A new twist on creative destruction

I've written about creative destruction here plenty of times before, usually in the realm of consumer products (Blockbuster, Sony Walkman, the music industry, Borders, Harry & David). Today, I've got a different twist on the matter, one that's oddly reminiscent of this post of mine from last year on the increasing urbanization of America.

In that post, I wondered whether we as a society were prepared to let our cities fail ("We must be willing to let dying businesses fail (hello, Blockbuster and the Walkman), and so too must we let dying cities fail."). Today, I wonder whether a city must occasionally die, so that it can be reborn.

Recent census figures show that Detroit’s overall population shrank by 25 percent in the last 10 years. But another figure tells a different and more intriguing story: During the same time period, downtown Detroit experienced a 59 percent increase in the number of college-educated residents under the age of 35, nearly 30 percent more than two-thirds of the nation’s 51 largest cities.

These days the word “movement” is often heard to describe the influx of socially aware hipsters and artists now roaming the streets of Detroit. Not unlike Berlin, which was revitalized in the 1990s by young artists migrating there for the cheap studio space, Detroit may have this new generation of what city leaders are calling “creatives” to thank if it comes through its transition from a one-industry.

With these new residents have come the trappings of a thriving youth culture: trendy bars and restaurants that have brought pedestrians back to once-empty streets. Places like the Grand Trunk pub, Raw Cafe, Le Petit Zinc and Avalon Bakery mingle with shops with names like City Bird, Sole Sisters and the Bureau of Urban Living.

Those familiar with past neighborhoods-of-the-moment recognize the mood. “It feels like TriBeCa back in the early days, before double strollers, sidewalk cafes and Whole Foods,” said Amy Moore, 50, a film producer working on three Detroit projects. “There is a buzz here that is real, and the kids drip with talent and commitment, and aren’t spoiled.”

Veeeeery interesting. Could it be that for Detroit to survive, the answer lies not in saving the Big Three auto manufacturers who have been at the city's economic core for decades, but in fact in letting them die, so that a new industry, a new employment base, a new culture can thrive?

Much of the discussion surrounding the auto bailout concerned "saving" Detroit, a pursuit that realistically failed, anyway. With or without the auto bailout, it was clear that Detroit's multi-decade reliance on one major industry was becoming untenable. Now, with plummeting real estate prices making the city an intriguing choice for young professionals, the crash of the Big Three might be exactly what Detroit needs to get back on its feet.

Ironic, no? Of course, that then begs the question... why did we bother saving GM and Chrysler in the first place?

[New York Times]