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Raise the Gas Tax!

17 hours 36 min ago

Driving just got a lot cheaper in America. The timing is great not only for American consumers, but also for America’s infrastructure. The Highway Trust Fund simply can’t keep up current spending levels without more revenue. Significant declines in pump prices have presented an excellent opportunity to raise the federal gas tax, while keeping pump prices lower than initially anticipated. Though a gas tax hike may not be the ideal approach, it is infinitely preferable to bailing out the Trust Fund with general revenue, or to putting the brakes on much needed infrastructure spending. This is a rare opportunity to improve America’s infrastructure without putting an additional burden on American taxpayers. It would be a shame to miss it.

No one enjoys paying taxes, though they are much easier to swallow when the revenue produces visible results. Since the gas tax is deposited into the Highway Trust Fund, it is somewhat like a user fee, albeit, an imperfect one. From the standpoint of fairness, it makes sense that drivers should pay for using the roads. Aside from fairness, the virtue of the 'user pays' principle is that it helps to ration roadway use. If movie theatres were paid for through tax revenue and tickets were free at the point of consumption, everyone would be stuck waiting in line. The same principle generally applies to roadways, although tolls have a more direct impact on traffic congestion than gas taxes. There is some legitimate debate over the optimal mix of revenue tools to fund roads, but if it comes down to raising the gas tax or using general government revenue, raising the gas tax is the obvious choice.

Congress has allowed the Highway Trust Fund to gradually lurch towards insolvency. Expenditures have risen while gas tax rates haven’t. America’s aging infrastructure is in desperate need of repair, so holding out for the ideal solution no longer seems tenable. The Congressional Budget Office estimates that spending is poised to exceed revenue by $167 billion over the 2015-2024 period. The Trust Fund has already received $54 billion in transfers from the treasury since 2008.

One of the proposed solutions to the shortfall is to restore the Highway Trust Fund's original mandate: use gas taxes exclusively to pay for highways. In other words, get rid of what's known as the Transit Account. That would go some way towards alleviating pressure on the Trust Fund, but it still wouldn’t bring the fund into balance. Regardless of whether or not the Trust Fund continues to pay for mass transit expansions, Congress will need to find more revenue.

There has never been a better time to increase the gas tax. Consumers and firms have budgeted for much higher gas prices than they’re paying at the pumps. The bi-partisan proposal to increase the gas tax by 12 cents per gallon would leave gas prices below $3 per gallon, which is still a substantial overall decline. Indexing the gas tax to inflation would help to ensure that the Trust Fund doesn’t end up in this bind every few years.

Given the state of the American economy, now is a particularly bad time to defer highway construction and maintenance. Public spending can’t be expected to fix all that ails it, but this is a good time to support the construction industry.

While 30 cents per gallon might seem high, American drivers would still pay among the lowest gas taxes on earth, and less than Canadians pay. That America has managed thus far to maintain an enviable national highway system for a fraction of Canadian federal fuel taxes is a testament to the efficiency of the Highway Trust Fund model.

Given the enormous windfall that drivers will receive from lower gas prices, clawing back some of it to ensure that American still have roads fit for driving is a reasonable proposition. Just because the federal government owns the national highway system doesn’t mean that it's free. Someone has to pay to maintain the system. Drivers should be first in line to do so.

Steve Lafleur is the Assistant Director of Research for the Frontier Centre for Public Policy-- -- a Canadian think tank based in Winnipeg, Manitoba.

Flickr photo by Curtis Perry: Another perfect day for highway drivers in LA.

Overselling America’s Infrastructure Crisis

Tue, 12/16/2014 - 21:38

60 Minutes ran a segment recently called “Falling Apart” that was another alarmist take on the state of American infrastructure. I’ll embed here but if it doesn’t display for you, click to CBS News to watch (autoplay link).

We’ve seen this story before. America’s infrastructure is falling apart and we need to spend many billions on upgrades, but politicians won’t agree because they are too craven.

There’s some truth to this point of view. The problem is that it’s oversold using the worst examples. It also gives short shrift to the many infrastructure upgrades that we have been making. And it ignores how people and businesses make capital purchase decisions in the real world.

First, I’m not surprised to see that 60 Minutes spent a lot of time in Pennsylvania. In my experience, Pennsylvania is in a class by itself when it comes to infrastructure. Drive something like I-70 from Washington to the Ohio state line and prepare to be appalled. Pittsburgh legitimately has a massive infrastructure maintenance overhang. Philly too. And much of the infrastructure there was under built to begin with. The Schuylkill Expressway goes down to two lanes each way, for example. Similarly, 60 Minutes is right about some of the obsolete bridges on Amtrak’s Northeast Corridor. They may have easily included other high profile embarrassments like LaGuardia Airport or Penn Station. Or they might have taken a look at state of decay of Rhode Island’s bridges.

There are clearly some high profile legacy items that need to be addressed. But that neglects the other side of the coin, namely that there’s a ton of major infrastructure that has been upgraded.

60 Minutes includes some footage of Chicago. Clearly there’s a need for bigtime investment there. But in the last 20 years or so IDOT reconstructed completely many of the major freeways in the area like the Kennedy and Dan Ryan. The Tollway Authority widened virtually the entire system and implemented open road tolling, vastly reducing congestion. Similarly the CTA opened the brand new Orange Line, did major work to renovate the Green and Pink Lines, just did major infrastructure upgrades on the south branch of the Red Line, and expanded capacity on the Ravenswood. They’ve also gone from tokens and cash to electronic fare collection. At least one new commuter rail line was opened (the North Central line). The O’Hare Modernization program is underway with new runways already online and a significant reduction in congestion there. A new terminal was also built and the existing terminals given some refreshes.

Is there a lot to do in Chicago? Undoubtedly. But let’s give credit for what has already been done.

It’s the same elsewhere. Nicole Gelinas notes that New York has invested $123 billion in the transit system in the last 30 years. That’s not chump change. The third water tunnel is now online there as well. Indianapolis built an ultra-modern airport terminal complex that’s up to international standards. Many other airports like DTW, SJC, SFO, etc. have built major new terminals or seriously upgraded their acts. There have actually been a lot of investments in port infrastructure to get ready for post-Panamax ships.

I’m told even Pennsylvania has done a good job of starting to address its infrastructure problems. The Philadelphia airport is actually quite nice these days, for example.

So we’ve actually done a lot already that 60 Minutes doesn’t give us credit for.

But what’s more, the presence of infrastructure that’s at or near the end of its useful life isn’t necessarily a bad thing anyway. Would it make sense for every single car on the road to be brand new? Of course not. Most cars ultimately end up getting driven till the wheels fall off. And that makes perfect sense. Why would you junk an asset that still has lots of service life left? We reallocate ownership of a lot of those cars during their lifespan, but we try to get the max out of their useful life.

It’s similar in our homes. How many of us replace a furnace at the first sign of rust? Yes, sometimes we do a complete upgrade or refresh of a kitchen or bathroom, but most of the time we don’t replace major household systems like furnaces or roofs until they appear to be at a point where paying for repairs when they break appears to be futile in light of the asset age. It makes sense to pay $400 to replace a starter that fails when the car has 125,000 miles. It’s more questionable when the transmission goes out at 175.

The fact that some issues or incidents with infrastructure can cause temporary closure or disruption is exactly how most personal capital assets work. A part goes out on our car. It needs to be towed and fixed. And it’s out of commission during that period. That’s annoying, disruptive, and costly. But does it mean that we should all go out and buy a brand new car? I don’t think so. And that’s certainly not how people behave in the real world. Obviously you have to build in a margin of safety on items like bridges where a failure would be catastrophic, but the same general principle applies. We shouldn’t wait for them to fail before replacement, but we do and should get the full useful life out of them.

Why would we expect our government to spend our money on its capital assets in a manner differently from how we spend our money on our own personal possessions? This explains why the public is much more skeptical of spending on infrastructure than the infrastructure lobby would like. It’s to be expected that some percentage of our infrastructure will perpetually be at or near end of life, as that’s the nature of the capital asset life cycle.

What’s more, when we replace a furnace or car, most of us don’t go out and buy Cadillacs. We buy something that fits the budget. Unfortunately, this mindset doesn’t seem to penetrate the public sector, where a significant amount of infrastructure is gold plated and priced at a level far out of line with international comparisons. The big problem in New York isn’t a lack of investment in transit. It’s the fact that the region has just about the highest transit capital costs in the world. Wonder why Madrid and Calgary have nice train systems? Among other reasons, they were very cost-efficient in their design and construction. Rather than more money, maybe we should first try some reform in our broken system of building stuff that results in lengthy project timelines and out of control costs.

So there are some things that need to be taken care of and we need to do that. But scaremongering about dangerous bridges isn’t the right answer. And where I see the biggest infrastructure needs are on local streets and bridges, where federal and state dollars are least likely to be applicable. It’s no surprise to me that most of the pothole ridden, bombed out streets we drive on are local city streets, where they are the maintenance responsibility of an entity that lacks the large, dedicated infrastructure revenue streams available to the state and federal governments. But that’s a topic I’ll have to explore in a future post.

Aaron M. Renn is an independent writer on urban affairs and the founder of Telestrian, a data analysis and mapping tool. He writes at The Urbanophile, where this piece originally appeared.

Can Abe Tackle The Real Reason For Japan's Decline? (Procreation)

Mon, 12/15/2014 - 21:38

Much has been made of Japan’s latest relapse into recession. For the most part, economists have focused on the efficacy of the once much-ballyhooed “Abenomics,” the stimulus and structural reform program that was seen as the key to turning around the island nation’s torpid economy.

While Prime Minister Shinzo Abe’s ruling coalition won a sweeping electoral victory this weekend, giving him a mandate to continue his economic policies, it is increasingly clear that the epicenter of Japan’s crisis is not its Parliament, or the factory floor, but in the bedroom. Japan has been on a procreation holiday for almost a generation now, with one of the lowest fertility rates on the planet. The damage may prove impossible to overcome.

Japan’s working-age population (15-64) peaked in 1995, while the United States’ has grown 21% since then. The projections for Japan are alarming: its working-age population will drop from 79 million today to less than 52 million in 2050, according to the Stanford Institute on Longevity.

Since hitting a peak of 128 million in 2010, Japan’s overall population has dropped three years in a row.

These trends all but guarantee the long-term decline of the Japanese economy and its society. In comparison, competitors such as the United States and India are projected to continue to grow their workforces over the long term. China’s workforce, which grew rapidly over the last couple of decades, recently began to decline, as early as 2010 by one estimate, due to its one-child policy.

Some countries, like Germany or Singapore, have tried to make up for low fertility through immigration, something that remains all but unthinkable in congenitally insular Japan. Short-term importation of workers has occurred through a “foreign trainee” program, but it has stirred controversy, with some immigrant workers claiming they are being cheated and abused.

Aging is becoming a bigger issue, particularly due to the country’s average lifespan of 83 years, which is among the longest in the world. Perhaps if everyone would have the good sense, as one Japanese official put it, to “hurry up and die,” the shrinkage would be manageable.

But old Japanese don’t seem to be lining up to commit suicide. So by 2020, adult diapers are projected to outsell the infant kind. By 2040, the country will have more people over 80 than under 15, according to U.N. projections. By 2060, the number of Japanese is expected to fall from 127 million today to about 87 million, of whom almost 40% will be 65 or older.

The fiscal costs are obvious. Over the past few decades, aging has helped transform once thrifty Japan into the country with the high-income world’s highest level of government debt. The demands for more help for the elderly, notably medical care, combined with a shrinking, increasingly occasional workforce, is one reason why Abe was forced to push for a sales tax increase, one of the things that retarded Japan’s recovery.

These trends have been developing for decades. Sociologist Muriel Jolivet noted in her 1997 work Japan: The Childless Society that many Japanese women had taken a break from motherhood, in part due to male reluctance to take responsibility for raising children. This trend accelerated in the next decade. By 2010, a third of Japanese women entering their 30s were single, as were roughly one in five of those entering their 40s. That’s roughly eight times the percentage in 1960, and twice that of 2000. By 2030, according to sociologist Mika Toyota, almost one in three Japanese males may be unmarried by age 50.

Many young Japanese are not only eschewing marriage but a highly publicized sliver now show little sexual interest in each other. The percentage of sexually active female university students, according to the Japanese Association for Sex Education, has fallen from a high of 60% in 2005 to 47% in 2012.

Much has been made of a subset of young Japanese men labeled as “herbivores,” who appear more interested in comics, computer games and socializing through the Internet than in seeking out the opposite sex.  And since many only work part-time, they tend to stay longer with their parents, further slowing economic growth.

No society can thrive under such an environment, certainly not in the long run. If “animal spirits” drive entrepreneurial growth — as it did unmistakably in Japan both before and after the Second World War — those are clearly dissipating now. As prices have dropped and opportunities shriveled, fewer Japanese are interested in starting or growing families.

In the longer run, one has to wonder what kind of country Japan may become over time, something hardly irrelevant not only due to the country’s importance, but also since other key Asian countries appear to be following the demographic path it is blazing, including including South Korea, Taiwan, Singapore and China. In China, the U.S. Census Bureau estimates, the population will peak in 2026, and will then age faster than any country in the world besides Japan.

Of course, projecting population and fertility rates over the long run is difficult, and there remains a large margin for error. For example, the U.N. projects Japan’s 2100 population at 91 million, while Japan’s National Institute of Population and Social Security Research projects a population of 48 million, nearly one-half lower.

Japan’s grim demography is also leading to tragic ends for some elderly. With fewer children to take care of elderly parents, there has been a rising incidence of what the Japanese call kodokushi, or “lonely deaths” among the aged, unmarried, and childless. Given the current trends, this can only become more commonplace over time.

The Japanese “model” of low fertility still has its defenders, including those in the U.S. who point out that it allows, in the short term, for greater per capita wealth and lower carbon emissions. But most Japanese recognize that the profound morbidity of the demographic trends; 87% see an aging population as a major problem, according to a recent Pew study, compared to 57% in China and only 26% in the U.S.

And to be sure, Japan remains a supremely civilized country, with low crime rates, a brilliant artisanal tradition, and exemplary infrastructure.But none of this can likely survive under these demographic conditions. Not surprisingly, the  Japanese government, like its counterparts in western Europe and Singapore, has attempted tomake child-rearing easier by providing cash payments for families and expanding child care.

Yet to date, such compensation has been unable to make up for high housing costs and weaker familial bonds. As Toru Suzuki, senior researcher at the National Institute of Population and Society Security Research, put it in The Japan Times, “Under the social and economic systems of developed countries, the cost of a child outweighs the child’s usefulness.”

Although the United States has not embarked on such a dismal course, in large part due to a greater land mass, lower housing prices and immigration, for us, too, the twin forces of lower fertility and the retirement of baby boomers is slowing our labor force growth rate.

Ideally American fertility rates will recover with the economy, allowing us to get back to a more sustainable demography that would at least replace older people with a steady supply of young adults. What we don’t want to do is emulate Japan. There’s a price to pay for avoiding the bedroom in favor of video games, not only for individuals but societies as well.

This piece first appeared at

Joel Kotkin is executive editor of and Roger Hobbs Distinguished Fellow in Urban Studies at Chapman University, and a member of the editorial board of the Orange County Register. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is author of The City: A Global History and The Next Hundred Million: America in 2050. His most recent study, The Rise of Postfamilialism, has been widely discussed and distributed internationally. He lives in Los Angeles, CA.

Photo by Kevin Poh: Night Life @ Shinjuku, Tokyo

California Business Needs to Go Small or Go Home

Sun, 12/14/2014 - 21:38

Here’s the bitter reality for business in much of California: there’s no cavalry riding to rescue you from the state’s regulatory and tax vise. The voters in California have spoken, and with a definitive, distinctive twist, turned against any suggestion of reform and confirmed the continued domination of the state by public employee unions, environmental activists and their crony capitalist allies.

You are on your own, Southern California businesses, and can count on very little help, and, likely, much mischief, from Sacramento and various lower orders of government. To find a way out of stubbornly high unemployment and anemic income growth, the Southland will need to find a novel way to restart its economic engine based almost entirely on its grass-roots business, its creative savvy and entrepreneurial culture.

This shift poses a great challenge, both for California’s interior counties and parts of the coastal region. Unlike Silicon Valley and its hip twin, San Francisco, no one is investing much in the Southland. Among the nation’s largest metropolitan areas, the Los Angeles region has become a corporate stepchild, trailing in new office construction not only to world-beaters like Houston, but also New York, the Bay Area and even slower-growing Philadelphia or Chicago. In fact, although the second largest metro area in the country, L.A.-Orange County does not even make the top 10 regions for new building.

Nor can we expect much in the way of residential housing growth, particularly single-family homes, as the state’s planners continue their jihad against anything smacking of suburban expansion. Traditional industries like aerospace, manufacturing and logistics face enormous regulatory barriers, ruinous taxation levels and huge energy price increases that will slow any potential growth, and could lead to yet more departures by existing large firms. Virtually all the region’s former major established aerospace companies have relocated their headquarters elsewhere, which hurts efforts to get them to expand or maintain facilities here.

Despite all this, the Southland is not without considerable assets. Perhaps most promising is the region’s status as the nation’s No. 1 producer of engineers – almost 3,000 annually. This raw material is now being somewhat squandered, with as many as 70 percent of graduates leaving the area to find work.

But there’s no reason for unmitigated despair; overall, Los Angeles-Orange has increased its ranks of new educated workers ages 25-34 since 2011 as much as ballyhooed New York, San Francisco and much more than Portland, Ore. For its part, the Inland Empire ranked fourth among 52 large metropolitan areas in terms of increased presence of bachelor’s degree-holders in this age group, adding almost 19,000 college-educated people since 2011.

There’s also a case to be made for Southern California as an emerging tech hub. As venture capitalist Mark Shuster points out, the region ranks third, just behind the Bay Area and New York, for its percentage of the nation’s tech startups, and is now the fastest-growing. The overall tech base, which includes aerospace, is still the largest in the country, with more than 360,000 employees. As tech moves from basic infrastructure to application, Shuster argues, the Southland’s time may come.

Despite producing MySpace, the region may have lost out in the social media wars, but shifts in tech trends could turn out to be far more advantageous. This relative optimism is remarkable given the losses in so many key engineering-driven industries over recent decades, from electronics and energy to aerospace.

Southern California’s technology community could well benefit from such things as growing demand for content among tech firms, as well as attempts to reboot space exploration. Indeed, investor Peter Thiel recently suggested that the region’s technology industry is the most “underestimated” in the nation.

“I’d definitely be short New York and long L.A.,” Thiel told the Los Angeles Times, citing both commercial space pioneer SpaceX and Oculus, the Irvine-based maker of virtual-reality headsets.

The case for a grass-roots rebound of tech in Southern California depends heavily on one key asset – the presence of the nation’s largest community of people in the arts. Roughly half of these workers are self-employed, according to the economic forecasting firm EMSI.

The Silicon Valley may be ideal as a place to nurture digitial technologies, but “nerds” as a whole are not cultural mavens or trend-seekers. They are better at transmitting messages than putting something worthwhile in them. In contrast, Southern California excels in filling messages with product.

The large existing base of television, movie and commercial producers has nurtured skills that are sought worldwide. Yet at the same time, with the studio system clearly in decline, as large productions go elsewhere, digital players such as Netflix, Amazon, Apple, as well as Los Angeles-based Hulu, have become more important. Indeed, when my Chapman students, many of them film majors, discuss their futures, it is increasingly these intermediaries, not the studios, that they identify as critical to a successful career.

This suggests a very different picture of the Southland’s industry than the one normally associated with large companies, studios and deep concentrations of talent. In the future, more production will be done by individuals, sometimes working out of their homes, scattered across the region. According to Kauffman Foundation research, the L.A. area already has the second-most entrepreneurs per 100 people in the U.S., just slightly behind the Bay Area. By necessity, Southern California’s economy will become more entrepreneurial and grass-roots; even as we have been losing large companies, our percentage growth in self-employed is among the highest in the country.

Not surprisingly, this activity appears concentrated not in the traditional bailiwicks in the San Fernando Valley, or in the hyped Downtown-adjacent areas, but along the coastal strip from Santa Monica to Irvine that some promoters have christened “the tech coast.” This epitomizes the growing role of young individuals and startups – as opposed to veteran engineers – in shaping the Southland’s emerging tech economy.

This pattern, however, is not just restrictive to digital entertainment. Southern California’s network of tested aerospace engineers – which, at 5,000 people, is second only to Seattle’s – is one reason why companies like SpaceX have located here. In an economy that relies more and more on individual expertise, this is a critical advantage.

One powerful caveat: We are not likely to see much blue-collar spinoffs of tech here, due largely to high land, regulatory and energy costs. Space X, for example, may have its key brain power in Southern California, but has chosen to construct its spaceport in lower-cost, business-friendly Texas. Another aerospace firm, Firefly Systems, this year decamped entirely for Texas, moving its headquarters to the Austin area and rocket engine facilities to rural Burnett County.

This pattern suggests that many of our emerging firms may remain somewhat limited in scope and largely focused on high-end functions, which reduces the positive impact for the region’s struggling local middle class and working class.

But the new grass-roots economy does not apply only to tech. Los Angeles has seen a huge rise in the number of people working from home, a percentage that since 1980 has more than tripled even as transit’s ridership share has dropped. Small, home-based businesses are common not only in such fields as real estate, but also in business consulting and even trade.

These home-based businesses, and small ones tucked into strip malls or small industrial centers – for example, in food processing – represent the last, best hope for a revived Southland economy. Our corporate community seems destined to continue shrinking, but this does not necessarily mean that the overall economy has to follow suit. Unable to rely on local officials to make things better, our best chance lies with relying on the entrepreneurial spirit and creativity of our people – the very thing that made us such an economic beacon in decades past.

This piece first appeared at the Orange County Register.

Joel Kotkin is executive editor of and Roger Hobbs Distinguished Fellow in Urban Studies at Chapman University, and a member of the editorial board of the Orange County Register. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is author of The City: A Global History and The Next Hundred Million: America in 2050. His most recent study, The Rise of Postfamilialism, has been widely discussed and distributed internationally. He lives in Los Angeles, CA.

Self employment photo by

Good Enough Urbanism: Faster, Cheaper, Smarter

Fri, 12/12/2014 - 21:38

There’s plenty of blight out there. Inner city blight, failing suburban blight, long lost rural small town blight… empty storefronts, boarded up buildings, dead streets. There’s simply no government program that’s going to bring these places back to life. No Wall Street investment scheme is likely to revive these places. Developers have no economic incentive to do anything with these buildings. Banks are risk averse and will not fund investments here. However, many of these forlorn spots exist within otherwise populated and potentially healthy neighborhoods. They may have been passed over when a nearby highway was extended or bled dry by big box stores and chain restaurants. But they could be pressed into service once again if enough people colonize them in creative ways – assuming the local authorities hold back on the usual mindless code enforcement.


I’ve heard many local economic development people and city planners tell me they can’t force people to do anything they don’t want to do. True enough. But, man can they shut people down in a hurry for a whole lot of ridiculous minutiae for no good reason. So towns need to ask themselves if they want to continue to deteriorate for the sake of adhering to all the accumulated and often archaic rules that may not even make sense anymore, or if they want reinvestment and vitality. Keep in mind, this sort of reinvention may not exactly look like a Gap, a Starbucks, or a Nordstrom, but that doesn’t mean it isn’t employing people and creating an environment that can start turning a neighborhood around.


Wherever I go I seek out examples of people who carve out a little business or useful community space in the midst of an otherwise uninspiring environment. Here are a few examples. Have you ever dreamed of opening up a shop of some kind? Many people do. But then you start to think about the high rent in a good part of town, and the regulations… The need for a handicap accessible public bathroom, a federally inspected commercial kitchen, insurance, a dozen pieces of paper covered in stamps from who-knows-what bureaucracies: permits, licensing fees, certifications, public notifications… Just thinking about the process stops most people cold. And then they find themselves working as an assistant manager at a chain for slightly above minimum wage.


These folks just skipped the whole asking-for-permission part and started working on a shoestring budget. They gave the garage a fresh coat of pain, got some inexpensive second hand furniture, flung open the doors, put out a sign, and started selling flowers. If the business fails they haven’t lost much – and at least the garage is finally clean and organized. If the shop is successful they can eventually work their way up to the full ADA, OSHA, and DOT gold standard with minimum parking ratios and energy efficiency compliance. But that can come later. Towns have to choose. Do they want to tolerate this sort of thing or shut it down immediately? It tends to come down to the “property values” folks objecting to the “trashy” nature of such establishments. In the end it’s all a matter of self-selecting populations agreeing on what is acceptable in their neighborhood and what isn’t. Some places will roll with it and others won’t. Fair enough.



Here’s a small town coffee shop with a big mostly vacant gravel parking lot that’s been set up as a family gathering place. People can come here, get a sandwich, something to drink, a pastry, and linger with other people from the neighborhood. The shipping containers are both secure storage for the cafe’s supplies, as well as the walls of an outdoor play area for kids. The picnic tables, shade structures, bicycle racks… none of it is expensive. A liability lawyer and insurance adjuster could have a field day with this place. But so far there have been no deaths or mutilations – except for out on the highway in front. But those folks were in cars and had nothing to do with the coffee shop or playground. (I don’t see the county shutting down the highway.)



Around the corner from my apartment there’s a German Lutheran church that puts on a beer garden in their parking lot at Christmas. There’s a mix of expatriate Germans (in jeans and T-shirts) and local German-Americans (in lederhosen and fedoras) along with the usual San Francisco Hindus, Buddhists, and seriously lapsed Catholics (that would be me), but all are welcome. The beer, bratwurst and kitsch oompah band are all pretty good.


This is Alfonso’s Cafe. It’s basically a shed in an old parking lot in a not-so-great suburban location. He set out some patio furniture, potted plants, and a shade structure and he manages to earn a respectable living. No one will ever confuse Alfonso’s place with a Parisian cafe, but it gets the job done and truly makes his neighborhood a better place compared to a dead parking lot. It’s Good Enough Urbanism. If all goes well Alfonso may eventually graduate to something bigger and more substantial. If he had to start with the entire armature of a full scale restaurant he may never have been able to pull together the money to get started. Alfonso’s Cafe is actually an in-between step, one level above a push cart or food truck, but one step down from something bigger and fancier.

My point is that many of the just-scraping-by locations are ripe for reinvention as incubators for small family owned mom and pop businesses if the local authorities cut folks some slack. Not everything will work, but there isn’t much to lose in trying.

John Sanphillippo lives in San Francisco and blogs about urbanism, adaptation, and resilience at He's a member of the Congress for New Urbanism, films videos for, and is a regular contributor to He earns his living by buying, renovating, and renting undervalued properties in places that have good long term prospects. He is a graduate of Rutgers University.

Two Chicagos, Defined

Thu, 12/11/2014 - 21:38

Years ago, when I first started working as a planner for the City of Chicago, my primary responsibility was working with community organizations that received Community Development Block Grant (CDBG) funding for commercial revitalization activities.  This being CDBG funding, our work was constrained to areas of the city where 51% or more of households earned less than the median household income for the Chicago metro area.  In the early 1990’s, this hardly interfered with our work — outside of the Gold Coast, the Near North Side, Lincoln Park, Lakeview and a few parts of the Northwest and Southwest sides, we were able to grant CDBG funding to virtually the entire city.

Fast forward twenty years.  Chicago’s transition from Rust Belt Capital to Global City has been unparalleled.  Where there once had been large swaths of middle-class, working-class and impoverished neighborhoods, with high-income enclaves, there are now nearly as many high-income neighborhoods as there are of the other three.  Perhaps someone who moved to Chicago post-1995 and lives in one of the up-and-coming areas is vaguely aware of this, but anyone who was here before then is quite right to be astounded.

Despite Chicago’s transformation, it’s been pretty well-documented that not all parts of the city have benefited.  The battle over the closing of nearly 50 schools, mostly located in the city’s poorer South and West side neighborhoods, brought this to light, as did Chicago’s high-profile murder and violent crime rates through 2013 (which, to date in 2014, have gone down dramatically).  Inequalities and disparities became evident in both areas; University of Chicago graduate student and blogger Daniel Kay Hertz brought the disparities to light with his analysis of violent crime in Chicago.  As he said in his piece:

Over the last twenty years, at the same time as overall crime has declined, the inequality of violence in Chicago has skyrocketed. There have always been safer and more dangerous areas here, as there are everywhere; but the gap between them is way, way bigger now than it used to be.

Over the last two decades a new but undefined paradigm has emerged, the one of “Two Chicagos”.  This is probably best explained once again by Dan Hertz, who recounted an overheard conversation on the L:

I was on the train earlier this week, and two white men got on and asked their neighbors, who were two black women, how to get to a hotel. The women told them. And then began a sort of stock conversation that Chicagoans have with tourists: How do you like the weather, ha ha? The men, who were from Atlanta, did not like it. Have you been on a subway before? Yes, but not often. Would you come back? Oh, yes. We love Chicago, the men said.

The men reached their station, and left.

One woman said to the other: I hate it when people say that – I love Chicago. No, you don’t. You love downtown and the North Side. The other woman said, Uh huh. 

That is a frequent sentiment of those who live on the other side of the invisible divide in Chicago.  But what, exactly, is that divide?  Where are the boundaries?  Exactly how deep are the difference?

I took a stab at trying to figure this out.

I compared some socio-economic statistics for the 56 zip codes in Chicago against medians and averages for the entire Chicago metro area (Indiana and Wisconsin excluded).  The differences are stark.

Let’s start by looking at maps of the areas of examination.  Here is the seven-county Illinois portion of Chicago’s metro area, with Chicago etched in:

I gathered data for all suburban municipalities and all City of Chicago zip codes within this area, for five variables — population, non-white population percentage, median household income, and median home value, and bachelor’s degree or more for persons 25+.  The data comes from the 2011 U.S. Census American Community Survey.  After collecting that data, I established an “average of medians” or “average of averages” to get a baseline for the metro area, and an understanding of how jurisdictions or zip codes would compare to one another.  One fairly big caveat — an average of medians or average of averages weighs all jurisdictions equally, skewing the numbers higher due to the number of small but well-to-do suburban municipalities.  So while the 2011 actual median household income for the seven-county area overall was $61,491, the average of medians was $74,731.  But since all data is expressed this way, differences are negated.

Next, I looked for Chicago zip codes that were above the metro area average in at least one of three categories — median household income, median home value, and bachelor’s degree or more for persons 25+.  These are the higher income neighborhoods that can be called “Global Chicago”.  Within the city, they look like this, in yellow:

Most Chicagoans would recognize this as the wealthier parts of the city.  It stretches from the far Northwest Side eastward to the lake, south to downtown and continuing south before ending in the Hyde Park neighborhood on the South Side.  Again, I included all zip codes that were above the metro average for at least one of the three categories I examined, so not all communities are the same.  Hyde Park, for example, is here because it has high educational attainment, but is below the average for income and home value.  The same applies to Rogers Park and Edgewater on the city’s northern border with Evanston.  Jefferson Park, Norwood Park and Sauganash, on the other hand, located on the Northwest Side, rank highly in home value but lower for income and educational attainment.

Taken together, you can see how “Global Chicago” compares with the Illinois portion of the metro area, the metro area excluding Chicago to give you Suburban Chicago, and the balance of the city beyond “Global Chicago” that I’ve called “Rust Belt Chicago”:

The differences are indeed stark.  “Global Chicago” is on par with the Chicago suburbs and the metro area overall in terms of income, and has a lower percentage of minority residents compared to the metro area.  Interestingly, “Global Chicago” has a much higher home value and educational attainment when compared to the metro area overall or the ‘burbs.  Meanwhile, “Rust Belt Chicago” lags far behind.  “Rust Belt Chicago” has a large majority-minority population, has an income nearly one-half as much as the suburban households, and has only one-third as many college graduates as “Global Chicago”.

I decided to take this analysis a little further and determine if there is a core to “Global Chicago”, and how it would compare to the rest of the city.  I collected data for zip codes that exceeded the metro average in two or more of the three categories.  That produced this map:

And this table:

Here, a “Super Global Chicago” compares favorably with the ‘burbs in terms of income, but far exceeds it in terms of home value and educational attainment.  Including some of the peripheral areas of the previous “Global Chicago” with the previous “Rust Belt Chicago” to produce an “Average Chicago” leads to some gains, but it still lags far behind the other slices of the metro area.

Right now, the CNN series “Chicagoland” is doing its best to illustrate the “Two Chicagos” meme, highlighting blues festivals and Stanley Cup championship celebrations on one end of town and school closures and endless crime on another.  However, these maps and tables may do a far better job of demonstrating the impact of past and current practices and policies on the city’s landscape.  In fact, I think Chicago’s example is one that will serve as a model, for better or worse, for other cities across the nation.

In reality I see the “Two Chicagos” meme as overplayed.  Chicago may be better understood in thirds — one-third San Francisco, two-thirds Detroit.

This post originally appeared at Corner Side Yard on March 18, 2014.

Pete Saunders is a Detroit native who has worked as a public and private sector urban planner in the Chicago area for more than twenty years.  He is also the author of "The Corner Side Yard," an urban planning blog that focuses on the redevelopment and revitalization of Rust Belt cities.

Chicago photo by Bigstock.

Cities: Better for the Great Suburbanization

Wed, 12/10/2014 - 06:57

Where Cities Grow: The Suburbs

The massive exodus of people from rural areas to urban areas over the past 200 years has been called the "great urbanization." For more than two centuries, people have been leaving rural areas to live in cities (urban areas). The principal incentive has been economic. But most of this growth has not taken place close to city centers, but rather on or beyond the urban fringe in the suburbs (and exurbs). Appropriately, The Economist magazine refers to the urbanization trend as the "great suburbanization," in its December 6, 2014 issue (PLACES APART: The world is becoming ever more suburban, and the better for it).

The preponderance of suburban growth is evident in high income world metropolitan areas. For decades, nearly all growth in nearly all cities has been in the suburbs. Some notable examples are London, Toronto, San Francisco, Portland, Tokyo, Zürich, and Seoul. The dominance of suburban growth is also evident in the major cities of the less developed world, from Sao Paulo and Mexico City, to Cairo, Manila, Jakarta, Beijing, and Kolkata (see the Evolving Urban Form series). The Economist describes the substantial spatial expansion of residences and jobs in Chennai (formerly Madras), a soon-to-be megacity in India.

Growing Cities Become Less Dense

The Economist quotes New York University geographer Shlomo Angel, whose groundbreaking work (such as in Planet of Cities) indicates that "almost every city is becoming  less dense." Angel also shows that, contrary to the popular perception of increasing densities, cities become less dense as they add more population. This extends even to the lowest income cities, such as Addis Abeba (Ethiopia), where the population has increased more than 250 percent since the middle 1970s, while the urban population density has declined more than 70 percent. The rapidly growing cities of China exhibit the same tendency, where, according to The Economist: "Mr. Angel finds that population densities tend to drop when Chinese cities knock down cheaply built walk-up apartments and replace them with high towers."

Suburbs in the United States

In the United States, The Economist says that more than half of Americans live in suburbs. In fact, this is an understatement, owing to the common error of classifying "principal cities" as urban core, when many are, in fact, suburban. The Office of Management and Budget established the "principal cities" designation to replace the former "central city" versus suburb classification. This was in recognition of the fact that employment patterns in US metropolitan areas had become polycentric, with suburban employment centers, which along with central cities were designated as "principal cities."

The absurdity of using "principal cities" as a synonym for central cities is illustrated by the broad expanses of post-1950 suburbanization now classified, with genuine core cities like New York or Chicago, as principal cities such like Lakewood, New Jersey (New York metropolitan area), Hoffman Estates (Chicago), Mesa (Phoenix), Arlington (Dallas-Fort Worth), Reston (Washington) and Hillsboro (Portland). In fact more than 85 percent of major metropolitan area (over 1 million population) residents live areas that are functionally suburban or exurban according to our small area analysis ("City Sector Model").

Urban core growth rates have improved since 2010, which is an encouraging sign. Yet, core city jurisdictions account for less than 30 percent of metropolitan area growth, as Richard Morrill has shown. The Economist points out factors that could prevent this long overdue improvement from being sustained in the future.

  • Schools are "still often dire in the middles of cities," according to The Economist. Any hope of keeping most young families as they raise children seems impossible until core cities take on the politically challenging task of school reform.
  • The Economist also notes the huge government employee pension obligations of some large core cities, suggesting the necessity of cutting services or raising taxes. "Both answers were likely to drive residents to nearby suburbs, making the problem worse. No number of trams, coffee shops or urban hipsters will save cities that slip into this whirlpool." The Economist specifically cites Chicago and New York, but could have added many more examples both in this country and outside.

Limiting Sprawl and Limiting Opportunity

The Economist is refreshingly direct in its characterization of attempts to stop urban spatial expansion ("urban sprawl"). "Suburbs rarely cease growing of their own accord. The only reliable way to stop them, it turns out, is to stop them forcefully. But the consequences of doing that are severe."  The Economist: chronicles the experience of London, with its "greenbelt" ("urban growth boundary"): "Because of the green belt London has almost no modern suburban houses and very high property prices."

The social consequences have been massive. "The freezing of London’s suburbs has probably aided the revival of inner-London neighbourhoods like Brixton. It has also forced many people into undignified homes, widened the wealth gap between property owners and everyone else, and enriched rentiers." Housing is typically the largest share of household expenditures and raising its price reduces discretionary incomes, while increasing poverty. In London, The Economist says that "To provide desperately needed cheap housing, garages and sheds there are being converted into tiny houses," quoting historian John Hickman who calls them “shanty towns”.

Higher house prices and lower discretionary incomes are not limited to London. Among the 85 major metropolitan areas covered in the 10th Annual Demographia International Housing Affordability Survey, all 24 of those with "severely unaffordable" housing have London-style land-use regulation or similar land use restrictions. These financial reverses are not limited to suburban households, since urban containment policies are associated with substantial house price increases in urban cores as much as in suburbs.

"Doom Mongering" About the Suburbs

Oblivious to this revealed preference for residential and often commercial suburban location, many retro – urbanists, including many well placed, have viewed the suburbs with "concern and disdain," according to The Economist. Since the Great Financial Crisis, The Economist notes that this has turned to "doom-mongering."

The Economist summarily dismisses suburban doom doctrine: "Those who argue that suburbia is dying are wrong on the facts; those who say it is doomed by the superiority of higher-density life make a far from convincing case."

The Future

In the editorial leader, The Economist, suggests: A wiser policy would be to plan for huge expansion. Acquire strips of land for roads and railways, and chunks for parks, before the city sprawls into them.

The Economist adds: This is not the dirigisme (government planning) of the new-town planner—that confident soul who believes he knows where people will want to live and work, and how they will get from one to the other. It is the realism needed to manage the inevitable.

The Economist continues that the suburbs have worked well in the West and are spreading, concluding that: We should all look forward to the time when Chinese and Indian teenagers write sulky songs about the appalling dullness of suburbia.

Wendell Cox is principal of Demographia, an international public policy and demographics firm. He is co-author of the "Demographia International Housing Affordability Survey" and author of "Demographia World Urban Areas" and "War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life." He was appointed to three terms on the Los Angeles County Transportation Commission, where he served with the leading city and county leadership as the only non-elected member. He was appointed to the Amtrak Reform Council to fill the unexpired term of Governor Christine Todd Whitman and has served as a visiting professor at the Conservatoire National des Arts et Metiers, a national university in Paris.

Photo: Suburban Ho Chi Minh (Saigon), by author

Gray Shadow Looms Over Home of Youth Culture

Mon, 12/08/2014 - 21:38

Southern California, like the rest of America and, indeed, the higher-income world, is getting older, rapidly. Even as the region’s population is growing slowly, its ranks of seniors – people age 65 and older – is exploding. Since 2000, the Los Angeles metropolitan area population has grown by 6 percent, but its senior population swelled by 31 percent.

The trend is stronger in the Inland Empire, where senior growth was almost 50 percent, the 14th-highest among the nation’s 52 largest metropolitan areas and more than three times the national average.

Figures from the Census Bureau suggest that these trends have continued since 2010. Regionwide – Ventura, Orange, San Bernardino, Riverside and Los Angeles counties – the senior population has surged 9.7 percent, more than the national rate of 8.4 percent. Overall, the senior share of the Los Angeles metropolitan-area population has increased to among the 20 largest in the nation.

These aging trends reflect in many ways the economic torpor of the region over the past decade. “We could be at the end of the period where Los Angeles thrived as a destination of choice for the working-age population, and it may simply begin to age, much like our counterparts in the Northeast,” suggests Ali Modarres, a former Cal State Los Angeles professor who now heads the urban studies center at the University of Washington, Tacoma. “Is L.A. finally out of its ‘sunbelt’ phase and entering its graying era?”

Less movement

Once, Modarres notes, this region was – like Florida and Arizona – a major lure to retirees, due largely to its ideal climate. But as the region has become more expensive and congested, this appeal has diminished considerably. As a result, our graying is likely the result not so much of senior migration into the region – since the L.A. area is the nation’s second-largest, after New York, exporter of people – but a case of people getting older in place.

In 1980, notes USC demographer Dowell Myers, half of the Los Angeles population ages 55-64 had migrated from another state. By 2010, that inbound segment had dropped to 26 percent and, by 2030, he projects, only 14 percent will be from elsewhere.

Traditionally a source of youthfulness, immigrants, too, are getting older. In Los Angeles County, the foreign-born share of the 55-64 population has risen from 30 percent in 1990 to 50 percent in 2010. By 2030, some 60 percent of this population will be foreign-born. Given the slowing rate of new immigration, Myers and others suggest that the foreign-born population will drop among the younger cohorts over the next few decades.

Geographic divide

Like everything else in this increasingly bifurcated metropolis, the geography of aging is divided into two main segments – high-income growth around the coast and lower-income, more minority-oriented sections further inland. In both groups, evidence suggests that they tend to generally stay close to home. Across the country, baby boomers, who are becoming seniors in ever-larger numbers – notes a recent Fannie Mae report – generally prefer staying in the homes they have occupied for years.

An examination of data from the 2010 census mirrors these trends. Some of the largest increases in seniors occurred in such heavily Latino and working-class areas as the Coachella Valley, where the 65-plus population soared by 14,700, or 43.2 percent; the Ontario area, where it grew by 30.3 percent; and Santa Ana-Anaheim, where this population expanded by 27.1 percent.

This pattern seems to be holding up since 2010, at least at the county level. By far the largest increase in seniors has occurred in the Inland Empire, which saw its senior population rise by 63,000 people from 2010-13. Overall, both San Bernardino (15.1 percent growth) and Riverside (13.8 percent) counties expanded their senior populations well above the regional average of 12.6 percent.

Coastal clusters

Looking at the 2010 Census, we see another fascinating pattern – the aging of beach communities, long the center of the Southern California youth culture. Indeed, the biggest increase in seniors over the past decade took place in coastal Orange County, where the senior population grew by 25,600, or a remarkable 50 percent. At the same time, the oldest parts of the Southland are also by the ocean, in Santa Monica and the Westside of Los Angeles. In 2010, roughly 14 percent of residents of this generally affluent area were seniors, versus 11 percent for the rest of the region.

Why are seniors staying in these enclaves? Well, the real question is, why not? Seniors who have stayed put, for the most part, were able to buy their homes for what today would be almost impossibly low costs, even though they were more expensive than average at the time. But, over the past three decades, as house prices have exploded across Southern California, these areas have become proportionally more unaffordable, which accounts for their declining populations of children as well as young families.

Safely ensconced with little or no mortgage debt, and with their property taxes limited by Proposition 13, many of these lucky seniors get to enjoy the fair climate and gorgeous beachfront for the rest of their active lives. Needless to say, few younger people, particularly families, will be able to join the party for quite a while.

Southland implications

Aging is a natural process, and virtually every city in the world, particularly in higher-income countries, now feels its effects. But the key issue is one of relativity. Until recently, this region’s populace was generally much younger than the national average but, since 2000, has seen its median age rise at nearly twice the national rate. Now, it could be on the way to resembling a sun-baked version of a Rust Belt community, as net outmigration continues by younger people, families and even immigrants.

There arguably are some good aspects of being in an aging region, such as lower demand for schools and, often, lower crime rates. In addition, seniors are an increasingly important source of consumer demand – according to Nielsen, Americans over age 50 by 2017 will control some 70 percent of the nation’s disposable income. Seniors, notes the Kaufmann Foundation, are also the fastest-growing entrepreneurial population, critical for future job creation.

Of course, there are dangers in taking these trends too far. Over time, young people and families are critical to creating demand for many key products, notably houses, cars and furnishings. They also are more likely to start and staff innovative companies. A declining youth population is not necessarily a good thing in a region that lives off being on, and establishing, the cutting edge of design, entertainment and technology.

There’s nothing inevitable about the region becoming a giant retirement home. The Southland can again become a magnet for migration. It’s advantages are manifest, with the beaches, mountains and incomparable weather. But the past couple of decades have demonstrated that these inducements alone are not enough to keep millions of people from moving away.

We need to start addressing the causes for persistent out-migration, and, more importantly, the relative dearth of new people. There are obvious candidates for remediation – one of the nation’s highest costs of living, particularly for housing, too many poor schools, a challenging business climate and a declining infrastructure. These are helping to drive the younger generations and enterprises – who should want to flock here – to Nevada, other mountain states, Texas and elsewhere.

This piece first appeared at the Orange County Register.

Joel Kotkin is executive editor of and Roger Hobbs Distinguished Fellow in Urban Studies at Chapman University, and a member of the editorial board of the Orange County Register. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is author of The City: A Global History and The Next Hundred Million: America in 2050. His most recent study, The Rise of Postfamilialism, has been widely discussed and distributed internationally. He lives in Los Angeles, CA.

Wendell Cox is principal of Demographia, an international public policy and demographics firm. He is co-author of the "Demographia International Housing Affordability Survey" and author of "Demographia World Urban Areas" and "War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life." He was appointed to three terms on the Los Angeles County Transportation Commission, where he served with the leading city and county leadership as the only non-elected member. He was appointed to the Amtrak Reform Council to fill the unexpired term of Governor Christine Todd Whitman and has served as a visiting professor at the Conservatoire National des Arts et Metiers, a national university in Paris.

"Senior Citizens Crossing" photo by Flickr user auntjojo.

The Rustbelt Roars Back From the Dead

Sun, 12/07/2014 - 21:38

Urban America is often portrayed as a tale of two kinds of places, those that “have it” and those who do not. For the most part, the cities of the Midwest—with the exception of Chicago and Minneapolis—have been consigned to the second, and inferior, class. Cleveland, Buffalo, Detroit or a host of smaller cities are rarely assessed, except as objects of pity whose only hope is to find a way, through new urbanist alchemy, to mimic the urban patterns of “superstar cities” like New York, San Francisco, Boston, or Portland.

Yet in reality, the rustbelt could well be on the verge of a major resurgence, one that should be welcomed not only locally but by the rest of the country. Two factors drive this change. One is the steady revival of America as a productive manufacturing country, driven in large part by new technology, rising wages abroad (notably in China), and the development of low-cost, abundant domestic energy, much of it now produced in states such as Ohio and in the western reaches of Pennsylvania.

The second, and perhaps more surprising, is the wealth of human capital already existent in the region. After decades of decline, this is now expanding as younger educated workers move to the area in part to escape the soaring cost of living, high taxes, and regulations that now weigh so heavily on the super-star cities. In fact, more educated workers now leave Manhattan and Brooklyn for places like Cuyahoga County and Erie County, where Cleveland and Buffalo are located, than the other way around.

The Psychological Undermining of the Rustbelt

When attention is paid to the industrial Midwest, it often takes the form of an anthropological curiosity as to how “the other half” lives. “I’ll tell you the relationship between New York and Cleveland,” said Joyce Brabner, wife of the underground comic book legend Harvey Pekar, to a New York City radio host. Brabner talked about the “MTV people” coming to Cleveland to get pictures of Pekar emptying the garbage and going bowling. But they didn’t bowl, Brabner quipped. They went to the library. “So, that’s it,” she continued. “We’re just basically these little pulsating jugular veins waiting for you guys to leech off some of our nice, homey, backwards Cleveland stuff.”

Urban economists, particularly those on the self-satisfied coasts, tend to envision utter hopelessness for the region. “Can Buffalo Ever Come Back?” reads the headline of a City Journal article by Harvard economist Ed Glaeser. He answers in the subtitle: “Probably not—and government should stop bribing people to stay there.” Glaeser cites Buffalo’s low levels of human capital and low housing costs as reasons to federally jump ship.

Berkeley-based economist Enrico Moretti is also bearish on the future of the region. Moretti believes that the winners in the knowledge economy, such as Silicon Valley, Boston, and Seattle, will be winning more, and the losers—he cites Cleveland and Detroit—will be winning less. In a recent interview, Moretti hints at the prospect of federal incentives tied to unemployment benefits to motivate people to leave the Rust Belt for high-tech hot spots. “If you are a waiter, you can make twice as much in Austin relative to Flint,” remarked Moretti. Of course what’s missing from this equation is that the median rent in San Francisco is much more than double that of Flint, without considering the higher cost of energy and far higher taxes.

Often, when national experts imbue hopelessness into the region, rustbelt leaders, no strangers to desperation, often take the bait. Perhaps nothing so illustrates the long-term acceptance of second-class status than the widespread adoption of the creative class model of urban development championed by Richard Florida. This approach—which holds up places like San Francisco and New York as exemplars par excellence—maintains that the key to growth is to develop a hip, cool scene that will attract educated, entrepreneurial people to a city.

For instance, in a recent interview about how to turn around Detroit, Florida says, “If you want to rebuild a neighborhood, you’re a lot better off starting with stuff people eat and drink.” In other words, cities should develop the microbrewery district, the artisanal culinary scene, etc. to attract the talent; and once the talent clusters, broad economic development will follow.

This approach was adopted in the ’90s by such politicians as former Michigan governor Jennifer Granholm, who famously proclaimed that the key to turning around rustbelt cities like Detroit lay in becoming “cool” by cultivating the “creative class” and subsidizing the arts. But as the American Prospect has noted, many down-at-the-heels burgs like Cleveland, Toledo, Hartford , Rochester, and Elmira, New York have tried but largely failed to reinvent themselves as hipster-oriented. “You can put mag wheels on a Gremlin,” commented one long time Michigan observer, “but that doesn't make it a Mustang.”

The Resurgence of the rustbelt as a productive region

The rustbelt revival relies not on mimicry but on embracing the regional culture that values production of things over simply their mere consumption. Cities like San Francisco, Portland and Seattle may have started with industrial roots, but their recent success has been tied to such factors as attractive geographies and, to Midwest sensibilities at least, mild climates. These regions have been enriched for decades by the migration of people from the rustbelt—Microsoft’s former President Steve Ballmer (suburban Detroit), venture capitalist John Doerr (St. Louis), and Intel co-founder Robert Noyce (Iowa) are just a few examples.

The cities of the heartland came into existence, first and foremost, as economic entities. Detroit, for example, grew first from timber and farming, and later autos; its location at the confluence of the Detroit River and the Great Lakes assured that its products could be exported around the nation and the world. Cleveland grew, and thrived, due to its location near such natural resources as oil (which explains Standard Oil’s founding in that city), as well as its strategic lakefront location. Pittsburgh also grew largely due to the nearby availability of cheap energy as well as the confluence of three rivers that made it an ideal place for the evolution of the steel industry.

Today many in the economics and urban planning professions consider such factors close to irrelevant. With the certainty of old Marxists predicting the inevitable end of capitalism, the clerisy today denies that industry can ever revive. “Construction and manufacturing jobs are not coming back,” intoned Slate, suggesting not much of a future for a wide swath of the country, and millions of Americans.

Yet a funny thing has happened on the way to oblivion: the rustbelt’s industrial base is reviving. Cheap and abundant natural gas is luring investment from manufacturers from Europe and Asia, who must otherwise depend on often unsecured and more expensive sources of energy. The current energy and industrial boom, according to Siemens President Joe Kaeser, “is a once-in-a-lifetime moment.”

Indeed, since 2010, jobs have expanded in energy, manufacturing, logistics and, with the return of the housing market in some areas, construction. Although much of the expansion has taken place in the sunbelt, notably Texas, the rustbelt economy has also been a prime beneficiary. Of the top ten states for new plants in 2010, five were in the rustbelt—led by second place (after Texas) Ohio, Pennsylvania, Michigan, Illinois, and Indiana.

 Most impressively, there has been a revival of job growth in these areas. Between 2009 and 2013, rustbelt cities and states dominated the country’s industrial revival. At the top of the list is Michigan, which gained 88,000 industrial jobs, a performance even greater than that of Texas, which came in second. The next three leading beneficiaries are all rustbelt states: Indiana, Ohio, and Wisconsin.

For much of the past half century, the rustbelt states suffered high levels of unemployment. But today Ohio, Indiana, Minnesota and Wisconsin have considerably lower rates of unemployment than the national average, and considerably less than California, Georgia, Nevada, New Jersey, and New York.

Human Capital: A critical advantage for the new rustbelt

Critically, despite generations of out-migration, the region has retained a strong base of skilled, technical workers. The Great Lakes states, for example, boast the largest concentration of engineering jobs (more than 318,000) of any major region. This is 70,000 more than northeast or the west coast. In terms of engineers per capita, both Dayton and Detroit rank among the top 12 regions in the country; they have many more, per capita, than Boston, San Francisco, New York, Los Angeles, and Chicago.

The rustbelt’s technological strengths differ considerably those of the two leading engineer cities, San Jose/Silicon Valley and Houston. In the Silicon Valley engineers tend to be focused on the high profile digital economy, while those in Houston are generally engaged with oil and gas. In contrast, the rustbelt’s workforce is more involved in the world of production, of practical engineering. Their work conforms closest to French sociologist Marcel Mauss’s description of technology as “a traditional action made effective.”

The revival of industry makes such engineering talent critical to regional success. It also provides a critical opportunity to expand the ranks of the middle class. The University of Washington’s Richard Morrill has found that areas with large concentrations of manufacturing—including largely non-union southern plants—and other higher-wage blue collar jobs have significantly lower levels of income inequality than areas that rely primarily on service, finance, and tech industries.

This could create tremendous opportunity for a broad swath of the rustbelt population. There is already, notes a recent Boston Consulting Group (BCG) study, a shortfall of some 100,000 skilled manufacturing positions in the U.S. By 2020, according to BCG and the Bureau of Labor Statistics, the nation could face a shortfall of around 875,000 machinists, welders, industrial-machinery operators, and other highly skilled manufacturing professionals.

 So rather than focus on the “hip cool,” the rustbelt’s new generation, particulary the majority without Bas, needs to become reacquainted with the skills—so often deemed unfashionable and dead-end—that built the region.

Equally critical has been the growth among younger educated workers in the region. From 2000 to 2012, the Buffalo metro area rose to seventh in the nation in the number of 25- to 34-year-olds with a college degree, a percentage gain of 34 percent. Greater Pittsburgh ranked tenth. Over the last three years, the Cleveland metro has risen to third in the nation in the percentage gain of young adults with a college degree, behind only Nashville and Orlando. Cleveland’s gain of 15,500 college-educated young adults was greater than Silicon Valley’s and seven times that of Portland.

These young folks aren’t just arriving, but they are also employed. According to the Center for Population Dynamics at Cleveland State University, Pittsburgh and Cleveland are third and eighth in the nation respectively in the percentage of 25- to 34-year olds in the workforce with an advanced or professional degree, ahead of such high-tech hot spots as Seattle, Austin, and San Diego, and well ahead of Portland, which ranks twenty-third. One explanation for this shift lies in job prospects. For example, one recent highly-disseminated report by the Portland-based Value of Jobs Coalition found that Portland’s “brain gain” was more akin to “brain waste.” The region’s educated labor force—which the report found was oversaturated with liberal arts majors—works fewer hours and gets paid less than the national metropolitan average.

The Comeback is not just coming, it’s already here

What’s driving the sudden improvement in the rustbelt? Some of it has to do with the region’s legacy. Various industrialists long ago financed the universities and hospitals that pepper the region, and it is these centers of knowledge production that are driving the highly-skilled workforce demand. For example, Carnegie Mellon’s robotics and computer engineering programs are creating a two-way pipeline between Pittsburgh and Silicon Valley. Both Google and Apple are broadening their physical footprint in the Steel City, in part because of the cost advantages the rustbelt offers relative to either coast. In Cleveland, the health care service and technology industry is clustering at a fast pace, particularly along the city’s health-tech corridor. According to Jeff Epstein, director of Cleveland Health-Tech Corridor, the city has raised more than $1 billion in venture capital over the last 12 years. The city’s biotech start-ups have increased by 133 percent, to 700, over the same time period. Global firms are taking notice. “The city has become quite a hub for the healthcare industry,” said Eric Spiegel, CEO of Siemen’s USA, on a recent visit to Cleveland. “We think there’s a good talent base here. It’s a good location for a lot of our businesses.” Bowling and taking out the garbage this isn’t.

Another major factor lies with costs. Housing prices in most rustbelt cities, adjusted for incomes, are one-third those of the Bay Area and at most one-half those seen in the Los Angeles, New York, or Boston areas. This can be seen not just in distant exurbs or suburbs, but in prime inner-city neighborhoods. Whatever dreams millennials have are likely to center around affordable single-family housing, as they begin to marry and start families. The rustbelt offers this younger generation the kind of choices, and middle class standards, that are increasingly unattainable in the superstar cities.

These changes are beginning to be seen in hard economic numbers. The region is already experiencing some of the nation’s largest per capita income gains. From 2009 to 2012, Cleveland’s metro income, when adjusted for inflation and cost of living, increased from $44,109 to $47,631—the fifth biggest increase in the nation, behind Silicon Valley, Houston, Oklahoma City, and Nashville. Buffalo ranked tenth in the nation, while Detroit and Pittsburgh ranked twelth and thirteenth, respectively. Conversely, Portland’s metro area ranked thirty-eighth in income gains, going from $39,414 to $40,706, one spot ahead of New York, whose per capita income nudged up by only $1,200.

Economic development, then, is not simply about adding a cornucopia of talent or cool, then shaking and stirring it like a drink. According to Buffalo native and rustbelt economic expert Sean Safford, a director at the internationally-acclaimed Parisian Sciences Po, creative classification efforts distract from the kind of basic investments that really matter. What is important, Safford found, is investing in infrastructure that will drive the evolution of the rustbelt’s knowledge networks, particularly around the anchor institutions such as industrial research labs, universities, and hospitals that can help produce products for the global market.

Cleveland, for one, is figuring this out. Along the city’s health-tech corridor, investment is not spent sprinkling the tech corridor with art galleries and microbreweries, but rather with the world’s first commercial 100 gigabit fiber network. Cleveland increasingly knows its bread is buttered by health care expertise, and it is making the requisite infrastructure investments to further the growth of its health care industry.

Sure, Cleveland has got a microbrew scene as well, just like Portland. But a pricey pint requires a solid paycheck, which means Cleveland has microbreweries whose products are consumed by people who know microbes, and how to fashion steel, or develop new energy resources. Those tasty brews are consumed by producers. As long as that causality stays clear—not only for Cleveland, but for other rustbelt metro areas as well—then the region’s future could be far brighter than most experts suggest. Before long, those who can only envision the rustbelt as a landscape of garbage cans and bowling pins may find that they are the people who are stuck in the past.

This piece originally appeared in Forbes.

Joel Kotkin is executive editor of and Distinguished Presidential Fellow in Urban Futures at Chapman University, and a member of the editorial board of the Orange County Register. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is author of The City: A Global History and The Next Hundred Million: America in 2050. His most recent study, The Rise of Postfamilialism, has been widely discussed and distributed internationally. He lives in Los Angeles, CA.

Richey Piiparinen is a Clevelander, writer, and Senior Research Associate heading the Center for Population Dynamics at Cleveland State University.

The Three Ages of Boss Rule

Fri, 12/05/2014 - 21:38

Between roughly the Civil War and World War II, most American cities were at some point dominated by a boss and his machine. The term “boss” referred not only a powerful politician, but one who acquired, held and exercised power outside the channels dictated by law. Progressive reformers fought the bosses for control of American city government for over a century. The Progressives ultimately won, or, at least, the bosses lost.

All this is well known. What is less well known is that the entire history of bossism is contained in three films: Martin Scorsese’s Gangs of New York (the origin), Preston Sturges’The Great McGinty (the peak), and John Ford’s The Last Hurrah (decline).

Gangs of New York: How Tammany Hall Civilized New York City

Gangs of New York (Gangs) takes place in New York City during the Civil War. Its plot concerns the war between Irish and nativist gangs for control of lower Manhattan. Both lose, leading to the rise of Tammany Hall, whose innovative manner of conflict resolution laid the foundation for modern New York. The ward heelers replace the warlords and the rigid identities of immigrant and nativist are dissolved. That’s how New York was tamed.

The film’s most memorable character is Bill the Butcher (Daniel Day-Lewis), the nativist gang leader bent on keeping the Irish down. A primitive man, Bill resembles Homer’s Cyclops in that he has only one eye and maintains his political authority through the open threat of violence. He’s the sometimes ally of Boss Tweed (Jim Broadbent), who functions as Tweed’s liaison to the slums of lower Manhattan.

In Gangs’ moral order, Boss Tweed represents progress. Tweed’s understanding of progress means thievery on a grand scale (rigging contracts for a new courthouse vs. exacting tribute from pubescent pickpockets) and bringing the Irish into the fold. Tweed tells Bill that to rely purely on violence is crude and inflexible, and he vows that Bill won’t last if he doesn’t adapt. Bill is less greedy than Tweed, and more principled in his own (bigoted) way. He’s ferociously independent, but also fatalistic. Bill knows that Tweed is right that his days are numbered. Nonetheless, he will go down fighting.

But the debate between Bill and Tweed is really a side show. Gangs’ main action concerns the struggle between the Irish and natives. The Irish are if anything even more primitive than Bill. They live in torch-lit caves, they are vengeful and as bigoted towards blacks as Bill’s crowd, and they reject the Civil War. Unlike Bill, the Irish have a bright future, but they, too, have bitter truths to learn. They seem to think that they can be New Yorkers without also being Americans. They are wrong. Scorsese asserts this by making the film’s climax not the 1863 draft riots themselves but the Union Army’s brutal suppression of them. The Army forces the Irish to submit to the legitimacy of the Civil War, and, by extension, the unconditional obligations implied by American citizenship. (Nation-building, 19th-century style.) Becoming American means becoming an American citizen, and citizenship implies renouncing the right to pick and choose among one’s obligations, and not least during times of crisis. Scorsese is slightly less clear about what becoming less Irish and more American will mean for the Irish than he is about the nativists’ education. But, at bare minimum, it means that they too will have to become more tolerant and capable of solving their conflicts through politics instead of violence.

Tammany did not itself vanquish the gangs (which were real by the way-see Herbert Asbury’sGangs of New York (1928), on which the film was based, and Tyler Ambinder’s Five Points(2010)). That task required guns and muscle. But, in providing a ready-at-hand political alternative to the gangs, Tammany answered the question what next?

What is the purpose of city government? It is not only to provide basic services such as education and street-cleaning, but to manage conflict. Government is much more than just a fee-for-service arrangement. Humans tend to disagree about the true and the good, which produces conflict, which we need politicians to manage for us by means of persuasion, intimidation, flattery, deal making, and so forth. Politics will always be with us and we will always need politicians.

The urban party machines excelled at managing conflict. If we believe that honest, rational debate will be inadequate to resolve most conflicts, then something else will be necessary to prevent government from being rendered completely impotent and to minimize the potential for violence. In most functional democracies, that “something else” has been a party system. Centuries of political experience strongly suggest that a democracy requires some form of organized mediation to recruit and vet candidates for office, and then, when in office, provide them with the support they need to be effective. “Parties are as natural to democracy as churches to religion (James Q. Wilson).”

Scorsese seems to understand these virtues of boss rule, while remaining aware of its corruption and vulgarity. Gangs argues that boss rule was an improvement over what came before: the gangs were just as corrupt, more violent, less enlightened, and, most crucially, pettier. Modern New York for Scorsese is, above all, a great city. Tweed was not a great man, but, according to Scorsese, Tweed’s political system provided the conditions for New York’s future greatness.

The Great McGinty: Bossism Ascendant

The Great McGinty (McGinty) takes place in an unnamed American city sometime in the first half of the 20th century. Its plot traces the title character’s (Brian Donlevy) rise from the soup line to the governorship by means of his skills at repeat-voting, fighting, bullying, carousing, wisecracking, bid-rigging and spending public money wastefully. “The boss” (Akim Tamiroff) gives McGinty his initial break and then directs his rise. McGinty chafes under the rule of the boss, and hilarity, and McGinty’s downfall, ensue. The third major character is McGinty’s wife (Muriel Angelus), his moral guide, who bucks him up to reject the boss.

McGinty depicts boss rule at its height, when it seemed almost the natural form of American city government. Sturges gives us the fully-developed specimen. All of the essential features of Progressive age city politics are in evidence:

First, the boss was often not the mayor. Of the 20 municipal bosses surveyed in Harold Zink’sCity Bosses in the United States (1930), 19 held some public office of some kind, but only two were mayors. There was no reason for the boss himself to be the mayor, since it was a ceremonial position with no real power. The office now known as the “strong mayor” did not become common until well into the 20th century. Progressive reformers strengthened the office of mayor by wresting fiscal and administrative authority away from the local legislature and lengthening the term of office. This left no choice to the boss but to become mayor. What few bosses have emerged to dominate urban politics since WWII have all been mayors. Examples include Richard Daley pere, Philadelphia’s Frank Rizzo, and Newark’s Sharpe James.

Second, Machine politics was genuinely democratic in the sense that it enabled men to rise from exceedingly humble beginnings to positions of high authority. In this respect, a real life equivalent of McGinty would be Harry Truman, who owed his career to Tom Pendergast, the notorious boss of Kansas City.

Third, the lines between reformer and boss could be sometimes blurry. McGinty is first elected as a reform candidate (“Down with McBoodle! Up with McGinty!”). Wise bosses were highly sensitive to public opinion. They sometimes had to run candidates who were just distant enough from the machine to be considered graft-free. This practice was known as “perfuming the ticket.” Problem was, such candidates did not always stay in line when they got into office. Sometimes they chafed like McGinty did.

Fourth, women hated grafters. The Progressive-era movements for women’s suffrage and municipal reform were practically indistinguishable. Women getting the vote dealt the bosses a grievous blow.

McGinty is a satire and therefore anti-boss. Sturges certainly expects us to like McGinty, the boss and the gang, and McGinty does eventually redeem himself by breaking with the boss (on top of earning the love of a good woman), but to say that his deep engagement in machine politics required redemption implies that bossism was a rotten system. The audience’s proxy is McGinty’s wife. She loves him, but she certainly doesn’t love his politics.

At the same time, Sturges depicts a world in which bossism as such is not seriously under threat. No fundamental structural reforms are at hand, just the occasional defeat at the polls and visit to the hoosegow.

The Last Hurrah: Ciphers Ascendant

The Last Hurrah’s protagonist Frank Skeffington (Spencer Tracy) is based on Boston’s James Michael Curley. We know this because of the many details drawn directly from Curley’s eventful life and career: Skeffington’s longstanding feuds with his city’s Cardinal and with the bluebloods, his personal dislike for FDR, his uxoriousness, his considerable charm and rhetorical skills, and the fact that he’s an old man running yet again for mayor in a predominantly Irish New England city. Skeffington’s final campaign forms the plot of Hurrah. Its events transpire in the mid-20th century, contemporaneously with the film itself (1958) and the book on which it was based (by Edwin O’Connor, published in 1956). Skeffington loses, to a young, upwardly-mobile Irish American put up by the local WASP establishment. Times have changed since Skeffington entered politics in the late 19th century. TV and radio have replaced flesh-pressing and spontaneous, street-corner oratory. The city is wealthier, and some of that wealth has reached the Irish, Skeffington’s traditional base. Their wealth has made them less resentful, rendering WASP-baiting demagoguery less effective than it used to be. Skeffington is aware of these changes, but he’s still convinced that one last victory is in his grasp. He believes that all it will take is a mix of charm, intimidation, patronage and loyalty, but events prove him wrong.

Skeffington’s is a personal machine. Bosses created machines, not vice versa. All urban machines depended on the leadership from a strong boss. We see this in the fact that we tend to refer to most of the important machines by the names of the boss who gave them life and influence (Pendergast, Hague, Crump). Tammany Hall, which did manage to last a long time and transcend the leadership of individual bosses, was the exception, not the rule.

And in that he controls the machine and not vice versa, Skeffington may be said to be his own man, the genuine article. He may be a bit of a grafter, but, in Hurrah, he’s not the candidate beholden to special interests. That would be McCluskey, Skeffington’s nebbish opponent. The film argues that, for all their faults, decline of Skeffington and his like heralded a more inauthentic form of politics. (The phrase used in Hurrah the novel is “a generation of ciphers.”) Politicians would thenceforth be packaged, handled and promoted like so many different brands of soap. The backlash against scriptedness and inauthenticity we see in the appeal of candidates such as Herman Cain and Ross Perot. These are not great men, but, in that authenticity is surely a condition of greatness, the decline of Skeffington’s ways portends the decline of greatness in city politics.

That’s the bad news. The good news is that Hurrah depicts the last stages of unity and reconciliation projected by Gangs. The subtitle of The Last Hurrah could be The Revenge of the WASP. Skeffington finds himself fighting against both the new Irish middle-class and old money Protestants. His moment seems to have been a blip, a brief transition phase in American urban history. By the film’s conclusion, history has come full circle and ethnic conflicts are resolved in a way that could never have happened while blueblood-baiters like Skeffington remained in power.

It’s somewhat difficult for the audience to appreciate how Skeffington could have lost to McCluskey. Based on what we are shown, the latter seems like a total boob. But we’re not the voters. To the increasingly affluent second and third generation Irish-Americans, Skeffington comes off as uncouth, just as he always did to the WASPs. They want a mayor that mirrors their conception of themselves: young, well-educated (in a conventional sense), nicely (not nattily) attired, and untainted by unsavory connections and loyalties.

In their classic study City Politics (1963), Edward Banfield and James Q. Wilson argued that this trend was general among ethnic voters in the American city at mid-century. Yes, Jews still preferred to vote for Jewish candidates, Irish for Irish candidates and so on, but:

[t]he candidates must not be too Polish, too Italian, or too Irish in the old style…[N]owadays, the nationality-minded voter prefers candidates who represent the ethnic group but at the same time display the attributes of the generally admired Anglo-Saxon model. The perfect candidate, then, is of Jewish, Polish, Italian, or Irish extraction and has the speech, dress, manner, and the public virtues-honesty, impartiality, and devotion to the public interest-of the upper-class Anglo-Saxon (p.43).

According to Hurrah, the Progressives were far less consequential in bringing down the bosses than two other factors. First, New Deal social welfare programs devalued the soft and hard currencies with which the machines purchased the immigrant vote (this thesis is advanced more explicitly in the book than the film). Second, the rising tide of prosperity produced the lace curtain Irish, who were wealthier, younger and less angry than their parents and grandparents who had composed Skeffington’s base. There are Progressives in Hurrah, who provide important leadership and money, but this was a battle that they had been waging for decades. Why did they prove more successful at this moment? Because the Irish were ready to move on.

Steve Eide is a Senior Fellow at the Manhattan Institute and also runs its fiscal policy oriented web site Public Sector, Inc.

Evaluating Urban Rail

Thu, 12/04/2014 - 21:38

For more than 40 years, US cities have rushed to build new rail systems (indeed I was part of such an effort, see Los Angeles: Rail for Others). This article examines the trend in transit and driving alone work trip market share in 23 cities (metropolitan areas) that have built new rail systems that have represented material expansions of regional transit systems. These new rail systems include Metros ("heavy rail"), light rail (not streetcars) and commuter rail (suburban rail). The capital costs of these systems have been at least $90 billion (2013$), based on Thoreau Institute website information.

A Policy Perspective

The perspective is that of a policy board member (which I was) and a belief that more transit (generally a good thing) is better than less. Thus, from the beginning of my career on the Los Angeles County Transportation Commission (LACTC), I was interested in obtaining the highest ridership possible within the constraints of available funding. As the LACTC considered building rail, a foremost objective was the hope for reduced traffic congestion, as we were assured by consultants that rail would attract drivers out of cars and reduce traffic congestion. To do this the rail system would need to reduce automobile travel.


The work trip market shares of 2013 (from the American Community Survey) are compared to those of the US Census immediately preceding the opening of the rail system, except where otherwise noted. This latest data is compared to work trip market shares for the Censuses preceding rail system openings, using current (2013) metropolitan area boundaries. This method favors transit, since metropolitan areas have grown spatially, and the more recently added areas (counties) would have had lower transit market shares in earlier censuses. The method also favors transit because in a growing metropolitan area (which excludes only Buffalo among the 23 cities) merely retaining transit work trip market share will generally not reduce traffic congestion, because highway traffic volumes tend to rise with population.

Transit Work Trip Market Shares

Overall, the average transit work trip market share in the 23 cities declined from 5.0 percent to 4.6 percent from the Census year preceding opening to 2013 (Figure 1).

  • The cities with rail systems opening after the 2000 Census did by far the best. In 2000, these cities had an average transit work trip market share of 3.0 percent. By 2013, this had risen to an average of 3.4 percent. The cities in this category include Austin, Charlotte, Houston, Minneapolis-St. Paul, Nashville, Phoenix, and Seattle.
  • The cities with rail systems opening after the 1990 Census experienced a modest decline in transit work trip market share, from 3.8 percent in 1990 to 3.7 percent in 2013. The cities in this category include Baltimore, Denver, Dallas-Fort Worth, Los Angeles, Riverside-San Bernardino, Salt Lake City, and St. Louis.
  • The cities with rail systems opening after the 1980 census saw their transit work trip market shares decline more significantly, from 4.8 percent in 198to 3.9 percent in 2013. This category includes Buffalo, Miami, Portland, Sacramento, San Diego, and San Jose.
  • The largest average transit work trip market share losses occurred in the cities with new rail systems that opened following the 1970 census. These metropolitan areas experienced a decline from 12.9 percent in 1970 to 11.1 percent in 2013. The new rail systems in this category were San Francisco's Bay Area Rapid Transit (BART), Washington's Metrorail and Atlanta's MARTA.

Driving Alone Work Trip Market Shares

Overall, the driving alone work trip market share rose from 72.3 percent to 76.0 percent (though complete data is not available for 1970), an increase of 3.7 percentage points (Figure 2). The driving alone work trip market share declined in only 4 of the 23 cities. In each of the decadal categories, the change in work trip market share was greater in driving alone than in transit (Figure 3).

  • The cities opening new rail systems after the 2000 census did the best in curbing the drive alone market share, but still experienced a loss. On average, the drive alone work trip market share increased the least in the cities, from 77.1 percent in 2000 to 77.7 percent in 2013, a rise of 0.6 percent.
  • The cities opening new rail systems after the 1990 census experienced an increase in the drive alone work trip market share from 75.2 percent in 1990 to 77.4 percent in 2013m for a loss of 2.2 percentage points.
  • The cities opening a new rail systems after the 1980 census experienced an increase in the drive alone work trip market share from 69.3 percent in 1980 76.3 percent in 2013, for a loss of 7.0 percentage points.
  • Comparable driving alone data was not obtained in the 1970 Census, which makes it impossible to directly compare the "before and after" Census work trip market share data for new rail systems opening during. However, each of the three new rail systems opened after the 1970 census added substantially to their ridership following the 1980 census (Note). Even so, the drive alone market share from 1980 was substantial, from 60.2 percent to 67.9 percent in 2013, an increase of 7.7 percentage points. The biggest drive alone gains were in Atlanta, which built MARTA and Washington, which built Metrorail. San Francisco, with its Bay Area Rapid Transit system (BART) experienced a smaller drive alone market share gain from 1980 to 2013 (Table).

Transit & Drive Alone Work Trip Market Share: Before and After 23 New Rail Cities City (Metropolitan Area) Last Census before Rail  Opening Last Census Transit Share 2013 Transit Work Trip Market Share Last Census Drive Alone Share 2013 Drive Alone Share Atlanta: Note 1970 7.3% 3.1% 68.3% 77.7% Austin 2000 2.5% 2.4% 76.5% 77.1% Baltimore 1990 7.7% 6.8% 70.9% 77.1% Buffalo 1980 6.6% 2.9% 66.6% 82.4% Charlotte 2000 1.2% 1.7% 80.9% 80.2% Denver 1990 4.3% 4.4% 75.4% 75.4% Dallas-Fort Worth 1990 2.3% 1.4% 78.6% 80.5% Houston 2000 3.2% 2.4% 77.0% 79.7% Los Angeles 1990 5.6% 5.8% 71.7% 74.1% Miami 1980 4.4% 4.1% 72.6% 77.8% Minneapolis-St. Paul 2000 4.2% 4.6% 78.3% 78.4% Nashville 2000 0.8% 1.0% 80.6% 82.8% Phoenix 2000 1.9% 2.6% 74.6% 76.5% Portland 1980 7.9% 6.4% 65.3% 70.7% Riverside-San Bernardino 1990 0.8% 1.5% 74.6% 76.8% Sacramento 1980 3.4% 2.6% 75.3% 75.1% San Diego 1980 3.3% 3.2% 63.8% 75.8% Seattle 2000 7.0% 9.3% 71.6% 69.7% San Francisco: Note 1970 15.9% 16.1% 57.9% 59.9% San Jose 1980 3.1% 4.2% 72.4% 75.9% Salt Lake City 1990 3.3% 3.2% 75.5% 75.0% St. Louis 1990 2.9% 2.9% 79.4% 83.2% Washington: Note 1970 15.5% 14.2% 54.2% 66.1% Average 5.0% 4.6% 72.3% 76.0% Derived from Census Bureau data Note: 1970 Census data not comparable for Drive Alone. 1980 data used  

Transit Alone Metropolitan Area Gains and Losses

Overall, the transit work trip market share declined in 13 of the 23 cities. Among the 10 cities with an increase, the change was less than one percentage point in all but two, Seattle and San Jose.

The strongest transit market share gain was in Seattle, at 2.3 percentage points (from 7.0 percent to 9.3 percent). However, most of Seattle's transit market share gain was related to bus and ferry service, which accounted 80 percent of the transit gain. San Jose had the second largest gain, at 1.1 percentage points (from 3.1 percent to 4.2 percent). Riverside-San Bernardino (0.8 percent to 1.5 percent) and Phoenix (1.9 percent to 2.6 percent) tied for third best transit market share increase, with 0.7 percentage point increases. Charlotte had the fifth strongest increase, rising 0.5 percentage points, from 1.2 percent to 1.7 percent.

The largest transit market share loss was in Atlanta, which fell from 7.3 percent in 1970 to 3.1 percent in 2013, a loss of more than one-half. Buffalo suffered the second largest loss, from 6.6 percent to 2.9 percent, a decline of 3.7 percentage points. Highly touted Portland experienced the third greatest transit market share loss out of the 23 cities, falling from 7.9 percent to 6.4 percent, a 1.5 percentage point loss. Washington had the fourth largest decline, falling from a 15.5 percent transit work trip market share to 14.2 percent, a loss of 1.3 percentage points. In Washington, much of the Metrorail ridership was diverted from bus services and car pools.

Baltimore (from 7.7 percent to 7.0 percent) and Dallas-Fort Worth (from 2.3 percent to 1.4 percent) tied for 5th largest decline, with a loss of 0.9 percentage points.

Drive Alone Metropolitan Area Gains and Losses

The largest drive alone gains were in Buffalo (15.3 percentage point gain from 1980) San Diego (12.0 percentage point gain from 1980), Washington (11.9 percentage point gain from 1980, due to the lack of 1970 data), Atlanta (9.4 percentage point gain  from 1980, due to the lack of 1970 data), and Baltimore (6.2 percentage point gain from 1990).

The largest drive alone market share losses were in Seattle (1.9 percentage point loss), Charlotte (0.7 percentage point loss), Salt Lake City (0.5 percentage point loss), and Sacramento (0.2 percentage point loss) while Denver remained constant.

New Rail Systems: Successful Simply in Being Built

The overall transit work trip market shares in the 23 cities declined 0.4 percentage points. By comparison, in the same cities, driving alone increased by an average of 3.7 percentage points (Figure 4). These results are considerably more modest than the claims made by rail proponents. It is fair to say that the new rail systems have not changed how people travel in cities, despite costing at least $90 billion.

It might be expected that this laggard performance would dampen the ardor for rail. Yet, many public officials and civic boosters consider virtually any system that opens a success. Tom Rubin, former Chief Financial Officer of the Southern California Rapid Transit District (a predecessor to the Los Angeles County Metropolitan Transportation Authority) wryly suggests that for many political interests, the success of urban rail is demonstrated by its getting built.

Despite the unfortunate politics of transit, success requires carrying more passengers, as many as the available funding will permit. The test of urban rail is not how many people are on the trains, but how many drivers leave their cars at home to ride it.

Note: BART's ridership has more than tripled since 1980, while Washington Metrorail's ridership is up approximately 40 percent. MARTA's ridership has increased substantially since 1980, with the first line having opened only in mid 1979.

This commentary is adapted from a presentation in November at an international transit conference in Shanghai.

Wendell Cox is principal of Demographia, an international public policy and demographics firm. He is co-author of the "Demographia International Housing Affordability Survey" and author of "Demographia World Urban Areas" and "War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life." He was appointed to three terms on the Los Angeles County Transportation Commission, where he served with the leading city and county leadership as the only non-elected member. He was appointed to the Amtrak Reform Council to fill the unexpired term of Governor Christine Todd Whitman and has served as a visiting professor at the Conservatoire National des Arts et Metiers, a national university in Paris.

Photo: Atlanta MARTA train by RTABus (Own work) [CC-BY-SA-3.0], via Wikimedia Commons

Voting With Your Feet: Aaron Renn’s New Donut

Wed, 12/03/2014 - 21:38

Growing up I remember the adults talking about the old neighborhood in Brooklyn where my grandparents lived during the Great Depression and World War II. In spite of the hardships of the era it was described as a great place full of life and colorful characters and extended family all on the same block. But by the time I was born no one we knew lived there anymore. My family was part of the great suburban migration away from cities. By 1967 (the year of my birth) New York, like most cities, had begun to fail. There were race riots, rapidly rising crime rates, strikes of every kind, unemployment, terrible public schools, a near bankrupt city hall, declining property values, high taxes, and a general sense that the city wasn’t any place to raise children or grow old. People voted with their feet. The Good Life existed exclusively in clean, quiet, leafy suburbs – many of which like Scottsdale or Orlando weren’t even attached to an historic urban core.

But today we’re seeing the economic and cultural revival of many of the city centers that had been declared dead. Boerum Hill, Brooklyn where my mom was born is now a million dollar address. Absolutely no one could have imagined that in 1974 or 1987. At the same time race riots and economic decline are now unraveling many poorly aging suburbs – precisely the same suburbs that were insulated middle class enclaves in 1969 or 1985. That’s not to say that all downtowns are bouncing back or that all suburbs are failing. There’s a big difference between Detroit that’s still contracting and San Francisco with an economy that’s actually overheating. And no one would put Short Hills, New Jersey in the same category as Ferguson, Missouri. But the waters are murkier than they used to be. Statistically, there are now more Americans living in poverty in the suburbs than in city centers or rural backwaters. This makes sense since the vast majority of the built environment consists of low density development and that’s where the overwhelming majority of all people of every kind now live. And it’s no longer true that the suburbs are all white. Many of the most ethnically diverse places in the country are now suburban rather than urban. The new Chinatowns, Koreatowns, and Little Indias are much more likely to exist in suburban cul-de-sacs than in city centers.

The challenge faced by many regions today is described beautifully by Aaron Renn here. The old model of urban poverty and suburban prosperity (the sweet fluffy “donut” with a dead center) has been replaced by what Mr. Renn calls the New Donut with a thriving downtown core, failing older suburbs, and booming new outer ring suburbs. Poverty then reappears out in the rural hinterlands.

I occasionally get critical comments from readers who dismiss my observations. One of my stories about a declining suburban neighborhood in southern California was re-posted on (a website I respect and enjoy) and it attracted these comments here. They can best be summed up as, “Dude, you’re a busybody from Planet San Francisco who knows nothing about the real lives of real people.” The comments assume that the suburbs are doing just fine and any attempt to tinker with them by pointy-headed urban theorists will only make things worse. In many instances I completely agree. There are examples of infill suburban development all over the country and most of them are pretty crappy. See my post here for specific case studies. But the default setting of the suburban development pattern is designed to actively fail over time. Doing nothing is a sure recipe for continued decline. Let me explain.


Each new shiny subdivision, shopping center, and office park built out on the edge of town (often in a different school district or municipality) draws more prosperous and mobile residents along with new revenue from fresh growth. Meanwhile smaller older tract homes, aging strip malls, and even churches lose value as they age. Taxes are generally lower in newly built areas since legacy costs for infrastructure and government employees hasn’t yet accumulated. In contrast, older suburban areas are loaded down with maintenance costs, underfunded pensions, rising health care costs, and declining revenues. The public schools wobble, lower income people migrate to the neighborhood, home owners are replaced by renters with slum lords, and the whole thing goes south pretty fast. People, of course, respond by voting with their feet.


If you want to see the in-between stage of this process check out the 1980’s and 1990’s retail centers. The strip malls are still freshly painted and the landscaping is well maintained, but most of the storefronts are empty. There’s just too much retail space on offer with too few businesses looking to fill it. This isn’t a result of a temporary economic downturn. It’s a feature of never-ending outward expansion. Some property owners have tried to reinvent their commercial space in creative ways. The old movie theater failed when the new multiplex opened up on the edge of town. The concrete bunker was painted pink and decorated like a Greek temple and turned into a beauty school. The school eventually failed and the building is now empty like so many other older retail properties in town. It’s obvious what these places will be like after another decade or two. These aren’t isolated instances. This is the inevitable result of a particular style of horizontal development. So what exactly do you do with all this stuff to prevent it from falling apart?


I had previously used the Antelope Valley in California as an example. The typical response by many civic leaders is to encourage new job creation and new retail sales to fill the public coffers. But even when new businesses do open and jobs are created it doesn’t really help the older neighborhoods recover. People looking for good places to raise their children or retire gravitate toward the newer parts of town – or more likely the next town over. People who want urban amenities like street life and culture generally flee the region entirely for a real city. If you drill down on these older neighborhoods on Google Earth you realize that there’s still plenty of undeveloped land, but since it’s in the wrong part of town it isn’t likely to ever see new five bedroom homes with swimming pools or upscale retail. Any suggestion that these districts could be reinvented with a downtown flavor to give people the option of a walkable urban neighborhood is met with stiff resistance from nearly everyone. It’s just not what people in the area want. So these places continue to fester. That’s not the opinion of a pointy headed urban theorist. It’s just an observable fact. This process is brilliantly articulated by the fiscal conservative Chuck Marohn from here.

   Google Earth

So let’s get back to that criticism about “busybodies from Planet San Francisco” telling people in the suburbs what to do. I’m observing a fact. The fact is that many suburbs are aging poorly and turning into slums. As city centers gentrify the poor are being displaced and they are finding their way to these failing suburbs because they’re cheap. So what have local governments like Lancaster and Palmdale been doing in response to the decline of their older suburban neighborhoods? Well… as lower income people migrated to the Antelope Valley from other parts of Los Angeles County both cities began an aggressive code enforcement program directed at discouraging poorer people from settling in the area. If you read the local Antelope Valley Times here the mayor of Lancaster, Rex Parris, praised the fraud investigation officials who were wrongly terminated by Los Angeles County bureaucrats. If you read the Los Angeles Times here both Lancaster and Palmdale were systematically raiding the homes of lower income black and latino citizens with SWAT style teams of heavily armed police looking for minor code violations and instances of fraud.

No one in particular is causing this demographic shift to happen, although liberals like to blame conservatives and conservatives like to blame liberals. Mostly it’s Adam Smith’s Invisible Hand of The Market. Eliminating all state and federal programs wouldn’t change the basic pattern. In fact, these migrations might actually accelerate in an all-out unfettered marketplace. When people can’t sell their homes they turn to renting. When they can’t find solvent renters they turn to Section 8 subsidized renters. If the Section 8 program didn’t exist the homes would eventually become so cheap that the same poorer demographic would ultimately fill the neighborhood anyway and/or the buildings would sit empty and rot. So the question is simple. How do you prevent this cycle of devaluation from happening to your town? Or how do you reverse the process if it’s already begun?


The most recent “solution” was for the city of Lancaster to propose shutting down its MetroLink rail station in order to prevent lower income people from traveling in from other parts of Los Angeles County. That approach plays well with suburban voters, but has no real effect on the larger trend. The idea that low density development and a lack of public transit prevents blight and crime just doesn’t hold up in reality. In the same way, creating a walkable mixed use slightly denser environment is neither a recipe for disaster or a cure-all. Many people assume that limiting growth with artificial boundaries raises costs by squeezing people into a limited amount of space and unnaturally jacking up rents and the cost of home ownership. In order to keep homes affordable new growth out on the edge must constantly be built. The dark side of that theory is that it’s impossible to prop up the value of older subdivisions if there’s an endless supply of new housing coming on the market.

I don’t expect the good people of the Antelope Valley to make any radical changes to the way they organize their affairs anytime soon. But I do expect many people to continue to vote with their feet and move away, taking their money and civic engagement with them. If these towns are incredibly lucky they will eventually be colonized by a new group of people who reinvest in these tired old neighborhoods. But I might not live long enough to see the pendulum swing back.

John Sanphillippo lives in San Francisco and blogs about urbanism, adaptation, and resilience at He's a member of the Congress for New Urbanism, films videos for, and is a regular contributor to He earns his living by buying, renovating, and renting undervalued properties in places that have good long term prospects. He is a graduate of Rutgers University.

New and Old Donut graphics courtesy of

Las Vegas: The Once and Future Downtown Project

Tue, 12/02/2014 - 21:38

There’s been a lot in the news lately about the troubles plaguing Tony Hsieh’s Downtown Project in Las Vegas. The latest is a longish report in the Guardian, which notes:

Yet by late September of this year, the press – especially the technology press – had begun asking some serious questions, as the Downtown Project suddenly laid off 30 people – 10% of the total it then directly employed. Alongside portentous headlines announcing this “bloodletting” appeared claims that Hsieh had “stepped down” from his position of leadership of the project. A damning open letter from the Downtown Project’s former “director of imagination”, David Gould, called the operation from which he had just resigned “a collage of decadence, greed and missing leadership … There were heroes among us,” he added, “and it is for them that my soul weeps.”

Technology web site Re/code also ran a seven part series on the Downtown Project, some of it unflattering, including a part focused on a spate of suicides there, and other on about a prominent failed startup.

I made the obligatory pilgrimage to the Downtown Project in 2013 and wrote up my observations in a three part series, of which you can read part onepart two and part three.

I noted at the time the audacity of one project trying to completely transform a place like downtown Las Vegas:

Las Vegas has the single most savagely bleak downtown of any major city I’ve ever visited. The Downtown Project is almost literally starting at zero. There are practically no assets. So anything that the Downtown Project accomplishes needs to be seen against that backdrop. Most of these other cities have been at the downtown redevelopment game for 30+ years, have massive architectural and institutional assets, and have already been the recipients of untold billions in investment, much of it public money.

I also mentioned that the accolades the project had received in the press were disproportionate to the actual accomplishments to date:

Honestly, it’s a bit infuriating as a guy who lived in Indy, Louisville, and Providence to see a place where so little has happened garner such massive press and accolades when most other regions the size of Vegas have done more while getting far less attention.

Indeed, it’s hard to think of a single downtown redevelopment effort that received as much glowing coverage as the Downtown Project. Not even Dan Gilbert’s Detroit efforts received such fawning attention. This is an accomplishment I’m not sure most people fully appreciate. Tony Hsieh was very savvy in using his status as a tier one entrepreneurial superstar, along with a bank of free “crash pad” apartments for visitors, to create buzz and publicity. Other cities should definitely stand up and take notice.

However, the very success of the project on the PR front primed it for inevitable blowback when problems arose. As the Guardian piece notes, “The story fairly demands an apocalyptic ending.” The higher a star soars in the celebrity firmament, the more knives get drawn when anything disturbs the pristine image. The Guardian reporter also said, based on a very recent trip, that reports of the project’s demise are premature.

So the Downtown Project has run into turbulence? Film at 11. Startups are hard, risky, trouble fraught endeavors. Tony went through multiple meat grinders in the past, and if you’ve read his book it’s by no means certain that Zappos would even survive. There were many times it could have gone under. Clearly the man has a massive appetite for risk, and the Downtown Project was certainly a risky and ambitious undertaking.

The initial puffery was overblown. Time will tell if the blowback is as well. Success was always going to be difficult. I noted last year that the project was going against the grain of the DNA of Vegas as a city, was very reliant on “best practices” type solutions vs. the innovative cultural approach of Zappos, and that “curating” a city was inherently dubious. Yet I admire the ambition and believe they’ve done a lot of things right.

I doubt that the project will ever realize the full, audacious vision that was laid out at the beginning. The commitment of Zappos to its downtown HQ probably prevents a complete flameout. But it may turn out that Tony was unwise to have so heavily promoted the project up front. That has more or less ensured that anything less than perfection will be judged as a failure. He set the bar so high, it is almost impossible to clear. Had there been more modest ambitions, then probably even incremental progress against the backdrop of the disaster zone that was downtown Las Vegas would have been seen as a win. But perhaps in one example of how the Downtown Project did match perfectly with the Vegas DNA, Tony Hsieh elected to pile all his chips on Red 14.

Full Disclosure: I had previous financial relationships with Downtown Project related entities and stayed for free in one of their crash pads during my stay.

Aaron M. Renn is an independent writer on urban affairs and the founder of Telestrian, a data analysis and mapping tool. He writes at The Urbanophile, where this piece originally appeared.

Downtown Project photo by Eddie Codel.

The Curious Comeback Of U.S. Downtowns

Mon, 12/01/2014 - 21:38

Perhaps nothing better illustrates the notion of urban revival in America than the comeback of many downtown districts. Yet if these areas have recovered some of their vigor, they are doing so in a manner that hardly suggests a return to their glory days in the first half of the 20th Century.

Instead what’s emerging is a very different conceptualization of downtown, as a residential alternative that appeals to the young and childless couples, and that is not so much a dominant economic hub, but one of numerous poles in the metropolitan archipelago, usually with an outsized presence of financial institutions, government offices and business service firms.

The good news: after an era of population declines, these areas are growing again: From 2000 to 2010, the downtown cores of the nation’s 51 metropolitan areas with populations over a milliongained slightly over 200,000 residents, or 1.3% of all the growth in the nation’s major metropolitan areas. However, 80% of that growth took place in just six cities — New York, Chicago, Philadelphia, Washington, D.C., Boston and San Francisco. In 18 of the 51 downtowns populations declined. Meanwhile, the population in the outer fringe of the 51 metro areas, 10 miles beyond downtown, grew by some 15 million.

These trends appear to have continued into the initial stages of the current economy recovery. In a survey of 2011-2012 patterns, Trulia found a similar pattern of higher growth near the center, but even stronger growth rates on the fringes. As we have noted since 2000, the slowest growth took place in the close-in neighborhoods adjacent to the urban core.

The better numbers reflect then not a mass “back to the city” movement but an uptick in the market appeal of city centers. And it’s unlikely that the old urban cores will ever come close to recovering the economic preeminence they once enjoyed. In American Community Survey data from 2006-08, the central business district of the New York metro area was the only one across the country that accounted for over 20% of regional employment; downtown’s share topped 10% in just six other metro areas: Chicago, Boston, Washington D.C., Richmond, Chicago and Hartford. This contrasts with the kind of employment dominance seen in the 1950s when Manhattan’s commercial core accounted for more than 35% of employment in the New York area. Of course, the decline is a natural outgrowth of the massive physical expansion of the New York area during the past half century, a pattern seen in other major regions.

From 2000 to 2010, the share of jobs dropped somewhat in the nation’s biggest urban cores, but employment declined far more in the inner ring suburbs, according to an analysis by demographerWendell Cox. In contrast the fastest job growth was in suburban and exurban areas, paralleling their gains in population. This has become clearer since the recession ended; the consultancy Costar notesbetween 2012 and 2013 office absorption grew quicker in the suburbs than the core, accounting for 87% of new office demand. Overall suburbs account for nearly 75% of all office space in our metropolitan areas.

We can see this pattern even in two of the hottest office markets, San Francisco and Houston. Overall, despite all the blather about tech moving into the core, San Jose, Calif., has almost 50% more new office space under construction than San Francisco. San Jose, it should be remembered, is essentially a giant suburb, with a very small downtown, and very low levels of transit ridership. It may be next to San Francisco but in urban form, it represents its direct opposite.

In Houston, easily the nation’s leader in new office construction, downtown has fared well in the boom but the vast majority of new growth is located in the ‘burbs, including the largest project — the new ExxonMobil campus, with 20 buildings that will host 10,000 employees. In both places population growth in the suburbs has been approximately four times that of the core cities between 2010 and 2013.

These patterns can be seen even in areas where there have been strong improvements in residential growth. In 2010, Chicago’sDowntown Loop Alliance reported that private sector employment in the Loop fell 20% during the last decade. Perhaps more telling, the number of jobs and resident workers (the “jobs-housing” balance) in the city of Chicago are converging toward equality. According to American Community Survey data, there are 1.1 jobs in the city of Chicago for each working resident. In contrast, two of the three large suburban corridors have higher ratios of jobs to workers than the city of Chicago. The Interstate 88 corridor has 1.3 jobs per worker, while the North Shore has approximately 1.5 jobs per worker. The Interstate 90 corridor has slightly more jobs than workers.

How could this be given the much hyped migration of companies such as Boeing to the Windy City? One explanation lies with the rise of what urban analyst Aaron Renn has described as the “executive headquarters.” These relocations, he notes, tend to follow CEO preferences but cover only a small number of employees. Cost pressures, particularly from Wall Street, make securing space in central cities prohibitive if it involves large numbers of employees. A small, swanky office is one thing but putting 10,000 workers in expensive towers seems less common.

The recent move of Archer Daniels Midland’s headquarters, he notes, brought roughly 100 jobs while that of Boeing, at a cost of $63 million in incentives, was a net gain of 500. In both cases, far more employees, spanning research, development and marketing remained in the original locations. Boeing, for example, retains over 80,000 employees in its original home around Seattle.

What seems clear from these trends is this: downtowns are back, but not as dominant business hubs. Instead we continue to see not massive construction of new offices but the continued conversion of offices to residential buildings. This is particularly true in Chicago, where developers are adapting older office towersmalls, as well as hotels for apartments. In most cases, these are rental properties designed to serve a generally younger, and childless market.

In Manhattan, the rate of office construction is running at a multi-decade high, but some insiders worry that demand may not be there in the next four years to fill the 14 million square feet of spaceprojected to be built by 2019. The shift of jobs, particularly in financial services, to cheaper locales could have a negative effect, as does the trend of employers cramming workers into smaller spaces.

What about the wannabes like downtown Dallas, Atlanta and Los Angeles? These central cores have failed to recover their economic base, with vacancy rates approaching 20% despite a dearth of new construction. Nor has mass transit — often sold as the “magic bullet” to turn these central cores into thriving urban hubs — succeeded in reestablishing their economic centrality. In all three metro areas, despite multibillion-dollar expenditures on new rail lines, transit ridership remains at or even slightly below the levels of a decade ago.

None of this suggests that these cores are not important to their regions, and particularly to their often vulnerable self-esteem. The downtowns of Atlanta and Dallashave gained some residents, and there is more pedestrian traffic at night. Similarly Los Angeles, whose downtown attracted nearly half of all L.A. residents daily in the 1920s, according to Robert Fogelson, continues to fade in economic importance. Today it represents about 2% of the vastly expanded metro area’s jobs. At least four other regional job centers are as larger or larger ).

Yet despite this, it’s legitimate to see some revival of the area, largely due to a rash of residential conversions and some new apartment building. This has brought some new life, as well as some restaurants and some shops, as the population within two miles of City rose by an impressive 23,000 since 2006. But this hardly represents a full-scale return to the center city as the population of the surrounding areas — two to five miles from City Hall — has dropped by a similar number. Almost all the new construction in downtown is either for residents or hotels; very little new office space is being produced.

Los Angeles’ downtown recovery, notes real estate analyst David Shulman, is “more about sports and entertainment venues, restaurants and bars, loft conversions, and hotels than it is about companies that need a lot of floors in tall buildings. Nightlife and streetscapes trump florescent light and cubicles.”

This resurgence in L.A., and elsewhere, is no mean accomplishment, but it also does not constitute sea-change in fundamental economic geography. Downtowns are back, but more as a lifestyle option than as a dominant feature of the metropolitan landscape.

This piece originally appeared in Forbes.

Joel Kotkin is executive editor of and Distinguished Presidential Fellow in Urban Futures at Chapman University, and a member of the editorial board of the Orange County Register. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is author of The City: A Global History and The Next Hundred Million: America in 2050. His most recent study, The Rise of Postfamilialism, has been widely discussed and distributed internationally. He lives in Los Angeles, CA.

Lead photo of 432 Park Avenue in New York by Louis B (Own work) [CC-BY-3.0 or CC-BY-4.0], via Wikimedia Commons

Southern California Stuck in Drive

Sun, 11/30/2014 - 21:38

Southern California has long been a nurturer of dreams that, while widely anticipated, often are never quite achieved. One particularly strong fantasy involves Los Angeles abandoning what one enthusiast calls its “car habit” and converting into an ever-denser, transit-oriented region.

An analysis of transit ridership, however, shows that the region is essentially no better off than when the the modern period of transit funding began in 1980, with the passage of Proposition A, which authorized a half-cent sales tax for transit. In 1980, approximately 5.9 percent of workers in the metropolitan area (Los Angeles and Orange counties) used transit for their commute. The latest data, for 2013, indicates the ridership figure has fallen to 5.8 percent.

Never ones to let facts get in the way of fantasy, some retrourbanists and media types continue to insist our mass-transit transition is well on its way. Liberal blogger Matt Yglesias, writing in Slate, declared that Los Angeles is destined to become America’s “next great transit city.”

This view is echoed throughout retrourbanist circles. “The City of Angels is noticeably transforming. Our once car-centric town is becoming less car-dependent,” suggests the local LA Streetsblog, “Public transit is having a comeback. Pedestrian and bicycle infrastructures are improving.”

Instead of rushing to rail, Angelenos continue to rely on their cars to get to work. From 1980-2013, the market share of drive-alone commuters has risen from 70 percent to 74.1 percent. There has been an increase in driving alone of approximately 1.4 million daily commuters. Driving alone accounted for d approximately 85 percent of the region’s increase in commuters.

Why do people stick to their cars? For one thing, transit takes longer. The average drive-alone, one-way commute in Los Angeles was 27.0 minutes in 2013, compared with an average commute of 48.7 minutes for transit.

The other big factor is accessibility to jobs. The University of Minnesota Accessibility Observatory produced an estimate for the percentage of jobs that the average L.A. resident could reach within 30 minutes by car. In Los Angeles, the average resident can reach 60 times as many jobs in that time by car as by transit.

Transit needs downtowns

Transit plays an important role in America, but mostly in the urban cores of a handful of “legacy” cities. These core metros (excluding their often-sprawling, low-density suburbs) – New York City, Boston, Chicago, Philadelphia, Washington and San Francisco – account for 55 percent of all transit-work trip destinations, just 6 percent of the country’s employment. Overall, the legacy cities’ transit ridership is nearly 10 times their proportionate combined share of jobs.

To a large extent, this reflects history and urban form. Transit remains largely a matter of downtowns. The cities with transit legacies have an average of 15 percent of their jobs downtown, three times the average for other major metropolitan areas. In contrast, Downtown Los Angeles has 2 percent of the metropolitan area’s jobs. In Orange County, Riverside and San Bernardino counties, homes to much of the regional population, there are really no substantial downtown areas.

In contrast, the many regions sharing L.A.’s multipolar form and large-scale transit investments – Atlanta, Dallas-Fort Worth, Denver, Minneapolis-St. Paul and Portland, Ore., – have seen their transit market shares stagnate or decline, despite having built expensive rail systems.

One problem is, like virtually all U.S. metropolitan areas (including the suburbs of legacy cities), the Los Angeles area, which pioneered the multi-polar metropolis, has been becoming more so and is even moving beyond polycentricity. The vast majority of growth in the statistical area encompassing Los Angeles, Orange, Riverside, San Bernardino and Ventura counties has taken place in precisely those areas – the Inland Empire, South Orange County or the Santa Clarita and Antelope valleys in northern Los Angeles County – that also have the lowest transit ridership. In contrast, the core’s growth barely represents a blip. From 2000-10, the functional urban core, which has the strongest concentration of transit destinations, accounted for virtually none of the region's growth.

Dreaming of New York?

For many L.A. planners and urban boosters, more transit – funded from Washington – often seems to constitute an exercise of social engineering on a grand scale. The hope is that, by pushing transit, particularly rail, we will recreate the metropolis with ever-greater density. “We are going to remake what the city looks like,” then-Mayor Antonio Villaraigosa told an approving New York Times two years ago.

Despite the hoopla and the subsidization of downtown Los Angeles, however, relatively few people work in, or even visit Downtown, ecept for sporting or cultural events, although many pass by it on the freeways.

For most Angelenos, Downtown is simply not part of their day-to-day experience the way, for example, Manhattan is for many New Yorkers, or the Loop is for many residents of the Chicago region.

Transit Class Warfare

Developers and their planning allies tend to focus on transit as something that will get middle-class Angelenos out of their cars. But it’s difficult to see this working as long as such an overwhelming majority of jobs (98 percent) are located outside Downtown. Since 1980, driving alone, which was increasing its market share, added 15 times as many new commuters as transit, with its slipping market share.

At the same time, there seems to be a profound unawareness of the low incomes of Los Angeles transit commuters. The latest American Community Survey data (2013) indicates that the median earnings of transit commuters at the national level is more than 85 percent higher than in Los Angeles. In the metropolitan areas around transit legacy cities, the median incomes of transit commuters is 150 percent higher than in Los Angeles.

To some extent, poorer Angelenos, in the government’s expensive shift from buses to trains, are being sacrificed to satisfy the Utopian vision of planners, pad the profits of big urban developers, and to build the campaign war chests of the political class. Indeed, from 2008-12, the bus lines, which carry more than three times as many passengers as trains, were cut 16 percent If L.A. is experiencing a transit revolution, its most dependent riders have been largely left behind.

So What Should Greater LA do?

As anyone who drives the freeways knows well, L.A. has a traffic problem. But Los Angeles also has the shortest average commute time of any high-income world megacity for which data is available, despite having the highest automobile usage, the least transit and, except for New York, the lowest urban density.

The real question is, will more transit, at least in its current form, offer the solution? Certainly, expanding and improving roads – although politically incorrect – has helped make commuting easier for many working in Orange County. Other ways to entice people off the roads, such as telecommuting, should be encouraged. Since 1980, the number of Los Angeles residents working at home has increased by approximately 240,000. This increase – 2.5 times that of transit in total numbers – has come at virtually no cost to taxpayers.

To be sure, many Angelenos, for one reason or another, need decent transit services. Our approach would be for government to find out who these people are, and look for ways to make transit work better for them. Rather than invest huge dollars in rail megaprojects, perhaps we could reduce bus fares, a strategy attributed to the legendary Los Angeles County Supervisor Kenneth Hahn that increased bus ridership dramatically from 1982-85.

Unlike today’s “progressives,” Hahn’s prime interest was serving his largely working-class and poor constituents. Besides cutting bus fares and increasingly service, other solutions, such as more competitively contracted service provided by regional agencies, such as Foothill Transit and the Antelope Valley Transit Authority, could provide less-expensive, more efficient and expanded service.

Los Angeles Mayor Eric Garcetti, has also expressed interest in promoting the use of rideshare services, like Uber or Lyft, and, more importantly, self-driving cars.

Ultimately, rather than try to recreate New York, or undertake the expensive and virtually impossible task of rebuilding Los Angeles in the image of the latest urban planning fad, we should explore a host of innovative solutions that will help transit riders here and now by developing workable, and effective, ways to help them get to the services and jobs they need.

This piece first appeared at the Orange County Register.

Joel Kotkin is executive editor of and Roger Hobbs Distinguished Fellow in Urban Studies at Chapman University, and a member of the editorial board of the Orange County Register. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is author of The City: A Global History and The Next Hundred Million: America in 2050. His most recent study, The Rise of Postfamilialism, has been widely discussed and distributed internationally. He lives in Los Angeles, CA.

Wendell Cox is principal of Demographia, an international public policy and demographics firm. He is co-author of the "Demographia International Housing Affordability Survey" and author of "Demographia World Urban Areas" and "War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life." He was appointed to three terms on the Los Angeles County Transportation Commission, where he served with the leading city and county leadership as the only non-elected member. He was appointed to the Amtrak Reform Council to fill the unexpired term of Governor Christine Todd Whitman and has served as a visiting professor at the Conservatoire National des Arts et Metiers, a national university in Paris.

Photo: Downtown Los Angeles toward the Hollywood Hills and the San Fernando Valley (by Wendell Cox)

The Three Generations of Black Mayors in America

Fri, 11/28/2014 - 21:38

A select group of cities elected black mayors during the brief and tumultuous Black Power Era, seeking to implement an activist social justice platform.  These cities – notably Cleveland, Gary, Newark and Detroit among large cities — became stigmatized in a way that few have been able to recover from.   A negative narrative was developed about most of them that stuck, despite considerable efforts to dispel them.  Cities that elected “first black mayors” after the Black Power Era, during a period of relative calm, were able to adapt as the political skill set grew in the African-American community.  However, the Black Power Era’s near-toxic combination of heightened white racism, black disenfranchisement and disillusionment – and ill-prepared black political leadership – accelerated the downfall of these select cities.

If the cities that elected black mayors during this tumultuous period are ever to move forward, to achieve their potential, they must be released from the purgatory they inhabit.

Just as many people have well-developed thoughts and opinions on the American Civil War but little understanding of the turbulent Reconstruction Era that followed, many are familiar with the 20th Century Civil Rights Movement, yet are far less knowledgeable about the local social and political events that followed it.  The Black Power Movement supplanted much of the Civil Rights Movement after the assassination of Dr. Martin Luther King, with an emphasis on turning social activism into political empowerment.  Several cities elected their first black mayors during that period.  Cleveland was the first with the selection of Carl Stokes as mayor in 1967.  Gary, Indiana followed suit the same year with the election of Richard Hatcher, and the federal government appointed Walter Washington to become Washington, DC’s first black mayor as well.  Later, Newark (Kenneth Gibson), Dayton (James McGee) and Cincinnati (Ted Berry) followed suit by 1972, and culminated with the elections of Tom Bradley (Los Angeles), Maynard Jackson (Atlanta) and Coleman Young (Detroit) in 1973.  A new era of African-American political empowerment had begun.

Taking a long historical view, it’s clear that the people who became first African-American mayors beginning in the late ‘60s and continuing through today held different views, developed different paths to victory and methods of governance, and had differing perceptions of their skills among their constituents.  Mayors elected through about 1975 were often activists straight from the Civil Rights Movement, and were looking for ways to turn the movement into actual political power.  The group of black mayors that followed them, from about 1975 to 1990 or so, had more distance between them and the Civil Rights Movement and were less concerned about implementing movement politics; they were more concerned about developing the kind of coalition that could get them elected and help them win legislative victories once in office.  The third group of “first black mayors”, coming after about 1990 and continuing through today generally came to terms with a different demographic landscape in most major American cities.  Whereas first black mayors elected twenty years prior could dependably rely on a supermajority of black votes in their favor – and an equally large supermajority of white votes against them – the most recent group works in a more nuanced and less racially charged environment.  Younger white residents without the racial grievances of their parents or grandparents were returning to cities, and Hispanics were rapidly increasing in numbers.  Anyone who would attempt to become a “first black mayor” in that environment would have to develop an appeal that goes beyond racial boundaries.

And yes, the decade that followed Dr. Martin Luther King’s assassination was as tumultuous as they come for America’s largest cities.  That period, well remembered by those who lived it as a time of particularly strong urban and social tensions, coincided with the downward slide in momentum of the Civil Rights Movement and the subsequent rise of the Black Power Movement.  Older adults likely remember the period well: urban riots, fights over school busing, Affirmative Action battles, efforts to eliminate long-entrenched policies like blockbusting and redlining.  Skyrocketing crime, heated debates on the inequity of public services, and the development of a new, rapidly expanding land called “suburbia” that was looking very appealing to a growing number of city residents.  Nearly all large cities developed scars during that period.  The question is whether they healed, and healed well.

“It’s Our Time”

Detroit Mayor Coleman Young.  Source: Detroit News

Coleman Young, elected as Detroit’s first black mayor in 1973, in many ways epitomizes the first group of black political leadership that emerged following the Civil Rights Movement.  One might call them the Black Power set.  Born in 1918, Young was part of a generation of African-Americans who stood tantalizingly closer to economic prosperity and social equality than any previous generation, yet were reminded that they could never achieve it.  After serving as a bombardier and navigator for the U.S. Army Air Forces during World War II, Young returned from his service disillusioned by the segregation he and his fellow troops suffered.  He went on to become a labor leader with the UAW and later built a political base as a state representative and state senator in the Michigan Legislature, representing Detroit’s East Side.

Young became a vocal critic of local leadership after the 1967 riots, and targeted the heavy-handed efforts of Detroit police to reduce crime.  Young announced he was running for mayor in 1973 in large part to work to disband the Detroit Police Department’s STRESS (Stop the Robberies, Enjoy Safe Streets) unit.  The unit was often mentioned as the initiator of police brutality complaints, and was allegedly responsible for as many as 22 deaths of black residents over a 2 ½ year period.  Young ran against John Nichols, the city’s police commissioner and staunch supporter of the troubled unit.

Young won a narrow victory over Nichols in 1973 in a race that was almost entirely split along racial lines in the nearly 50/50 city.  In his inaugural address, Young famously told “all those pushers, (to) all rip-off artists, (to) all muggers: It’s time to leave Detroit; hit Eight Mile Road! And I don’t give a damn if they are black or white, or if they wear Superfly suits or blue uniforms with silver badges. Hit the road.”  Young maintained that his message was that criminals were not welcome in Detroit; the quote has often been interpreted by white former Detroit residents as a throwing down of the gauntlet, urging whites to leave the city for the suburbs.  Young went on to win four more terms in office.  He balanced budgets yet struggled to maintain services in a city with a rapidly declining tax base.  He remains one of the most controversial leaders in Detroit history.

Conversely, Cleveland’s Carl Stokes and Newark’s Kenneth Gibson may not have provoked similar passions in their respective cities, but they did not fare much better.  Stokes obtained his law degree in 1956, served three terms in the Ohio Legislature and narrowly lost a bid for mayor in 1965.  His eventual win in 1967 garnered him plenty of national attention as he became the first African-American mayor of one of the nation’s ten largest cities.  He was successful enough to pursue and win a second two-year term in 1969, but his tenure in office was characterized by constant feuds with the Cleveland City Council and the Police Department.  Stokes left office at the end of his second term.  After studying civil engineering in college, Gibson worked for nearly two decades as a structural engineer with the New Jersey Highway Department, the Newark Housing Authority and the City of Newark.  He pursued the mayor’s office as a reformer wishing to restore honor to the office following the corruption scandals of incumbent Hugh Addonizio.  Gibson won in 1970 but perhaps his attachment to people like Newark poet and playwright Amiri Baraka, who challenged Gibson to push the city’s corporate interests to take a more active and responsible role in the community, served as a lightning rod to the city’s remaining middle class element.  Gibson was elected to four terms, but Newark’s slide continued unabated.

Black National Political Convention

It’s probably fair to say that the political pinnacle of the Black Power era took place between the elections of Gibson and Young, with the advent of the Black National Political Convention in 1972.  Held in Gary, Indiana and hosted by Mayor Richard Hatcher, delegates from the entire spectrum of black leadership convened to establish a black political agenda for urban America.  More than 8,000 people attended the three-day convention, with 3,000 selected to be voting delegates.  Newly elected black officials attended, along with celebrated black nationalists and revolutionaries.  Delegates with more moderate position also attended.  However, whites were not invited.  No white speakers whose views were sympathetic to the movement; not even white reporters.  This exclusion caused groups like the NAACP and the Urban League to skip the event and be critical of the gathering.

Renee Ferguson, a former Chicago local news television reporter and currently the press secretary for U.S. Rep. Bobby Rush (D-IL), attended the convention as a 22-year-old reporter for the Indianapolis News.  In an interview with Chicago public radio station WBEZ remarking on the 40th anniversary of the convention in 2012, she spoke about the frenzied nature of the event.  “When I got there it was very disorganized, much bigger than anybody had planned for and impossible actually for anybody to see what was happening. The speeches were long and there were a lot of egos and there weren’t many women.”

Ferguson said that the agenda of the convention was framed by a basic question, and was the source of great tension.

“Are black people going to work on the inside with the system, or are they going to have their own and work on the outside? And that was the big argument no matter what else they talked about,” Ferguson said. “That was the underlying intrigue and the most interesting thing for me to document as a young reporter.”

In the end, black nationalists won the day.  The prevailing theme of the convention was that African-Americans would seek to create change outside of the system.  The agenda included platforms that had support from other liberal factions (elimination of capital punishment, national health insurance), but also included platforms that sought to consolidate political control with the growing number of leaders (community control of schools, busing for school integration).  Perhaps the biggest message of the convention, however, was that “White politics had failed Black people”.  And a new group of leaders set out to implement that vision.

Coalition Builders

Chicago Mayor Harold Washington, the day after winning the election in 1983.  Source: Illinois Historic Preservation Agency.

Almost immediately after the convening of the convention, a group of rising black political figures who rejected the premise of the Black Power era leaders sought to ascend through coalition building.  Rather than work exclusively outside of the system, and alienating those who disagreed with them, this group stressed their ability to work within the existing power and political framework.

As a state representative at the time representing Illinois’ 26th legislative district, Harold Washington would’ve been eligible to serve as a delegate to the Black National Political Convention.  Whether he attended is uncertain.  But it is clear that he adopted a coalition-building style that served him well as he ascended to the office of Mayor in Chicago.

Born in 1922 and just four years younger than Detroit’s Coleman Young, Harold Washington nevertheless followed a different path to mayor of Chicago.  Washington also served in the Army during World War II, building runways for long-range bombers in the North Pacific.  Upon his return from service he graduated from Roosevelt College in Chicago in 1949, and from Northwestern University Law School in 1952.  Washington immediately became immersed in local Chicago politics after law school, working for 3rd Ward Alderman and former Olympic athlete Ralph Metcalfe.  While working with Metcalfe Washington became intimately familiar with Chicago’s brand of Machine politics – a spoils system, patronage, and a personal approach to bringing out the vote on Election Day.

Contrary to Young’s experience in Detroit, African-Americans in Chicago experienced a fair amount of political enfranchisement.  In many respects, African-Americans were just one part of the ethnic milieu that made up Chicago’s political landscape, like the Germans, Poles, Italians and Irish.  The foundation of Chicago’s political machine was its ability to meet the specific needs of those who could be convinced to depend on them, and convincing as many people to depend on them as they could.  The Machine’s success meant that it could not ignore or exclude potential votes, wherever they came from, and that included the African-American community.  The Machine’s strength was derived from its network of precinct captains, committeemen and elected officials that would convene regularly to discuss its political platform, slate of candidates vote targets and distribution of benefits.    Washington received a sound political education in coalition building through his work in Chicago’s Machine.

Washington was elected into the Illinois House of Representatives in 1965 and to the U.S. Congress in 1980.  Over the years, he developed a reputation of independence from the Chicago Democratic Party leadership, often becoming an unreliable member of the Machine’s state legislative contingent.  As a State Senator Washington was one of a group of independent black Democrats who partnered with white liberal Democrats and moderate Republicans to push forward the Illinois Human Rights Act of 1980.  His ascension to Congress later that year, defeating Machine loyalist Bennett Stewart, further alienated him from the Machine.

This effort afforded Washington a unique political perspective.  He enjoyed strong independent support from his African-American base, largely developed apart from the Machine.  He had strong connections with members of Chicago’s “lakefront progressive” community, which had a fairly large contingent in the city’s Hyde Park community, where Washington also lived.  It was likely evident to Washington and others that this pairing provided him a wider base than other black elected officials who rose through the ranks and focused solely on serving the needs of their African-American constituents.  Furthermore, Washington likely realized that the Hyde Park progressive community’s networks with other progressives, particularly on the North Side, opened up opportunities for offices beyond Congress.

Washington rode the wave of his unique coalition into mayoral politics in 1983.  Bolstered by support from his African-American base and reform-minded white progressives, Washington won against Republican Bernard Epton that November.  Once elected, however, he was confronted with a solid bloc of 29 aldermen (out of 50) firmly wedded to the “Democratic Organization” structure that had survived for so long in Chicago.  The bloc led a four-year period of legislative gridlock in Chicago known as Council Wars – the bloc assumed control of all Council committees, allowing it to set the legislative agenda; the bloc voted down virtually all of the mayor’s appointments; the bloc fought bitterly with Washington’s supporters on budget and appropriations.

Despite the challenges, however, Washington’s coalition held firm.  Federal lawsuits led by Washington allies challenged Chicago’s ward redistricting following the 1980 Census.  At the time, Chicago’s population included approximately 40 percent white and black residents, and 15 percent with an Hispanic background.  However, Washington supporters argued that wards were gerrymandered to maximize the number of white aldermen in the racially polarized city – at the time of Washington’s election as mayor there were 33 white, 16 black and one Hispanic aldermen.  Federal courts ruled in favor of Washington’s supporters in 1986, causing a redrawing of seven wards and special elections.  Washington supporters won four elections, creating a 25-25 split in the City Council and effectively giving the mayor control of the Council through his ability to cast a deciding vote.  Unfortunately, Washington’s control was short-lived.  He died of a massive heart attack on November 25, 1987, just months after his defeat of the obstructionist bloc.

Whereas Harold Washington’s political acumen made him a coalition builder, Baltimore mayor Kurt Schmoke’s stellar athletic and academic pedigree, wonky sensibility and personable nature drew coalitions toward him.

Schmoke attended the prestigious Baltimore City College for high school, where he excelled in football and lacrosse.  He entered Yale University in 1967, where he played quarterback for the freshman team and developed into an undergraduate student leader.  After graduating from Yale with a degree in history in 1971, Schmoke studied as a Rhodes Scholar at Oxford University and graduated from Harvard Law School in 1976.

Schmoke’s first electoral victory was as Baltimore State’s Attorney in 1982.  He defeated William Swisher in a surprise landslide, running a race-neutral campaign against the law-and-order, and (according to some) racially insensitive incumbent.  Schmoke was technically not Baltimore’s first black mayor; that title goes to Clarence “Du” Burns, who was elevated to mayor after the election of the previous mayor, William Donald Schaefer, as Maryland’s governor.  But Schmoke inherited much of Schaefer’s progressive and business establishment, as they saw him as the one who could articulate their agenda in a largely black city.  Schmoke challenged Burns in 1987 and won narrowly.  Recalling Schmoke’s victory for an article in Baltimore’s City Paper, City Council member Bill Cunningham said it was a “new-day-is-dawning thing.”  In the same article, the Rev. Arnold Howard of Enon Baptist Church said, “We were looking for someone to encompass our hopes for the future, someone who would validate our own journey.  He went into office with all that on him. He was the new savior. He was the one who would fulfill our dreams.”

In the end, however, despite being twice re-elected, Schmoke’s analytical approach to leadership alienated coalitions who thought they were getting something else.  He developed a reputation for establishing bold policy goals that were difficult to build consensus around – improving adult literacy, drug decriminalization – and put in place department heads who brought the same policy wonk approach to their work that he did.  The business establishment and African-American community alike thought they were electing a dynamic “mover and shaker” who could energize them as they pushed toward new heights.  But Schmoke was perhaps more manager and caretaker than mover.  As a result he left office in 1999, deciding not to seek a fourth term, with a frayed coalition: a business community slightly betrayed, and an African-American community slightly disillusioned.

Trans-Racial Appealists

With the start of the 1990’s a new type of black political figure began to emerge.  Gains made through increased access to education and job opportunities were putting more African-Americans in previously unattainable positions, and allowing them to pursue previously unattainable avenues.  Wellington Webb, the first black mayor of Denver, fits this bill.

Webb was born in 1941 in Chicago and arrived in the Mile High City at age 11.  In his autobiography, he chronicles a difficult childhood; his mother had a drinking problem and he ended up being raised by his grandmother, and he had academic difficulties at Denver’s Manual High School.  But Webb fought through his family problems and personal demons.  He attended and graduated from Northeastern Junior College in Colorado in 1960, and obtained his bachelor’s degree from Colorado State College in 1964.  He was introduced to politics by his grandmother, who was a Democratic Party district committeewoman in Denver.  Webb wanted to become a teacher, but found it difficult to obtain a position in Denver’s public schools, and thought local political involvement in some of the federal “War on Poverty” programs of the late 1960’s might help.  He transitioned from working in a potato chip factory to working in city government, and later obtained a master’s degree from the University of Northern Colorado in 1971.

Webb developed a reputation as a numbers-cruncher and policy wonk in city government, and was pulled into politics rather than pushed into it by any sense of bitterness.  He was elected to the Colorado House of Representatives in 1972 and represented the Northeast Denver neighborhood he grew up in.  In 1977 he was appointed by President Jimmy Carter to serve as regional director of the U.S. Department of Health, Education and Welfare, and in 1981 he was appointed by Colorado Governor Richard Lamm to be executive director of the state Department of Regulatory Agencies.  Webb held that position until 1987, when he ran and won in the election to become Denver’s city auditor.

Webb’s political ascendance through the ‘70s and ‘80s certainly put him on a path to consider pursuing citywide and even statewide positions, but it was unclear whether an African-American in a city with a small minority population, in a state with a small minority population, could be competitive.  He did not start with a built-in large political base like Young or Washington; nor did he have to ability to strengthen a base through coalition building the way Washington did.  His only strategy, should he pursue another office, was to make a trans-racial appeal that would highlight his experience, skills and vision.

Webb entered the campaign in late 1990.  Three leading candidates emerged: Webb, Denver District Attorney Norm Early (also African-American), and Republican lawyer Don Bain.  Webb carried out his “Sneaker Campaign”, going door-to-door in virtually all of Denver’s neighborhoods while preaching a message of competency.  He surprised everyone by forcing a runoff with Early in the May 1991 primary, finishing with 30 percent of all votes to Early’s 40 percent.  Webb was able to consolidate the support from other candidates with a law-and-order platform prior to the general election against Early in June 1991.  Webb won with 57 percent of the vote.

Sacramento Mayor Kevin Johnson.  Source:

Perhaps a better version of a first black mayor who won with a broad trans-racial appeal would be Kevin Johnson of Sacramento.  Johnson was born in Sacramento, where he was a standout student and athlete.  He excelled in basketball and baseball, and accepted a scholarship to play basketball at the University of California, Berkeley.  From there he went on to a storied college basketball career and a long professional career with the NBA’s Cleveland Cavaliers and Phoenix Suns.

Even during his playing days Johnson maintained strong roots with his native Sacramento.  He established the Kevin Johnson Corporation, which focused on real estate development and business acquisitions, and the St. HOPE nonprofit organization as an after-school program in the Oak Park neighborhood he grew up in.  After his retirement from basketball in 2000, he broadened St. HOPE to include charter schools and nonprofit development in Sacramento.  Today, St. HOPE is a network of four charter schools in Sacramento, and a development company with more than a dozen new construction and renovation projects in Sacramento.

Johnson had intimated his political ambitions for years, but finally announced his run for mayor in 2008.  Race was hardly a factor in the race; indeed, Johnson was viewed as a decorated favorite son of California’s capital city.  Johnson received numerous endorsements from Sacramento’s business and political establishment, and was the highest vote getter in the nonpartisan election that June.  He forced a runoff against two-time incumbent mayor Heather Fargo, and soundly defeated her in November.

Johnson has parlayed his athletic, corporate and nonprofit success well in the government sector.  He has been a staunch supporter of charter schools, along with his wife Michelle Rhee, the former chancellor of the Washington, DC Public Schools.  He was actively involved in keeping the NBA’s Sacramento Kings basketball team from fleeing the city, orchestrating the team’s sale to a group of local investors.  He easily won reelection in 2012, and in April 2014 was elected as president of the U.S. Conference of Mayors.

There are other black mayors who fit the trans-racial appeal profile, but are not the first black mayors of their respective cities.  Kasim Reed of Atlanta, Michael Nutter of Philadelphia, and Cory Booker of Newark each brought impressive academic credentials, strong corporate backgrounds and youthful passion to their positions as mayor, distinguishing them from their predecessors.    Reed interned for U.S. Rep. Joseph Kennedy II before earning his juris doctorate from Howard University, and became a partner at a law firm prior to entering politics.  Nutter earned a business degree from the Wharton School at the University of Pennsylvania.  Booker earned his bachelor’s and masters degrees from Stanford, earned a Rhodes Scholarship to attend the University of Oxford, and earned his juris doctorate from Yale.

Because of their academic and corporate credentials, Reed, Nutter and Booker are as comfortable in corporate boardrooms as they are in churches or community centers.  Each has forged partnerships with political opponents, and adopted a pragmatic bipartisan approach to governing cities.  Each has focused on effective service delivery rather than empowerment or redistributive policies.  Booker’s success as mayor of New Jersey’s largest city propelled him to his current position as New Jersey’s junior U.S. Senator through special election in 2013.

The Power of Perception

Detroit, Cleveland, Newark, Chicago, Denver, Baltimore and Sacramento occupy different positions on the success spectrum of American cities.  Of these five Chicago would certainly occupy the highest perch.  Chicago clearly is a global city – a world financial center, the home of a dozen Fortune 500 companies and the critical link in the nation’s rail and air transportation network.  The Windy City has extensive economic connections throughout the world.  Indeed, world-class architecture firms based in Chicago are designing the gleaming skyscrapers sprouting everywhere in China’s large cities.  Denver would rest in a position not far behind Chicago.  Denver has become the capital of the Great Plains and Mountain West, a mid-continent transportation hub that built its wealth on its access to mineral resources in the Rocky Mountains.  Sacramento would likely occupy a position behind Denver.  Sacramento’s growth has been more recent than the others, and it still sits in the shadows of much larger California metropolises.  But as the capital of our nation’s largest and most influential state, it has heft.

Baltimore, Cleveland and Newark would occupy another place on the spectrum.  All are well known for enduring the storm of industrial decline, and in Cleveland’s case, fiscal insolvency.  They’re slowly recovering from a nadir reached perhaps a decade or two ago and have made small steps toward improvement.  They’ve worked hard to revitalize their cores – Newark has leaned on its financial services sector to turn the tide, while Baltimore and Cleveland have relied on their assets in education, health care services, and biomedical and biotech research.  However, all are far from being complete success stories.

Then there is Detroit.

Each city has had African-Americans serve in the city’s highest office.  Chicago’s Harold Washington endured tough times as mayor of Chicago, but he built a lasting coalition that allowed him to prevail.  Denver’s Wellington Webb learned to adapt in a pluralistic environment and raised the profile of a Western city.  Cleveland, Newark and Detroit each elected first black mayors during the turbulent post-Civil Rights era and paid a steep social price for doing so.  Cleveland and Newark began their turnaround some years ago; perhaps Detroit’s, with its recent bankruptcy filing, has just begun.

If anyone doubts the impact of electing an African-American mayor during the racially tumultuous late ‘60s-early ‘70s era, examine the general perceptions that formed of the cities during that period and have endured ever since.  Newark and Detroit, already tainted by the aftermath of urban riots, were effectively shunned by white residents after the elections of their first black mayors.  Cleveland may have been headed down the same path after the election of Carl Stokes in 1967.  But Stokes chose not to run for a third two-year term as mayor, leaving a wide open field.  Stokes was followed by three consecutive white mayors — Ralph J. Perk, Dennis Kucinich and George Voinovich – before the election of the city’s second black mayor, Michael White, in 1990.  Atlanta touted itself as the “City too busy to hate” in the ‘70s, but Maynard Jackson’s 1973 election coincided with rapid white flight out of the city, at the same time that Sun Belt migration from the north was strengthening the suburban base.  In Washington, DC, black political empowerment there was often wrapped up in the controversy of federal political representation for the District.  Mayors in the District were federally appointed until Walter Washington was elected mayor in 1975.

Perhaps the best way to view perceptions of cities that elected “first black mayors” during the Black Power Era is to examine the fortunes of Detroit and Philadelphia during and after this period.  Entering the 1970’s the Motor City and the City of Brotherly Love had similar populations (about 1.5 million people in Detroit, 1.9 million in Philadelphia), with a similar geography (about 140 square miles) and similar demographics (approximately a 60/40 split between whites and blacks).  As noted, Coleman Young was elected mayor of Detroit in 1973, narrowly winning against Police Commissioner John Nichols.  It was clear that Nichols’ candidacy was an effort by his constituency to restore order to a city during a difficult time.  Meanwhile, another police commissioner, Frank Rizzo, assumed power as mayor of Philadelphia in 1971.  As mayor Rizzo was regarded as having a strained relationship with the city’s African-American community.  Rizzo’s “law-and-order” tactics were viewed positively by his white ethnic base and have been credited by some for keeping Philadelphia from suffering the same fate as other cities.  Could the Nichols campaign have been modeled after the successful Rizzo election two years earlier?

Possibly.  Yet it is instructive to view the difference in perceptions of both cities since that time.  Philadelphia was certainly hit hard by the decline of the nation’s manufacturing sector.  Philly had substantial losses in the shipbuilding, oil refining and food processing industries over the decades, losing thousands of jobs as a result.  Yet did Philly endure what was in effect a boycott of the city by white residents?  Troubled North and West Philadelphia are well known, but did their troubles define the entire city?  I think many people could imagine a real-life “Rocky Balboa” coming from Philadelphia in the ‘70s and ‘80s, but far fewer could imagine a similar character coming from Detroit.

Philadelphia’s national perception took a tumble over the last 40 years, but the city has fought back hard to rebuild itself as a premier city with a strong economic foundation in education, health care and financial services.  Detroit, however, continued on a descent no other city endured.  High crime rates, racial tensions, dilapidated abandoned buildings in a desolate post-industrial landscape  — all defined Detroit then and continue to define it today.

Between 1970 and 2010, Philadelphia’s population dropped by 22 percent, from 1.9 million to 1.5 million.  The decline was largely driven by a substantial loss of its non-Hispanic white population over the period, which declined by 56 percent.  Over the same period, Detroit’s population dropped by 53 percent, from 1.5 million to just over 700,000.  Its decline too was largely driven by a loss of its non-Hispanic white population, which dropped by 93 percent. Ninety-three percent.

Something happened that kept a base or core of white residents in Philadelphia.  Something happened in Detroit that led to their virtual disappearance.

Cities that elected their first black mayors during the Black Power Era deeply suffered in national perception because of the gamut of social challenges they had at the time, and found it difficult to stabilize poor economies or for revitalization to gain traction.  But they suffered far worse than other cities because they were in effect shunned.  They suffered from the greatest increases in crime.  They experienced the largest declines in school quality and performance.  They witnessed the steepest drops in property values.  They had the widest divides between police and community.  They had the highest numbers of white middle-class residents departing for the suburbs.  Newark was shunned.  Gary was shunned.  Detroit was shunned.  Maybe Cleveland, Los Angeles, or Cincinnati, or Dayton did not suffer the same fate because African-American populations there did not approach parity with whites, who were eventually able to “reclaim” the city’s highest office.  In the end, however, select cities paid a price for the election of black mayors during this time, a price not paid by cities that elected black mayors after them, or not at all.

Another Transition

Detroit Mayor Mike Duggan on election night in 2013.  Source:

On January 1, Michael Duggan assumed the difficult and unenviable responsibility of becoming the 75th mayor of Detroit, Michigan.  Given the most recent difficult period that Detroit has endured, and the continued difficult times ahead, Mayor Duggan’s inauguration was a subdued affair.  There was no inaugural ball or celebration.  The new mayor was simply sworn in with a short ceremony in his new 11th floor office in the Coleman A. Young Municipal Center.

The new mayor said he would focus on operations – removing blight, snowplowing streets, repairing lights, making sure buses run safely and on time.  The mayor suggested he would move into Manoogian Mansion, the palatial mayoral residence on the Detroit River that was deeded to the city in the 1960’s.  As far as the focus on operations goes, he really has little choice in the matter.  The State of Michigan-appointed emergency manager Kevyn Orr, brought in with exceptionally broad powers to resolve the city’s financial mess and currently leading the Motor City’s largest-ever municipal bankruptcy, has a lock on policy decisions right now.  Mayor Duggan says his focus is to “return the city to elected leadership on October 1,” the day that Orr’s 18-month appointment from the state ends.

And with that, Mike Duggan became the first white mayor of Detroit since 1973, mayor of a city with a population that is 83% African-American.  This most recent election, most observers believe, is a venture into the unknown, and is as much an experiment as Detroit’s bankruptcy itself.  An era of African-American political leadership has ended in Detroit, but no one is certain of what the next era might be.

Perhaps the bankruptcy, the election of a white mayor and the growing urban pioneer spirit that is visible in parts of the city means that the shunning of Detroit has ended.

This post originally appeared on August 10th, 2014 in Corner Side Yard.

Pete Saunders is a Detroit native who has worked as a public and private sector urban planner in the Chicago area for more than twenty years.  He is also the author of "The Corner Side Yard," an urban planning blog that focuses on the redevelopment and revitalization of Rust Belt cities.

Top photo: The Monument to Joe Louis, commonly known as “The Fist”, in downtown Detroit. For more than thirty years, the sculpture has been a controversial symbol of black power in Detroit.  Source: Pete Saunders

Planning a Trip to China

Wed, 11/26/2014 - 21:38

Recently concluded agreements between the United States and China have led to easing of visa restrictions, which is expected to lead to tourist volume increases in both directions. As a frequent traveler to China, I have found that organized groups – the simplest way to travel in China – far too confining and have avoided their use with the exception of travel to a Great Wall site in the Beijing area.

It is easy to obtain a visa by mail or express to visit China by applying through a Chinese consulate or visa service. These are readily found on the internet. It may be surprising that obtaining a visa to visit China is easier than obtaining a visa for a US visit by Chinese citizens, which requires a face-to-face interview with a US consular official.

Purpose of My Travel

My principal professional interest is cities. I have toured all of the urban areas with more than 1,000,000 residents in Western Europe, Japan, Australia, New Zealand, Canada, and the United States and nearly all of the world's megacities (over 10 million people). My purpose has been to examine the geography, urban form and transport system of world cities

China has become a particular interest, not only because of its unprecedented economic trajectory and its poverty reduction, but also because of its strong rate of urbanization. According to the United Nations, in 1975, China was 17 percent urban, and will reach 56 percent in 2015, three times the level of 40 years ago. I have traveled extensively in China over the past 15 years and toured each of the 27 largest urban areas and a number of smaller urban areas.

Getting There

Chances are that the individual tourist will enter China through one of its two largest international airports in Beijing and Shanghai.

Beijing's Capital International Airport was rebuilt for the Olympics and is an architectural masterpiece. Capital International Airport now trails only Atlanta's Hartsfield-Jackson International Airport in passenger volume. As late as 2002, Capital International did not rank among the world's top 25 airports. There is a limited stop Metro line to the core of Beijing, costing about $4.

Shanghai's Pudong International Airport has been substantially expanded in recent years, and unlike many airports, has maintained a consistent architectural design, despite its additions. Pudong International is unique is being served by the world's only Magnetic Levitation train ("maglev") which takes passengers part way to central Shanghai, at speeds up to 270 miles per hour (430 kilometers per hour). The Mag Lev is the fastest train in the world in commercial operation. The one-way fare is approximately $8 (Note 1). The core of Shanghai can be reached from Pudong by Metro for slightly more than $1.00 (29 miles or 47 kilometers).

One option the tourist will not find at Chinese airports is the self-drive rental car counter. Generally, rental cars are available only to drivers with a Chinese driving license.

Not Getting Lost

Some in China speak English, but the vast majority do not. As is noted below, the principal means of travel within the cities is by taxi and most taxi drivers do not speak English. Therefore it is very important to always take an "address card," which will have the hotel name and address printed in both Chinese characters and English, so the taxi driver can return you to the hotel. Hotel personnel will also write destinations in Chinese characters to give to taxi drivers for trips from the hotel.

Getting Around in Urban Areas

Even so, the urban transportation system meets the needs of most tourists. China's cities are by no means walkable, though some attractions will be available on foot. For example, many central Beijing hotels are within walking distance of Forbidden City. In Shanghai, the Bund and the Nanjing Road shopping district (Note 2) are also near central area hotels.

Generally you can get around on plentiful and inexpensive taxis or transit systems. China is building metros (subways) in many cities. Shanghai has the longest Metro system in the world, while Beijing ranks second. Distances between stations are often quite great and it is advisable to use taxis from the station for destinations that are beyond comfortable walking distance.

Getting Around Between Cities

Airlines: China also has an effective intercity transportation network. China's domestic airline passenger volume is nearly equal to that of the European Union and trails the United States by 40 percent. Generally, the Chinese airline system is very "English friendly," with onboard staff generally bilingual and English speakers easily found within airports. Meals are provided on most flights.

Air tickets may be readily purchased using credit cards through Internet sites such as,,, and C– My favorite is C-Trip, a Chinese travel agency which has an English language toll free number in China.

Trains: China has the longest high-speed rail system in the world, with similar quality to those of Japanese and Europe or Amtrak's Acela Express. The high-speed trains have train number prefixes of "C", "D" or "G" (such as G-1234). Other trains could be less comfortable for Westerner. They can be much slower and often do not have Western style toilets.

Announcements and electronic signs in carriages are in English and Mandarin. Staff is generally less English proficient than on the airlines, however. There is limited food service (as on the French trains) and travelers may want to take along snacks. Drinks are readily available.

Tickets may be purchased online from sites such as Travel China and C-Trip with credit cards. However, credit cards cannot be used for tickets at railway stations. I purchase tickets in China, at major stations, where there are special English windows.

Buses: Buses, which operate on the world's largest motorway (freeway) network, go many places that cannot be reached by the higher quality train services. Often hotels will be able to obtain bus tickets. My most notable bus trip was from Ningbo to Shanghai, to cross the Hangzhou Bay Bridge, one of the longest in the world.


China has its share of five star and other "high- end" hotels. I tend to avoid these hotels, because I am interested in stretching my dollar to see more, and stay longer. There are good options for lower cost hotels in China. My own favorite is Ibis, part of the French owned Accor chain. While the guest can expect to pay €100 or more in Europe, Ibis hotels tend to cost between $25 and $50 per night for double occupancy. The advantage, is that Ibis provides a consistent standard that is little different between Paris and Shanghai or Qingdao. Generally, Ibis staff communicates adequately in English. Ibis also has restaurants with limited fare, though I prefer the small entrepreneurial neighborhood establishments.

A good second choice is the locally owned Jin Jiang Inns, which have similar costs, but where staff English proficiency is less predictable. Even so, Jin Jiang Inn staff will often provide assistance using "on-call" English speakers by mobile phone.

The travel site aggregates hotel rates (including Ibis and Jin Jiang) and is a good shortcut for finding the best deals.


There is significant variation in the cuisine between the provinces and regions of China. Eating is one of the great pleasures of China. This too can be inexpensive. There are small independently owned restaurants throughout Chinese cities. Meals can be purchased at from $1 to $3 in these establishments. Of course, you can pay much more.

My favorite is Lanzhou noodles, which are served in a large bowl with beef, vegetables and hot Sichuan pepper sauce. Servers will routinely ask Westerners whether they want the hot sauce (and it is hot), but I order it. The noodle dish is named after the city of Lanzhou, capital of Gansu province.

However, some tourists may prefer Western food, which can be found at some higher cost restaurants and the many fast food restaurants such as McDonald's, Burger King, Kentucky Fried Chicken, and Pizza Hut.

Convenience Stores

Chinese cities are dotted with many small entrepreneurial as well as franchised convenience stores (or small grocery stores). Usually within walking distance, these stores carry a good selection of soft drinks, including both western and Chinese.


The Chinese currency is the "Yuan" or "RMB." The current exchange rate is about six to the dollar or 600 per $100. Money may be exchanged on entry at the airports and generally at the large national banks, such as the Bank of China, the Agricultural Bank of China, the China Construction Bank, the China Merchants Bank, the Bank of Communications, China CITIC Bank, and ICBC (Industrial and Commercial Bank of China). Usually, there will be English proficient staff available. These banks have branches throughout the nation. Further, these banks usually have Automatic Teller Machines linked to international networks, such as Visa.

Other Cautions

Water: As in many developing countries, tap water may be insufficiently safe for drinking. Hotels routinely provide bottled water.

Food: I recommend eating only hot food. It is advisable take along an antibiotic prescription in case of serious stomach upset. On 11 trips, I have had only one occurrence and have seen the problem cleared up overnight.

Taxis: The great majority of Chinese taxis operate legitimately, charging metered fares (with drop charges ranging from near $1 to just over $2). My fare from Pudong International Airport to the Jing'an District of Shanghai (beyond the core) was $32 in terrible traffic.

However, there can be difficulties with taxis, especially at train stations and airports. It is always best to obtain a taxi from the organized taxi rank, where metered fares will be available. Often western travelers are approached by drivers at terminal exits offering absurdly high rates. For example, this trip, at Longyang Road Station in Shanghai (terminus of the Mag Lev), I was offered fares ranging from more than three to 15 times the meter fare to nearby hotels.

The First Trip

A good way for the novice traveler to China to start is a trip to the Shanghai or Beijing areas.

In Beijing, there are sites such as the Great Wall of China (Exhibit 1), the Forbidden City (Exhibit 2), the Ming Tombs. The Lama Buddhist Temple and the Confucius Temple (only a 3 minute walk away) and the Summer Palace. The former treaty port of Tianjin, with its extensive pre-War western housing and spectacular new architecture is little more than a half hour away by train. Tangshan, site of one of the world's most deadly earthquakes (1976), is another 45 minutes away (Exhibit 3).

Shanghai has the "Bund," along the Huang Pu (river), with its Western style commercial buildings from the pre-World War II era. From the walkway on the Bund, there is a stunning view of the new Lujiazui business district in Pudong, which includes the second tallest building in the world (top picture). Only 30 minutes away by train is Suzhou, the "Venice of China," with its canals (Exhibit 4) and the leaning pagoda on Tiger Hill. Hangzhou, with its scenic West Lake is just an hour's train ride away (Exhibit 5). The historic Grand Canal, which provided access between the Yangtze Delta and the Beijing area, can be seen at both Suzhou (Exhibit 6) and Hangzhou.

There are many other cities of great interest for subsequent trips, especially Chongqing, Qingdao, Xi'an, Dalian (Exhibit 7), Harbin, Chengdu, Shenzhen and Wuhan.

The bottom line is that traveling in China is more complicated than traveling in Wisconsin or Ontario. But it is not that difficult and getting better.

Note 1: The Mag Lev line was intended as a demonstration line that would encourage China to use that technology for its high speed rail network. Further, the line was to be expanded through central Shanghai and then southwest to Hangzhou (180 miles or 110 kilometers). Citizen opposition led to cancellation of the extension and China opted to use conventional technology, rather than Mag Lev for its high speed rail network.

Note 2: On Nanjing Road, Western tourists are often solicited by students to attend a tea drinking ceremony. This experience should be avoided. The tourist will have to pay the bill and the costs will likely be far above expectation.

Top photo: Lujiazui business center in Pudong, across the Huang Pu from the Bund (November 3 by author)

Wendell Cox is principal of Demographia, an international public policy and demographics firm. He is co-author of the "Demographia International Housing Affordability Survey" and author of "Demographia World Urban Areas" and "War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life." He was appointed to three terms on the Los Angeles County Transportation Commission, where he served with the leading city and county leadership as the only non-elected member. He was appointed to the Amtrak Reform Council to fill the unexpired term of Governor Christine Todd Whitman and has served as a visiting professor at the Conservatoire National des Arts et Metiers, a national university in Paris.

New Class Order

Tue, 11/25/2014 - 21:38

In this predictably difficult year for the Democrats, the party of the people is turning, of all people, to its plutocrats. However much the party stigmatizes right-wing billionaires like the Koch brothers, a growing proportion of America’s ultra-rich have become devoted Democrats, giving them an edge in fund-raising. Indeed, an analysis of billionaire contributors this year by Politifact found that 13 supported liberals while only nine backed Republicans.

The left plutocracy helps explain how Harry Reid’s Democratic Senatorial Campaign Committee has greatly outraised their Republican rivals. Overall, Democratic-aligned committees have achieved a lopsided edge in fundraising – $453 million opposed to $289 million, according to Politico. Overall, the top three donors to the political Super PACs this year all lean to the left.

Democrats counter that many Republican groups, notably the Koch-funded Americans for Prosperity, generally don’t reveal their finances. But as the New York Times’ Tom Edsall notes, “Liberals do the same, and the press in large part gives them a pass.” He points particularly to the “Democracy Alliance,” a conglomerate of some 100 very rich donors who contribute some $30 million annually to progressive organizations and causes.

All this reflects a changing class system far more nuanced than the overworked meme about the “1 percent” arrayed against the toiling masses. Instead, we have a plutocracy increasingly divided, mostly along regional and industry lines, among themselves. It’s no surprise voters, notes columnist John Kass, are confused by this recent headline in the Chicago Tribune: “Obama decries income inequality in speech after $50,000-a-person fundraiser for Quinn.”

The Democrats’ Plutocrats

The Democratic plutocracy is largely rooted in such industries as telecommunications, entertainment, software, legal services and, surprisingly, a large section of Wall Street. Financial firms, such as Goldman Sachs, supported the president even before his first election. Although the firm did shift towards Mitt Romney in 2012, it maintains close, even intimate, ties to the president, as spelled out in the left-leaning Huffington Post. Wall Street has been the big winner in the Obama economy due to the Federal Reserve’s policy of ultra-low interest rates, which work to force investors into stocks.

Others sectors also have good reasons to embrace the Democrats. Lawyers often benefit from increased regulation, although that does not apply to most businesses. Overall, legal firms have contributed more than twice as much to Democrats than they have to Republicans.

Another powerful force for the Democrats lies in the high-tech sector. The same Fed policy that helps Wall Street asset managers also boosts venture capitalists by making investment in even dodgy start-ups irresistible. Once a minor force in campaigns, the tech firms, including software, have greatly expanded their campaign spending, up three-fold since 2000, with a tilt that, in 2012, saw Democrats harvest roughly twice as much high- tech cash as their GOP rivals.

Most of the leading tech industry figures – Yahoo’s Melissa Mayer, Google’s Sergei Brin, venture capitalist Reid Hoffman as well as Facebook’s Mark Zuckerberg and Sheryl Sandberg – strongly tilt toward the Democrats. The grassroots nerdistan may be even more bluish; 91 percent of the contributions of Apple employees in the 2012 presidential race went to President Obama.

Concerns over climate change are a big plus for the Democrats with Silicon Valley. Mega-figures like Google’s Eric Schmidt and Tom Steyer, a former big time investor in fossil fuels, oppose all fossil fuels, including natural gas. Apple’s CEO Tim Cook, who has Al Gore on his board, has even asked that what he considers climate change “deniers” not invest in his company.

Silicon Valley is not just content to proselytize the masses. Firms like Google and investors have been quick to exploit the Democrats’ green politics, investing heavily in highly subsidized renewable fuels. Being green has become yet another business opportunity for some of America’s wealthiest investors and companies.

Then there’s always geography. Most of the major Democratic plutocrats live in solidly blue states such as Washington, California, Illinois and New York, where political influence means, for the most part, appealing to Democrats.

In contrast, being a conservative Republican in Silicon Valley avails one little; you are pretty much excluded from the biggest political events and any ideological misstep, as the former head of Mozilla learned the hard way, can lead to virtual banishment.

The Republican Residue

None of this suggests that the Republicans have become the new de facto populist party. The GOP still gathers in millions of dollars from big businesses, but these tend to be very different industries than those of the Democrats. Particularly prominent are fossil fuel companies, caught in the crosshairs of the White House and its regulatory apparatus. In 2012, oil and gas executives doubled their federal contributions to $70 million, with some 90 percent going to Republicans.

This year, energy firms are again making big bets on the GOP, hoping to block environmentalist-backed regulations by helping Republicans gain a majority in the Senate.

Republicans also do well with old-line oligarchs in agribusiness firms, home builders, casino owners, commercial banks and insurance companies. Once more divided in their loyalties, these appear to becoming increasingly GOP oriented in recent years. The party’s embattled governors have been raising millions from energy moguls like the Kochs, casino magnate Sheldon Adelson and tobacco firm Reynolds American.

There’s also a strong regional tilt here. Most strong energy, home-building and agribusiness firms are concentrated in the middle of the country, most prominently in Texas, Oklahoma, and the Dakotas. Voters in these states, particularly Republicans, tend to be more favorable, according to Gallup, to expanding natural gas and oil production than their Democratic counterparts who are generally more partial to wind and solar.

Other players tip the scales to the Democrats.

Traditionally, Democrats have balanced the disproportionate business support for Republicans with strong backing from unions.

Since 1989, six of the largest political donors have come from labor. Today, business may be effectively divided, but organized labor remains rock solid in its backing for President Obama and his party.

Some private sector unions are upset by presidential policies on such things as Keystone XL pipeline.

But increasingly, the dominant union force behind the Democrats is not hard-hats but public employee unions, whose power in many blue states is all but incontestable.

Looking forward: The Gentry Liberal Ascendancy

Despite the fund-raising shortfall, Republicans could do well this November.

Even brilliantly targeted get-out-the-vote efforts, or effective use of social media, may not be enough to save Harry Reid’s Senate majority, and certainly will not be enough to break the GOP stranglehold on the House. But this may prove only a temporary triumph, as most long-term trends in political fund-raising favor the Democrats.

The most profound is the movement of money away from the tangible economy – oil and gas, manufacturing, home-building, logistics – to such activities as financial transactions, digital technology, media and entertainment.

Unless the Democratic Party rediscovers its populist soul, these sectors, and those who derive their fortunes from it, will enjoy friendly treatment from Democrats, whether in mergers, as in the case of Comcast, or in evading privacy controls, which impacts much of the social media sector.

More important will be the progressive orientation of the trustifarians, the inheritor generation, which is just emerging from Hollywood, Silicon Valley and Wall Street.

Already the bulk of nonprofits are now solidly liberal, with roughly 70 percent of their funds going to left-of-center causes. This trend will likely increase in the future. The new gentry – like the inheritors of the fortunes of the once-reactionary Ford, MacArthur and Rockefeller families – is likely to ignore basic business concerns and instead adopt the generally leftist culture in their favored locales.

Ultimately, the American oligarchy is transforming in ways injurious to Republicans and favorable to the Democrats. The Supreme Court has dropped restrictions on fundraising and the economy has boosted the incomes of the super-rich, but not much for anyone else.

That may upset Democrats in principle, but, in the long run, they are likely to be the biggest beneficiaries.

This piece originally appeared at The Orange County Register.

Joel Kotkin is executive editor of and Distinguished Presidential Fellow in Urban Futures at Chapman University, and a member of the editorial board of the Orange County Register. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is author of The City: A Global History and The Next Hundred Million: America in 2050. His most recent study, The Rise of Postfamilialism, has been widely discussed and distributed internationally. He lives in Los Angeles, CA.

Urbanists Need to Face the Full Implications of Peak Car

Mon, 11/24/2014 - 21:38

As traffic levels decline nationally in defiance of the usual state DOT forecasts projecting major increases, a number of commentators have claimed that we’ve reached “peak car” – the point at which the seemingly inexorable rise in vehicle miles traveled in America finally comes to an end.   But while this has been celebrated, with some justification in the urbanist world as vitiating plans for more roads, the implications for public policy haven’t been fully faced up to.

Indeed, the “peak car” is antithetical to the reigning urbanist paradigm of highways known as “induced demand.”  Induced demand is Say’s Law for roads: supply of lanes creates its own demand by drivers to fill them. Hence building more roads to reduce congestion is pointless. But if we’ve really reached peak car, maybe we really can build our way out of congestion after all.

Traffic levels have stabilized or even fallen in recent years. According to analysis by economist Doug Short featured in Streetsblog, aggregate auto travel peaked on a per capita basis in 2005 and has fallen since. Per capita traffic levels are now back to 1994 levels, a two decade rollback in traffic increases.

Population adjusted traffic growth. Image via Doug Short

Even looking at total, not per capita travel shows a marked reversal.  The State Smart Transportation Initiative, a pro-environmental research center, put together a graph showing how high the US DOT’s traffic projections have turned out to be:

VMT forecasts vs. actual. Source: SSTI

This data is complemented by a slew of recent stories about the poor financial performance of toll roads, resulting in part from traffic falling far below projections.  For example, the concessionaire operating the Indiana Toll Road recently went bankrupt. Streetsblog reported that while projections forecasted traffic level increase of 22% in the first seven years, traffic actually fell 11% in the first eight.

Recent traffic declines are a reversal of a long running trend of Vehicle Miles Traveled (VMT) increases at above growth in population. Some of this is no doubt due to the poor macro-economy. But there are reasons to believe we may be in a new era of traffic growth or lack thereof.  Many of the trends that drove high growth have largely been played out: household size declines, suburbanization, the entry of women into the workforce, one car per driver, etc. That’s not to say these will necessarily reverse. But we’ve reached the point of diminishing returns in terms of how many more women, for example, will join the labor force given that there’s already 57% female participation and their labor force participation rate is projected to decline in the future.

This is potentially very good fiscal news, especially given tight budgets. Clearly many of the freeway expansion projects on the books that have been driven by speculative demand should be revisited.  For example, the state of Wisconsin has massive investments planned in Milwaukee area freeway system even though the metro area is very slow growth in population.  Are these really necessary?  Projects in more rapidly growing boomtown regions in places like Dallas, Houston or Charlotte may well continue to make sense. From top to bottom, engineers need to recalibrate their forecasting models to better correspond to reality. And to revisit highway plans accordingly.

So the idea that we need to build fewer roads than we thought is sound. But less attention has been paid to the flip side implications of this.  To repeat, the induced demand theory says that there is a more or less infinite supply of traffic, thus any new roadway capacity will be used up shortly, leaving congestion as bad as the status quo ante.  Despite peak car, articles touting induced demand as a reason not to build roads continue unabated, including recent ones in Wired (“What’s Up With That: Building Bigger Roads Actually Makes Traffic Worse”) and Vox (“The ‘fundamental rule’ of traffic: building new roads just makes people drive more”).  In a world of peak car, where traffic levels are flat to declining on a per capita basis, induced demand no longer holds court, certainly not to the level claimed by those who believe it’s pointless to build roads.

In fact, what peak car means is that while speculative projects may be dubious, there many be good reasons now to build projects designed to alleviate already exiting congestion.  Places like Los Angeles remain chronically congested, which has great economic and social consequences, not the least of which is the value of untold hours lost sitting in traffic.  While individual projects there might indeed be boondoggles, maybe it’s worth building some of the planned freeway expansions there in light of peak car. In short, in some cases peak car strengthens the argument for building or expanding roads.

On the other hands, many of the regional development plans designed to promote compact central city development and transit may be predicated on an analysis that assumes large future traffic increases in a “business as usual” scenario.  Not just highways but all aspects of regional planning are dependent on traffic forecasts.  That’s not to say that such plans are necessarily wrong, but clearly revised traffic reality needs to be reflected in all plans, not just highway building ones.

It’s not clear how this will all play out, but urbanists and policy makers of all stripes need to think about the full implications of peak car. At a minimum, the traditional “you can’t build your way out of congestion” rhetoric should be  supplanted, at least in most areas, by a more nuanced approach that neither overestimates demand, nor ignores the problems caused by rapid growth in some regions and pockets of congestion in others.

Aaron M. Renn is an independent writer on urban affairs and the founder of Telestrian, a data analysis and mapping tool. He writes at The Urbanophile.

Legal but Still Poor: The Economic Consequences of Amnesty

Sat, 11/22/2014 - 18:50

With his questionably Constitutional move to protect America’s vast undocumented population, President Obama has provided at least five million immigrants, and likely many more, with new hope for the future. But at the same time, his economic policies, and those of the progressive wing of the Democratic Party, may guarantee that many of these newly legalized Americans will face huge obstacles trying to move up in a society creating too few opportunities already for its own citizens, much less millions of the largely ill-educated and unskilled newcomers.

Democratic Party operatives, and their media allies, no doubt see in the legalization move a step not only to address legitimate human needs, but their own political future. With the bulk of the country’s white population migrating rapidly to the GOP, arguably the best insurance for the Democrats is to accelerate the racial polarization of the electorate. It might be good politics but we need to ask: what is the fate awaiting these new, and prospective, Americans?

In previous waves of immigration, particularly during the early 20th Century, there were clear benefits for both newcomers and the economy. A nation rapidly industrializing needed labor, including the relatively unskilled, and, with the help of the New Deal and the growth of unions, many of these newcomers (including my own maternal grandparents) achieved a standard of living, which, if hardly affluent, was at least comfortable and moderately secure.

Demand for labor remained strong during the big immigrant wave of the 1980s until the Great Recession. The country was building houses at a rapid clip, which required a large amount of immigrant labor. Service industries, particularly before the onset of digital systems, such as ipads for ordering, that replace human staff in fast-food restaurants, tend to hotels and provide personal services, although often at low wages.

More recently, this wave of undocumented migration has diminished, as economic prospects, particularly for the low-skilled, have weakened. Yet the undocumented population remains upwards eleven million. Largely unskilled and undereducated, roughly half of adults 25 to 64 in this population have less than a high-school education compared to only 8 percent of the native born. Barely ten percent have any college, one third the national rate.

This workforce is being legalized at a time of unusual economic distress for the working class. Well into the post-2008 recovery, the country suffers from rates of labor participation at a 36 year low. Many jobs that were once full-time are, in part due to the Affordable Care Act, now part-time, and thus unable to support families. Finally there are increasingly few well-paying positions—including in industry—that don’t require some sort of post-college accreditation.

Sadly, the legalization of millions of new immigrants could make all these problems worse, particularly for Latinos already here and millions of African-Americans.

African-American unemployment is now twice that of whites. The black middle class, understandably proud of Obama’s elevation, has been losing the economic gains made over the past thirty years.

Latino-Americans have made huge strides in previous decades, but now are also falling behind, with a gradual loss of income relative to whites. Poverty among Latino children in America has risen from 27.5 percent in 2007 to 33.7 percent in 2012, an increase of 1.7 million minors.

Logically, many Latinos and African-Americans might suspect that amnesty won’t be a great deal for them. There are occasional signs of disquiet. A recent Pew survey found that not only half of all whites, but nearly two-fifths of African Americans and roughly even a third of Hispanics approved of increased deportations of the undocumented. A Wall Street Journal-NBC poll found that well less than half of Latinos supported the President’s action.

This ambivalence may reflect the reality that legalization of the undocumented may be felt hardest in those places, such as California, that have attracted the most newcomers, and also have highly developed welfare states. Today public agencies in Los Angeles, with an estimated one million undocumented immigrants, are bracing from large increases in the demand for state provided services.

One LA Supervisor estimates the County, facing “an already impossible fiscal dilemma,” will need to spend an additional $190 million, without hope of federal compensation, on the newly legalized population. Ultimately, the newest migrants will be competing with existing residents—particularly poorer ones—not only for jobs but also social services.

The President’s action on immigration requires a profound shift in economic policy, particularly in the large urban centers where most undocumented are clustered, to avoid creating a squeeze on scarce jobs and services. But Obama’s other big agenda—addressing climate change—has slowed the expansion of fossil fuel development. Meanwhile, it’s the energy sector that creates precisely the kinds of high-paying blue collar jobs, averaging upwards of $100,000 annually, that immigrants might be eager to fill and could give low unskilled workers a foothold into the middle class.

Similarly, efforts by Obama’s allies at Federal agencies like HUD to encourage dense housing and discourage suburban growth means far less construction employment, one of the largest generators of good blue collar jobs and opportunities.

Ironically, the places where the cry for amnesty has been the loudest—New York, San Francisco, Los Angeles, and Chicago—also tend to be those places that have created the least opportunity for the urban poor. This is in part due to the fact that these areas have tended to de-industrialize the most rapidly, discourage fledgling grassroots businesses through high taxes, environmental and housing, regulations.

Whatever their noble intentions, these cities generally suffer the largest degree of income inequality, notes a recent Brookings study. In fact, according to an analysis by Mark Schill at the Praxis Strategy Group, African-American incomes in New York are barely half those of whites and, in San Francisco somewhat below half. In contrast, cities with broader economies like Dallas and Houston, have black populations earning sixty five percent of white incomes. Similarly, Latinos in Boston, New York, Philadelphia and San Francisco do far worse, relative to incomes, than their Sunbelt counterparts, compared to whites.

These trends could worsen in precisely those areas with the biggest concentrations of undocumented immigrants covered by Obama’s executive order.

Take, for example, the borough of the Bronx in New York City. The most Latino of all New York’s counties, in the Bronx, roughly one in three households live in poverty, the highest rate of any large urban county.

In the country. It’s doubtful that legalization absent job growth will improve conditions , as it adds more potential claimants for local benefits without creating new income sources.

For reasons that can’t be purely economic, most Latino political leaders, and much of the group’s electorate, are in favor of policies that, over time, could doom prospects for Those who receive amnesty. Of course, there are other factors that play into support for these policies, like the emotional pull to reunite families, but whatever their appeal such measures could leave the very people they are meant to help as legal paupers.

My adopted home region of Southern California has seen an almost 14% drop in high-wage blue-collar jobs since 2007. Deindustrialization has continued, and construction employment lagged, even while the country as a whole, sparked by more secure and now cheaper energy supplies, has seen industrial production improve since 2010.

Herein lies the great dilemma then for the advocates of amnesty. In much of the country, and particularly the blue regions, they will find very few decent jobs but often a host of programs designed to ease their poverty. The temptation to increase the rolls of the dependent—and perhaps boost Democratic turnouts—may prove irresistible for the local political class.

So what should we do under these circumstances? Constitutional arguments aside, there do seem to be some better ways to create conditions for upward mobility among newcomers.

Higher minimum wages may help some of the legal residents, but arguably at the cost of new jobs for others including the newly amnestied. However popular with most voters, such redistributive measures will not address the fundamental economic challenge posed by amnesty.

Perhaps a sounder strategy would be to adopt policies that encourage broad-based economic growth, including energy, manufacturing, logistics and home construction. This would, of course, require some moderation of regulatory standards, particularly in reference to climate change.

The President’s recent deal with China, which essentially allows the Chinese to keep boosting emissions until 2030 while we reduce ours steeply, could make things worse. In some states like California, where the global warming consensus is beheld with theological rigidity, “green,” anti-suburban policies largely guarantee that most of the urban poor will never enter the middle class. In San Francisco, Boston and New York, the percentage of Latino and black homeowners is roughly one-third to one-half that seen in redder regions like Houston, Dallas, Phoenix and Atlanta.

In essence, the deepest blue states have created the worst of all conditions for the urban poor, and will be particularly tough on undocumented residents granted amnesty.

All this suggests that, if we are to make new Americans economically successful, we need to concentrate not on racial redress but find ways to spark broad based economic growth. Increasing use of inexpensive natural gas, for example, would not only help continue to reduce emissions but would spark an industrial expansion that would create more blue collar jobs. Similarly, policies that allowed for affordable, energy efficient new homes could create not only more blue collar employment possibilities, but a brighter future for young families, many of whom are themselves immigrants or their children.

The current amnesty could benefit both the country overall as well as recent immigrants if it is tacked to a broad based economic growth strategy. But that doesn’t seem to be in the cards. Instead, continuing policies that inhibit broad-based economic growth are increasing the numbers of Americans who must depend on government, not the economy, to take care of themselves and their families.

This piece originally appeared at The Daily Beast.

Joel Kotkin is executive editor of and Distinguished Presidential Fellow in Urban Futures at Chapman University, and a member of the editorial board of the Orange County Register. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is author of The City: A Global History and The Next Hundred Million: America in 2050. His most recent study, The Rise of Postfamilialism, has been widely discussed and distributed internationally. He lives in Los Angeles, CA.

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