Economic crisis, or Opportunity?

I would like to point out an article written by Lawrence Martin (o f the Globe and Mail) written for the metro-news.

This metro paper has been good to me the past week or so.

He wrote it in part in response to a report by Roger Martin and Richard Florida (summary).

We all know (or should be taught in grade 1) that the free market capitalistic system is cyclic; we experience intervals of growth and prosperity, as well as an eventual collapse. The causes of such collapse are still debated fiercely in the worlds of economics and political and sociological sciences, usually a flaw in the laws or the system goes unforeseen, or some continued stress causes eventual downturn of the economy.

What is also known however is that recessions are times of rebuilding and restructuring, weak firms and poorly run firms or enterprises fail and from the failures lessons are learned. Industries are restructured minds are changed and the pioneers among us endure, they take repeated failure and build upon successes of the past. And after the failures we always end up better off then where we fell from, the history of economic growth trends upwards always.

Want proof? The dot com bubble of the late 90’s. They built an industry financed by venture capital with lots and lots of cash on the basis that eventually a profitable product or service would be produced. Small companies stopped being small companies when they were bought by large ones for inflated prices based on the same promises and ceased to exist. All this cash flying around and nothing real being produced. Eventually the capital dried up, and the hint of a recession caused all the funding to disappear. Almost overnight an entire industry pretty much disappeared. What happens next is case in point. The internet came back in a big way. This time built on an advertising model previously thought impossible at such scale. Large companies sell their products that don’t seem like products at all yet there are billions of dollars and fierce competition surrounding it. What product is that? Search. Google, Yahoo, Microsoft own huge stakes in search and that’s where the money is and it all comes from advertising dollars. On top of that we have content services as well as a cloud of web based applications. All semi–tangible products. The sector was reborn and is undergoing an evolution. Devices are being built and manufactured to take advantage of all these services. Companies such as Apple, Nokia, RIM, Microsoft, and now Palm (seems like it might be back in business with the Pre) are all taking advantage with mobile devices alone. In their wake companies like Google leave an industry that although certainly not immune to this economic downturn are built and structured now to weather the storm.

So back to Martin, Martin and Florida, all of them are basically saying this: That we in Ontario should be focusing our efforts to rebuild
Ontario into a creative services economy.  Almost all government programs, spending and tax and trade policy are geared toward helping the manufacturing and resource sector. L. Martin writes:
Stimulus schemes and handouts, they say, may be necessary to prop up the old economy. “As in all times of economic crisis, there is considerable pressure on governments to protect the past and undertake bail­outs.” That said, “There is a better way.”

He reports that we need to capitalize on the current recession and move off the old industrial economy. Further saying.

Start making the big moves to an idea-driven, creative economy based not on goods, but on services. Put the stress on the development of knowledge workers, on research and development, on innovation.

With the amount of education in this province and across Canada, I don’t see how we can allow this opportunity to pass us by.

The “brain drain” you hear from years past (circa late 90’s) is almost never uttered this day in age, with more people reluctant to move to the USA due to a booming and stable Canadian economy, and with fears of either a totalitarian Bush state or now a Huge Government Obama Nanny state, Canadians probably are feeling more comfortable at home now. Canada’s service sector is already large, and the structuring toward manufacturing is only likely due to a very vocal minority.

Service sector is much more flexible to change then is the manufacturing sector. It’s less susceptible to fluctuations in the dollar or economy. When people might not want to buy cars there is always room for research and innovation, consulting, creative projects, financial services ect ect.

If you take one thing from this, let it be this: Please educate yourselves, please start your own companies be creative, hire creative minds if you aren’t creative. Don’t think that you need to “make” something. Small business is the backbone and the meat and potatoes of an economy. Urge your government to support small creative business, and if you can’t rely on government (which we all know we can’t) rely on each other. Be adventurous, take risks, and support creative enterprises yourselves with your hard earned cash. Build a better Canada

Ok so that was more than one thing. So on that I’m going to Hope for Change , not from some new leftist dream world supported by huge government debt but; but from an economy of the people for the people.

Could such a thing be done? Can we see a better Ontario, a better Canada? One more solid and competitive then most nations on earth? (I’m gunning for France personally)  To quote Mr  Rebadt DeLama

Yes We Can.