Richard Florida sees another great transformation at the end of the recession, and an opportunity for some cities to reinvent themselves, while others fade into history. He'll be on the show talking about his article, "How the Crash Will Reshape America" today, and he volunteered to write a little extra credit for us:
I hate the word depression for the obvious reason it sounds... well... depressing. I think of it as a great and necessary reset — after the excesses of the past decade or two — a reset not just of our economy but of where and how we live. "This economic crisis doesn't represent a cycle," GE's Jeff Immelt told his board of directors in fall of 2008. "It represents a reset. It's an emotional, raw social, economic reset. People who understand that will prosper. Those who don't will be left behind."
When I was a very young boy, my father who always prefaced his economic advice by saying he was a "child of the depression" - born in 1921, he dropped out of junior high-school in 1934 to take up work in an eyeglass factory - would remind me that the Great Depression was the time the American economy was remade from the ground up.
The Great Depression unleashed a massive wave of technological innovation and with the New Deal saw the creation of a social safety net. It also paved the way for mass suburbanization of the 1950 which spurred demand for the automobiles, appliances and consumer goods streaming off the assembly lines. Decades earlier, the Long Depression of the 1870s transformed America from a largely rural country dotted with trading centers and mill towns to a country of giant industrial cities like Pittsburgh, Cleveland, Detroit and Chicago which concentrated production, generated a great wave of innovation and created a whole new geography of and growth.
We are going through a similar reset today. The way we've been living - our economic landscape of suburbanization, sprawling Sunbelt growth and a run-away housing bubble sowed the seeds of the current crisis. It's not just a reset of our economy and technology. It's a reset of where and how we live.