our situation now looks just like the late 1920s -- the creation of new industries, creation of new sectors, incredible robber baron wealth, Gatsby-like partying in the cities, all of this celebrity culture, and then an impoverished new class, the working class. Which is exactly how the creative economy has unfolded.
Except that what Roosevelt did is say, "I'm going to make sure that these working-class people get to be part of the industrial economy. I'm going to build an industrial society that allows people to organize and bargain collectively, raise their wages, has affordable housing, get long-term mortgages, provides occupational safety and health, Social Security in their old age and welfare in their spells of poverty. And I'm going to make sure that their kids can go to college."
And now the Bush administration is doing everything it can to roll back the New Deal.
Right, that's their goal and that's why the U.S. is losing this competition for talent. Let's go back: The reason Bush can do that is because Clinton and the Democrats never extended the benefits of the creative economy the way they needed to. Because of the Democrats' failure to create some kind of mechanism for socializing the risk or ameliorating the risk and fear that people in Pennsylvania and Arkansas and Alabama and Tennessee and Montana feel. And because the Democrats were seen as the party of Hollywood and Silicon Valley, regular people said, "The hell with you!" and abandoned the Democratic Party and became a core constituency of Bush's support.
Now Bush has the mandate, at least in his eyes and the eyes of the Republicans, to dismantle the New Deal, which gives other countries a huge advantage. Because the creative economy downloads risk onto the individual, you need mechanisms to socialize that risk, to spread that risk.
What do you mean by socialize the risk? If you start talking like that and keep using the word "class," all the reactionaries are going to start calling you a creative communist.
I'm not talking about socialize as in socialistic. I mean develop mechanisms that say to an individual: When you pursue your career or a bunch of projects or a bunch of service jobs, when you're laid off, you're going to have some kind of wage insurance or unemployment insurance, some kind of health benefits. You'll have some sort of education benefits so you can go back to school and navigate this creative economy with some sense that you're not going to be absolutely abandoned.
The U.S. has become very Darwinistic. And the failure of the left to develop an alternative is our greatest dilemma, because the conservatives are doing exactly what they're supposed to do. I'm not saying it's right for our economy, it's disastrous to our economy, but you shouldn't expect the conservatives to build that platform.
What's happening in Canada, in Australia, in Scandinavia -- I went and met with the premiers of West Australia, South Australia, Victoria and New South Wales. I met with labor governors and liberal party mayors. All of them are building platforms, and the one in South Australia was remarkable -- they invest in productivity and prosperity, invest in economic opportunity, use the market and make sure they're a creative society with ecological sustainability and social inclusion. So the dialogue in Australia and Canada and Scandinavia is about how to build a creative or innovation economy and how to build that kind of social safety net. Or, a better phrase than social safety net would be socially inclusive innovation. It's not so much a social safety net like the old industrial economy but it's a way of making sure people are included as a part of it. But that dialogue isn't happening in the United States and this is what abjectly terrifies me.
What no one really understands is that in the creative economy, what makes us different and yet the same is our creativity. Every single human being is creative. Every single human being has creative possibility. Whether it's a blue-collar worker or somebody who cuts your hair, or somebody who waxes your back, or somebody who works in a high-tech company, or somebody who writes poems. What we all have is our creativity. And we can actually organize people on that basis. We can say, "We're all different yet we're part of the same whole thing." Why can't the Democrats articulate that message? And why are they broken down into this intra-partisan fighting?
Why do you say the anti-elitism of George Bush & Co. is so harmful?
Here's a guy who went to a private prep school, to Yale and to Harvard. And he's developed a posture as an anti-elite to cultivate the support of the people who are terrified, legitimately terrified, about how they fit into the creative economy. He's appealing to the common man by saying, "You know what we're going to do, we're going to stop this. All these things you're afraid of, we're going to stop. We're going to stop this gay marriage thing and we're going to stop women's rights, we're going to make sure not as many immigrants will get into your country and we're going to make sure terrorists don't take over your cities!" It's the old "Know Nothing" platform.
But his anti-intellectualism is part of a political posture to appeal to this group, by playing on their fear, which allows them to pull a fast one on people, as Tom Frank rightly points out in his book "What's the Matter With Kansas?" They say, "Oh, we're going to give you back your moral values and your family values and the America you feel that you're losing and we're going to take away everything that gives you some sense of security." So they're going to dismantle the New Deal, they're going to make the tax cuts permanent. If you ask me, the debate over stem cell research alone -- that could destroy a whole emerging sector of the American economy and virtually anyone who works in that field will have to move.
The idea of promoting "socially inclusive innovation" might fly in Australia and Scandinavia, but I can't think of any politician out there who could weather the fury of rote partisan criticism supporting that sort of change would bring out.
Yes, what scares me is that that force is absent from present-day America. Instead of bemoaning low-wage service jobs and then just talking about restoring manufacturing and dealing with outsourcing, someone somewhere has to say that the real key to the future is to make these service jobs good jobs. I mean that's the real policy point -- the service economy, which represents 40 to 45 percent of the lowest paying jobs in our economy with the least protection, has to become part of the creative economy. We have to change those jobs in the way industrial jobs were once changed from being terrible jobs to being good jobs. We're in deep trouble if we can't focus on and address the externalities of the creative age -- income inequality, the class divide, housing unaffordability, traffic congestion, and the one also talked about in the book, the incredible amount of mental stress, which is the occupational health and safety issue of the 21st century.
Gays seem to be the perennial target. And asides like gay marriage have served to organize and energize all sorts of crazy agendas.
Gays and to a lesser extent women and to some degree immigrants, but gays most of all, become the target of all of this hatred. But it's not hatred that comes out of thin air: It's fear. It's fear that the economy is going somewhere that gives advantages to these people who live in gay neighborhoods, who live in places like Washington, D.C., who have all of these advantages -- education, skill, cosmopolitism and abilities. And if they're not gay, they surely must be French. So that becomes a scapegoat issue and a way to organize.
And then progressive political forces are saying, "You know what, the gays cost us the elections," or "You know what cost us the election? It's that women's rights stuff. Ah, it doesn't really matter if women don't have a right to have control over their own bodies. Ah, the hell with them ..." It's that sort of reaction that leads to this stalemate. What the progressive forces in this society have to do is ameliorate that fear and that anger.
The point is that if all this continues, America's economic advantage is gone. It'll become an intolerant place, the kind of place where lines are drawn in the sand, where gays don't feel comfortable, where young people don't feel comfortable, where immigrants and newcomers don't feel comfortable. The fact is that according to our rankings, the U.S. is 20th in tolerance out of 45 countries. As a country we're not ranking with the equivalent of the San Franciscos or Austins, we're ranking with the equivalent of the conservative Southern areas. And that's a huge problem.
If we fail to address this fundamental class divide -- on which these evangelicals and social conservatives and all this stuff is being promulgated -- if we can't address that class divide, we are in very deep shit. And it's not enough anymore to just say, "Well, we're going to tweak our immigration policy," or "We'll take a closer look at what's happening to our cities."
Yet for all that crisis talk, the book ends on a hopeful, or perhaps even utopian, note, depending on the reader.
At the end of the day most Americans are very open-minded people. Many Americans are terrified and the ones that are scared are the ones who have the fewest advantages. The ones that are rallying around the Christian Coalition and the evangelical cause and the social conservatives, the ones that elected Rick Santorum in Pennsylvania, those people are petrified.
Yet despite all that, there are very positive points in the American political and economic horizon, but they're local, they're not national. And what puzzles me, after living in Washington, D.C., for nine months now, is the absence of any real conversation about this. And it's not just in Washington policy circles -- the media is completely out-of-touch as well. We have the same dozen talking heads appearing on talk show after talk show discussing national policy debates like Social Security or tax cuts, completely divorced from the economic transformation this nation is wrenching itself through.
The great hope in the American political system is the fact that there are people working tirelessly in the states and localities. The big disconnect is in Washington, in the House, in the Senate, and in the Bush administration, which is the most disconnected of all. But there are people of both parties at the local and state level working really hard to try to build exciting and creative solutions. The big debates in our cities are about housing affordability and about maintaining accessible neighborhoods. And in older industrial towns, they're wondering how to make their city a more exciting place that retains young people. And one thing the last century and a half of history has taught us is that you can never underestimate the transformative power of the United States.