Urban economics is a huge topic that I couldn't possibly do justice to in a blog post. A few blogs devoted entirely to the economics of cities do a pretty good job though. I highly recommend Ryan Avent, an economist who follows transportation and development issues in his blog The Bellows.
I just want to talk a little about a hot new topic: President-elect Obama's plan for a White House Office of Urban Policy. Now first of all, it is SUCH a relief to have a President who understands and appreciates the city--and the immense challenges and potential in America's cities. Unfortunately, these days, it's not often one sees the words "great" and "cities" in sequence. In 1961, a resident of New York City named Jane Jacobs published a book called "The Death and Life of Great American Cities". Until the resuscitation of the past decade, anyone who paid attention would have to say that the "Great American City" was dead. Anyone who didn't pay attention might forget that such a thing had ever existed. But thanks to a variety of factors--including demographic shifts making singles and empty-nesters the predominant American family type--cities are coming back.
I first saw Obama's suggestion of an Office of Urban Policy (OUP) way back in primary season, back when Clinton continued to insist "It's only a flesh wound", and people actually believed it. At the time, I was a bit skeptical. When we already have a Cabinet-level Department of Housing and Urban Development, what exactly would this OUP do except further bloat the bureaucracy? HUD sends around 4-7 billion dollars a year to cities for the purpose of providing housing, homeless assistance, and economic development. It spends another $30 billion or so on public housing and other housing assistance. A President sympathetic to cities could increase those numbers of course, but could also effect policy by simply redirecting it and guiding it to better uses.
But the more I thought about it, and the more I came to understand the limitations that HUD has (independent of money), the more I started to think that the OUP could be a great initiative. COULD be a great initiative. So here is why it could be good, and what it should do in order to be good.
First of all, the OUP will combine the efforts of the multiple departments that have a role to play in cities. The primary ones are HUD and the Department of Transportation. As long as the Federal Highway Administration and other highway funding mechanisms have a budget 5 times as large as the Federal Transit Administration, cities face an uphill battle. But even if the money doesn't change, if it can be coordinated with HUD grants and HUD-required planning efforts that local governments undergo, then we can make some progress. Other offices, like the Dept. of Education, Dept. of Health and Human Services, and the Small Business Administration can certainly be coordinated to better serve our cities. I'm focused on investing in the built environment though, rather than investing in human capital, so I won't address their potential--however, we need a President and Executive Branch leadership who does understand the roles of all these organizations and can tie them together.
The best candidate I've heard for OUP is Bruce Katz. Katz is a former Chief of Staff at HUD, and currently runs the Metropolitan Policy Program at the Brookings Institution. Brookings is a truly elite think tank in DC (THE elite think tank, in my opinion), and their Metro Program is a high profile comprehensive effort to draw attention to the immense value created by America's Metro areas ("Metro areas", because our cities are no longer defined by central business districts). The Metro Program is staffed by some of the most brilliant minds working in housing, transportation, and economics, and Katz is the man who runs the show. For what it's worth, he's also on Obama's transition team for HUD, and has been spotted in the HUD building.
Now, even with Katz at the head of the new OUP, it will have challenges. What is the office's authority? Will it control any money? It's easy to say multiple Departments should coordinate--how will they make it happen? Perhaps most importantly, the Federal government does not control cities. Hell, even cities don't control cities--citizens do. No matter how eloquently President Obama speaks about cities, or how much money is funneled to them, cities will continue to face an uphill battle until the American public begins to think more critically about those things they have come to take for granted. We all need to be more realistic about the costs of transportation, about the costs of land, about the costs of energy. We need to realize that a neighborhood where people look different, have varying incomes, or live in close proximity does not make it a dangerous neighborhood--it makes it interesting. We all need to get out of our cocoons--our cars, our backyards, our air conditioned living rooms with big screen TVs and video games--and remember (or dream about) what it's like to live in a great American city.
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