America: The Great ReSet

If you haven't read the March issue of the Atlantic: How the Crash Will Reshape America--listen to the author. Richard Florida, writer and theorist, was interviewed recently on NPR about how the global economic crash will reshape America. Highlights:

As America continues to move to mega regions, geographic corridors of economic vitality, cities that anchor mega regions, are the future. We simply cannot afford the expansion of suburbs, not because of money but the cost of time. Strategy: connect declining cities to mega regions (i.e., Detroit can become connected to Chicago and Toronto with high-speed rail).

Solution to economic recovery? Make housing and transportation cheaper. To thrive in the new knowledge economy? Stay competitive with a global geographic structure? Become less costly in time and economic resources. A reset of our economy will come from a new way of living. Suburbanization is the old model, fueled by the old industrial society (we bought cars, houses, refrigerators, based on this model.

Demand for new consumption in mega regions will come from high density mega regions, built on a new American Dream. Right now people are spending 50% of income for housing and transportation, when the mix should be 31-38% of income. The single family home is a privilege and a dream of the past. Renting will be the new economic reality, with a workforce that is flexible to be able to move where the jobs are--untethered by mortgages.

The world is not flat(aka Thomas Friedman). It's Spikey. These spikey regions account for 20% of world pop but represent 40% of GDP... and 9 out of 10 innovations.

Chicago is a mega region that will thrive. In the new era, "ChiPit"—runs0geographically from Chicago-Detroit-Cleveland-to Pittsburgh. Pittsburg is considered by Florida as a model, where it took a generation of civic and corporate vision and investment to bring the old industrial economy back. What about Detroit? Fabulous universities, Wayne State and U of Michigan—it will take a generation to rebuild assets. Back in the 1940's, Detroit was a top 5 US City. Today, it can’t has to reposition, and its great U's will be instrumental. Detroit has to connect with it’s mega-region hubs, like Chicago and Toronto. It will become a suburb to the metropolis, just like Wash DC has become a suburb or NYC. News and media from NYC relocated because it was affordable and easily connected to NYC, reigniting DC.

The future is now. Talented people who are mobile are going to geographic centers like Chicago—regional centers of the new knowledge-driven economy. I'm so thankful I'm a Chicagoan and urbanista! Yet I know as an ad guy, I helped fuel the last twenty years of consumerism. So where does that leave us, the ad industry, in terms of the Great ReSet?