Cities in the 2020s

Source: istockphoto.com

These are the days of miracle and wonder--PAUL SIMON

This week, National Public Radio's "Marketplace Morning Report" discussed economic forecasts by the Oxford Economic Group which expects weak global economic growth in the near future, including the U.S. (Safo 2019). Actual results may vary, of course, and the authors suggest the cities best situated for a prosperous early 2020s are those outstanding on dimensions of economic mix, cost of living, and quality of life. So the U.S. urban economy expected to grow the most in 2020-21 is... San Francisco??

I'm not questioning the report's methodology, rather taking it as read, because [a] it's proprietary, and [b] I'm cheap. But San Francisco's cost of living is infamously high, particularly housing. Its cost of living ranked #2 among U.S. cities in 2019 by Kiplinger, trailing only the Borough of Manhattan (which is only part of a city), thanks to "years of relentless growth driven by high-paid tech workers." Average apartment rent: $3821 a month. So, given their criteria, however is San Francisco #1?

Poster, City Lights Bookstore, July 2014

Put another way, if San Francisco is in the best position in spite of its ridiculously high housing costs, what does that say about the rest of the country? For example, what is going to happen in Chicago, which ranks at the bottom of Oxford's list, thanks to the frightening budget and tax picture in the State of Illinois? What about small cities and rural areas, which can't compete with the big places for economic mix (or, arguably, for quality of life)?

The "winner-take-all" nature of the post-industrial economy applies not only to individuals but also to places (though see Sawhill 2019 for the argument that this situation results from political choices as well as economic fundamentals). In the modern tech economy, wrote Emily Badger (cited below) in The New York Times around the time Amazon made its HQ2 announcement, cities that already have wealth, opportunity, highly educated workers and high salaries will just keep attracting more of them.... A small number of rich and internationally connected cities keep increasing their economic advantages--and as a result, the inequality widens between them and everywhere else.

It looks like the 2020s will feature a big shakeout. I hope it won't hurt, but it probably will. Interestingly, Brookings scholars' list of the biggest economic stories of the 2010s focus less on places than on individuals (tax cuts for the rich, rising inequality, lower life expectancy, fewer teens in the workforce) and systems (monetary policy stuck on full-blast, good news on health care access and cost, no worker productivity gains, aging population). But it's fair to say that the fall-out from most of these individual- and system-level trends will impact localities, too, and not all localities to the same degree. Localities will have, already have, fewer resources to address either rising individual vulnerabilities or cutthroat economic competition.

Maybe the 2020s will be the placid sort of decade in which these sorts of issues can be thoughtfully sorted out. The 2010s certainly were, when you compare them to its immediate predecessor which featured a small recession, a massive terrorist attack, a debilitating war, and finally the biggest financial crisis since the Great Depression. The 2010s have been quite a breather, comparatively, apart from a series of unforced errors. Future generations may well wonder why we squandered this opportunity in government shutdowns, highway construction, and the odoriferous politics of Donald Trump. The tasks of the 2020s will be hard enough without the possibility of additional pressure from:

• an economic downturn
• employment issues for the rest (of workers, of places)
• natural disasters exacerbated by climate change
• increasing refugee flows
• increasing homelessness, due to rising incidence of mental illness and/or poverty (see Hu 2019)
• changes in energy prices and supply
• intensified inter-group hostility
• crumbling infrastructure on which maintenance has been deferred too long

Pete Saunders, a planner and blogger from the industrial Midwest, anticipates the decade to come might fulfill the transition period underway throughout the 2010s, turning away from the auto-centric era that ran from World War II until the last decade's housing crisis.

Our development future will be even more urban.  It will be based more on the mobility options and opportunities --autonomous and alternatively fueled vehicles -- that will expand this century.  It will be more economically unequal in America, as America's economy becomes more equal with the rest of the world.   And our development patterns will be something that will adapt to the demands put on it by climate change. [For the next twenty years:] The rebirth of cities actually does take hold nationally, as growth filters downward from our superstar coastal cities to other cities.  Interior cities will tout their assets and amenities and become cheaper alternatives to the coasts. (Saunders 2019)

This fulfillment will be facilitated if millennials stay in cities, as seems to be happening where such opportunities exist (Lewyn 2019), rather than coming to expect the same subsidized suburban development their parents came to expect. It will require the masters of capital to notice all the talent in the cost-efficient interior of the country, and to move to take advantage of it, and for interior cities to position themselves for strength--culturally as well as physically and financially. It will require a willingness to adapt to climate change, even if we have to call it something else to soothe the deniers.

Some days my town seems to be about attracting entrepreneurs and removing obstacles to traditional development, and some days its long-term plan seems to consist of subdivisions and strip malls, not to mention the casino. I guess the glass is never entirely full, nor is it entirely empty, and that history progresses incrementally, even imperceptibly. Whatever this new decade brings, may there always be voices of hope and visions of common life.

SOURCES:
 Emily Badger, "The Same Cities Keep Attracting Tech. Why?" New York Times, 8 November 2018, B1, B2
 Winnie Hu, "Please, Don't Have a Seat," New York Times, 8 November 2019, A22
 Michael Lewyn, "Are Cities Really Losing Millennials?" Planetizen, 23 December 2019
 Nova Safo, "Economic Growth for U.S. Cities Will Depend on Mix of Industries," Marketplace, 23 December 2019
 Pete Saunders, "Revisiting the 'Big Theory' on American Urban Development," Corner Side Yard, 23 December 2019

SEE ALSO: "What Defined the Decade Since CityLab Launched," CityLab, 30 December 2019
EARLIER POSTS:
"Globalization's Challenge to Cities," 25 June 2016
"Can Cities Change Their Luck?" 20 June 2016
"Two Tales of Cities," 7 June 2016

Globalization's challenge to cities

 

Source: dimassuryo.files.wordpress.com

Thursday's referendum in Britain on whether to remain in the European Union has been interpreted, at least in part, as a referendum on the increasing integration of economies across the Earth, which has accelerated in the last three or four decades. The phenomenon of globalization has been credited and blamed for a number of developments during this time; in fact while these developments might be caused by globalization, others are symptoms of a small world, the ability of economic power to buy political power, or mere coincidence. Globalization has certainly been associated with individual economic insecurity as well as the failure of state political institutions, and that has created volatile politics all over the world (Langfitt 2016).

From a troglodyte's perspective the world began to globalize 3000-4000 years ago as trading developed across groups and, as navigation developed, across geographic regions. But that's not what we're talking about here. Technology has increasingly enabled manufacturing, marketing and to a certain extent service provision to occur across space without noticeable impact on the product or the consumer. No more is it enough to be the best bank, car dealer or bookseller in your part of town; now you're competing with banks, or car dealers, or booksellers all over the world.

In Thomas Friedman's felicitous phrase, today's world is "flat." Without going all in on his argument, the flatness metaphor is useful for illustrating how geographic barriers to competition have been removed, which makes economic security more difficult to achieve whether one is an individual, a firm or a city. Friedman, while noting that people "have to run harder to stay in place," generally sees this as a positive development, and he's far from alone in this. Tougher competition brings more and better choices for consumers, and all those firms and workers running harder will keep improving human life. Friedman emphasizes skill development as the answer to individual and national insecurity, particularly advocating improvements to the U.S. education system.




The benefits are hard to deny: Besides offering greater choices for consumers, a flat world has allowed development of a middle class in emerging nations like China and India, and reduced the extent of poverty worldwide especially in Latin America (FAO 2015). Of course, for the winners in global competition the rewards are huge. Just ask Jeff Bezos, founder of Amazon.com, who is probably the richest bookseller the world has ever known, or the heirs of Sam Walton, who founded the most dominant retail chain in history. However, a lot of people, at least in the West, are finding that global opportunity cuts both ways, and are stressed by what seems like a loss of control over their lives (Berube). This insecurity is exacerbated by advances in automation, which allow manufacturing to be done by a fraction of the work force of days gone by; a liberal (at least in practice) immigration regime which flattens even local labor markets; and doubts about our ability to replicate the economic growth of the 20th century. (For the last point including its impact on politics and society, see Thomas Piketty, Capital in the Twenty-First Century [Harvard, 2014], ch. 2.)

What the forces of globalization, automation, immigration and slow growth have in common is that they raise questions about the future of work. The pop culture image of the blue collar working stiff slogging his way through the working day (think Johnny Paycheck's classic song "Take This Job and Shove It" or Fred Flintstone shouting "Yabba dabba do!" when the whistle blows at quitting time) seems positively blessed in retrospect. However boring, arduous or dehumanizing their jobs, that era's "blue collar aristocrats" could generally count on jobs being there for anyone able to work. If cars were going to be made, steel produced or coal mined from the Earth, large numbers of American (mostly) men were going to be needed to do it.

Previous technological advances have, of course, brought insecurity. The Luddite protests more than 200 years ago may not have been reacting to technological advances, but plenty of their contemporaries feared for their jobs in the Industrial Revolution (Conniff 2011). Eventually the descendants of the Luddites found work in mines, on railways, and in trades, joined unions and were paid reasonably well, and of course many people until relatively recently worked on farms (cf. Lebergott 1966). And maybe the answer to the future of work is just around the corner. Millions of jobs have been created since the depths of the recession in 2010, with the official U.S. unemployment rate falling from over 10 to below 5 percent. However, there's a difference between a job and a career; wages remain stubbornly stagnant and long-term unemployment persists at a high level (Kille 2014, Burtless 2016). From the perspective of 2016, the future of work remains mysterious. If the current presidential campaign is any indication, political elites have less of a clue about what to do than I do, which unfortunately is saying a lot. It's little wonder that an insecure public turns on easy targets. If only we could ditch the EU bureaucrats, environmental regulations, or large banks; if only we could raise the minimum wage, restrict immigration, or make college free; then everything could go back to the way it was. Except somehow we'd get to keep all the cool stuff.

American cities today find themselves in a variety of positions. Some continue to reel from the collapse of the industrial economy four decades ago, and are struggling to serve citizens with multiple needs, stem declines in population, and figure out some way back onto the horse that is the global economy. Others have found their places in the global economy, as centers of technology, medicine, media and the like. But even those cities have a substantial number of poor citizens the benefits aren't reaching. Cities of all types are having to come up with policy solutions when [a] they are elusive, [b] past errors have left city finances in shaky states, and [c] people everywhere--not just Britain--are skeptical of government elites who collect taxes yet seem unable to deliver satisfactory outcomes.

 

Source: globalizationns31.yolasite.com

I am no libertarian. I firmly believe that the answers to the problems of the 21st century will be found through conversation, building connections and collective effort. "We're all stuck here for awhile," as Rodney King once said. They will require government in order to articulate and administer collective decisions. But I'm not surprised that a lot of people react to the 21st century by sticking it to whomever they can--elites, phantoms, and each other.

SEE ALSO: David Wessel, "In Wake of 'Brexit,' Addressing Voter Anger with More Than Lip Service," Brookings, 24 June 2016, http://www.brookings.edu/research/opinions/2016/06/24-wake-of-brexit-addressing-voter-anger-wessel

OLDER POSTS
"The 'New Normal' Economy and Place," 20 November 2013
"State of the Union and Places," 29 January 2014
"The Future of Economic Inequality," 1 October 2014