Cities On A Hill - Manhattan Institute - November 27, 2006

The Creative Class Canard

 

he urban silliness quotient hit a new high this week with the Times’ breathless story on Sunday about cities competing with “hipness” to attract the young. The peg for this oft-repeated tale of surging urbanism was a self-serving release by the Atlanta Metropolitan Chamber of Commerce that crowed about how in the last census their city ranked first in attracting 25- to 34-year-old educated people.

If this shtick sounds familiar, it should be. It’s the same “creative class” mantra that has mesmerized city policy makers from coast to coast. The key factor in “creative class” theory, concocted by academic Richard Florida, is that if you are hip, cool and “tolerant,” at least to people with the right liberal social views, your city will flourish.

Reporters, urban developers, gay activists and arts foundations naturally love this idea. Sometime they use it to push their agenda—not necessarily with Dr. Florida’s endorsement—for such things as new publicly financed arts venues, subsidized lofts, restaurants, clubs and street festivals.

Yet depressingly few have considered the evidence about whether the theory actually works. Many of the cities that have long been at the top of the “creative class” list of “cool cities”—San Francisco and Boston, for example—have over the past five years had among the most sluggish rates of economic growth.

Other municipalities that have swallowed the creative class kool aid, such as those embracing Michigan Governor Jennifer Granholm’s “cool cities” initiative in that beleaguered state, have fared even worse. Another disaster spot is Baltimore, where mayor (and newly elected Maryland governor), Martin O’Malley’s efforts to create coolness have left the city ranked among the absolutely worst places to Live in America. Meanwhile, New Orleans, perhaps America’s hippest city, has emerged as the ultimate poster child of urban dysfunction.

Nor does it appear that these centers of hipness have done all that well in attracting and retaining young people, particularly since the collapse of the dot com bubble in 2000. Instead, people in their 20s and 30s, according to the census’ American Community Survey, appear to be heading to the places that have been creating jobs, such as Orlando, Houston, Dallas and, to a surprising extent, Southern California, including Orange, Riverside and San Bernardino counties.

This is the dirty little secret about “talent”: it revolves mostly around the economy. In the late 1990s Portland, Seattle, San Francisco, New York and Boston, all “hip and cool” cities , did enjoy rapid high end job growth. Since then, migration trends have cooled off in New York, San Francisco and Boston, although no doubt some of the super-educated, most elite young people still head to these places. Seattle and Portland metros appear to be doing better among the broader ranks, although it appears most of the growth is taking place in the surrounding suburbs rather than in the urban core.

This leads us back to Atlanta, a strange place to identify with some sort of hip-cool urban renaissance. Atlanta is one of the most suburbanized regions in the country; barely one out of every ten residents in the region live in the city, much of which is poor. Virtually all the job growth there has been in surrounding suburbs.

There also are reasons to be skeptical about the extent of the Times’ claims of Atlanta’s inner city “comeback.” The downtown’s office vacancy rate is now roughly twenty percent, among the highest in the nation. Several big companies—including Bell South, Scientific Atlanta and Georgia Pacific—have all been acquired, and now Delta, the key to the city’s cornerstone as a transport hub, is on the block. Its headquarters could seen be shifted to Phoenix, the base of potential purchaser US Airways.

Amidst all this, the much ballyhooed downtown condo building boom may be busting. A recent report on WXIA Television there revealed that one condo tower has started auctioning off units, not a good sign in a city where there are already 9,000 condos on the market and plans for another 17,000.

In the 1990s and early 2000s Atlanta’s appeal to young people was no doubt real, but much of it consisted not of young “cools” moving to the urban core. Instead it was a booming economy that drove the migration of the educated to the region—and most of them went to suburbs.

This became peculiarly evident when the Atlanta Opera decided to move to the massive new auditorium at the Cobb Galleria in the suburbs. Cobb has a booming economy that attracts companies, and young professionals who, by the time they get into their 30s, may be more interested in economic opportunity, a single family house and procreation than remaining “hip and cool” urbanites.

Perhaps city officials elsewhere should look more closely, not only at the realities of the “Atlanta model” but also at what is happening across the country. It’s the economy and things like efficient administration, reasonable levels of taxation and most of all job growth that create the preconditions for educated migration, whether in boomtowns like Houston, Phoenix, Orlando, Fargo, Charlotte or, for that matter, suburban Atlanta.

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