It Just Takes Some Imagination

I had the good fortune to be around Miami this past Saturday night as the city hosted Sleepless Night when the clocks were turned back for the end of daylight savings time.  This is part of the international Nuit Blanche network of cities celebrating the arts and culture.  

Of the more than 100 events in Miami Beach, one that attracted a very large crowd was the “vertical dancing” on the glass side of the Frank Gehry-designed New World Center, which houses the New World Symphony.  It was performed by Project Bandaloop as “Bound(less)” with Dana Leong.

I posted ten minutes of excerpts from this show at http://www.youtube.com/watch?v=yRpAPPn0_xE.  (There’s a two minute version someone else posted at http://www.youtube.com/watch?v=lJjV2aB0h-Y.)

Aside from noting how cool this is, as I was watching, I thought how straightforward this was – instead of letting the side of a building just provide a skin for the occupants, this transformed the side of the building into a dance floor.  (The other side of the building is a huge screen that lets people outside see and hear the concerts going on inside.)

It’s simple and, compared to lots of other civic events across the US, it is relatively inexpensive.  All it takes is some imagination to create this kind of Wow! experience in your city.

I realize, of course, that not every city has the large pool of artists, dancers, musicians, etc. that can be found in Miami.  So I’m not suggesting that every city imitate this particular event.  But every city has the potential for interesting experiences, which can be discovered with a little imagination.  

As the broadband-based video communications becomes more widespread and more of what we produce are intangible services and knowledge, there will be an increasing number of people who can make a living anywhere they choose to live.  What a city might have done to attract tourists in the past, it will have to do to retain and attract residents.  

Like SleepLess Night, give them a reason to be there.

© 2011 Norman Jacknis

[http://njacknis.tumblr.com/post/12468596258/it-just-takes-some-imagination]

It Just Takes Some Imagination

I had the good fortune to be around Miami this past Saturday night as the city hosted Sleepless Night when the clocks were turned back for the end of daylight savings time.  This is part of the international Nuit Blanche network of cities celebrating the arts and culture.  

Of the more than 100 events in Miami Beach, one that attracted a very large crowd was the “vertical dancing” on the glass side of the Frank Gehry-designed New World Center, which houses the New World Symphony.  It was performed by Project Bandaloop as “Bound(less)” with Dana Leong.

I posted ten minutes of excerpts from this show at http://www.youtube.com/watch?v=yRpAPPn0_xE .  (There’s a two minute version someone else posted at http://www.youtube.com/watch?v=lJjV2aB0h-Y.)

Aside from noting how cool this is, as I was watching, I thought how straightforward this was – instead of letting the side of a building just provide a skin for the occupants, this transformed the side of the building into a dance floor.  (The other side of the building is a huge screen that lets people outside see and hear the concerts going on inside.)

It’s simple and, compared to lots of other civic events across the US, it is relatively inexpensive.  All it takes is some imagination to create this kind of Wow! experience in your city.

I realize, of course, that not every city has the large pool of artists, dancers, musicians, etc. that can be found in Miami.  So I’m not suggesting that every city imitate this particular event.  But every city has the potential for interesting experiences, which can be discovered with a little imagination.  

As the broadband-based video communications becomes more widespread and more of what we produce are intangible services and knowledge, there will be an increasing number of people who can make a living anywhere they choose to live.  What a city might have done to attract tourists in the past, it will have to do to retain and attract residents.  

Like SleepLess Night, give them a reason to be there.

© 2011 Norman Jacknis

[http://njacknis.tumblr.com/post/12467813473/it-just-takes-some-imagination-i-had-the-good]

Is The Second Economy The End Of Human Labor?

Recently, there have appeared some analyses that point to a shift from traditional human production to machine production.

In a McKinsey Quarterly article (https://www.mckinseyquarterly.com/Strategy/Growth/The_second_economy_2853

), W. Brian Arthur, a visiting researcher at the Palo Alto Research Center (PARC) and an external professor at the Santa Fe Institute, focused on the “second economy”.  The subtitle of his article sums up the message: 

“Digitization is creating a second economy that’s vast, automatic, and invisible—thereby bringing the biggest change since the Industrial Revolution.”  He continues, “we can say that another economy—a second economy—of all of these digitized business processes conversing, executing, and triggering further actions is silently forming alongside the physical economy… human beings may design it but are not directly involved in running it. It is remotely executing and global, always on, and endlessly configurable.”

A recently there appeared a new book, “Race Against The Machine: How the Digital Revolution is Accelerating Innovation, Driving Productivity, and Irreversibly Transforming Employment and the Economy” by Erik Brynjolfsson and Andrew McAfee.  I suppose, as a form of testament to their thesis of an accelerating digital revolution, their book will only be available in e-book form.

The arguments in both the book and the paper are that an increasing amount of traditional human labor is being carried out by machines that are connected via the global Internet.  The idea of machines as the cause of unemployment is not new.  It goes back, at least, to the industrial revolution.  (Indeed, some of the classical Greek philosophers complained about the introduction of writing systems that they claimed diminished the capacity of people to remember – and, perhaps, led to unemployment of those who were the carriers of society’s oral tradition.  How many town criers are left these days?)

The concern about automation has been counterbalanced by the realization that this is a reflection of increasing human productivity, since after all these are our machines that we choose to create and deploy.  In the past, automation has allowed each of us to produce more and thus live better.

The question now is whether the use of technology is so great that it allows only a few people to reap the economic benefits of increased productivity.   The increasing inequality of income and wealth in the US and other advanced economies over the last four decades is often offered as evidence that the benefits will accrue to only a minority.   

However, this trend seems to have been more aligned with changes in redistributive public policies than a result of technology.  After all, even as late as the 1990s, economists (like Robert Solow) were still seeking proof of the increased productivity that was supposed to have come from the massive investment that companies had made in technology.  That productivity seems to have eventually arrived in this century.

It would not seem to make sense to ameliorate income inequality by reducing income as a whole for all of society, but instead it may be time to revisit the role of public policy in sharing the wealth.  The current political climate is not receptive to much of a debate on this.  However, as more human labor is devoted to intangible services and knowledge, which often have the feel of being more like public goods and less like private goods, the question of who gets credit for such goods will become harder to answer – and the idea of sharing the credit and the wealth generated may become more acceptable.

More important, there is an end-of-history feel to some of the arguments being put forth.  It is as if we are all headed to a life of desperate poverty or grand leisure.  Or perhaps something akin to the horrendous future envisioned in the “Time Machine.”

Such a vision, I think, is based on a limited view of what drives people to labor and a failure to recognize the how expansive human desires can be.  As Steve Jobs famously said, people often don’t know what they want until you give it to them.  

How many things that we consider today to be necessities were unknown years ago?  How much new knowledge that we are seeking was considered an unnecessary luxury or even unknowable in previous centuries?

We will not all stop seeking new things and new ideas even if a network of intelligent machines will often replace traditional human labor.  As a society, we need to start thinking about new public and private policies to create employment opportunities around those new possibilities.  At the very least, that should keep us busy for a while 😉   

© 2011 Norman Jacknis

[http://njacknis.tumblr.com/post/12157832415/is-the-second-economy-the-end-of-human-labor] 

Blending Physical And Virtual Spaces

As part of my work with the US Conference of Mayors on a future-oriented economic growth strategy for American cities, I point out that, in the past, quality of life was traded off for economic growth.  (This same approach seems to have been part of the more recent industrialization of China.)

But in the future, quality of life becomes a part of the economic strategy since it is a way of attracting people, many of whom who can choose to live anywhere.

However, quality won’t just be about the existing physical aspects of a city.  More than that, cities will blend physical and virtual spaces to create new destinations.  So it was with interest that I read this article about how “Augmented Reality Will Make Boring Cities Beautiful” –  http://www.smartplanet.com/blog/cities/video-how-8216augmented-reality-will-make-boring-cities-beautiful/691

The key lesson: 

“Once augmented reality is widespread, the difference between a great and a mediocre city won’t just be its built environment. To some extent, it will also be the degree to which that environment is a suitable tapestry for the creatives who will paint it with their augmented reality brush. Digital artists who learn to re-appropriate the city with the most innovative augmented reality add-ons won’t just bring themselves fame and fortune — they’ll also be attracting others to the places they love.”

© 2011 Norman Jacknis

[http://njacknis.tumblr.com/post/11610950221/blending-physical-and-virtual-spaces]

Real Jobs or Real Income?

Another part of my work on economic growth is focused on how the traditional job in the traditional large corporation is becoming a relic of the past.  It came out of an industrial era in which large corporate bureaucracies were created for reasons of efficiency.  See the economist Ronald Coase’s classic work on the theory of the firm.

The internet, however, has made it easier for people to collaborate in a more informal way and to create projects of great value – such as Linux and Wikipedia.  I describe this as a movement from Coase to Shirky (author of Here Comes Everybody).

This role of the Internet has already begun to affect the economy.  So it was with interest that there was some recent publicity on CNBC and MSNBC about the success of Thumbtack and ODesk, which help people find income on the Internet, rather than finding traditional jobs.  See, for example, “Online Work Replacing Full-Time Employment: Record Unemployment, Recession Mentality Lead Companies to Alternative Hiring Strategies” at http://www.msnbc.msn.com/id/44017638

The MSNBC interview of ODesk’s Gary Swart was frustrating to watch as he and the reporter kept talking past each other.  The reporter kept saying that these were not “real jobs”.  Mr Swart was diplomatic enough not to argue that those “real jobs” were no longer so real.  Nor did he offer the rejoinder that many of people who use his service to identify sources of income were probably quite pleased to be able to have the flexibility that Internet work provides.  These people also find they make more money than they would make at a so-called “real job” flipping burgers.

Even in an economy with traditional job unemployment measuring at anywhere from 9-18%, most Americans are concerned – perhaps not so much about “jobs”, but about the fact that their real income has gone down, even if they have a real job.  Anything that boosts their income is positive and an indicator of the strategy for the future.

© 2011 Norman Jacknis

[http://njacknis.tumblr.com/post/10200660202/real-jobs-or-real-income]

The Misalignment Between The Economic Success of Local Government and Their Residents

As you can see from some of the other posts here, at the request of the US Conference of Mayors, I’ve been focusing on an economic development strategy that will work in the future.  As a result of that work, I’ve been presenting my ideas in many places and before many audiences, generally including mayors or other senior officials of local government.

Without going into the whole line of reasoning, I discuss the combined effects of (1) a future with ubiquitous high quality communications and (2) the shift of the labor force to providing ideas and other intangible services.  One implication of these trends is the disaggregation of the monolithic big company that would concentrate jobs in a city and, as an alternative, the empowerment of fluid teams of individuals.

To drive the point home, I argue that the true measure of the economic success of a city is the sum (or the median?) of the income and wealth of its residents – and not the total sales of companies that might have a local postal address there.  

In what sometimes comes across as a provocative statement, but isn’t, I put up an equation: economic growth does not equal real estate development.   I say that because a large part of the economic development expenditures of local governments have been about real estate development.

A few times in recent weeks, I’ve met with mayors or economic development directors who understand exactly what I’m talking about and see the future as I present it.  Then comes the response: “We should be thinking about the amount of money in the pockets of our residents, but you’re missing something here.  Our business – the city government – is mostly dependent upon property taxes and commercial real estate is the golden goose that lays most of those tax eggs.  We focus on real estate development because that’s where we get the return in the form of taxes later.”

That’s a fair argument for the year 2011, as far as it goes.  Of course, often what is a key part of the incentive package is a reduced property tax bill.  More important, commercial real estate will have a hard time maintaining itself in the face of the trends that I discuss.  Indeed, over the last ten years, many big companies have found that they need half the square footage per employee that they used to.  Even now, many employees telecommute or operate remotely somewhere out of the office.  So in the long run, this equation between real estate development and economic growth will break down.

This raises a more serious public policy question, though.  How did we get into such a situation where a smart mayor realizes that the economic success of the city government is misaligned with the success of the city’s residents?  And, for the viability of our democracy, how do we align these?

Or, if you want to ask a related and more pragmatic question: if the goose that laid the golden eggs – commercial real estate – is getting ready to retire, what replaces it?  

Either way you look at it, local governments in the United States need to shift away from their dependence on commercial property taxes.  There are various alternatives that cities have been forced to pursue and may have to depend on more.  Some examples: income taxes, property taxes on residences (which the Internet has now also made places of work and shopping) or even sales taxes on the goods/services that are sold directly into residences.  I’m not suggesting that any of these is perfect or even good, but they all share one characteristic – the revenue base grows as the city’s residents have more money in their pockets.

Whichever of these or other possibilities is selected, cities and counties will be forced to align their financial success with the economic success of their residents.  This is a good thing for their residents because their local government will then emphasize the development of each resident’s income potential.  Even from the narrow interest of the government as a business, this is a good thing because government will have a more assured revenue stream that is appropriate for a 21st century economy.

© 2011 Norman Jacknis 

[http://njacknis.tumblr.com/post/9079495075/the-misalignment-between-the-economic-success-of-local]

Virtual vs. Physical Interactions

In response to my post of the Chattanooga editorial, someone wrote to me that he thought that virtual communications would make physical interaction even more important.  I won’t go into the whole argument here, but note that this is more sophisticated than the simple comparison of virtual vs. physical interactions that many people have made.

Nevertheless, I did think that it deserved a response and here it is:

I think the Internet in its current form (texting, email, social media, etc.) is still an immature form of communications.  So the crux of the matter is not so much whether the current Internet will change how people interact, but how the ubiquitous video communications of the future will affect behavior.

Our physical selves will not disappear, so there will still be physical interaction.  But I suspect that these interactions – and the cities in which these interactions takes place – will be of a different nature than what we’ve been accustomed to.  I’ve been working with the mayors, in part, on what that future city should look like and what will be its functions.  Most under threat is the urban model that primarily views the city as the dominant, centralized location of economic production.  Indeed, the traditional physical business cluster has already dissipated in many places – Detroit and Wall Street, to name just two famous clusters which are no longer as dominant in their industries as they used to be. 

Economic relationships will perhaps be more affected by ubiquitous video communications than other human relationships because video communications increases the likelihood that trust will develop between potential business partners.

Of course, how this all plays out will be a cultural question.  I remember that my grandmother believed that the telephone was only to be used for very minor or extremely urgent conversations – nothing in the wide swath of human conversation in the middle, especially not business.  If you wanted to converse with her, you saw her personally, probably preceded by a letter.  My parents thought this quaint and had no problem at all conducting important business matters on the telephone.  My bet is that the next generation will take video chat for granted as a perfectly acceptable way of doing business.

Time will tell – so let’s make a date in 20 years to see which of these opposing views gets closer to the future reality. 

© 2011 Norman Jacknis

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Chattanooga’s Gigabit Network As The Base For Future Economic Growth

I’ve been working on a future-oriented economic growth program with the US Conference of Mayors and we have identified Chattanooga as a location to demonstrate some of these ideas because it has, by far, the largest and fastest deployment of fiber in any metro area in the US — enabling every home and other building to have a gigabit connection.  

I’ve described to them how and why this kind of network changes a city’s economy and should change its economic growth strategy.  I’m also helping them think of innovative uses of their network that will set up their future economic growth for a couple of decades — with particular emphasis on those that are only feasible at these higher bandwidths.  Among other aspects, this includes virtual collaboration among entrepreneurs in the global marketplace, virtual lifelong learning and blended virtual/physical spaces that become destinations for both residents and tourists.  

Last week, I made a presentation about this to the civic and business community in Chattanooga.  

That presentation led to a significant editorial by the Chattanooga Times Free-Press (http://www.timesfreepress.com/news/2011/jul/21/the-other-economic-vision/?opiniontimes) as well as a news story (http://timesfreepress.com/news/2011/jul/21/epb-grid-attracts-cisco-systems/).

© 2011 Norman Jacknis

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Chattanooga Gigabit Fiber To Every Building

This is a segment of the Council for the New American City at the US Conference of Mayors Annual Meeting, June 17, 2011. It features Mayor Ron Littlefield and Norman Jacknis, Cisco IBSG Public Sector Director discussing the gigabit fiber network that the city has deployed throughout its metro area and its implications for future economic development.

SmarterCape Summit Presentation

On May 10, I was the plenary keynote speaker at the SmarterCape Summit – the kickoff meeting for the $50 million + Open Cape project to bring broadband and its applications to Cape Cod and southeastern Massachusetts.  The other major speakers of the day were Massachusetts Governor Deval Patrick and the co-founder of the global Intelligent Community Forum, Lou Zacharilla.

The presentation was an extension of my work with the US Conference of Mayors on future-oriented (network-based) economic growth.
There is a link the video (with the first couple of minutes unfortunately deleted) at http://www.myaccesstv.com/component/hwdvideoshare/viewvideo/823/business-and-economics/cisco-dr-norman-jacknis.html
The presentation is at http://www.smartercapesummit.com/Images/Event/Event%20Presentations/JACKNIS.Plenary.pdf

© 2011 Norman Jacknis

SmarterCape Summit Presentation

Originally published 5/20/2011

On May 10, I was the plenary keynote speaker at the SmarterCape Summit – the kickoff meeting for the $50 million + Open Cape project to bring broadband and its applications to Cape Cod and southeastern Massachusetts.  The other major speakers of the day were Massachusetts Governor Deval Patrick and the co-founder of the global Intelligent Community Forum, Lou Zacharilla.

The presentation was an extension of my work with the US Conference of Mayors on future-oriented (network-based) economic growth.

Here’s a PDF of the presentation SmarterCape Summit

© 2011 Norman Jacknis