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From our readers: Comments on the Cities of Ideas series by the Austin American-Statesman

AUSTIN AMERICAN-STATESMAN

Tuesday, May 7, 2002

Thanks to Professor Clark for forwarding the selection from the Austin American-Statesman in which his research is cited. I read the selections from the Austin paper about the rise of the creative class and am somewhat under-whelmed. Of course, I should first read Professor Florida's book which figures so prominently in the series, or at least read the remainder of the series before commenting. However, I have decided to throw caution to the wind and note some problems that seem obvious from the outset. The first are the measures used to determine new economy cities. Patents are a particularly problematic proxy because they do not include innovations in creative industries such as media or social innovations in nonprofit industries. The following examples from my home city, Portland, Oregon, illustrate some shortcomings. Will Vinton Studios is a world leader in claymation but I am guessing is fairly low on patent applications. Similarly, Wieden and Kennedy Advertising, known for its edgy Nike ads and winner of numerous advertising awards, is probably also low on patent applications.

Patents fail to identify social innovation coming from service industries such as nonprofit organizations. When Mitch Rofsky founded Working Assets and Todd Silberman founded and eventually sold ($1.5 billion) Lifeco travel agency, what patents reflected their social innovations? The answer is probably none. And when together these two innovators, who live in Northwest Portland, are launching Better World Travelers club as a socially responsible competitor to AAA, what patent reflects this social innovation. Again the answer is probably none. Will Better World Travelers club out-compete AAA and create a new service industry powerhouse? Hard to say, but the founders past success suggests that they understand the new market of folks who are tired of AAA anti-environment lobbying and hidebound auto culture. Regardless of success, these are two social and service innovators whose creative work is not captured by the sorts of measures used in the study.

More examples. Portland is recognized as a hub of sustainability innovation. But these innovations are largely innovations in the nonprofit and civic sector. In transportation, Portland has pioneered an innovative light rail transit systems. It has several times been ranked the most bicycle friendly city in the nation. The cycling innovations were pushed by nonprofit organizations such as the Bicycle Transportation Alliance and supported by a responsive and inclusive city government. Not coincidentally, Portland has a rapidly expanding cluster of organizations that claim sustainability as their mission: Oregon Environmental Council, Ecotrust, Sustainable Northwest, Coalition for a Livable Future, Northwest Earth Institute, Zero Waste Alliance, Forest Stewardship Council, Community Food Matters, Institute for Culture and Ecology, to name just a few (no exaggeration). These organizations build buildings, employ staff, provide services. Civic innovation in transportation and social innovation in service industries are not captured by old industrial measures such as patent applications and are probably not identified in any current measures of growth industries.

In addition, I would submit that these are not residual industries that follow the growth of high tech or some other "basic" industry. They are new socially innovative industries that, in fact, may be creating the amenity climate that is attracting the "so called" basic high tech industries. The failure of the study's measures to identify creative service and social innovation suggests something problematic about using old measures that focus on "growth" and "industry" to understand the "new economy." In the new economy, measures such as growth in the GDP may not tell us much. It is well understood that growth in GDP captures as much "illth" as "wealth." In the new economy, less production may be more valued than more production. For example, under the old growth model, a building which required more of everything would be considered positive and would contribute to "growth." Under the new model, a building which minimized use of materials, reduced energy consumption and was designed to be deconstructed with zero waste would be valued. There would be much less of everything, but in the end more "wealth" than "illth."

In the new economy, nonprofit services would be understood to be "basic industries" in a way they are not now. This was also true of the old economy, but nonprofits were seldom recognized for their industrial innovation. Using the example of the AAA cited above, the same elites who organized the first driving clubs (which eventually became the AAA) were leaders in the Good Roads Movement. They were the civic leaders who passed legislation creating state departments of transportation. They sponsored the early local race tracks and national excursion competitions. Not coincidentally, they were also early investors in the auto industry. And what was the wellspring for tourism, today the world's largest industry? It was nonprofit travel clubs, religious missionaries, and adventurers sponsored by nonprofits such as National Geographic Society. To give another example in the area of sports and recreation, it was the YMCA which invented basketball and volleyball and created the innovations in recreation and fitness which became the infrastructure for the current health and fitness industry. The innovations of the YMCA were both physical — it created the spaces and activities — but also cognitive — they reinforced the connection between mind, body and spirit, which was something new in its day.

The social innovations which helped build the infrastructure for so called "basic" industries have seldom been recognized for their indispensable economic role, primarily because measures of the economy and growth are stuck in a 19th century economic mindset of physical industries with physical inputs and outputs. The current study of cities which purports to identify a new creative class reifies the old model by using similar 19th century measures of industry (albeit high tech) and products (the patent proxy).

As to Putnam, I thought we put his ideas to rest long ago, but apparently not. Why did the "traditional" cities score high on Putnam's social capital rankings? Perhaps because Putnam measure's of social capital reflects the same industrial economy mindset as the study. Putnam may be right to the extent that the old membership organizations and civic repertoires such as voting are in decline, but he is wrong in missing the transformation of civic engagement and enlargement of participation which has accompanied the decline. The new civic generation is not more "individualistic" but they are community oriented in a different way. Their volunteering is less membership based, more episodic and cause related. Their professional and civic lives are more intertwined. Organizations and activities are more informal, they come and go, people don't join so much as participate. In addition, the new civic generation has acquired a whole new set of civic repertoires (information and organizational skills) that are far more sophisticated than previous generations.

All this points to a problem in studying the new economy. I would suggest that the place to start is to rethink what an economy is and what it should be doing. More growth, more jobs, and more population may not be the values of the new economy. In the new economy, less may be more — and civic and social innovation may be the new "basic industry." Paradoxically, the cities that recognize this may be the ones everyone will want to move to.

— Charles Heying, Ph.D.
Associate Professor
Urban Studies and Planning
Portland State University
506 S. W. Mill Street
Portland, OR 97207-0751
heyingc@pdx.edu