Thursday, November 30, 2006

Celebrating the Burgh Diaspora: Pittsburgh Day

Scots all over the world celebrate St. Andrew's Day. Like the Irish on St. Patrick's Day, the Scottish Diaspora enjoys a spotlight during the displays of national pride. The time has come to cheer, instead of jeer, Scotland's global emigrants:

But there's something unique about Scottish identity; not just a distinctive culture but particular values were taken abroad. They are recognised everywhere, sometimes in jest but more often with respect. It's not just jokes about thrift but an image of venerating education, probity and hard work that the name conjures up. That is something to take pride in and build upon. As a global brand Scotland has its unique selling points. We would be daft to let it pass by.

Excuses are made that the timing falls between Hogmanay and the Festival - both big and important in themselves. For sure progress has been made - yesterday MSPs endorsed a Bill to make St Andrew's Day a voluntary national holiday - but much more could and should be done. While Dublin is at the epicentre for Ireland and the Irish around the world on St Patrick's Day, the same cannot be said about Edinburgh on St Andrew's Day.

Yet it's a huge opportunity not just to promote Scotland but the Capital around the world. It's our day and our chance to parade on the global stage. Truly celebrating St Andrew's Day offers an opening to bring our people together wherever they may be and allow our country and identity to be portrayed to countless millions around the world. As well as the bonding with our kinfolk of old, there's a chance to promote a modern, vibrant Scotland to visit and invest in; with Edinburgh at the heart of it.

I think Pittsburgh has a global brand worth promoting, something not lost on CMU or UPMC. Scotland is making a concerted effort to reach out to its diaspora, a development model Pittsburgh should emulate.

Pittsburgh intends to celebrate its 250th birthday in November of 2008. The City should pick a day for Pittsburghers around the world to reconnect with their heritage on an annual basis. Boston is synonymous with Patriots' Day, a state and municipal government holiday with the Boston Marathon as the centerpiece.

As long as there isn't an effort already in place, let this post serve as the launch of a "Pittsburgh Day" campaign.

Wednesday, November 29, 2006

Freelance Pittsburgh

The Mobile Class needs a champion (and a good cupcake). Sara Horowitz could be that person:

The conventional wisdom is that, for better or worse, trade unionism is in irreversible long-term decline, at least in the world's leading economies. In America, for example, only 12.5% of the workforce now belongs to a union and a mere 7.8% of private-sector workers, down from one-third in 1960. Most forecasts predict that this trend will continue, perhaps until unionism is confined to museums and history books. But Sara Horowitz is determined to prove them wrong.

Ms Horowitz is trying to reinvent the trade union to meet the needs of today's workers—specifically, the fast-growing army of freelancers who flit from one employer to another. These workers have largely been ignored by the traditional trade unions, which are wedded to the shrinking band of workers who expect to spend the bulk of their careers with one employer, particularly in the public sector, where over one-third of workers are still unionised. In 2001 Ms Horowitz launched what is now called the Freelancers Union. Today, with 37,000 members, it has already become the seventh-largest union in New York state, and could soon be far bigger. In the next few weeks it will open a branch in Connecticut, with three more states to follow by next spring. After that it has plans to expand into the rest of the country, and perhaps even beyond.

While mobility increases economic opportunity, the windfall often comes at the price of rights. Newcomers do not enjoy the same strength of voice as the natives. Furthermore, those willing to move to improve are often scapegoated as the source of a region's woes.

Anything that could help increase the mobility of labor would strenghten the hand of the worker. Unions often have been in the position of anti-immigrant, fearing outsiders willing to toil for less pay. The result is a poorly developed legal regime that protects economic migrants, unions pitted against the very workers it should be helping.

The Freelancers Union is a bit like a diaspora network, tapping into the resources of a large and talented group. And also akin to immigrant groups, cities such as Pittsburgh could position themselves to attract this type of employee.

The Freelancers Union is looking to expand. Why not in Pittsburgh?

Tuesday, November 21, 2006

China Burgh

I'm thrilled to see a series on China in the Pittsburgh Post-Gazette. I appreciate the opportunity to learn about how Pittsburgh is connecting with an emerging geopolitical and geoeconomic powerhouse:

China is the first gold rush of the 21st century, the place to go if you are adventurous and want to get rich fast. For Mr. Martin and his 27-year-old business partner, Pittsburgher Josh Weiner, their get-rich-quick scheme centers on persuading distributors, restaurateurs and bar owners to put imported beers in the hands of young, status-conscious Chinese professionals looking for ways to flaunt their wealth in this city of 19 million.

Mr. Weiner is among the thousands of foreigners, including many Pittsburghers, hustling to make money from the most dramatic international story of our time -- Red China's embrace of freewheeling U.S.-style capitalism.

At least 20 big Pittsburgh-area companies -- from PPG Industries to Alcoa to H.J. Heinz to Allegheny Technologies -- have offices or operations in China, joining about 49,000 other American firms hoping to capitalize on China's massive growth while avoiding the pitfalls of working in a country where the ways of doing business are opaque and complex.

Chris Briem notes the likely economic windfall for the Pittsburgh region if Westinghouse is allowed to service the rapidly growing energy markets in India and China. The Post-Gazette series details the opportunities in China. Either country represents the potential for high-return investments, even for beer distributors.

Pittsburgh should continue to explore ways to increase its global connectivity. Pittsburgh might tap the Indian Diaspora, a network with strong links to Pittsburgh. This is also a selling point to keep Westinghouse in the region when it expands its operations. Pittsburgh could be developing as a global energy player, thanks to being a leader in clean coal burning and nuclear technologies and the innovations in green architecture.

Monday, November 20, 2006

Listening to the Burgh Diaspora

I never tire of reading or hearing about the ubiquity of Steelers Fans around the country:

I've never been to a city that didn't have a Pittsburgh bar. I travel a lot for my job and in the last year I have been to Orlando, Houston, Phoenix, Sedona, The Grand Canyon, Chicago, Nashville, New York City and San Francisco. I have seen Steelers fans, Roethlisberger jerseys and that beautiful three-diamond logo in all of these places.

While The Grand Canyon was one of the most spectacular sites I've ever witnessed, seeing someone holding a Terrible Towel while looking at the canyon at sunrise was truly a sign from God.

Everywhere I go I see black and gold. So distinctive. So eye-catching. It always makes me smile. Like a homing beacon beckoning my inner Steelers soul.

Friday, November 17, 2006

Global Resilience Pittsburgh

Pittsburgh should aim to increase regional resilience. Esquire magazine recently named Enterra Solutions CEO Stephen DeAngelis as one of the "Best and Brightest" for 2006. DeAngelis suggests that increasing connectivity is the best way to deal with global forces that disrupt economies:

This fall, Enterra teamed up with Oak Ridge National Laboratory, a Department of Energy site outside Knoxville, Tennessee, to form the Institute for Advanced Technologies in Global Resilience. America, the institute reasons, will protect itself best not by throwing up firewalls and digging moats but by becoming more connected, hyperconnected. The tighter and more far-reaching the network, the stronger its ability to absorb a vertical hit 'like September 11, Hurricane Katrina, or an outbreak of avian flu' and minimize the ripples spreading across the country. The more resilient we become, the faster we respond and the faster we recover.

Pittsburgh could do a better job of promoting global connectivity. Peter Taylor and Robert Lang produced a report for The Brookings Institution titled, "U.S. Cities in the 'World City Network'." Of the American cities that rate worldwide, Pittsburgh has the lowest global connectivity.

Pittsburgh's orientation is domestic, the top 10 cities as follows: Washington (DC), Cleveland, Dallas, Philadelphia, St. Louis, Charlotte, Boston, Minneapolis, Indianapolis, and Kansas City. The most important international city is Rotterdam. I'm guessing that the Burgh Diaspora has a lot to do with Pittsburgh's connectivity profile. Regardless, Pittsburgh does suffer from a relative lack in global connectivity, which may undermine its economic resiliency.

Thursday, November 16, 2006

Enfranchising the Diaspora

A number of countries are attempting to build bridges between the homeland and their diaspora communities. But embracing the movement of people is proving difficult for government policymakers. The rooted often view migrants with a great deal of suspicion. In other words, people don't trust outsiders, particularly those between places.

While mobility often results in domestic anxiety, there is great potential for development. The difficulty is figuring out how to tap into migration. One response is providing transnational populations with a political voice in the host country:

Latin American states have taken the boldest steps in recognising the essentially transnational character of contemporary migration: many of "their" migrants live simultaneously in the host country and the country of origin, through frequent travel, cheap communications, active cultural and social associational life, and consumption habits.

In response, several countries in the region (El Salvador is one example) now have a ministry dedicated to the affairs of the diaspora, offer dual nationality and have even amended their constitution to enable diaspora communities to directly elect their own representatives to sit in the legislature. These states understand that if migrants are to scale up their contributions to the development of their home regions, the originating states need to maintain a meaningful social contract with them.

In the United States, there are a number of transregional communities cut off from their hometown. Pittsburgh could formalize its relationship with the economic refugees scattered around the United States. What we need is a mayoral candidate who has the vision to mobilize this tremendous resource of human capital.

Wednesday, November 15, 2006

R2I Pittsburgh

During my conversation with InfoWorld's Jon Udell, he broached the subject of the Return to India (R2I) Movement, a diaspora experience worth investigating. Save the tech boom in Bangalore, there are a number of similarities between the Indian Diaspora and the Burgh Diaspora. However, I'm not convinced that Pittsburgh expatriates harbor a similar burning desire to return to their homeland.

Nonetheless, perhaps the Pittsburgh region would benefit from Pravasi Bharatiya Divas:

Pravasi Bharatiya Divas aims at bringing the expertise and knowledge of the Indian overseas community to India and integrating it into India's development process. Pravasi Bharatiya Divas is focused to highlight networking opportunities and collaborating them to confer a mutual developing platform. Generating this synergy to excel together towards a bright India along with the Indian overseas community is what Pravasi Bharatiya Divas 2007 proclaims with its head held high.

Think of Pravasi Bharatiya Divas as a government sponsored festival in the homeland that celebrates the diaspora. Some Indians might be enticed to return, while others seize the opportunity to do business. At the very least, Pittsburgh could signal to its own diaspora that it is ready to foster a relationship.

Monday, November 13, 2006

Economic Policy Pittsburgh

The best Pittsburgh can do to stimulate the regional economy is to push on a string. In the face of globalization, economic policy is increasingly impotent. Even investment in innovation is unlikely to generate the desired return:

The truth is, China and India are increasingly attractive places for companies to do research and development (using ideas, perhaps, that were originally developed using U.S. tax dollars). Money is following as well, with U.S. venture capitalists investing more than $400 million in Chinese and Indian companies in the third quarter alone, according to the National Venture Capital Assn. There's a growing sense that at a time of scarce resources, the U.S. may not be getting enough bang for its buck from R&D spending. "The question about funding basic R&D for health care is the same as for funding other basic R&D," says Robert B. Reich, Labor Secretary under Clinton and now at the University of California at Berkeley. "How long can and should the U.S. continue to subsidize the rest of the world?"

Venture capital does not understand regional or national loyalty. Public dollars spent in Pittsburgh can and will flow overseas, with local tax payers left wondering if they will ever see any results. Politicians are unlikely to offer voters a choice that can help improve the economy, with foreign nationals reaping the benefits.

The counterintuitive approach is to embrace all kinds of regional capital outflows, more intensely linking Pittsburgh to the global economy. Pittsburgh should look for investment opportunities wherever they may be, which is likely well beyond the Three Rivers.

Sunday, November 12, 2006

Pittsburgh 3.0

Just when I thought I understood Web 2.0, along comes the New York Times to tell me I've been talking about Web 3.0 all along:

Web 2.0, which describes the ability to seamlessly connect applications (like geographic mapping) and services (like photo-sharing) over the Internet, has in recent months become the focus of dot-com-style hype in Silicon Valley. But commercial interest in Web 3.0 — or the “semantic Web,” for the idea of adding meaning — is only now emerging.

The classic example of the Web 2.0 era is the “mash-up” — for example, connecting a rental-housing Web site with Google Maps to create a new, more useful service that automatically shows the location of each rental listing.

In contrast, the Holy Grail for developers of the semantic Web is to build a system that can give a reasonable and complete response to a simple question like: “I’m looking for a warm place to vacation and I have a budget of $3,000. Oh, and I have an 11-year-old child.”

Under today’s system, such a query can lead to hours of sifting — through lists of flights, hotel, car rentals — and the options are often at odds with one another. Under Web 3.0, the same search would ideally call up a complete vacation package that was planned as meticulously as if it had been assembled by a human travel agent.

If Web 2.0 is a revolution of any sort, a thought that might elicit a laugh from cutting-edge website developers, it is the transformation of content consumers to content producers. At least, that's how I see it. Web 3.0 would add value to all these consumer inputs.

While we wait for a smarter search engine to cut through all the noise, research librarians already have a good understanding of how to quickly and effectively search a large catalogue of information. Also, online communities of collaboration do an efficient job of sifting, with amateurs honing expertise in a specific subject matter. In other words, somebody out there knows exactly where to look to find the perfect answer you need.

Thursday, November 09, 2006

Can Pittsburgh Change Course?

Pittsburgh needs to start thinking about itself in a global context. When local columnist Dan Simpson voices concern about China's growing presence in Africa, Pittsburghers should take note. The problem is figuring out how Chinese oil interests in Sudan affects a local in East Liberty. Teasing out these connections would give someone cause to read the Pittsburgh Post-Gazette for international coverage instead of heading to the websites of the New York Times or Washington Post.

Aggregated Globalization Scores

The big news yesterday was the resignation of Donald Rumsfeld as Secretary of Defense, signaling a dramatic shift in US foreign policy:

Beyond the immediate issue of Iraq -- and Afghanistan, where the Taliban have re-emerged as serious menace -- are larger questions of how the United States will fight the longer term battle against terrorists, rogue nations and nonstate actors that many analysts believe have supplanted traditional nation state warfare as one of this century's biggest threats.

Rumsfeld's answer to that call was dubbed "Transformation," which he described in a 2002 speech as a necessary response to the events of Sept. 11.

"Our challenge in the 21st century is to defend our cities and our infrastructure from new forms of attack while projecting force over long distances to fight new and perhaps distant adversaries," he said. "Our goal is not simply to fight and win wars, it is to try to prevent wars."

But many analysts said that despite the cutting edge rhetoric and early successes such as the tight integration of U.S. Special Forces with Northern Alliance fighters in Afghanistan, Rumsfeld focused too much on gee-whiz technology and heavy air power instead of human intelligence and boots on the ground.

"All of 'Transformation' was about building a force that was superb at fighting the Soviet Union in the Sahara Desert," Hammes said. "Unfortunately, that's no longer the kind of war we are in or will be in for the next 10 to 15 years."

Part of that emphasis came from a concern shared by Rumsfeld and others in the administration about China, which they saw as an emergent military threat and a "near peer" to the United States, said Thomas Barnett, author of "The Pentagon's New Map" and "Blueprint for Action."

"The fixation on China, which was strong with this administration when it came in and certainly remained strong with the China hawks under Rumsfeld and with Rumsfeld himself became the excuse for over-feeding the war force and starving the occupation force," he said. "The Air Force and the Navy probably get happier than they need to be ... and the Army and the Marines are left hanging."

Gates, a former director of the CIA, might bring a different perspective to that equation, in the view of some analysts -- with possible ramifications in Iraq and beyond.

Optimistically, Rumsfeld stepping down signals a change in how we view China, an ally in the promotion of globalization instead of an enemy competing for resources. To the extent that Pittsburgh is linked to the global economy, this would be a significant paradigm shift. In this sense, Pittsburgh might view China as an opportunity.

The change in course would be away from protectionism and fears about economic globalization. While quaint, Pittsburgh's predominantly parochial mindset stands in the way of regional development and progress. Withdrawing from Iraq and the rest of the world would be a grave mistake.

Friday, November 03, 2006

Resilience Pittsburgh

Pittsblog pinch hitter Chris Briem served up a dish of optimism about Pittsburgh startups. While Briem stopped well short of joining the cheerleading squad, the part of the article that caught his eye piqued my interest:

Like all such pieces it captures a lot of big issues that it nowhere near has enough space to treat appropriately. So skipping a lot of the economic development story there, I do have to say I appreciate Max Kings quote at the end..

``It's remarkable to see how resilient the people are.''

If you are interested, my own comments on a similar theme were in this oped a few years ago: It was twenty years ago today.

The point is that Pittsburgh now demonstrates significant economic resiliency and is now better prepared to deal with structural shocks like the one that occurred during the 1980s with the collapse of the industrial complex. Briem's commentary highlights what I view as a tension in development circles between the paradigms of sustainability and resilience.

I'll say upfront that regional stakeholders should promote resiliency, not sustainability. The difference between the two perspectives concerns economic cycles. Sustainability would lessen the boom and bust, promoting small and more manageable growth. Resiliency allows a region to ride out the bust, emerging better positioned to take full advantage of the boom phase.

Shocks to the economic system are inevitable, at least in the near term. I suppose advocates of sustainability would claim that their approach can mitigate all types of shocks, but that strikes me as unrealistic. Meanwhile climate change, terrorism, and political turmoil pose constant threats to increasingly integrated markets around the world.

Thursday, November 02, 2006

Globalization's Mobility Imperative

The emerging discontents of economic globalization are America's middle class. During the reign of the United States as global superpower, capital flowed abroad and flourished in frontier marketplaces:

On Oct. 28, 1998, the US Congress established a commission that brought together highly respected experts to examine the effects of the country's trade deficit and the withering away of industrial labor. Donald Rumsfeld, the current US defense secretary, then-US Trade Representative Robert Zoellick, Anne Krueger, the number two at the International Monetary Fund (IMF) and Massachusetts Institute of Technology (MIT) Professor Lester Thurow provided their assessment of the situation at the behest of the president.

Things were going swimmingly for the Americans until the end of the 1970s, the commission report concluded. Family incomes grew virtually at the same rate in all sections of the population during the first three decades after World War II, with those of the poor growing slightly faster. The lowest fifth of US society saw a 120 percent increase in incomes, the second fifth 101 percent, the third 107 percent, the fourth 114 percent and the fifth 94 percent. It was as if the American dream had manifested itself in statistics.

But then the trend reversed, and not just in the United States. Japan had awakened, and global trade had shifted directions. Capitalists left their home turf and went looking for suitable locations to invest in. Direct investment abroad - which had been more or less in harmony with exports until then - rose dramatically.

Until then, investment abroad had served mainly to boost the export of German, US or French products. But then factories themselves began to be relocated, mainly to cut manufacturing costs. Production for the world market became increasingly global itself, which led to a redistribution of capital and labor. Global production increased by a solid 100 percent between 1985 and 1995. But direct investment abroad increased by 400 percent during the same time period. Capital's new mobility began to make the other factor of production, labor, restless, too.
To the extent that labor can chase capital defines the ability to join the ranks of the middle class. In other words, those who refuse to move in order to improve will lose. Stories of brain drain voiced around the United States indicate strong systems of education, empowering people to relocate in areas of prosperity.

I suspect relocation will increasingly mean leaving the country with global integration being the primary metric of economic success. Venture capital flowing out of Silicon Valley presage this landscape. The winners of that game are members of a diaspora, moving deftly between clusters of innovation.