Tuesday, 6 April 2010

Macro Level Trends – US Metro Rehabilitation – Navigating Las Vegas through the Economic Desert

Recently reported upbeat US technical data has prompted Presidential Senior Advisor Larry Summers to state that the country approaches “escape velocity” in its bid for attained self-sustaining growth. For millions of citizens that technical data and the overtly positive rhetoric may presently appear as yet another examplar within the realms of that all too familiar quote regards statistics.

Yet, unquestionably the US administration must move beyond its stance on China's foreign reserve surplus in re-balancing global liquidity, and regenerate its economic base, building its way out of Main Street's tough recession. The topic of infrastructure, and its endemic relationship with the prime tenants of ecological responsibility and the individual, of course will play perhaps the primary role in the re-building of the US. But today - unlike J Edgar Hoover's relatively basic 'New Deal' that saw a geographically diverse population 're-centred' for infrastructure building projects from the agricultural dust-bowls of the Mid-West to unprofitable mining towns in Virginia – a new more expansive and forward thinking philosophy is required to regenerate America.

In a bitter twist of fate, one of the most desperate cities that requires the boost of such initiative is Las Vegas itself, once the 'escapist' older satellite town to Boulder City - created to house the construction workers of the New Deal's iconic Hoover Dam.

Given its relative youth and very murky origins, the 20th century story of Las Vegas is a well known addition to the US's history books. However having expanded rapidly over the last 15 years or so, it is the 21st century's near-term that must provide new solutions to meet the challenges that emerged when the economy rapidly contracted; effectively leaving economic devastation as the reality behind the glitzy facade of the city.

Of course recessions are typically a time of new build, the advantages of reduced labour & materials costs leveraged to bolster project costs, business models and of course add to the good of the local economy. Though not quite on the legendary scale of the Hoover Dam, Vegas has been espousing the regenerational agenda of 'City-Center', a reportedly different entertainment venue for regional residents and tourists alike in contrast to the character and remit of its Casino-related surrounds. Instead, it endeavor to bring 'culture' per se to Las Vegas via what is in reality a re-baked version of regurgitated 'Euro-Modernism': as seen before in Miami's 1930s originally 'clean' 'Ocean Drive Deco', this momentarily re-diverted by Lapidus hotels & Lincoln Drive's “Too Much is Never Enough” re-creation in the 1950s (that simply overlayed vibrant tones over simple geometric structures), and perhaps last seen back in the 'Euro' guise of Ford's 1961-69 Lincoln Continental.

Of course for Las Vegas after such pseudo-architectural landmarks like the kitsch original Flamingo and The Sands, the 1960s onwards brought on the idiom of the commercially successful but characterless 'decorated sheds' and 'neon boxes'; perhaps best illustrated by The Mint.

However, whilst an architectural atrocity that added no cultural value to the roadscape The Mint inadvertently assisted in growing the soul of city auto-culture in the guise of the The Mint 400 off-road race between 1968 and 1977– latterly put into legend As the Great American Desert Race - as a counterpoint to the better known and older Baja 1000.

The Mint 400 has been revived and runs annually from its Fremont Street start-point, but critically it nourished the small core of Vegas auto-culture. Today beyond that renowned desert race of Hunter S Thompson lore, it takes the form of NHRA Drag-Racing derived from its illegal start-point of counter-culture youth origins across America but perhaps most emblematic on the old Vegas Strip – very apt – to the running of NASCAR at the Vegas Speedbowl.

The business park grounds surrounding the Speedbowl also happens to be home of the US auto-legend Shelby - which today goes by the holding company name of Carroll Shelby International Inc since 2003, previously in the guise of Shelby American, that name now reborn as the manufacturing subsidiary of CSI (ticker CSBI:OTC for 'over the counter' stock trades).

[NB CSBI is today 06.04.2010 trading at $0.26, a quarter of the value it reached on 25.02.08, demonstrating the decimation to the national and local economy].

For today's media-connected, TV referential popular society that 'CSI' nomenclature has obvious overtones to the TV series CSI: Las Vegas. Whilst that may have been an obvious cognitive tool happily the only connection Shelby has to the judicial system has been the use of the prison system's low cost labour in the formation of 'hand-lay-up' composite body-shell surfaces (hoods, fenders, doors etc) for its niche Cobra and Series One cars.

In the dour economic climate of this Nevada state desert town, this picture of knocked automotive niche manufacturing confidence sits in apparent contrast to the overtly upbeat tones of the local Mayor et al regards the expensive 'City-Centre' initiative – something touted as an economic savior. It's true role as a commercially profitable cultural centre remains to be seen, though as with the case of any newly announced maximum capacity passenger aircraft that proffers space and new experiences like on-board gyms the reality ultimately reverts back to normal business practices and maximum capacity utilisation. This may be ultimately the case with City-Center, where good social intentions that seek to change the character of the city fall to the way-side as the demand-cycle for cheap accommodation picks-up as part of the recessionary-busting effort.

City-Center is perhaps the expected reaction to the recession, an evolution of the 1930s build initiative, this time using largely private funds (even if tussled over) of MGM Mirage and Dubai World. It at least demonstrates the much needed fluid and symbiotic interaction of private capital and an assistive town administration, and highlights an effort to think beyond the (neon) box for the social and commercial good.

And whilst it may be far more typical Vegas style 'Show than Substance' it highlights the need for the city to become self-sustaining in a re-balance of its commercial, productive and wealth creating base. Moreover, just as it became a leading examplar of the credit-bubble, the metropolitan area growing at historic record rates with the explosion of housing construction, so perhaps now the challenge is to re-mould the city as a model of future-thinking.

That means strategically reviewing its geographic and philosophical position, understanding its innate industrial capabilities that lay beyond the gaming tables, show stages, service hospitality to the self-sustaining practical nature of its businesses and inhabitants that once built a city in the desert. That spirit may have heavily depleted as Vegas's character changed with the boom times, but that character needs to be regained.

Look behind the surface and today the outskirts of Vegas into Paradise, Winchester and Enterprise counties are experiencing the same type of retraction as inner-city Detroit experienced over decades as the indigenous car industry slowly shriveled to new global conditions. This of course, it is hoped, is an exaggerationn of the troubles facing Las Vegas, but the wake-up call is clear that alternative growth models beyond City-Centre and ever lasting discounted hotel-room pricing.
As part of this exercise the automotive soul of Vegas should be re-examined to see what else can be built to serve a new era, vehicles beyond the generic limousine Lincoln Towncars, stretched Hummers, yellow cabs, Detroit-sourced white rental cars, police black & whites, and periodic appearances of Elvis' pink Cadillac that run up to 'drive-through' churches furnishing marriage services.

2011 sees a new electorial mayor, after 3 terms of Goodman, and s/he should pose that question to the City and get answers that go far further than simply the usual 'taking heads'.

It may be an over-used example that now has become about as kitsch as Vegas itself, but that original winning attitude of Carroll Shelby that originally took the seemingly unconvincing shell of an AC Ace and fitting it with the massive energy of the 427 power-plant, does serve as a lesson for the municipal ambitions of the city. Ambitions that could seek to create a self-sustaining ethos in everything from water-resources to personal mobility. With unemployment running high and the local prison system likely to see influx, the innate costs of the value-chain are probably at an all time (price parity) low.

Perhaps there is no-where better that could merge a can-do attitude with the American fascination for the automobile, recognising than whilst old fashioned mass-manufactured 'Detroit Iron' resides in the heart, the future calls for a vehicle type and manufacturing system that should be radically different, something far more in-tune with the needs of the earth, local-economies and local individuals. Look at the desert racers (and indeed the swamp racers of the Deep South) and it is obvious the ingenuity for auto-re-creation is there; prompted by a 'Strip' ethos that could see lightweight as key for the goal of fuel economy and US energy security.

Buggies parade the desert sands, why not an on-road philosophical equivalents of very different shapes and sizes, If 1960s European sportscars were revered as 'rolling sculpture' why not the case for 'rolling architecture' in Vegas, where the 'neon boxes' are made to move?

Carroll Shelby held an Ace up his sleeve forty years ago that changed the face of US autos. Time now that the Obama & Las Vegas' administrations back Private Equity resources, possible PPI schemes & Main Street America's capabilities, to fabricate an Ace of their own.

Evolutionary development in nature show how desert beetles are able to navigate their way around a parched Nevada landscape; and a similar 'fit for purpose' philosophy should be part of the US Auto sector's localised re-invention where plausible and amenable.

The sooner Las Vegas starts its re-invention, not glamourising its seedy past, yet merging excitement and its new (City-Center) higher ideals in way that creates something truly avante-garde, the better for it and the whole of the US.