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November 17, 2003

Old Economy (Roman Style) Versus New Economy: Part 1

Old Economy (Roman Style) Versus New Economy:  Part 1


 


Being comfortably installed back in Rome for a little more than a week --after an absence of more than 30 years punctuated by a few tourist stays of no more than a couple of days every few years-- I can’t help but marvel at the entrepreneurial vigor of the Romans.  The “old” city was always a cacophony of open air markets, shops, stalls and human sounds of grinding, scraping, sawing emanating from artisans fixing, repairing and even cleverly faking the antique pieces decorating grand apartments, ponderous museum and flea market stall.  Of course, many of these skilled craftsmen have died out but taking their places are shopkeepers, café owners and restauranteurs, especially restauranteurs.  Streets that were dark and mysterious once the workshops closed down are now lighted and full of life.


 


Impressively, the Roman authorities have gotten a real hold on the inner city traffic problem that once made navigation limb-threatening by practically limiting car movement to people who live in the quarters or who have specific business there.  This has opened the way to buzzing scooters, like mosquitoes on athletic supplements, that can zip through everyplace but the special areas that are completely closed off to traffic like Piazza Navona and Piazza Santa Maria in Trastevere.  Bikes and foot traffic now move freely through the old, winding cobblestone streets.


 


Rome, of course, is something utterly unique.  There is no place on earth like it, no place with so many layers of history still visible (or invisibly hidden in the structures of medieval buildings sometimes built right on Roman temples), no place where so many centuries of vanity and vainglory have combined to allow for the ornate construction of palaces and churches representing the riches that the headquarters of the first great global enterprise, the Church of Rome, has spread around the city.  Every Roman cardinal great or small for the last 600 years, every Pope, has left some mark, be it a church or two or a family palace and some of the mightier ones, flush with cash from their exclusive indulgence franchise and ready to monumentalize their worldly fame, transformed the entire city from a medieval village to the great Baroque wonder that it is today.


 


So yes, the city is full of tourist rightly attracted to this open-air museum and movable feast that is modern Rome.  The steady supply of Euros these tourists bring with them acts like manure to a field of entrepreneurial mushrooms, and so in a myriad of shapes and hues, businesses sprout overnight in every nook and cranny of the city.


 


But beyond that there is a pattern.  After all, the cafés are for the most part individually owned, not a bunch of Starbucks and Cosi’s, nor are the restaurants and snack bars Olive Gardens or TGIF’s.  Something strange is (not) going here (take your pick); there are small grocery stores, small hardware stores, small household supply shops, small video stores, small whatever.  What a wonder to see from the perspective of the big box world of Wal-Marts, Targets, Home Depots, Best Buys, etc.


 


Yes, there are giants here, most with not so glorious pasts as state-owned, or state-run monopolies: autos, big oil, big banks, telephone, TV.   There are government jobs, of course, and a large public sector but still you have to marvel at how many small businesses have carved out enduring niches.  I even found a little shop that specialized in casting and carving decorative plaster.  It hadn’t moved from its spot in the back streets of Trastevere where it probably was founded long before I first got here and judging from the various white objects leaning in against every supporting surface, it hadn’t lost any of its market share.


 


What I’m getting at is a fundamental difference in our societies and perhaps between much of Europe today and that of the US.  As Americans we pride ourselves on our self reliance, our individualism, our value of individual effort and personal competitiveness but the question then springs up like some kind of a dagger hidden beneath my cloak:  where do we get to express this individuality in a society that is so clearly dominated economically and socially –think big media—by huge entities that have so heartily gobbled every market and are thus the only promising career choice for most of us.  If most jobs are traditionally created by small businesses (this has been a truism of the US economy) and the playing field for small businesses shrinks from day to day –think manufacturing and think China, think retail and think Wal-Mart—we have to wonder and worry where new jobs might come from.  Large corporations must think bottom line and globally.  They are, after all, at the service of the shareholders, as they like to say.  And if it is possible to move a backroom computer operation to India and run it for half the price with little or no loss in efficiency then who is to tell the CEO or board that this isn’t the way to go.  When Wal-Mart places one of its mega orders for some doodad or other, it thinks price. It’s cheaper to set up a factory in China, along the way transferring technology and make it there. The American consumer wants those price cuts.  Supposedly he or she doesn’t give a damn where the stuff gets made and how many jobs get lost in the Faustian bargain.


 


One problem, maybe: Can these consumers, tempted by the lowest borrowing rates in 50 years, and inundated with encouragement from media and government, run out their plastic forever?  Okay, homeowners, got to double or triple dip but extending the amount they owe on their houses, presumably paying off their credit card balances and extending their limits to once more enter into the field of American battle, not Iraq but the big box down the road.


 


Maybe the Fed can keep printing the money forever without affecting much more than the price of the dollar if you happen to be abroad, like me, or the price of gold, if you happen to be long on the yellow stuff, also like me.


 


Then again, maybe not.


 


Rmb


 


Rome


 


11/17/03

Posted by dymaxion at 04:01 PM


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