something I wrote

wrote this a few years ago, lost it to a crashed laptop and now have salvaged it from the internet...

The Knowledge Economy and Diversity:
New Opportunity for Black Americans
Angela Larson
Introduction
Many black Americans believe that Capitalism is evil. This belief underscores a mindset of such longevity and ironclad reputation that its core tenets have become near apriorisms in our collective consciousness. The central maxim of this worldview is that capitalism’s promise of unchecked wealth accumulation for individuals inspires such incurable avarice as to make racial and class oppression, dehumanization of the American worker and a host of other social ills, positively inevitable. Corollaries to this claim are the equally pervasive notions that American corporations intentionally prioritize the racial and cultural status quo alongside profits and that the American economic system is designed and maliciously directed to do the same.
Black political leaders, liberals and even academics have so often condemned competitive free enterprise historically as a primary source of class oppression that it is now seen, in principle, as such. Little wonder, then, that any positive linkage between corporate America and progress within the black community easily goes unnoticed. But a careful survey of our nation’s past and current economic landscape soundly refutes this view and reveals the emergence of unprecedented financial opportunity for minorities. Capitalism is not a dirty word, and the American Corporation is not the enemy.
With our national economy continuing to struggle, CEO’s being led away in handcuffs, and war on the horizon, it may seem like odd timing for talk of new economic opportunity for black Americans in the corporate setting, but let’s set aside the headlines for a moment and consider what the future of the "new economy" will mean for people of color.
The Industrial Age has ended and a new Information Age has emerged to take its place. In the last century, the advent of mass production gave rise to a full realization of the enormous potential of economies of scale and made the U.S. the richest nation on earth. Today we are at the vanguard of a new economic age, driven not by steel and cars, but by technology and innovation; and knowledge—more than labor, location, or raw materials—is now the crucial economic resource.
One cannot escape the host of new nomenclatures highlighting this economic shift: IT, ICT, E-conomy, E-commerce, Information Economy, Knowledge Economy, such terms are increasingly tossed around as academics, executives, members of the media and office workers everywhere join in the growing commentary and discussion regarding the new global economy and what its future has in store.
At least two new economic principles have emerged in this new knowledge society. First, innovation is king. It now powers the economy of all developed nations. Second, human capital (or if you prefer, intellectual capital) has replaced all other forms—financial or material—as the most important corporate asset. In response, corporations have pushed the aggressive pursuit and maximization of human capital to the strategic forefront, paving the way for an explosion of "knowledge workers" in all spheres of business. There are now over 38 million such workers in the U.S., and their increasing economic dominance translates into radical departures from the traditional corporate picture. To understand these changes and how they are impacting the fortunes of black Americans, we must understand who these workers are.
The Creative Class
We’re all familiar by now with at least one survivor of the dot.com boom and bust of the late 90’s, "the office IT guy." Unshaven, no socks, a colorful tattoo (or three) peeking out from his no-collar shirts and bedraggled chinos, he likes mountain biking, coffee houses, live music and showing up to work at 10 in the morning. No longer an oddity of the tech-underground, 20something bohemian professionals of similar ilk are populating small firms and big corporations alike; yesterday’s corporate outsider is today’s cutting-edge insider.
In a 2002 book titled, The Rise of the Creative Class1, Richard Florida, a professor of regional economic development at the Heinz School of Public Policy and Management at Carnegie Mellon University, has transformed the "knowledge worker" from a mere employment demographic into a full-fledged socio-economic phenomenon, heralding the emergence of what he calls the Creative Class. At its center is a "super creative core" comprised of people "whose economic function is to create new ideas, new technology and/or new creative content." In addition to the obvious candidates such as artists and writers, Florida includes engineers, software developers, scientists and people working in architecture and design. Around the core we find a much broader group of "creative professionals," employed in business and finance, law or health care and related fields. These people "engage in complex problem solving that involves a great deal of independent judgment and requires high levels of education and human capital."
Our economy’s deepening dependence upon the Creative Class is made obvious by noting its dramatic expansion as a percent of the total workforce. All told, the Creative Class has consistently increased its ranks in the past century, rising from 3 million in 1900 to 38.3 million in 1999. In the 1990’s alone, the Creative Class climbed in numbers from about 20 percent to its current 30 percent of all employed people. Conversely, the same period has seen a steady decline in the Working Class population (which employs the majority of the black workforce), which currently accounts for 33 percent of all working people. And while the service class (consisting of lower-end health care, office and clerical workers, as well as food service and preparation, etc.) is still the largest, with about 55 million workers and 43 percent of the total workforce, it is the Creative Class that is driving our economy.
The impetus to take advantage of the Creative Class is reflected in a number of economic trends in recent decades. Florida sites, for example, an over 800 percent increase in research and development spending, which he characterizes as "systematic investment in creativity," since 1950. Additionally, there is the development of the modern venture capital system, which, according to Florida, generated new avenues for innovation and creativity by "unleash[ing] the talents and energies of creative people who previously might have chafed within the confines of big firms or research labs." Venture capital expenditures increased from less than $1 billion in 1990 to over $100 billion by 2000 (before decreasing to less than $40 billion in the wake of the 2001 stock market crash). And while the economy has yet to witness a substantial recovery, there can remain little doubt that our nation’s fortunes are tied to the Creative Class economy.
Creativity in the Workplace
As Florida puts it, "Creativity2 has come to be valued—and systems have evolved to encourage and harness it—because new technologies, new industries, new wealth and all other good economic things flow from it." He notes the emergence of a new "creative ethos" in which "creativity, individuality, difference and merit" have replaced the "organizational ethos" of the postwar economy, where social and professional conformity reigned supreme. Florida avers of his Creative Class mentality: "Individuality, self-expression and openness to difference are favored over the homogeneity, conformity and ‘fitting in’ that defined the organizational age." Consequently, the old "top down" corporate paradigm wherein behemoth bureaucracies, and a multitude of managers, policies and directives from above kept executives and company men well in line has been usurped by a decidedly less structured "bottom-up" gestalt, designed to allow creative people the intellectual and managerial freedom their creativity requires.
Recruitment strategies have also changed. Companies now compete for talented personnel with increasing disregard for race, age, ethnicity or gender. What black Americans must understand is that this is not the result of sweeping social change, nor legally imposed quotas or otherwise artificially generated policies devised to increase "diversity" in the workplace. It is happening because economic success now demands it.
Capitalism, in its purest form, is a meritocratic economic system, meaning that it ignores ideological, social and political considerations. Survival is overwhelmingly a matter of finding ways to maximize profits and minimize costs over one’s competitors. This is a simple, self-interested principle that operates without passion or prejudice. In the "Brave New World" of post-industrial America, this principle manifested itself primarily through the implementation of methodologies intended to increase and streamline production. The rise of the assembly line and large factory systems required tight control and monitoring of all aspects of production to ensure maximum efficiency, resulting in near universal adoption of the "command and control," military-style model, which demanded that every employee accept and maintain strict adherence to the
corporate hierarchy, and carry out perfect "push-button" execution of everyday responsibilities.
Under such a system, is it any wonder that corporate America churned out homogenous, "cookie-cutter" executives, from whom conformity, both in and out of the office, was expected and even demanded? That ethnic and cultural minorities were unable to build significant inroads within the corporate structure of the "organizational age" is as much a consequence of the existing economic milieu as it was the result of any longstanding prejudicial hiring policies or otherwise "institutionalized" occurrences of corporate racism.
This claim may seem controversial, but the fact remains: the sorts of radically individualistic and idiosyncratic personalities, work habits and interests, not to mention the increasingly diverse backgrounds, of today’s Creative Class working environment would have been utterly antithetical to success in the working world of 1950; today, that environment is crucial. Talent and creativity cannot be prioritized without the introduction of diversity, just as conformity cannot be maximized less its exclusion. Ironically, that the capitalist system is blind to such distinctions is exactly what has lead to its perennial denigration by liberal and black political leaders.
Not only has diversity increased because of a shift in priority from conformity to creativity, with recruiters seeking out talent over a propensity to fit in, diversity itself is highly conducive to the creative process, thus generating its own inherent value. This means that firms now have an intrinsic motivation for being color blind with regard to personnel, and talent acquisition becomes even more merit based. An organization that continues to filter potential employees according to race will be penalized in the long run, even if it highlights creativity and talent thereafter; a diverse organization, so long as it recruits its employees for their skills, will inevitably thrive over one that stubbornly supports the status quo.
Hence the increase in diversity among companies at the vanguard of technical innovation and economic growth. But, as Florida points out, "it is a diversity of educational elites, limited to highly educated, creative people." Corporate offices now look more like university research labs and think tanks, where diverse peoples have always gravitated and interacted. But, as is the case at many such institutions, African Americans are woefully underrepresented in occupations associated with the Creative Class, especially in high tech fields.
Black Americans in the Knowledge Economy
The percentages of black men and women employed in managerial and professional occupations are far below those for whites; and with only 119,000 engineers, 45,000 doctors and 48,000 lawyers in the year 2000, blacks account for precious few of the 38.3 million members of the Creative Class.3 Not surprisingly, median incomes of black families relative to white families have changed little in over 30 years, with black
household earnings remaining less than 60 percent of that of white households.4 Even more unsettling, the median net worth (assets less liabilities) of white households was about 10 times that of black households in 1990, with the past decade bringing negligible improvement. In 1999, for example, the median net worth of households headed by older black people was $13,000, compared to $181,000 for households helmed by older whites.5 And, while incomes for blacks have risen in recent years, at $30,439 for an average black household in 2000, most blacks make considerably less than a single member of Florida’s Creative Class, for whom just under $50,000 is the average yearly income.6
These numbers, while disturbing, are not new. Nor can they be expected to improve simply because American firms now cater to the Creative Class. However, there are crucial lessons for the black community. The rise of the Creative Class effectively debunks the accepted wisdom that says Capitalism is always a bad thing for minorities and outsiders. The knowledge economy proves that capitalism is blind to race, creed or color: witness the dramatic explosion of diversity across all categories within the high tech sector. When diversity translates into dollars, diversity there will be. This can hardly be a surprise to even the most casual student of economics, as the capitalist system is based upon purely self-interested interaction between individuals for mutual benefit, in a free market system, unfettered by ideological or political constraints. Under capitalism, rationality dictates that individuals and financial entities will inevitably sacrifice political ideals for economic gain. Capitalism is, therefore, not inherently a source of oppression, but rather a potent force for social change.
Unless black leaders relinquish the political tunnel vision that has dominated the past half century, and refocus energies upon increasing opportunity among blacks for entry into archetypically Creative Class occupations through an emphasis on job training and education, black Americans face being left behind in the next half century. The time for heavy-handed racial politics has passed. The liberal experiment of the past 30 years has failed: economic gains have been minimal, and education levels among blacks of all age groups continue to lag. The rise of the Creative Class is not the result of social engineering, policy experiments, or any other artificially contrived means; but it is an example of how the outsider has become the insider, of how the minority mentality can become mainstream. In short, the rise of the Creative Class reveals an opportunity that black Americans should not fail to grasp.
1Richard Florida, The Rise of the Creative Class: and how it’s transforming work, leisure, community and everyday life (Basic Books, 2002).
2Note that it is human creativity—the ability to produce novel "forms," be they ideas, technologies or strategies—that more appropriately denotes the central commodity in today’s economy, and the term "creative capital" replaces "intellectual capital" as a more apt characterization of the driving force behind our nation’s economy. One of Florida’s main contributions, then, is to shift the emphasis on human capital from the intellectual to the creative, claiming that the former (specialized knowledge and technological information) presents merely the "tools and materials of creativity" and that "innovation…is its product."
3Census 2000, the Survey of Minority-Owned Business Enterprises, the Current Population Survey and the Statistical Abstract of the United States. http://www.census.gov/statab/www/
4 Council of Economic Advisors for the President’s Initiative on Race, "Changing America: Indicators of Social and Economic Well-Being by Race and Hispanic Origin." September 1998. http://www.access.gpo.gov/eop/ca/pdfs/ca.pdf/
5Census 2000, the Survey of Minority-Owned Business Enterprises, the Current Population Survey and the Statistical Abstract of the United States. http://www.nih.gov
6Census 2000, the Survey of Minority-Owned Business Enterprises, the Current Population Survey and the Statistical Abstract of the United States. http://www.census.gov/Press-Release/www/2001/cb01-158.htmlhttp