Looking Back From the Future

Understanding how some cities have transformed shows why focusing on the little things can help struggling places survive and thrive.
by | November 2016
Flint, Mich. (AP/Carlos Osorio)

Aaron M. Renn

Aaron is a Governing columnist and a Senior Fellow at the Manhattan Institute.

The unpleasant reality for many struggling postindustrial cities and regions is that there isn’t an obvious turnaround in sight. For some whose lives are tied up in these communities, that’s a truth they simply cannot confront, instead turning to politician after politician promising magic-bullet solutions. For others, that’s a reason to give up hope and just write these communities off.

But there’s a better way, one that acknowledges reality while recognizing that the future may hold possibilities that we can’t see or imagine.

Let’s look back at a place once left for dead: New York City. In the 1970s, it was failing and nearly went bankrupt. Films like Death Wish and Taxi Driver portrayed an urban dystopia. The city’s population was falling, and some argued that there was nothing left to do but implement a strategy of planned shrinkage.

Yet today New York is a gleaming, booming city at all-time population and job highs, one where public angst often focuses not on civic failure but on problems brought on by success, such as high rents and overcrowded subways.

How could such an unexpected transformation have occurred? New York certainly benefited over the past two decades from the fantastic leadership of two mayors, Rudolph Giuliani and Michael Bloomberg. But this can obscure larger forces that played a major role in the city’s transformation.

The reality is that many cities around the world -- Boston, London, Seattle, Tokyo, Washington, D.C. -- have radically transformed themselves for the better over the same period. This suggests that common factors have been at work.

Those common factors are changes in the macroeconomy and culture. Today’s globalized, technology-powered economy rewards deep pools of specialized, highly skilled talent. It rewards access to global networks, both physical, like international airports, and those linking human capital. What’s more, the talent needed in these industries is attracted to “thick” labor markets -- those with both many job openings and a deep labor pool to compete for them -- to high-amenity environments and increasingly, though not exclusively, to dynamic urban neighborhoods.

All of these play to the advantage of cities like New York. That doesn’t mean good leadership isn’t critical. The difference in the track of New York versus that of Chicago is in part due to a leadership gap, but recent leaders of both cities faced more favorable circumstances than did those of the 1960s and ’70s.

We can see this play out in the differences between Detroit, which is seeing something of a central city revival post-bankruptcy, and Flint, Mich. Detroit is the center of a large region with a thick labor market, has a big pool of engineering and other educated talent, is home to several major corporations, and still dominates the North American auto industry. It has true big-city amenities and a major international airport, and it is the biggest trade gateway to Canada.

Flint lacks all of these. Does that mean that the future is hopeless for Flint or for other similarly struggling cities and regions? No. Just as we didn’t know that New York City could turn around, we also don’t know what the future holds for Flint -- and that could be a good thing. What we can say is that, as with New York, macroeconomic and other changes will need to occur to bring Flint and places like it back into favor before they will really be able to transform.

The honest truth, however, is that these changes don’t seem to be anywhere on the near horizon. But we need to set policy now to pave the way for them, and that means realizing that we can’t restore these economies by government fiat. Expensive build-it-and-they-will-come endeavors, like the now-infamous Detroit People Mover or a $750 million state subsidy for an Elon Musk solar panel factory in Buffalo, N.Y., only breed cynicism when they don’t live up to the hype.

Instead, we need to focus first on helping people, through improving education and making sure they are connected to opportunities. Where needed, create something like the “Mobility Bank” proposed by the Brookings Institution’s Hamilton Project to assist people who want to move but don’t have the money.

But we can’t ignore places. Government has a role to play, not in trying to engage in central economic planning but in setting the stage to profit from any future change in the economic winds. This can start with the painful process of dealing with legacy problems: addressing underfunded public employee pensions whose growing costs threaten to crowd out other essential expenditures; repairing old sewer and water pipes to comply with modern environmental standards; remediating Superfund sites to make land available for development; and rebuilding core public services.

This is what New York did when it started cleaning up its subway system (literally, by eliminating graffiti). The Bryant Park Restoration Corp. was a successful public-private partnership that transformed what used to be called “Needle Park.” Policing was vastly improved to begin both reducing crime and professionalizing the department. Detroit has embarked on its own painful cleanup.

In other words, severely struggling cities should focus on taking care of the basics and problems that can be solved, realizing that they are still in some sense wandering in the wilderness, instead of believing that they can simply subsidize their way back to prosperity.

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