Economic Engines

Lessons from Kokomo on How to Spend Responsibly

There’s a debate raging about whether governments should spend more money on economic development and infrastructure, or whether they should cut spending to bring finances under control, a strategy often dubbed “austerity” by critics.

In reality, the two are inseparable. Until you have a firm handle on your finances, you can’t afford to invest on any sort of sustainable basis. This is the logic underpinning what Bruce Katz at the Brookings Institution calls “cut to invest.” That is, there’s no new magic pot of money arriving, so everyone from the federal government to cities needs to make some cuts in order to free up cash to spend on higher-priority items. An unlikely poster child for this philosophy is the small industrial city of Kokomo, Ind. With a population of 57,000 about 45 miles north of Indianapolis, Kokomo made national news as the center of the auto industry collapse, even prompting a visit from President Obama. At its bleakest moment, Kokomo’s unemployment rate hit 20 percent and it faced a near-cataclysmic fiscal crisis when bankrupt Chrysler, the city’s largest employer, didn’t pay its property tax bill. READ MORE

The Economic Case for Free Bridges and Roads

People should pay their own way. It’s a maxim that many Americans hold near and dear. It grows out of our traditions of self-reliance and individual initiative. It’s such a strong belief, that it’s even seeped into the rules we apply to infrastructure projects. 

By this logic, a road, bridge, airport, museum or subway should support itself through its user fees, fares or tolls. If it doesn’t, it’s a freeloader, like a welfare recipient having to be “subsidized” by the community at large. READ MORE

If Cities Want to Succeed, They Need to Focus on What Makes Them Distinct

Have you ever noticed that while every company tries its hardest to convince you it’s different and better than its competition, every city tries its hardest to convince you it’s exactly like the coolest cities? 

This is easiest to see in marketing videos put out by various chambers of commerce and convention and visitors bureaus. If you happen to watch one that isn’t of your own city, you will immediately be struck by how generic it is and how it tries to sell you on a list of purported amenities and attributes we’ll label “conventional cool.” A list that includes things such as coffee shops, bike lanes, trendy fashion boutiques, startups, microbreweries, skateboarders, silk-screen-print posters, hip restaurants, tattoos, public art and so on. READ MORE

The Death or Life of a Sidewalk Ballet

When I first lived in New York City in the late 1980s, I was struck by how the proprietors of the tiny grocery store below my apartment on upper Broadway would hold keys for the children/guests/friends of nearby residents, as well as packages, notes and so on.

The late Jane Jacobs put a lot of importance on the practice. In her masterful and influential 1961 book The Death and Life of Great American Cities, Jacobs wrote it was an example of the “casual, public trust” that underlies the “casual, public contact” that constitutes a rich street realm. This is great -- except shopkeepers don’t do this much anymore in New York City, nor do people ask them to. READ MORE

Do Cities Really Want Economic Development?

So many cities and regions continue to struggle economically. Even within nominally well-performing places there are pockets that have been left behind. Most of the have-nots in the current economy have been struggling for an extended period of time, often in spite of enormous efforts to bring positive change.

Why is this? Perhaps we need to consider the possibility that these places are getting exactly the results they want: Maybe they actually don’t want economic development. READ MORE