Last week, Umair Haque (bubblegeneration) predicted that Europe would prove to be the next innovation leader–not because of any forthcoming shift toward a culture of entrepreneurialism, but because the day is coming when content will be key, and Eurpoeans simply remain more, ah, cultured than Americans. This pronouncement that drew numerous responses (including my own) that ranged all the way from ‘Huh?’ to ‘Excuse me?’ Innovators in Silicon Valley like Chris Yeh took particular exception.
Since then, Haque has taken the debate on the relative values of financial vs. social capital further, yea, invoking the spectre of Wal-Mart:
Let me use an example to illustrate. The cost of Wal-Mart killing your local mom and pop bakery isn’t just terrible food, no more friendly chats, and unemployment. In fact, Wal-Mart offsets your loss in quality with scale economies, creating value.
Actually, the real economic loss is more subtle, and much more pernicious: we lose entire sets of people deeply committed to what they do, which is where real creativity ultimately flows from. We lose people with skin in the game, and replace them with workerbots. The guys at your local bakery were makers of tiny cultures, not just producers of goods. Which do you think will be more valuable in a world of Chinese/Indian/etc hypercompetition – scale economies, or creativity driven by passion and commitment?
The debate on Bubblegeneration is a significant (in that it’s particularly cogent) articulation of the Euro-centric argument for a managed economy – the twist being that the stated protectionist goal is the preservation of ‘culture’ not jobs per se.
But looking closely, Haque’s argument contains the seeds of its own undoing: in the world of hypercompetition he speaks of, it’s true that creativity driven by passion and commitment will dominate – which is exactly what entrepreneurs like Chris Heh and his rather cultured friends in Silicon Valley embody. The truth is that while the world may have fewer (and probably better) mom and pop bakeries moving forward, that level of creative energy is being re-invested in other more dynamic areas of human endeavor and achievement – i.e., the mom and pop software shop.