JSB pointed me to a new interview with Richard Florida in Salon. It is a great introduction to Richard Florida's new book, The Flight of the Creative Class. Richard gained quite a bit of attention with his earlier book, The Rise of the Creative Class, which made the case that economic growth essentially depends on three elements: technology, talent and tolerance. His new book is basically a wake-up call to U.S. policy makers regarding the "creative talent drain" we are starting to experience. His thesis is summed up in an article on "America's Looming Creativity Crisis" in Harvard Business Review he wrote in October 2004:
The United States of America is on the verge of losing its competitive advantage. It is facing perhaps its greatest economic challenge since the dawn of the industrial revolution. . . . Terrorism is less a threat to the U.S. than the possibility that creative and talented people will stop wanting to live within its borders.
In his Salon interview, Richard summarizes the two factors which drive his current concern:
There are two factors interacting here. The first, which would have happened anyway, is that other countries realized how important talent is and cities in those countries have become really effective in competing for talent. So the playing field has been leveled. In the past, people would have said, "Absolutely, my first choice is to move to New York or Boston or San Francisco or Seattle or Chicago ..." Now cities like London, Dublin, Amsterdam and Stockholm have become extremely attractive to talented people, not because of any particular public policy but because of the way they've developed over the past decade. And I'm not just talking about the relocation of Americans, I'm talking about the location decisions of people on a world scale.
The second factor is that -- obviously spurred by this so-called threat of terrorism -- we've become far more restrictive in our ability to absorb and attract foreign talent. The numbers are all there, showing the decline of foreign students in the U.S. and the decline in the number of visas issued. So many foreigners have visa troubles now, even great scientists, artists and musicians. . . . Not surprisingly, there's a general sense in the world that the United States isn't as welcoming.
For those who think that Richard is an alarmist, I can only say that I share his concerns. BTB and BTC are back in Silicon Valley, only this time they mean "Back to Bangalore" and "Back to China", as talented immigrant entrepreneurs here pick up stakes and head back to their homelands.
JSB and I observed in our new book, The Only Sustainable Edge, that
Where value originates and who captures it will increasingly depend on the evolution of talent markets and the relative capability of firms (and nations) to rapidly develop and amplify the value of this talent. Product markets and financial markets will of course still matter, but the center of gravity for value creation and capture will inexorably migrate to global talent markets
I worry that the U.S. is far too complacent about its ability to compete in global talent markets. Richard Florida provides a timely warning.