Soft Green Gales of Creative Destruction

• Creative destruction: getting rid of the old to allow the new to exist; the new holds greater promise than the old

• Gale of creative destruction: Joseph Schumpeter’s idea that creative destruction as undertaken by firms and individuals has the capacity to ‘go viral’ and transform entire industries and economies due to the desire to keep up with the competition

• Soft innovation: New production practices and products that play upon sensory perception, redefine aesthetic appeal, and spark creativity

• Green innovation: New production practices and products that are environmentally friendly and promote environmental sustainability

• Regime change: major ideological shifts in leadership and governance
  

Social media buzzes about creative destruction. Go to Twitter, search for “creative destruction,” read the tweets, and surf to the external content. There, tweeters, bloggers, architects, planners, IT developers, and other soft and green innovators are positively giddy about the prospect that their work could, first, prompt the abandonment of energy inefficient, physically intransigent infrastructures and production techniques, and second, lead to the formation of new ways to attack really pressing problems—like climate change, fossil fuel dependency, unemployment, hunger, inner-city disinvestment, regional decline, and the like.

Some U.S.-based writers, however, temper this exuberance with worries that unless innovators can demonstrate that soft and green will translate into private sector profits, or unless the state takes the lead in getting this form of creative destruction going, then this particular gale is going to be more like a gentle breeze. And, if the U.S. doesn’t step it up and get a wiggle on—particularly in regard to green innovation—it is going to be left behind as a relic.

I have two reactions. Both have been influenced by Carville Earle’s (2003) political economic history of the United States, The American Way: A Geographical History of Crisis and Recovery (Rowman and Littlefield). In this book, Earle presents a “Dialectical Policy Regimes Model.” It specifically links the concept of creative destruction to particular moments in U.S. history.

In short, Earle’s model is based on the idea that the U.S.’s historical development—from the 1780s to the present day—can be thought of as an ongoing cyclical alternation between two policy regimes. One of these, (the democratic) promotes egalitarianism in the domestic sphere and free-trade in the international arena; the other (the republican) promotes elitism in the domestic sphere and protectionism in the international arena. [NB: Earle makes deliberate distinctions b/w democratic regimes, the Democratic party, republican regimes, and the G.O.P. While there is close correspondence between parties and regimes, the correlation is definitely not 1 to 1. Hence the small case ‘d’ and ‘r’ when talking about regimes.]

Separating the regimes are moments of creative destruction that have been kicked into motion by economic and social crisis.

The cycle is as follows:

1. Elitist-protectionist republican regimes take over by instituting processes of creative destruction that involve technological innovations (usually process innovations) that promote capital accumulation (1790s-1830s, 1870s-1920s/30s, 1970s/80s-?).

2. Elitist-protectionist republican regimes tend to end in crises of consumption (e.g. 1830s, 1920s/30s, late 2000s [?]).

3. Egalitarian-free trade democratic regimes take over by instituting processes of creative destruction that entail state formation and the implementation of product innovations and universal social programs that promote wealth redistribution (1840s-1870s, 1930s-1970s/80s, late 2000s [?]).

4. Egalitarian-free trade democratic regimes tend to end in crises of production (1870s, 1970s/1980s, [?]).

5. Return to 1. Every time this happens, there is a redefinition of American statehood and the notion of citizenship. There also occurs expansion in the spatial extent and amount of network integration within the country. The country thus grows geographically from an agglomeration of sectional economies (1790s-1870s), into a functionally interdependent national economy (1870s-1970s), to having controlling nodal status over much of the trans-national global economy (1980s-present).

So, there are three things going on simultaneously with this model: 1) dialectical shifts back and forth between policy regimes, 2) producer or consumer oriented moments of creative destruction, 3) spatial expansion and functional integration of the American economy. Wow.

Tragically, Earle passed away in 2003 shortly after The American Way was published. He did not get to enjoy the positive reception that his book has had from historians, geographers, and political scientists. But even if he had, my guess is that he would have continued for at least the next several years to improve upon the dialectical policy regime model. He says in the book that it is only a beginning step.

Earle also would probably have now been scouring the economic data and legislative dockets for indication as to whether or not the election of Barack Obama signals the beginning of true regime change back toward egalitarian free-trade democracy. It is up to those who read The American Way to ponder that question. Some of my future blog posts will elaborate more on his model, its promise and its many problems. It’s a hard book to read and at times so economically deterministic that it makes me want to bash my head against the wall. But every student (minus one) I’ve read it with (n = about 20) has said afterwards that it changed their perspective on American history, geography, politics, and economy in some way. They’d never really taken cyclical temporality seriously; purely progressive onward-and-upward meta-narratives die really hard.

Back to the tweets. . .

First reaction: after swimming through the social media engagement with creative destruction, thinking about Earle’s take on American political economic history, and experiencing first-hand the Great Recession of 2008-9, I have to agree with many tweeters and bloggers who think that we are in the midst of a gale of creative destruction.

I don’t, however, think this particular moment hinges upon convincing producers about the profitability of green and soft innovations. Instead, if the erosion in consumption that occurred during and after the credit freeze of the Winter of ’08-’09 is any indication, the Great Recession is a crisis of consumption. And according to Earle, the way that the U.S. has gotten itself out of that particular pickle in the past has been to enact policy that will—through state subsidization—develop product innovations and spread the benefits of prior process innovations throughout the population, even if it isn’t profitable at first. If that’s true, then legislators—the ones who control the federal and state purse strings—and traditional media pundits (who right now are so ideologically polarized)—are who we need to be convincing. Thankfully, NGOs, charities and other not-for-profit organizations have primed that pump through work that—although not always intended this way—offers really useful demonstrations for how green and soft innovations might be spread into places that the private sector on its own might otherwise overlook. (Maybe there was some good to come out of the neoliberal moment afterall!)

Second reaction: The U.S. is not going to become one giant relic if state intervention doesn’t happen at the federal level; no matter what, some states and localities are going to make green and soft a priority once the dust settles a bit from the current economic crisis (if they haven’t done so already). Moreover, if the federal government does step in and implements national green and soft strategies, state’s rights and home rule as spelled out under the U.S. Constitution and various U.S. state constitutions are going to ensure that localities will opt into and participate within those strategies in really different ways. Some will be good at it. Others will be really lousy—as demonstrated through the wildly divergent ways in which Medicaid and Medicare services are delivered from county to county. A lot may depend on how much experience a place had during the 1980s, 90s, and 2000s with not-for-profit and privately led green and soft projects. No matter what, the geography of this egalitarian round of creative destruction in the U.S. is still going to be really uneven.

Two questions remain, however: if egalitarian creative destruction requires democratic state intervention, has the Great Recession of 2008-9 been severe enough to force those big wheels into motion? And: what happens in places that miss out on the soft green gale? Will they become so environmentally toxic and politically volatile that their juxtaposition against that of the green and soft world is what will lead to the ‘next big crisis?’