There is a great article in the American Prospect this week on the Richard Florida cult and how he is modifying his views. He has been chargin $35,000 per talk to tell every small and medium sized community across North America they can be successful if they embrace creativity and hang paintings on the wall at City Hall. In February 2008 he told the residents of Sackville, New Brunswick that they were in a “cosmopolitan country town” with obvious advantages over Toronto and in his new book, however; he will argue “it’s time for the country to cut its losses and instead encourage growth in places that are prospering”.
In a warm-up to his next book — The Great Reset, due out in April — Florida has been arguing that the recession has so decimated many cities and regions that it’s time for the country to cut its losses and instead encourage growth in places that are prospering, like Silicon Valley, Boulder, Austin, and North Carolina’s Research Triangle. And the rest? In his much-cited cover story in the March issue of The Atlantic — “How the Crash Will Reshape America” — he delivered the harsh news: “We need to be clear that ultimately, we can’t stop the decline of some places, and that we would be foolish to try. … Different eras favor different places, along with the industries and lifestyles those places embody. … We need to let demand for the key products and lifestyles of the old order fall, and begin building a new economy, based on a new geography.”
The article implies that Florida’s new tack is based on the failure of his old creative cities idea. For those of you that follow this blog I have said since his first book that he had a causality problem. He argued that places with high concentrations of creative people generate strong economies. I argued that places with strong economies have suplus disposable income to invest in creative endeavours which in turn increase the creative class which does have an impact on the economy. It’s chicken and egg.
The problem is that communities were literally investing huge money in festivals, cultural events, museums, etc. and expecting that ICT, automotive, aerospace, financial firms would come stampeding to the door. They lowered investment in efforts to directly grow key industries turned that investment into ‘creative’ things and it didn’t work.
I have read numerous articles in recent months about Florida and the growing dissallusionment with his creative ideas. I guess his move to focus on the few regions that are already prosperous is a logical step for him – although it will limit his $35,000 speaking visits to a select few locations.
This article takes a harsh view of Florida’s new position:
Now, by declaring cities or regions to be relics, Florida is denying any agency on the part of local leaders to stem the tide, says Karl Stauber, president of the Danville Regional Foundation in southern Virginia. “It’s very easy for people to adopt the victim position: We’re screwed and we can’t do anything about it,” he says. “My fundamental problem with Florida is that he reinforces the victim mentality.” At the same time, Stauber says, Florida’s regional determinism overlooks the role that specific decisions and investments have played in making some places thrive. It’s no accident, for one thing, that many of his most “creative” cities are home to public universities. Why assume that new investments might not prop up other places as well?
I think that is true. I have studied economic development across North America, parts of Europe and even Latin America over 20 years and there are numerous examples of cities and regions that were on the periphery with declining economies that transformed themselves into newer, stronger economies just by sheer force of will and action.
By moving to a fatalistic position, Florida risks a prolonged and deep economic funk across the U.S. A few years ago I looked at straight population trends by region in the U.S. going back to World War 2. I can’t find that research now but I recall being surprised that every region of the U.S. from the Pacific Northwest, to the mid-Atlantic states has witnessed at least one serious population growth spurt since the war (with growth rates well above the national average growth rate). In Canada, by contrast, Atlantic Canada had never even achieved the average national population growth rate in 140 years since Confederation. I concluded at the time that this ability for all regions to achieve strong growth was part of the reason why the U.S. was so successful during the 20th Century.
When regions started to overheat, capital and investment would move elsewhere. That would, in turn, cause a downturn in the overheated region, force a reset and then back to growth. That free flow of labour and capital around the U.S. was not mirrored in Canada.
My point is that (as pointed out in the article) if we just agree that certain regions are doomed because they were based on an old economy, that will lead to bad outcomes. All regions need to have the potential to be successful – even though we know that many will not.
I look forward to his new book. Maybe now he will get beyond the pulpy sentimental soup that he was feeding willing municipal leaders and start talking hard realities. Or maybe not. Maybe he will just try and shock us with another round of out of context statistics so he can sell books. We’ll see.
Take Northern New Brunswick (and ultimately all of New Brunswick). It will take great effort and courage to make the changes that are needed up there if that economy is to thrive in the future. There are many that have written the region off and want it to reset down to a new equilibrium where the economy is based on what’s left of the natural resources and a small local service economy.
While I agree this is a likely scenario, I don’t agree it is an inevitable one.
Good post, David. One thing that has always interested me about Florida is where he was marketing his ideas. To a large degree, it seems to me that he was well-received by those in business schools. In fact, the entire cult of business schools is built around ideas that are similar to Florida’s in that, in many cases, they are based on opinions rather than data. They have gone about things backwards – constructing points of view, then searching for data to suport the POV. The whole concept of hypothesis testing has been lost. Faculties of economics and business schools need a good purging to clean out all the postmodernists (‘my opinions equal your facts’) followed by a re-committment to rigorous data analysis.
“Maybe he will just try and shock us with another round of out of context statistics so he can sell books.”
Based on his past performance, what would you expect?
Good post, but YOU have a causality problem as well. You say that every region had a burst of population at some point and say that it is due to some free market determinism-that population growth is indicative of economic growth and that it stops when it ‘overheats’. Care to prove that theory? When exactly did Maine’s economy ‘overheat’ and lead to outmigration?
Even IF it were true, its more depressingly fatalistic than Florida-get more economic growth and it will lead to more population which will ultimately ‘overheat’ and leave for another region! Yikes, no wonder people don’t like economists and aren’t crazy about growth…create jobs so your kids will stay by you but THEIR kids will have to leave once it overheats!
But again, this is a misunderstanding of what the ‘creative class’ actually is. Go work a day with small woodlot owner and you’ll see just how ‘creative’ they are, obviously moreso than a skidder driver for a large forestry firm. There is a difference in ‘creativity’ withing the SAME industry.
And I’d like to see the quote where Florida says “have more festivals and galleries and you will be economically prosperous”. As far as creativity goes we KNOW that Florida is right, or at least virtually every OECD study of the past decade and a half agrees with him as do most posters here who talk about the need for R&D. Anybody that doesn’t think research is creative, obviously hasn’t done any, its the very definition of creativity.
So one can easily argue that Florida WAS right, but enough people simply didn’t listen to him.
So let’s go from theory to reality.
Miramichi: Announcement of a new solar production plant. This is by a new company, which, like any new company, needs to be creative to come up with funding. They are also banking on new development in solar research and setting up partnerships with solar researchers in Fredericton (too bad they weren’t in Miramichi, but that may come).
For the actual production, a new company like this will have to develop production processes for a new workforce. That takes creativity, and if they go a step further and look at Toyota’s production successes-where ‘creativity’ is empowered down to the individual employer, you again have an emphasis on creativity. Anybody want to argue that that’s not economic development and will lead to at least SOME people either moving to Miramichi?
In Caraquet we discussed before the new deconstruction plant. Thier entire building is passive solar and primarily solar heated. In order to set up a product chain they are talking about railroads, not just trucking-that’s pretty creative. Moreover, their ultimate product is a new chemical meant to treat roads, in other words, based on the creativity of the owners. More importantly though, the recycling industry is VERY creative, what to do with old parts has been a problem for our society for generations, and any manufacturers in NB would be smart to go check out what they have lying around (though they expect to have little ‘lying around’).
It’s unfortunate about FatKat but that’s a good example of creativity leading to growth. Animators came from all over the world to work their, if there were a few more then we are talking a full fledged industry.
I’ll stop there, I could go into David’s oft mentioned industry of game design, which is TOTALLY creative, as well as film and video industries which are not particularly profitable now, but certainly CAN be with the right conditions and investment.
Just like David there are some things Florida says that seem right, others a crock, and much needing more study and possibly trying out. Like any speaker or writer, you take what is useful and move on. As David says, the economic history of the US has been different than the regions of Canada, which means even if he is right about the US, it wouldn’t apply to Canada. Although its worth mentioning that essentially its been public policy at almost all levels to focus on so called ‘clusters’, which is another way of saying if you aren’t in a cluster, you are &^%$ed.
Mikel, you are confusing ‘creativity’ with Florida’s ‘creative class’. They are not the same thing.
“I have studied economic development across North America, parts of Europe and even Latin America over 20 years and there are numerous examples of cities and regions that were on the periphery with declining economies that transformed themselves into newer, stronger economies just by sheer force of will and action. ”
David, can you name some of these specific cities/regions? I’m not questioning the validity of the statement… the opposite actually, I’m just very interested to learn more about these real world examples, see some of the strategies they employed, etc…
thanks
Excellent post David but I feel let down. I was beginning to believe the answers to our economic development challenges were to hang up some paintings and send everyone to art class. Too bad it is more complicated than that.
Here’s an idea, with the hundreds of economic development people we have hired in the province, maybe we should do like Florida and export our resources; perhaps they could make money traveling around the world meeting groups desperate to change their economic circumstances and deliver paid speeches while selling books. The trouble is, we’d have to get all those economic developers on the university payroll so they had a steady paycheck and the free time travel.
Not ruse…more like rise. The rise in the province’s tally of uncollected loans to so-called business and industry. Something close to a billion in corporate welfare. Surely this warrants a response.
What were these loans for? What good came from them? Did they achieve their goal? Why aren’t they paid back if the business strategy to invest in these businesses/corps worked and created a huge windfall. Should the loans be open top the public to see online, more transparency? Was this specific debt easy to view in a budget line? If not, should it be? How does something like this go unnoticed? All fair questions.
From the article you reference:
“During his five years as Florida’s manager, Frantz estimates that Florida spoke in several hundred cities. Several overseas visits reaped well above the usual $35,000 or $40,000. His fees were typically paid by local foundations or by ticket prices that could range above $100, for crowds well into the hundreds.”
Not counting book sales, that is about $10 million over 5 years. And us poor working slobs are paying taxes so he can draw a salary for educating our children, paying taxes to provide him with research funding and paying taxes to subsidize student loans. Sweet.
“My point is that (as pointed out in the article) if we just agree that certain regions are doomed because they were based on an old economy, that will lead to bad outcomes. All regions need to have the potential to be successful – even though we know that many will not. ”
My ‘gut reaction’ was to immediately agree with this statement but upon further thought I began to question it. There is such a thing as ghost towns, usually after an economic decline or some sort of natural disaster: http://en.wikipedia.org/wiki/Ghost_town
If you look at the Wiki reference, down the page there is the beginnings of a list of Canadian ghost towns: http://en.wikipedia.org/wiki/List_of_ghost_towns_in_Canada
It is quite surprising to look at the number of them; Ontario for example has something like 160 some pictures here: http://www.ghosttownpix.com/ Many are associated with mining or railways. If you look throughout Canada and around the world, ghost towns are not uncommon.
However, at some point in recent history, it seems we have adopted a ‘never say die’ policy where infinite resources and effort are expended to prop up the economy in struggling towns. Having lived through Moncton’s resurgence, I appreciate that never say die attitude, but is there some point where, despite diligent best efforts, we recognize we have ‘fought the good fight’ and lost? How does that come about? Will we ever see a modern era ghost town again? (I can think of at least one possibility, Fort McMurray).
Actually, they are. Go to creativeclass.com and check it out. Florida is most definitely not talking about painters and buskers.
From wikipedia:
Florida describes the ‘Creative Class’ as 40 million workers – 30 percent of the U.S. workforce, and breaks the class into two broad sections, derived from standard SOC codes data sets:
* Super-Creative Core: This comprises about twelve percent of all U.S. jobs. This group is deemed to contain a wide range of occupations (e.g. science, engineering, education, computer programming, research) with arts, design, and media workers making a small subset. Those belonging to this group are considered to “fully engage in the creative process” (Florida, 2002, p. 69). The Super-Creative Core is considered innovative, creating commercial products and consumer goods. Their primary job function is to be creative and innovative. “Along with problem solving, their work may entail problem finding” (Florida, 2002, p. 69).
* Creative Professionals: These professionals are the classic knowledge-based workers and include those working in healthcare, business and finance, the legal sector, and education. They “draw on complex bodies of knowledge to solve specific problems” using higher degrees of education to do so (2002).
Additional to these two main groups of creative people, the usually much smaller group of Bohemians are also included in the creative class.
Florida concludes that the creative class is the core force of economic growth in our future economy, and is expected to add more than 10 million jobs in the next decade.
Here’s an interesting article that identifies the need for a good left brain / right brain mix for a successful business model.
Innovation in Turbulent Times
http://hbr.org/2009/06/innovation-in-turbulent-times/ar/1
I also read somewhere that creative people are going to be in high demand for the foreseeable future.
Thanks for posting the American Prospect piece on Richard Florida’s recent activities promoting his Creative Class theories. Clearly his honeymoon period is coming to an end.
Florida has achieved cult status. Judging from his appearances on TVO’s The Agenda, even Steve Paikin has fallen under his spell. Much of the magnetic appeal is to the culturati in Canada and the U.S. He’s the toast of Toronto and popular among liberal intellectuals who previously saw globalization as a threat to national and regional cultural identities.
In a post-modernist age, deconstructionism rules and his relentless optimism was a refreshing change. He may not survive the current Tea Party movement of anti-intellectualism.
“In a post-modernist age, deconstructionism rules and his relentless optimism was a refreshing change. He may not survive the current Tea Party movement of anti-intellectualism.”
Florida is actually a product of postmodernism. His opinions equal facts, and those who worship him are generally in fields where opinions equal facts.
“Florida concludes that the creative class is the core force of economic growth in our future economy”
That actually is not the core of Florida’s thesis. That creativity is a driver of economic growth is not disputed (that’s why R&D is subsidized by private and public sectors; I think we used to refer to the creative class (apart from the bohemians) as ‘skilled workers’); what’s disputed is Florida’s thesis that making urban areas attractive to the ‘creative class’ will stimulate growth. Most critics would say that urban regions with significant economic growth will attract persons with skills – including those with ‘creative’ skills – thus they will end up with more ‘creative’ people. Florida’s claim was that successful urban regions grow because they are more attractive to creative persons; others argue that 1) successful urban regions, because they provide more employment opportunities, attract an increasing proportion of skilled workers and artisans, 2) Florida cannot separate the chicken from the egg and 3) that his claims are not supported by data.
“Actually, they are. Go to creativeclass.com and check it out. Florida is most definitely not talking about painters and buskers.”
Sorry, but most members of the ‘creative class’ are not creative. Most scientists, knowledge workers, artists, etc, just do their day-to-day work without a great deal of inspiration or ground-breaking success. Only a small minority of the ‘creative class’ are truly creative. That’s why you cannot equate being a member of the creative class with creativity.
Well, thats RICHARD”S ‘opinions’, which also don’t have many facts. What Richard is talking about above is the ‘super creative class’-and he is right. MOST ‘skilled workers’ are not in the ‘super creative class’ because much of their job is NOT ‘creative’. But SOME of their work is creative.
That’s a BIG issue though, however, I’m willing to get into it. R&D IS inherently creative, and even though you don’t always get inspiration or ‘success’ (hardly a useful gauge), its part of the ‘class’. I don’t think I equated creativity with being a member of the creative class. A mechanic is ‘creative’ but not a member of that class. To my mind almost EVERY job has elements of creativity, but as Florida says, that doesn’t make them a member of that ‘class’.
The chicken and egg argument is an interesting metaphor. IF you associate that metaphor with Florida’s thesis then you are actually admitting that he’s right-because as with the chicken and egg, there is lots of data, just no conclusion as to which came first. People who say egg have just as much legitimacy as those who say chicken.
However, the point is that David and he are talking about two different things. The poignant problem with David’s theory here is not that it is ‘unsound’, it is just that it really has no direct achivable goal. Doaktown hires David and Richard Florida to come and give them advice, they want to stop decreasing in size.
So, David comes in with his advice: “you need foreign direct investment to create jobs and build the place up and prosperity will follow”. Sounds nice, but then comes the ‘well, duh’ moment. Ok, HOW do we get foreign direct investment-heck MONCTON can barely get new international industries. David would have to fill the rest of that in, but from the blog some advice is things like setting up foreign offices to tout the town.
In short, its not real ‘practical’. What they can do is severely limited. Then the town asks Richard Florida. Ok, he says, you need to create a NEW kind of town, you need artistic types, you need galleries, you need to get the people in the town to ‘create’. Well, OF COURSE that is successful, we KNOW that is successful. There is evidence that boneheaded tourists will stop in Nackawic just because its got a big stupid axe monument. Shediac has a big giant lobster, in fact NB can be characterized by the ‘big giant things’ that seem to be all over the place.
So the artists show up, they put on a festival-some people come. Theres’s a small tourist trade. A videomaker comes and films it, then does a documentary. Some of the locals start a community theatre and start filming thier productions and selling them on the web. One of their shows gets picked up by CBC and boom, there’s another industry. A guy from Miramichi’s animation school sees the buzz and moves down and starts an animation company.
That, of course, is hypothetical but how business and investment OFTEN works. I have no idea why people think business and economics are ‘either or’ scenario’s. However, if you lived in Doaktown, which theory would YOU want to hear? One theory involves the local people getting creative, a good in itself, the other theory involves a vague maybe hypothetical that maybe someday COULD account for something, but has really screwed people over in the past (it was largely foreign investment that built Doaktown as a resource area and then shut it down when it left).
What a lot of people miss is that a university is inherently creative. How many cities have been built up around their university’s? Heck, there’s a reason why Waterloo is building up faster than London.
“Heck, there’s a reason why Waterloo is building up faster than London.”
Yes, its closer to Toronto.
“To my mind almost EVERY job has elements of creativity, but as Florida says, that doesn’t make them a member of that ‘class’.”
In other words, you agree with my statment above. Creativity and the ‘creative class’ are two differnt things.
Then why is it also growing faster than Georgetown and Guelph? An hour northeast of Toronto is pretty much desolate, while an hour southwest isn’t.
Of course I agree (as does Florida). Creativity is the exercise of that class, much like saying ‘chattering’ isn’t the same as ‘the chattering class’. A class is a group of people with a common denominator, the common denominator is a characteristic, not a group of people.
Just to add to the above though, the GOOD thing about Florida’s advice is it empowers local communities, it creates a good in itself. This is an essential component that could LEAD to finding more direct investment. It may not, but its certainly a heck of a lot better policy than ….I don’t know, I never hear ANY policy recommendations here.
“the GOOD thing about Florida’s advice is it empowers local communities”
Well then I guess its too bad that Florida has switched gears. According to the article cited by David, he no longer sees much hope for those hard-done-by communities and regions. Now its about building the communities that are already growing and forgetting about everywhere else. As for empowerment, you can say that about most ED advice, but that is not all that that Florida was saying. He had a specific approach, which he is now apparently abandoning. He is cutting you adrift.
“I don’t know, I never hear ANY policy recommendations here.”
Perhaps you don’t hear them, but there are few here and there to read.
@richard
“One thing that has always interested me about Florida is where he was marketing his ideas. To a large degree, it seems to me that he was well-received by those in business schools.”
> Richard Florida’s ideas are in fact best received by economic development agencies that believe that all they have to do is get the blessing of Richard Florida as “the kind of place that the creative class loves” (that’s what he said of Sackville)
I agree with Mikel that nowhere in Florida’s books it says that building museums, art houses, etc. is the first step for economic development. There is a whole set of other factors that need to be addressed before that.
The problem that I have with Richard Florida is that he has banalized a very important component of economic development: investment in human capital. Let’s not forget that attracting (and retaining) the BEST people is an important component of every successful economic development initiative.
(*tong in cheek*) Dave, I am just wondering what your thoughts (and this blog’s readers) are about the Conference Board’s Magnet Cities report that just came out (http://www.conferenceboard.ca/documents.aspx?did=3380)
I truly hope that people in NB (and economic developers in particular) analyze the report without any preconceived ideas about “how wonderful the province and its cities are”. My 5 cents: Let’s try to learn something from this report.
One last thought: when reading the report, remember that it’s not about big cities versus small ones.
There aren’t too many, I’d LOVE to hear some. David talks about spending more on the ‘selling’ side, but then occasionally bemoans the fact there is little in the way of policy to sell. Again, let’s pretend Doaktown came and asked for advice…what would it be?
In his books he was saying what statistics already show, and unfortunately people hooked on to the Coles Notes version and focused on the ‘bohemian factor’ and gays. Meanwhile, statistics Canada, the OECD, and virtually every economic organization advice says the exact same thing about Canada (just like the above mentions)-INVEST IN PEOPLE. Simple as that. I was reading about Singapore and what a basket case it was until it looked at economic development at ALL levels. While it became one of the world’s largest oil refining nations, it also invested substancially in education, skills training, and public housing.
In Canada, NSERC now has half its board coming from industry and has patently stated that if you aren’t researching a new widget to be sold, don’t bother applying.
As for the other junk about Florida, I don’t give a rats ass about Richard Florida, he doesn’t give me a cheque. Where he is falling short NOW is that he is giving in to the inevitable-again, ‘clustering’ is very much public policy. If you aren’t near a ‘cluster’, then you are screwed. Years ago on this blog I remember an entrepreneur who was denied ANY funding was told specifically that in was in an area that was not in the ‘cluster’ policy. If you weren’t in St. John, Moncton, or Fredericton, there was no interest.
In the US its far worse, which is what Florida is responding to. It’s gotten so bad that he’s literally talking about survival. That’s unfortunate, but its not like economic development has ‘teams’ or something. You take what is useful from what people say and move on. However, I think my scenario on Doaktown isn’t a bad one to push, its certainly better than “try lowering your property taxes…oops, I forgot, you need the province to break the law to do that..”. There is VERY little a municipality can do to entice investment. There ARE things it can do to make it a better place, and that may have the effect they were looking for, but couldn’t afford. There are lots of places that have done it before.
For the guy above, when the conference board’s document becomes publicly available then I’ll take a look. I’m not that crazy about most of their stuff anyway, and I hate filling in those questionnaires just to get more spam and emails.
The ‘great cities’ themes have been looked at here before though. THey often change the criteria and that results in different cities.
I now know TONS of people here in Waterloo who are out of work with no job prospects on the horizon, and I’m talking about both low and high income.
As for attractiveness of work, thats a mixed bag. If you like the outdoors, as we do, then Waterloo certainly isn’t for you. I’m from oromocto and its recreational facilities make this place look like a joke. It’s a place that is extremely beautiful, but here in Waterloo a Toronto reporter came to waterloo when the Perimeter Institute opened and asked why put such a beautiful building in such an ugly town. It’s not ‘ugly’, its just so nondescript there is nothing memorable about it, and where I disagree is that the Perimeter Institute is probably the ugliest building I’ve ever seen!
However, its jobs prospects and entrepreneurial prospects will be heads and tails above any city in NB. But there IS money in NB, just few customers. It’s also a multicultural centre, and every time I go home its a real culture shock, and I think I’d miss that.
Real estate is booming almost everywhere except rural areas, so when they talk about cities, they essentially are always talking about very different things. Waterloo is a ‘magnet’, but for very different reasons than Ottawa. Guelph though is also a magnet-if you are in agriculture or agricultural research.
That’s a long way of saying that these lists are often not particularly instructive.
“Meanwhile, statistics Canada, the OECD, and virtually every economic organization advice says the exact same thing about Canada (just like the above mentions)-INVEST IN PEOPLE. Simple as that.”
Of course, if Florida was saying just that he 1) would be repeating what many others have already shown, and 2) would not have sold very many books. When the US invested heavily in science education in the 1960s, they reaped the benefits and held a technological lead in many areas for years afterwards. There’s plenty of evidence that those investments, and investments in early childhood care and education, health care, etc pay huge benefits to society. Nothing novel there – just a failure by the right to recognize the data.
The core of Florida’s book was not about those investments; it was a claim that urban areas that were growing dynamically had done so in large part because they were made more attractive to members of the creative class than other urban areas that were growing more slowly. That claim is why Florida got attention. You can believe that investments by govt in education, child care, healthcare, etc are beneficial without buying into Florida.
If any of you spent a reasonable amount of time of your life living in or around some of the urban cities Florida pays attention to, and not the famous ones you can name off the top of your head, you would better “get” what he means. After all it’s just a theory based on his academic research, and geographic expertise. I can see how some of his ideas are worth criticism, but living in Canada, where there really are NO broken-down neighborhoods, you can’t have the requisite experience to truly understand what he means on the “defeatist” side of his rhetoric. I’m talking about blocks and blocks of totally run-down, dilapidated, residential, retail AND industrial areas. Crumbling down, broken curbsides, grass so high you can’t see the stop signs anymore. Plow it under I say, and make where the action is better…build it and they will come. It’s an ancient human trait…to migrate to where the resources are. It’s only in modern times that people have stayed put in economically barren land scratching their heads and hoping the mill will open again.