We have all seen these headlines before, so it's not so under the radar for us. But the New York Times just published this article about Toronto calling it a "quietly booming tech town." Depending on how you want to measure things, Toronto is now the third largest tech hub in North America after Silicon Valley and New York City (or at least that's what the NY Times is telling me). The article touches on some of the ingredients for this success, but let me be a bit more explicit in this post because I think it is particularly relevant right now.
Canada is a "Western" country. What does that mean? It means that we're a democracy, we have the rule of law, we respect individuals (including private property), and we allow for pluralism of opinion, along with many other freedoms. These are all wonderful and magical things that are sometimes taken for granted. But I couldn't imagine living in a place that doesn't allow for such freedoms, nor would I want to.
On top of this foundation, we have two other important ingredients: extraordinary universities, like the ones mentioned in the article (University of Toronto and University of Waterloo), and some of the most liberal immigration policies in the world. Our borders are open for the smartest and most ambitious. With just these handful of things -- freedom, rules, education, and talent -- we can screw up a lot of other stuff and still accomplish some pretty great things. I may be oversimplifying, but probably not by much.
Humans are wonderfully talented. Let people be and they'll show you. Because history has shown us time and time again that the above recipe works remarkably well. (Related post: Do the best cities have a lot of immigrants?)
Albert Wenger is currently in the process of writing a book called World After Capital. The book isn’t finished yet. It still exists in a crude rough draft form. But already he has made it freely available online. You’re also welcome to comment and contribute to the book as he works on it.
Why has he done it this way?
Because this format of publishing is in line with where he believes the world is heading. He believes we are headed towards a world where new forms of surplus – brought about by technological innovation – will create greater levels of freedom: economic freedom, informational freedom, and psychological freedom.
His overall thesis is that the world has been moving through a series of scarcities. As hunter and gathers, the scarcity was food. In our agricultural period, we learned how to create food surpluses (which freed up more of our time), but it then produced land scarcity. Once the industrial revolution hit we once again freed up more of our time through surpluses, but then the scarcity became centered around capital. We also started to negatively impact the environment. Today, as we clearly move away from the industrial economy towards a knowledge and information economy, Albert believes the new scarcity is attention. (I wrote a related post about a month ago.)
If you’re interested in this topic and don’t feel like diving into his book, I suggest you watch this 23 minute presentation by Albert Wenger. I watched it this morning and he talks about everything I mention above.
Here’s one of his slides that I felt was important to share:
Why it’s interesting to think about this shift is because there will inevitably be positive and negative outcomes associated with it; there will inevitably be groups who, probably because of self-interest, would rather cling to the past; and because there are pressing global issues that we need to be focusing our attention on – issues such as climate change.
I can’t help but wonder about all the ways this shift could reverberate through the economy and our cities. Earlier this week I wrote a post about architecture as a tool for capital. But with our current fixation on “starchitecture”, one could argue that we have already transformed architecture into a new tool – a tool for grabbing attention. If you believe that attention is the new scarcity, then this makes perfect sense.
Last weekend I posted a poll asking readers what they think the “capital of the world” will be in 2050. It was really the 2nd half of a two part poll. The first one asked what people think the capital of the world is today. And the majority of people said New York.
While New York still came out on top in the 2nd poll, the most notable difference is the rise of Chinese cities. Behind New York is Shanghai, Hong Kong and Beijing. And in a way, this order makes sense to me. China would like to see Shanghai on top of Hong Kong, because it’s perceived as being more Chinese (Hong Kong is still too British). But both are still more economically important than Beijing.
Still, my own belief is that China is going to need to go through some structural changes before its cities really have a chance of dethroning New York (or London, depending on your vote in the first poll). And I think it has to do with openness, transparency and freedom. Fred Wilson probably put it best when he said to basically invest in whatever China blocks:
As our [Bitcoin] panel was winding down, Superintendant Lawsky asked what countries were doing it right. I didn’t answer that question but instead decided to talk about one that isn’t doing it right and brought up China and noted that a fantastic investment strategy would be to have invested in every Internet service that China has blocked. My point being that the services China likes to block are the really important ones that have been built on the Internet.
He then goes on to say that he believes there’s a strong correlation between innovation and freedom. And I would agree. So until China stops blocking the innovation that is likely going to drive the world forward, I think it’s going to struggle to assume a true leadership position.
What are your thoughts?