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Glaeser and Florida on Backlash, Decline, and Renewal

Edward Glaeser and Richard Florida take questions on the future of cities and how their thinking has changed.

The audience at the Urban Land Institute's mid-winter meeting in Washington, D.C. (Urban Land Institute)

For the true Ed Glaeser/Richard Florida completists: Here is the second part of their conversation at the Urban Land Institute’s mid-winter meeting in Washington, D.C.—the question and answer section.

The two urban experts fielded questions about place-based vs. people-based policies, what cities did to remake themselves, how to reframe local government’s role in urban planning, how to address economic backlash and economic decline, and how technology could reshape the way we inhabit and build cities.

Q: How has your thinking about cities evolved over the years?

FLORIDA: I agree with Ed: We should pretty much do people-based policies. But I worry that the backlash that we are going through is about place-based policies. It’s about being a middle-aged man with a family and seeing your factories and jobs go away.

Ed talked about the male joblessness problem. Now, those two intersecting problems of angry men in communities that are declining; if we don’t do something better, what we’re going to end up with is something awful.

GLAESER: I absolutely agree, and as much as I am intellectually committed to opposing place-based policies, we’ve got to do something for these communities that feels that somebody cares about them.

I would differentiate between policies that are clearly person-based, Social Security for example—things that you take with you that are completely unrelated to the benefits that you get. There are some things, which both of us would probably define as person-based policies even though they’re place-administered, but they occupy gray space. Schools, for example, or even safety, where in some sense the reason why we’re delivering safety is because we care about the people, not the place, but it is always delivered by local policy.

Another would be specific policies aimed at strengthening this city, this location. So a classic example of an extreme place-based policy is an empowerment zone. Where you would draw a line, we say there are tax benefits for locating in this area. But infrastructure is often justified, including Detroit’s people-moving monorail, on a place-based logic. So to the extent that you’re going to have place-based policies, you can make them in ways that are less harmful, rather than more harmful.

For example, putting massive amounts of high-speed rail in central Kentucky for hundreds of billions of dollars would seem like a tremendously wasteful use of anybody’s resources. Whereas figuring out some way to do smarter regulation for new businesses or even some form of a sensible tax reform that might work there would feel less harmful.

FLORIDA: Or what we might get is massive subsidies for rebuilding manufacturing. Or worse yet, arm-twisting manufacturing companies to come back to wherever. Those are horribly ineffective things.

I want to go back to Ed’s point; person-based policies really work. I was the beneficiary of them. I grew up in a working class town in New Jersey, with kids turning to crime and going to jail or juvenile detention or drug rehab. And the poicy which changed my life was a Garden State scholarship that lifted me out of there and put me in Rutgers. My whole trajectory changed.

But there is so much resistance, and familial resistance. We don’t want our kids to go off there. They have to stay home and work here. I saw this in Pittsburgh and elsewhere. How do we begin to rebuild these places and to create some economic pathways? We had those economic pathways before. A job in a manufacturing plant and a really cheap, suburban home. What is the analog of that that we could potentially do for these communities in today’s economy.

Q: A lot of places in the South are thriving and have remade themselves, often because they have less regulation. Why don’t we use those more as an example?

GLAESER: The skilled centers in the Sunbelt are the most dynamic parts of America by many measures. They bring a combination of both having relatively high levels of college graduates, of creatives, with deregulation. And that at its best is the most powerful combination to do it.

But without the skills combination, it’s very, very hard. One of the advantages of having the low levels of regulation in the South is that you have mass production housing on a grand scale, which is entirely feasible and possible in places where there’s sufficient demand. It doesn’t matter what you do to the regulation in new construction in central city Detroit. You’re not going to have some construction industry boom in places where more than 90 percent of the homes are valued at significantly below the physical cost of construction.

FLORIDA: And just having really good colleges and universities, that’s a big thing that helps places succeed or fail. Pittsburgh’s rebirth came because some goofy professors who everyone thought were bananas were building robot tanks roaming around the—and everyone went, “What? Robot tank?” Then 30 years later, these goofy robot tank people are acquired by Uber and boom.

In Pittsburgh’s case, the foundations were also critical stabilizers. And they could lay the seed corn for renewal by supporting local universities. What I find really interesting is Detroit, where you have old money and new money together. That ability of new money and old money to lever one another has been very interesting. So I think in the worst case, old money—philanthropic—helps you stave off decline. When you can combine it and lever against new money, you can get really better things.

GLAESER: In Massachusetts, there’s a lot of interest in the so-called gateway cities, because in some sense the spikiness of Richard’s world is particularly obvious in Massachusetts, where you have a city that is a capital of the information age, whereas it’s surrounded by places like Lowell and Lawrence and Worcester and Springfield and places that are legacy textile towns, places that were hubs 100 years ago.

The most important thing for many of these groups is not that they’re the end in itself, but they are a crucial watchdog and strengthener of local government. And without some degree of engagement by these organized citizens, groups of well-educated, connected people who have a better idea of how government can work, I think that can be very, very important.

FLORIDA: We actually studied this in Pittsburgh when we were thinking about 20 years ago. We studied all sorts of governance mechanisms and what we found is they don’t matter. Silicon Valley had nothing, never mind public-private partnerships. They just grew. So that makes me want to discount them. But Ed said something quite profound, and I only learned this when I moved to Toronto. In the United States, we take these things for granted, and in many ways they’re what’s really robust.

There’s a lot of conversation about the “rise of the rest.” There is no empirical evidence to suggest that is the case. The San Francisco Bay area increased its share of venture capital investment intake from 25 percent in 1990 to 45 percent in the year 2015. If you take this Boston-New York-Washington megalopolis, L.A. and greater San Francisco—it attracts like two-thirds of all venture capital investment in the world. There may be pockets of activity elsewhere, but they’re quite small scale.

Q: Is the competition across local governments worthwhile, or do we need to think about a way to govern more regionally in order to deal with these NIMBY issues?

GLAESER: It’s not one size fits all for all government services. There are some things which it is just fine to have local governments have control over, and land use decisions are unquestionably not one of them. You talk about Pasadena—this is a massive city compared to Weston, Massachusetts, where I woke up this morning, which has 11,000 people. And apart from my own household, not a single one of them thinks that any building would ever be a good idea within Weston. And it’s absolutely—as we know, these suburbs become homeowners’ enclaves where you don’t have anything.

Part of the beauty of a large, mixed city is you have CEOs at the table. You have people who actually see the costs of having high housing costs, because they have to pay it in their wages. And you have people who are actually speaking for poor people who can’t afford it, whereas give me a town of 11,000 upper-middle-class suburbanites—not a single one of them are interested in any of that. They just don’t want anyone else driving on their road at all. And they certainly don’t want housing affordability, because that’s a decrease in the value of their core asset. So if we’re going to get to something in terms of making our suburban enclaves more passable, we need something that decreases their level of local control.

Now broadly speaking there are two models for this, one of which is just override over local zoning. My local model for this in Massachusetts is Chapter 40B, which says if you have basically no affordable housing within your community and the builder meets a bunch of different standards, the builder can just essentially use state standards and bypass the locality completely. It’s a very powerful thing. It’s widely hated within all of the suburbs.

The second strategy is one which actually provides just more incentives for communities to build. Massachusetts has Chapter 40R and 40S, both of which provide some degree of cash, which transfers to a community if it needs more building. These incentives are, in the Massachusetts case, way too weak to have a visible effect, but you’d have to do something like tie various forms of state aid to actually delivering housing, which is considerably more politically possible to imagine that Weston would lose its state aid for schools, as Weston is a relatively rich place and can make up for it, and that that would go to Revere, a relatively poor place that actually does provide housing. So you could imagine more of a set of transfers on that, particularly given that would surely be progressive, and the poorer communities would have no problem saying yes to stuff and would take it away.

FLORIDA: Governance problems scale according to the scope and nature of the problem. If you ask me, the single biggest problem in America today is the centralization of authority in the federal government and the imperial presidency. And that is why we vacillate between this national angst every four or eight years.

The movement to use our federalism in a more dynamic way—it’s much more than cities as the opposition to Trump. It’s about adapting policy to a variation in local condition, which is growing over time and becoming more extreme.

Policy should be fine-tuned to local conditions, and that means some level of devolution over time. How do we articulate a real agenda for empowering local communities to solve the problems they face.

Q: What do you see for the future of cities during our current economic backlash?

FLORIDA: I’ve been thinking about this a lot in the context of our current disruption, the election. And I’ve been thinking about what I remember from the last ten years. What I remember is Ed Glaeser’s Triumph of the City, I remember that cities got stronger, that cities got better. What I remember is this progress of urbanization. So that’s what we’re going to see in ten years.

Ten years from now, we’re going to see that the world is spikier, despite all our efforts to make it flatter, it’s going to get spikier. We’re going to be more concentrated; we’re going to be more clustered.

The other thing we’re going to see is real new competitors. The United States has had this fantastic run, because of openness, tolerance, progressivism, great cities. Now I don’t know where they’re going to be. Are they going to be Hong Kong and Singapore? Are they going to Toronto and Sydney? I don’t know. We’re going to see real new competitors. We’re going to see a world of more global migration—no matter who wants to stop it, we’re going to see a world of more global migration, and we’re going to find some problems we didn’t anticipate, the same way these divides came up.

We’re going to find problems we did not anticipate. But I think our job has to be to push on the positive lever, which is urbanization, knowledge accumulation, forward progress. And the speed bump in the road of divisiveness, of backlash—we have to be better at dealing with that both in narrative terms and on the ground.

Q: How do you see public housing as part of the larger fabric of cities?

GLAESER: I think that public housing authorities can be a great source of innovation. We’ve got a lot of them. A lot of them have smart, well-meaning people. We can have more programs that are wrapped in. We can wrap together skills with the housing units. We can figure out smarter ways to handle Section 8 housing vouchers. We can make them of shorter duration, but available to more people. There are lots of different things that you can imagine experimenting. I think we certainly should be pushing and allowing our local housing authorities to engage in more experimentation that wraps together other services together with the core housing function.

Like most economists, when we’re talking about delivering more affordable housing, I tend to like vouchers a lot more than government owned and operated structures. Now, Singapore is able to do that well, somehow or other miraculously, but I don’t think we think the U.S. track record is great on that. But having sensible voucher programs seems like something that should be part of our social policy mix.

FLORIDA: I agree with Ed. The transformation of social housing in Toronto is worth a close look, and particularly this place called Regent Park, which was a dilapidated typical public housing problem with all the associated. A private developer, rebuilt Regent Park as a neighborhood, and a neighborhood with all sorts of services, not just a neighborhood with nice housing, but arts, creativity, innovation, entrepreneurship. It has become a vibrant community hub.

Q: How do you think technological changes to transportation, autonomous vehicles, artificial intelligence will change the development of cities?

FLORIDA: I think the greatest threat to dis-intermediating you, the real estate industry, is technology. So I’d be worried. I would be worried that people who know how to do technology are coming into your space in a big way. Now, you may think that we know how to build stuff, but that doesn’t matter. They can deploy a hell of a lot of capital.

But the ability to combine technology with living and working is going to be a big thing. It’s not just a question about ‘how do you let autonomous vehicles run around in your community’—it’s ‘how do you build this kind of community of the future?’

I would say what worries me more is, I don’t go to a store. I go to this thing called Amazon. My mother-in-law came to visit and she can’t understand that I do all my shopping online, when she still goes to a store. I don’t ever go to a store. Now I get all of my groceries—I can actually have the butcher deliver me stuff as needed. I can get my lunch—and then when I go out, of course I used to sit in a bar and get dinner and talk to a human being. And now I pull out my cellphone, and I hide. So technology is affecting the fabric of community in a way that is very powerful. A lot of that’s for good; it creates extra time and free time, and I can spend more time with my family and more time doing work. But it may perhaps cause us to interact less in a way that used to be good for cities.

GLAESER: Cities have always been about sharing. What is a restaurant but a shared dining room or shared kitchen? What is an urban park other than a shared backyard? What technology has done is it’s enabled us to share more stuff.

So now we have new technologies that enable us to share more stuff, and that typically favors cities where there are more people who are closer to each other to share. But, the promise of these technologies almost always fails to deliver unless they’re coupled with sensible changes and incentives as well. So in the world of transportation there’s something called the fundamental law of highway traffic which is that vehicle miles traveled increased roughly one for one with highway miles built. As I deliver more infrastructure, I get more usage of it.

Now think about innovation that makes it vastly less painful to sit in your car. You can work in your car, you don’t have to pay any attention to the road. What’s that going to do to the number of people who want to drive around? We think our streets are gridlocked now—the advent of AVs (autonomous vehicles), the marginal impact of maybe slightly better traffic planning that you’ll get out of AVs versus the fact that you’ll see an onslaught of people who are happy to sit on roads—it’s one to 100 that in fact the negative effect on traffic is going to overwhelm it.

Unless we introduce congestion pricing on autonomous vehicles from the get-go, they are going to be an urban traffic disaster. With congestion pricing, they can be a tremendous asset. But we need to tax them from the beginning. That will be very natural on dedicated lanes for AVs.

Think about instead adding an autonomous vehicle lane on both sides of Route 95 that only takes buses or maybe takes special cars. You charge people for that. And unfortunately, all of this technology doesn’t help the jobs problem at all. It almost universally goes in the opposite direction.

FLORIDA: It’s going to make central places more valuable. It’s going to actually drive up the value of central places.

Q: Given the big challenges for some cities trying to rebuild, is there actually an argument for smart decline of some of these areas as opposed to investment, and have you considered that as you look at the economic statistics around some of these areas?

GLAESER: I’m widely associated with that view and hated for it, even more so than Richard—

FLORIDA: You took the heat off me on that.

GLAESER: There are limitations to how much we can invest in every area, and not every spot of America needs to have a vibrant community living on it. We don’t need to invest billions to recoup every declining city, as long as there’s a strong coda—that we never forget the people. As long as we make sure that we are redirecting those resources to actually care for the children, to care for the people to provide them with new skills and with a brighter future.

What can be so galling is when place-based policies go wrong. I join with Richard in thinking we need to think about doing smart ones. But when they go wrong, the tragedy of it is that $300 million that went on [Detroit’s] monorail didn’t get invested in Detroit’s children—it didn’t get invested in their safety, didn’t get invested in their schools. And that’s what’s so difficult about this.

FLORIDA: It’s a turn of phrase—I’m not sure I entirely agree with it, the idea that you’re going to have to do some kind of place-based thing to make sure to keep people in those places where people are moving out to better opportunity and better ways of life, but we need to make sure the people left-behind aren’t left in totally desperate conditions. I think this is an area where we need real systematic thinking; it would be great to have cities who are willing to try demonstrations, become test beds, and bring more action.

We will be blamed for every bad thing if we forget the people these ideas are meant to help. It’s a political critique where you’re put out there as some kind of evil caricature of who you don’t want to be.

GLAESER: It’s OK if I’m an evil caricature, but it’s not okay if the ideas become evil caricatures.

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