Remember all the talk about how America was losing its competitive edge in financial services? For “America”, read “New York City”, of course. Well, the concern may be lessening. At a conference on the future of New York hosted by the Economist on Tuesday, Mayor Bloomberg was apparently very upbeat. According to the New York Times City Blog – “Economic Threat From London? Not to Worry, Mayor Insists”, “Mayor Michael R. Bloomberg — fresh from a visit to England, during which he stayed at his London apartment — presented an extremely cheerful report card on the state of New York’s economy.” Later panelists apparently talked about how NYC could stay competitive (unlike the Mets) — but there did not seem to be any wailing and gnashing of teeth.
Is there really a threat of London gaining ground on NYC as a financial center? Probably yes. Is it a major blow to the US financial services industry? Probably no. Improvements to US financial regulation and other economic policies are needed — not just for the competitiveness of NYC as a financial hub but for the economic system of the US as a whole. As we develop our I-Cubed Economy, our policies will need to catch up with where our financial system has already gone.
But, as for all the hype of the-sky-is-falling, a quote from that wonderful New York show – Saturday Night Live – may be called for: “never mind”.
The rulemakers for private-sector financial accounting (the Financial Accounting Standards Board – FASB and the International Accounting Standards Board – IASB) took action a number of years ago on account for intangible assets (see our paper Reporting Intangibles). However, those rules applied only to purchased intangible, not internally generated assets. FASB and IASB are looking into that issue, after a couple of years break. In the meantime, the rulemakers for state and local government accounting — the Governmental Accounting Standards Board — has been steadily moving forward, starting in May of 2003. In July of this year, they issued GASB Statement No. 51, Accounting and Financial Reporting for Intangible Assets, which includes internally generated assets.
It is heartening to see that GASB has grappled with this tough issue. It is now up to FASB and IASB to pickup the work – and the pace.
If you are interested in understanding the role of design in the I-Cubed Economy, check out Bruce Nussbaum’s blog. And no, we are not just talking about fancy products like the iPod and the iPhone. Design thinking is becoming a model for business thinking and engineering. Nussbaum explains in one of his most recent posting – Why is The New York Times So Dumb About Design And Innovation?:
It’s not that the article is bad–it’s a nice discussion about how back-end process innovation is often key to the success of products. The problem is the rarity of this kind of piece in the NYT. Design in the Times is still mostly about style, aesthetics and fashion. Glitzy, cool stuff with skinny models and empty, but beautiful homes. Coverage of design in the Times is a throwback to, what, the 50’s? The entire evolution of design out of simple form to process, methods, strategy and more just isn’t in the newspaper.
That evolution of design is much of what Nussbaum talks about and tracks.
Another good source is the Illinois Institute of Technology (IIT) – Institute of Design. They recently hosted a conference on design. Here is what one of the speakers from the UK Design Council talks about – ABSTRACT: Trust me, I’m a Designer: How Design Research Can Influence Businesses, Governments and Policy Makers?:
Governments increasingly recognise the need to move their economies from low-value, commodity products and services towards differentiated, added-value production. In turn, businesses understand that competing principally on price is a losing game. More and more business leaders and policy makers also see design as a strategic business process that helps to identify and meet real user needs.
Some time ago I did a piece on how the UK is moving in this direction, while the US still doesn’t get it (see UK Leads; US Lags). US business gets it, but public policy (and public understanding) is still far behind — as Nussbaum’s critique of the New York Times shows. We need to turn that around.
Today is also the first Monday in October, meaning that the Supreme Court is back in session. Most of the attention for this new term is focused on controversial social cases (see New Issues, Familiar Battles – WSJ.com, Justices Begin Work on a Polarizing New Docket – New York Times, Supreme Court to Take On Contentious Cases in New Term – washingtonpost.com, Guantanamo inmates’ rights to get fresh look – Los Angeles Times). Buried in all the other issues is at least on patent case — Quanta Computer v LG Electronics. As the Associated Press – “Court to Consider Technology Patent Case” – explains:
At issue is whether a patent holder can seek royalties from multiple companies as a patented product works its way through the manufacturing process.
I doubt, however, that this will be the only IP case the Court hears during its 2007-2008 term. Given all the other cases that are making their way through the court system, I’m sure something else will bubble up. If the past year is any guide (and it may not be), it could be an interesting year.
Today is the first date of the federal government’s fiscal year (never mind that most of the government is still running under a continuing resolution rather than a real budget — but that is another story that has to do with history and politics). As such, it is also the day that the Commerce Department’s Technology Administration (TA) and the Undersecretary of Commerce for Technology disappears. The elimination of these offices was part of the recently enacted America COMPETES Act (the one part I was not happy about). In place of the Undersecretary and TA, the Commerce Secretary has created a Technology Council to coordinate technology programs within the Department. Missing from this equation, however, is a home for technology policy and analysis within the Department.
This new structure makes clear that the locus of policy making on technology issues has shifted to the White House for any overarching approach to technology, with each particular agency taking the lead on the specific narrow issues of interest (i.e. broadband, IP, tech funding etc.) Whether the Commerce Dept Technology Council and the White House Office of Science and Technology Policy are enough to drive a coherent policy remains to be seen. We may just be back where we were in the mid 1980’s when we created the Technology Administration in the first place.