According to economist Richard Florida in his recent article, the solution posited by the title of his recent Atlantic Monthly article, How the Crash Will Reshape America, is through a renewed emphasis on velocity and density. This is also the article that prompted Suburbia R.I.P. in Fast Company Magazine.
Regarding how we started to get into this mess, “For the generation that grew up during the Depression and was inclined to pinch pennies, policies that encouraged freer spending were sensible enough – they allowed the economy to grow faster. But as younger generations, weaned on credit, followed, and credit availability increased, the system got out of hand.” To truly understand this, check out this 47-minute video that every fiscally responsible person should watch.
“Suburbanization – and the sprawling growth it propelled – made sense for a time… But that was then; the economy is different now. It no longer revolves around simply making and moving things. Instead, it depends on generating and transporting ideas. The places that thrive today are those with the highest velocity of ideas, the highest density of talented and creative people, the highest rate of metabolism. Velocity and density are not words that many people use when describing the suburbs. The economy is driven by key urban areas; a different geography is required.”
Next steps financially? “Substantial incentives for homeownership (from tax breaks to artificially low mortgage-interest rates) distort demand, encouraging people to buy bigger houses than they otherwise would. That means less spending on medical technology, or software, or alternative energy – the sectors and products that could drive U.S. growth and exports in the coming years. A bigger, healthier rental market, with more choices, would make renting a more attractive option for many people; it would also make the economy as a whole more flexible and responsive.”
Next steps geographically? “We need to begin making smarter use of both our urban spaces and the suburban rings that surround them – packing in more people, more affordably, while at the same time improving their quality of life. That means liberal zoning and building codes within cities to allow more residential development, more mixed-use development in suburbs and cities alike, the in-filling of suburban cores near rail links, new investment in rail, and congestion pricing for travel on our roads.”
The Vision? “A more concentrated geography, one that allows more people to mix more freely and interact more efficiently in a discrete number of dense, innovative mega-regions and creative cities. But most of all, it will be a landscape that can accommodate and accelerate invention, innovation, and creation – the activities in which the U.S. still holds a big competitive advantage.”
What’ll that feel like when it happens, when we learn to innovate and collaborate at the same time? Probably something like the video above.
How would you like to see the crash reshape America? Comment below (registration not required).