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Social innovation

03/13/07 12:00AM By Bill Shutkin
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(HOST) With some of the US economy's biggest players struggling to survive in the global marketplace, commentator Bill Shutkin sees a new frontier for American innovation.

(SHUTKIN) I'm no economist, but I can't help following closely what's going on in the U.S. economy right now. Two stories in particular have caught my eye.

The first is the decline and imminent fall of Detroit and the Big 3 automakers. Thirty years ago Detroit's CEOs and unions demanded the Japanese build factories in the U.S. or face further import restrictions. Today, the Japanese have not only complied, but thrived. They've built a superior product and continue to innovate with technologies like hybrid engines. Most important, they've responded to what consumers want: fuel efficiency, good design and low maintenance costs.

Now turn the page in the Business Section of your newspaper and you'll read about the travails of another keystone American institution, Hollywood. It turns out the big movie studios can no longer depend on domestic sales for their profits. Instead, they're relying increasingly on foreign box office revenues. For a variety of reasons, quality chief among them, Americans are declining to buy what Hollywood has to offer.

So what's the connection between Detroit and Hollywood, two cities and two industries that could hardly be more different?

It's that what these sacred cows of American culture produce is being rejected by the American people. Sure, there's still a ton of leading edge, world class businesses in the U.S., but the foreign competition is heating up.

But perhaps Detroit and Hollywood's loss is society's gain. We may have ceded our creative edge in industries like automobile manufacturing and filmmaking but we have a chance to make up for it in what I think is the next frontier of American ingenuity - social innovation.

Social innovations are new ways of governing our society that maximize opportunities for people to realize their personal and collective potential. They're the strategies and institutions that operate among the public, private and non-profit sectors to enable our increasingly diverse, post-industrial society to pursue a vision of a just and sustainable world - one person, one community at a time. They are employee-owned companies, tax credits for renewable energy technologies, zoning rules that promote dense, vibrant downtowns and free wireless internet access. Social innovations serve one master: solving social problems.

Many of the tools of social innovation already exist. The challenge is to develop the civic will to use them at scale, to build a new social order out of them.

General Motors claims in a current ad, that a new American revolution is upon us. I agree. But it's not arriving in a car or a truck. Rather, as in 1776, it's in the way we govern ourselves, the rules and institutions we put in place to achieve a better society. And like the original, today's revolution needs leaders up to the challenge, less like Lee Iacocca or Michael Eisner and more in the mold of George Washington and Thomas Jefferson.

Bill Shutkin is a writer, lawyer and Research Affiliate at MIT.

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