Economic Engines

Linking Up NYC

What is a phone booth without a phone? In general, it’s an eyesore. But not in New York City, where beginning this year old phone booths will be transformed into about 10,000 sleek metal slabs that will provide high-speed digital access throughout the entire city.

The plan is called LinkNYC, and it’s important for two reasons. One, it may be a plan other cities can copy -- there are certainly plenty of old public pay phones around. Two, it’s an example of reimagining old assets and connecting citizens to what is increasingly a vital and life-enhancing service: the Internet. READ MORE

The Myths of Municipal Mergers

In the wake of the events in Ferguson, Mo., much of the media coverage focused on the geopolitical fragmentation of the St. Louis area, and the abuses it has engendered. In some circles, it led to talk of government consolidation, or “big box” government, as a possible solution.

St. Louis County has 90 municipalities. (This doesn’t include the city of St. Louis, which is technically an “independent city.”) Believe it or not, with 22,000 residents, Ferguson is one of the biggest. A number of the municipalities have fewer than 1,000 people. This proliferation of small cities has created perverse incentives to bad and abusive governance. But while there may be clear benefits to consolidation, is it really the answer here? READ MORE

The Real Root of Broken Infrastructure: Broken Governance

When a pothole snags your car or a broken rail halts your morning train, it’s natural to blame the crumbly asphalt or twisted steel. But as I’ve said for many years, physical infrastructure reflects political infrastructure. And fractured infrastructure usually reflects fractured political infrastructure.

MORE: Read the rest of the December issue. READ MORE

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