How the Financial Crisis May Not Be So Bad for New York

We just got around to reading the cover story of the current issue of The Atlantic Monthly called How the Crash Will Reshape America. One of the article’s central points is that while hubs of intellectual and creative capital like New York will surely suffer in the economic crisis, they will suffer a lot less than second-tier cities, the suburbs or industrial areas and therefore benefit on a relative basis. While there has been much hand-wringing about New York’s reliance upon the finance industry, many other smaller cities, it turns out, are much more reliant: Hartford, Des Moines and Charlotte, to name a few. Rather, New York is an incredibly diverse place which should be well-positioned to reinvent itself faster and more efficiently than other places:

New York is much, much more than a financial center…It is home to a diverse and innovative economy built around a broad range of creative industries, from media to design to arts and entertainment. It is home to high-tech companies like Bloomberg, and boasts a thriving Google outpost in its Chelsea neighborhood… New York is more of a mecca for fashion designers, musicians, film directors, artists, and—yes—psychiatrists than for financial professionals…The financial crisis may ultimately help New York by reenergizing its creative economy…Place still matters in the modern economy—and the competitive advantage of the world’s most successful city-regions seems to be growing, not shrinking…Talent-rich ecosystems are not easy to replicate, and to realize their full economic value, talented and ambitious people increasingly need to live within them…Economic crises tend to reinforce and accelerate the underlying, long-term trends within an economy [like the map of per capita patent creation above]… In this case, the economy is shifting away from manufacturing and toward idea-driven creative industries—and that, too, favors America’s talent-rich, fast-metabolizing places.

Sounds good so far, right? Here’s how the trends will play out on the American landscape, according to the author Richard Florida:

What will this geography look like? It will likely be sparser in the Midwest and also, ultimately, in those parts of the Southeast that are dependent on manufacturing. Its suburbs will be thinner and its houses, perhaps, smaller. Some of its southwestern cities will grow less quickly. Its great mega-regions will rise farther upward and extend farther outward. It will feature a lower rate of homeownership, and a more mobile population of renters. In short, it will be 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. Serendipitously, it will be a landscape suited to a world in which petroleum is no longer cheap by any measure. 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.

Sounds like we’re sitting pretty, huh?
How the Crash Will Reshape America [The Atlantic]