The Agenda

Ben Schulman on the Magic of Failure

Richard Florida points us to a wonderful piece at Gapers Block that captures a lot of my own inchoate thoughts. Ben Schulman describes how Pittsburgh’s success reflects a legacy of failure:


The steel collapse decimated Pittsburgh and its region, taking with it nearly 1 out of every 10 jobs there. Entire towns surrounding the city became obsolete. But it is because of that failure, that absolute bottoming-out, that Pittsburgh has been able to cast aside its past and emerge as a unique showcase of what a small, bustling, connected American city can eventually become. The example of Pittsburgh is to fail on the failures and invest in the attributes- granted, of which the ‘Burgh had many, in its beautiful architecture, old establishment money, intact communities and ethnic organizations, and cultural trusts and universities- that a place already has. It is a tale not so much for cities facing similar problems to the Pittsburgh of 30 years past, as it is for the country as a whole in this stage of national transmogrification.

Like Pittsburgh did, the country needs to realize that failure is an option. Failure can be a catalyst for movement and for action. Failure can be a paradoxical assertion of American greatness. It is time for great structural changes that reinvest in our national attributes- granted, of which America has many, in its beautiful architecture, old establishment money, intact communities and ethnic organizations, and cultural trusts and universities- rather than band-aiding failed foreclosure prevention policies.

I don’t agree with all of Schulman’s prescriptions:

The current crisis could be used to rewrite the rules in regards to short-sales, allowing underwater homeowners to sell their properties without being penalized, as they are now by having the forgiven loan amount treated as taxable income. By freeing sellers from this penalty, in effect, the mobility of individuals to go where opportunities are increases, and the housing market loosens. As the aforementioned Richard Florida has mentioned, perhaps now is the time to get rid of the tax deduction for mortgage interest and enable the country to settle into new modes of habitation. Let’s let Detroit shrink. Bring back the Public Option. We could radically alter the political landscape of the country for the benefit of all by adopting Neil Freeman from’s Electoral Reform Map

I’m okay with reforming short-sales, I obviously love the idea of axing the mortgage interest deduction, and I’m all for letting cities shrink. Redrawing the states is a bit pie-in-the-sky, and I sure as heck don’t think bringing back the Public Option is the right recipe for successful national transmogrification. But Schulman’s thinking is interesting all the same. He is the left-of-center version of what Virginia Postrel memorably called a “dynamist,” a person who embracing the disorderly, decentralized, innovative future, rather than a “stasist,” a person who instinctively defends the old and familiar. One could call a stasist as conservative, but that doesn’t do justice to America’s distinctive conservative tradition, which has a far more dynamist cast. 

I’d much rather have a political debate in which Schulmanism defines the mainstream left and not the AFL-CIO’s version of homegrown social democracy. But Schulman is speaking for a relatively small number of college-educated professionals, and the same is probably true of me as well. Dynamism is a tough sell in a country of homeowners panicked about losing their nest eggs. It is a far easier sell in a country in which a large majority people feel prosperous and upwardly mobile. But a defensive politics of loss aversion is a recipe for economic stagnation. This is a vexing chicken and egg problem.  


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