Seattle is in the midst of a pivotal mayor’s race. Maybe not close and certainly not substantive, but very significant for the next four years. Do we take a sharp left turn, as may be happening nationally to the Democrats, or do we roll up our sleeves and try to move ahead on a piled-up mish-mash of projects?
For political/tactical reasons I explored in a previous article, we are not getting the public debate many cities are having. Coming out of the recession, America now has two models for successful urban regions, and we might be arguing about how to blend them. One is the Seattle/Boston/San Francisco/New York model: high cost, high tech, high regulation, high tolerance, creative economy, export-driven. The other is the Houston model (equally vibrant): low tax, low regulation, high tech, energy-based, highly diverse, affordable. What seems to work best is a mid-sized city with regional cohesion and blue politics but in a red state that serves as a corrective to keep taxes and regulations down. Examples are Austin, Denver, Salt Lake City, Oklahoma City, Raleigh, San Antonio, Charlotte, Omaha and New Orleans.
It may not be in the mayor’s race, but the debate about what kind of city Seattle should aspire to is a lively one in the business community. This debate is producing a third model for the coming decade in Seattle, to set beside Mayor McGinn’s model of a progressive vanguard and Ed Murray’s model of pragmatic results through consensus.
Naming this model is tricky. “Globally fluent cities” is a term used by the Brookings Institution, which is leading the discussion about metropolitan regions in the U.S. and abroad. "Global metrocities" is a possible term, with its emphasis on an export economy, global competition for talent and markets, sophistication. Note: not “world cities,” with the connotation of large size like New York and London. Mid-size (Seattle size), but cutting a big profile: That’s what our business leaders, and others in philanthropy, research and nonprofits have in mind for Seattle.
At one level, Seattle has long been this kind of a city, trading resources like timber around the Pacific and selling jetliners around the world. The new crop (Amazon, Microsoft, Starbucks, Costco, Gates Foundation) only intensifies one of the most export-driven regions in the nation. Time to coast? Not at all, say business leaders, since Seattle is playing in a very competitive global environment.
Four years ago, JPMorgan Chase, the banking giant that took over Washington Mutual's banking operations, gave the Brookings Institution $10 million for a five-year program to study and measure the global assets of such cities as Los Angeles, San Diego, Miami, Atlanta, Houston, Denver, Columbus, London, Sao Paulo and Mexico City. The study tried to isolate key factors of global fluency — such things as local leadership with world view, companies with global reach and that are centers of global supply networks, compelling global identity, knowledge infrastructure (patents, universities) and metrowide public-private cohesion that invests in infrastructure and business clusters by strategic priorities. (The last one is a particular weakness of Seattle.) Here’s some of what they found about Seattle. And here are the 10 top traits of globally competitive cities, as Brookings/JP Morgan Chase see them.
Studies were made, reports given to the cities, conferences held — and then not a lot seemed to happen. Seattle was not included in the study because it was already so far along this path.
That has now changed. For one thing, the chair of JPMorgan Chase in the Northwest since 2009, Phyllis Campbell, pushed hard to include Seattle as a test case for how to use this data and actually change things locally. Secondly, Boston Consulting Group, which bills itself as “the world’s leading advisor on business strategy,” was opening an office in Seattle and wanted to do a high-profile pro-bono project to announce its presence. They joined forces with the bank, with the Seattle Metropolitan Chamber of Commerce and Brookings to study Seattle and a new group of peer cities.
Late in October, the results of the study will be released in detail, but I was given a preview of them the other day by the Chamber’s chief of staff, Eric Schinfeld. For this study, eight peer city/regions were used, all selected to be globally oriented and Seattle-like (progressive, good quality of life, research-rich, mid-sized, etc.). The cities are Boston, San Francisco/Silicon Valley, Vancouver, B.C., Singapore, Melbourne, Amsterdam, Hamburg and Stockholm. Five key areas, each with numerous sub-metrics, were selected for comparative research: talent, infrastructure, business environment, innovation ecosystem and global connectedness. Seattle came in fifth best, overall.
At the Chamber’s annual leadership conference at Suncadia in October, the detailed results will be presented, along with some case studies of how some of these cities were able to take lagging sectors and improve them. The Suncadia gathering of political and business leaders will pick some of the 51 study areas that can be measurably improved. Then comes the effort to enlist leaders in business and politics in a one-year effort to move the needle in these areas; more will be picked in each of the subsequent two years.
It’s an interesting peer group of cities. There are no race-to-the-bottom, cheap-labor models. They are Seattle-sized, indicating we have finally gotten over our “world city” aspirations to match mega-cities such as New York or Tokyo. They are sophisticated, diverse, worldly, open, attractive places to live. We are finally “acting our size.” And the league we are playing in, among the most admired and dynamic in the world, suggests a new Seattle dream. As Schinfeld puts it: “to be the best mid-sized regional economy (or near the best) in the world.”
Where Seattle lags, perhaps permanently, is in political leadership aligned with such goals, in being able to solve big problems and to make big strategic investments. Our business climate is unhappy with the political realm and the politicians are increasingly anti-business. (Mayor McGinn is pretty much calling for a labor-business donnybrook in his second term.) And this mayor's race is a kind of bidding war from the left, driving Ed Murray further into a labor agenda.
One problem is the lack of strong, trusted, civic-minded business leadership in the Seattle region. That is partly because our leaders are undergoing a transition from banking and real estate to new-economy figures from the tech world. A good sign: the Chamber’s new chair is Gary Kaplan, CEO of Virginia Mason Hospital and a world expert in LEAN management. Soon to come, top executives at Microsoft and other tech giants.
In the Mayor McGinn years, business leadership has tended to shrug and ignore City Hall or to decamp to the suburbs. Microsoft has built its own bus system, second only to Metro in size. Vulcan has built an independent fiefdom in South Lake Union. But these companies have employees who complain about poor transit (especially to South Lake Union) and are deterred from taking jobs here by rumors of a troubled school system. Eventually, these companies will realize they have to solve these problems by engaging the political realm.
Will the politicians engage these globally fluent business leaders and their emerging agenda of global competitiveness? Globalism is not a popular word in populist Seattle, with its tradeoffs of a downward drag on wages, footloose companies, and high-risk investments. In seemingly opting out of global sweepstakes, Portland exerts a counter-appeal for some in Seattle — the Rose City is a quirky city that doesn’t worry about peer comparisons. There’s resentment that the Gates Foundation is solving the world’s problems but not deeply engaged in Seattle’s. The city has long worried about getting too big for its own good.
Be that as it may, the city’s economy has clearly caught the global tiger by the tail. And that reality, as well as the business community’s growing consensus for the global cities initiative outlined above, is going to be the driver in our local politics for the next decade, whoever occupies the hot seat at City Hall.