The Case for Optimism August 13, 2009, 5:00PM EST

The Vibrant Promise of Cities

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Mario Hugo

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After being laid off from a Wall Street job in a downturn, I started Bloomberg as a four-person company with the aim of building a computer terminal that could give up-to-the-minute financial information to analysts and traders. Today the company employs 10,000 people.

The current recession, too, will give rise to a new wave of entrepreneurs. The challenge that state and local governments face—one that Washington, too, should take up—is finding ways to encourage and attract this potential. In New York City, we're expecting a big payoff from what we're doing: opening business incubators, holding boot camps for entrepreneurs, organizing business-plan competitions, expanding the amount of early-stage seed capital for startups, and cutting taxes for the smallest small businesses.

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As countries such as India and China expand their economies, the U.S. will profit, too. The businesses they create will open offices in areas with the highest concentrations of educated, highly skilled workers. America's deep pool of talent and technological knowhow will continue to make it a highly desirable location—and investment opportunity. And if Congress has the sense to fix our broken immigration system, our open society and world-class universities will remain a magnet for the world's best and brightest. That's important: Economists have estimated that every person arriving on an H1-B visa creates jobs for five native-born Americans. Competing for talent and capital will also require all levels of government to invest more in our quality of life—mass transit, parks, schools, and so forth. That will help raise our long-term standard of living, even if real incomes don't rise appreciably in the near term.

There's hope coming out of Washington as well. True, watching the health-care debate deteriorate into a partisan shooting match makes it hard to be optimistic about the capital. But it is encouraging to see the President trying to dismantle major obstacles to our long-term prosperity, including the problems in health care and our broken education and financial regulation systems.

No problem will be solved easily or perfectly—this is Washington, after all. But as we saw during Ronald Reagan's Presidency, when economic problems become sufficiently severe (such as the need for tax and Social Security reform) and when a popular President is also a powerful communicator, bipartisan solutions become more likely.

The truth is, the economy is never as good as it looks in a boom and never as hopeless as it looks in a recession. For optimists, there are always opportunities. People said I was crazy to start a new kind of technology company in a recession. (Later they said I was crazy to run for mayor of New York.) Maybe I was. But human achievement is built on the optimistic notion that what is not possible today can be possible tomorrow. America has never had a short supply of optimists, which may be the best of all reasons to be hopeful.

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Bloomberg is the Mayor of New York City and founder of Bloomberg LP.