How did this book come about? At first glance it seems so different from the domestic focus on the American cities in your first book.

After I finished "The Rise of the Creative Class" I was invited to the Knowledge Wave conference in New Zealand. The speakers were Robert Putnam [author of "Bowling Alone"], [Stanford professor] Paul Romer, and me, plus all these heavyweights from around the world. Later they arranged a lunch with the director Peter Jackson [of "Lord of the Rings" fame] and a tour of his Wetta Studios.

When I asked him why he chose New Zealand to build his state-of-the-art studio instead of L.A. or elsewhere in the U.S., he said, "I decided I could build this incredible digital film production complex in Wellington. And not only could I attract talent from around the world because we have a great project and great people and a great location -- there's the sun and the beautiful surroundings and the beautiful city -- but it's small enough so there weren't the kind of distractions you would find in L.A." Distractions like a lot of congestion, people who don't come to work, people who don't have to work all day to afford a house ...

He said, "What we could do here is build a team, while in L.A. everyone is moving from project to project. What I'm trying to do is build an actual company that's around for a long time. It's for people who want to work for a company that has a continuous stream of employment." And he said he could get people from Australia, from Germany, from France, from the Soviet Union or the former East European block and from the United States. They all wanted to work at the studio.

"The Flight of the Creative Class"

By Richard Florida

HarperBusiness

336 pages

Nonfiction

Buy this book

And so I put that into my head and I started to think and I started to travel around a little more and it just dawned on me that the competition between Pittsburgh and Austin, Cleveland and Seattle, St. Louis and San Francisco, wasn't just a national competition. In fact, the competition for talent was global.

Which is the same type of global expansion that's happened in many industries.

Right, it was like what had happened in the auto industry 20 years ago, when you had French auto producers, Italian auto producers, Japanese auto producers and the big three here, and they all competed for national market share. But then that market went global -- as did the market for TVs and the market for telecommunication devices and the market for computers -- and then companies had to compete on a world scale. The same thing is happening with cities and the talent they compete for.

And when all this hysteria about national security, homeland security started to happen, I realized that what really drove the United States to its position of greatness wasn't the fact that we had a big market or lots of raw materials or our American ingenuity. What really made America great for the better part of a century and a half has been our openness to people from all over the world. That's what built our textile industry, that's what built our railroad industry. It was because we accepted people like Andrew Carnegie in the steel industry, David Sarnoff in the electronics industry, Adolphus Busch in the beer industry, and so on.

And according to analysts' statistics for the high-tech revolution, 30 percent of the companies in the Silicon Valley area were founded by an Indian or someone born in a Chinese-speaking country. Whether it's eBay or Yahoo or Google or Hotmail, what drove America's high-tech revolution and other industries was the ability to attract the world's best talent.

But what are the current problems the U.S. faces in terms of attracting that sort of talent? What's the difference between now and, say, five years ago?

There are two factors interacting here. The first, which would have happened anyway, is that other countries realized how important talent is and cities in those countries have become really effective in competing for talent. So the playing field has been leveled. In the past, people would have said, "Absolutely, my first choice is to move to New York or Boston or San Francisco or Seattle or Chicago ..." Now cities like London, Dublin, Amsterdam and Stockholm have become extremely attractive to talented people, not because of any particular public policy but because of the way they've developed over the past decade. And I'm not just talking about the relocation of Americans, I'm talking about the location decisions of people on a world scale.

The second factor is that -- obviously spurred by this so-called threat of terrorism -- we've become far more restrictive in our ability to absorb and attract foreign talent. The numbers are all there, showing the decline of foreign students in the U.S. and the decline in the number of visas issued. So many foreigners have visa troubles now, even great scientists, artists and musicians. And once they're living and working in the U.S., they can't go home to visit relatives for five years because if they're not a resident they have to get their visa renewed every time they enter or exit the country. Which means it's a huge problem to leave the U.S. even for a short period of time because they're not sure they'll be able to get back in again. Not surprisingly, there's a general sense in the world that the United States isn't as welcoming.

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