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  • Windy City Triumphalism at Odds with Souring Economy

    Mayor Daley said this week that the economy in Chicago is the worst that he’s seen since becoming mayor.

    You’d never guess this judging by the article about “demographic inversion” published in the New Republic by Alan Ehrenhalt . The author prints a lot of anecdotal evidence about on-going gentrification he witnesses in his hometown but unfortunately offers precious few statistics about job growth.

    The vacancy rate for industrial real estate in the Chicago area recently climbed to its highest level in 14 years. The governor also called violence in the city “out of control.”

  • Ranking “Dreamtowns”

    Over half of the nation lives in metropolitan areas of more than 1 million people, but bizjournals.com suggests many may indicate another preference:

    Yet a substantial number of these residents of big cities and inner-ring suburbs don’t have their hearts in it. They would prefer to live on the suburban fringe or in small-town America, as repeatedly shown by surveys during the past decade.

    Bizjournals just released rankings of micropolitan areas. Micropolitan areas are urbanized small cities where the central city population is between 10,000 and 50,000. Like metropolitan areas, micropolitans are still defined by county and commuting geography, so many are larger than 50,000 overall.

    Because they offer self contained employment centers, these types of places may prove to be even more appealing as energy costs escalate. Recent domestic migration trends show that small and medium sized metro regions are attracting the most new residents.

    Check out the rankings list, it’s odd to note that most of the top 20 are in northern climates. Not surprisingly, small college towns dominate the rankings, offering a source of stable professional jobs and the added vitality of a new crop of 20-somethings each year.

  • Harry Siegel

  • In Praise of Manufacturing & Industrial Zones

    My father made the huge piece of art that sits proudly on display at the entrance of the Daley Center Plaza in Chicago. Pablo Picasso designed this particular sculpture—or conceived it…or bent it with artistic vision…or however you want to put it.

    But my father made it.

    I’ve believed that since I was a small child. It’s a belief based mostly in filial pride, but there is some truth to it. Picasso, as I understand it, ordered the material for his untitled sculpture from the steel mill where my father worked at the time.

    My father handled the job as iron ore mixed with heat and sparks and sweat and swear words on the way to becoming steel. Picasso only took over after things had cooled down.

    I think of this as city planners ponder what to do with the industrial zone that sits on Downtown’s eastern edge. I can’t help but wonder why Los Angeles County’s role as the largest manufacturing center in the U.S., with approximately 470,000 jobs, so often goes overlooked.

    Sure, the manufacturing sector has shrunk over the years – and it will likely shrink some more in the future. But you could cut the local manufacturing sector in half and it would still be a giant engine of our economy. It gets bigger when you consider that manufacturing jobs tend to pay more than many service-sector jobs. That means the manufacturing jobs put more dollars in circulation to help finance a lot of those service-sector positions.

    Manufacturing also brings benefits that defy statistical analysis. Making things – objects or materials that can be touched, like the steel in a sharp sports car or the clothes on your back – is different than providing a service.

    Here’s what happens with services: The burger is made and consumed. The bed is made, slept in, and made again.

    Here’s what happens with manufactured products: The steel is used to build a grand cruise ship that steams into the harbor between trips to exotic ports and spills stories that will live for generations. The chair is purchased for some hearing room at City Hall and allows visitors to sit and gather their thoughts before standing up to take part in our democracy. The plastic is fabricated in a way that protects our astronauts as they set out on some historic mission of exploration.

    And here’s a simple fact: Making things makes people proud – and that’s the best thing you could hope for a city’s populace.

    I realize that the new lofts that have sprung about around Downtown – including some in the industrial zone – are pretty. I also understand why some land might be more valuable – at the moment, anyway – as a residential development instead of a metal-bending plant or a tool-and-die operation.

    I also believe, however, that Los Angeles is fortunate to have a major industrial center Downtown. I believe all involved in the current debate over its future should consider that seriously.

    Yes, manufacturers will continue to face challenges. One of the biggest will come from offshore markets with plentiful and cheap labor.

    But anyone who thinks industry is done in Los Angeles or the U.S. should keep Italy in mind. The Italians have been at a disadvantage on labor costs since somewhere around the 13th Century. Yet Italy has carried on as a manufacturing center, turning out everything from fine textiles to high-performance motorcycles. Italy long ago made a virtue of design and matched it with manufacturing processes that cannot be easily knocked off in low-wage markets thousands of miles away.

    It’s time for some enterprising city in the U.S to bring the same virtue to manufacturing – and Los Angeles is uniquely positioned to do exactly that. This will require some land – and history shows it will work best if various manufacturers are clustered together near a lively landscape with a plentiful labor pool and available housing stock.

    Sound familiar? I hope so – and I hope all involved will see the wisdom of maintaining a healthy and sizeable industrial zone Downtown. After all, some kid’s father might just make a famous artwork for City Hall someday.

    Jerry Sullivan is the Editor & Publisher of Los Angeles Garment & Citizen.

  • Increase in Democratic Vote Share in Cities

  • Central City Households with Children

  • Urban Poverty Levels, 2006

  • Cities Shifting to Democratic Vote

  • Urban America: The New Solid South

    By Joel Kotkin and Mark Schill

    Ever since the 1930s, most urban areas have leaned Democratic. But in presidential elections, many remained stubbornly competitive between the two parties. As late as 1988, for example, Republican nominees won Dallas County and made strong showings in the core urban counties of Cook (Chicago), Los Angeles and King (Seattle).

    Today, America’s urban areas have evolved into a political monoculture that increasingly resembles the “solid South” that provided a base for Democrats from the late 19th century to the 1960s. Since 1972, the year of the Nixon landslide, the Democratic share has grown 20 percent or more in most of the largest urban counties.

    As a result, places where Republicans such as Ronald Reagan could once win a respectable share of the vote — including San Francisco, Philadelphia and New York City — by 2004 were delivering 80 percent or more to the Democrats. Even in the losing year of 2004, Democratic nominee John F. Kerry won almost every city of more than 500,000 people.

    This fall, Barack Obama, a resident of Chicago, can comfortably expect to triumph in virtually every major urban county, often by ratios of 2-to-1 or more. He can count just as much on cities in decline as he can on those that have been gentrified; he will rack up big margins both in heavily white core counties such as those around Minneapolis and Portland, Ore., as well as overwhelmingly minority Baltimore, Philadelphia and the Bronx, N.Y.

    Race and income levels do not explain the emerging urban mono­culture, because the cause lies elsewhere: in the evolution of cities over the past four decades. The shift began in the late 1960s, when urban regions, from financial centers such as New York and Chicago to old industrial cities such as Detroit and Cleveland, began to suffer a massive exodus of predominantly white, middle-class residents.

    This left behind an increasingly impoverished, highly minority population with very little proclivity to support conservative or even moderate Republicans. Today in some cities — mostly old industrial centers in the East and Midwest — this population remains dominant and is likely to vote in huge numbers for Obama. Most of these cities suffer poverty rates at least 50 percent higher than the national average.

    At the same time, some other cities — such as New York, Chicago, Boston, San Francisco, Seattle and Portland — have done far better. They have done so by attracting a population of well-educated, white professionals. Pockets of this demographic, to be sure, also exist in some hard-hit industrial cities, but the new urban affluents tend to concentrate in cities with industries, such as financial services and media, that provide excitement and the prospect of high-wage employment in a glamorous setting.

    Many new urbanites tend to be students or professionals enjoying city life during their first, highly experimental years of adulthood. At this point, they are most open to liberal ideas and causes; they have yet to worry much about taxes and crime, issues that drive people to the center. As they grow older, marry and raise families, many in this cohort — particularly those who do not ascend into the upper classes — leave the urban core for the suburbs or other more affordable regions.

    Yet if the urban base — roughly 30 percent of the population — offers Obama a huge edge in the election, he must not identify too much as an urban candidate. In the past, the danger for Democrats lay in being perceived as paying too much heed to poor, minority voters. Fortunately, Obama, as an African-American, has little need to compete for their affections.

    More tempting, however, might be to embrace the emerging agenda of the benefactors of gentrification: powerful real estate interests and other groups. Among them are vocal constituencies who are openly hostile to people in suburbs and small cities. This ideology first emerged in 2004 in John Sperling’s “Retro vs. Metro” thesis, which envisioned the eventual triumph of a sophisticated urban population over backward-seeming rural, small town and suburban constituencies.

    An even clearer example of this urbanist ideology came in the wake of Kerry’s 2004 defeat, largely at the hands of rural, small-town and exurban “retro” voters. Editors of The Stranger, a Seattle alternative weekly, pointed out in an article that “if the cities elected our president, if urban voters determined the outcome, John F. Kerry would have won by a landslide.” Their solution was not to reach out to the other geographies, but to build an “urban identity politics” to counter Republicans’ hold over suburban and rural voters.

    “From here on out, we’re glad red-state rubes live in areas where guns are more powerful and more plentiful, cars are larger and faster, and people are fatter and slower and dumber,” The Stranger proclaimed. Given the editors’ uninhibited sense of superiority, they felt confident that in the emerging Darwinian struggle, the suburban and exurban Neanderthals would be forced to give way to the clear superiority of the urban Cro-Magnons.

    Since 2004, this ideology has become stronger, ironically bolstered by two bubbles fostered by President Bush’s fiscal policy: the boom in city condominium development and the rapid expansion of the financial services industry. Even as 80 percent to 90 percent of metropolitan growth redounded to the suburbs, the rising affluence of the urban cores persuaded the media that cities were not only back but were also reasserting their historic ascendance over the periphery.

    In recent months, the city-centered media such as CNN, The New York Times and National Public Radio have jumped on the urbanist bandwagon. They have promoted urban chauvinists’ contention that high gas prices and legislation to limit global warming would end the era of dispersion. This return to a more urbanized demography, some Democratic bloggers suggest, would assure a new liberal ascendancy.

    Whatever Obama may believe personally, he would be well-advised to distance himself from such sentiments. For one thing, identifying with people who celebrate the demise of other geographies may offend the majority of Americans who prefer to live in “retro,” lower-density environments. Suburb- and countryside-bashing may turn on editors and readers of The New York Times, but it hardly constitutes good politics.

    In terms of political strategy, Obama would be far better off stressing the commonalities between people in differing geographies. His time on the campaign trail should tell him that laid-off paper industry workers in central Wisconsin, hard-pressed suburban homeowners in San Bernardino, Calif., and struggling inner city residents in Brooklyn have ample cause to reject an extension of Republican rule. Why repeat the Bush tactic of dividing people from each other, this time based on where they choose to live, when the economic misery is so well-distributed?

    By displaying genuine empathy for Americans living in suburbs and small towns as well as in cities, Obama could achieve more than a small tactical victory, à la Karl Rove. With a strong showing in the other geographies as well as his inevitable landslide in cities, he could instead realize a historic triumph closer to Rooseveltian proportions.

    Joel Kotkin is a presidential fellow at Chapman University and executive editor of www.newgeography.com. Mark Schill is the website’s managing editor and a community strategy consultant with Praxis Strategy Group.

    This article originally appeared at Politico.

    Other articles in the Three Geographies Series:
    The Three Geographies
    Rural America could bring boon to Dems
    Suburbs will decide the election

  • Cities are Changing, But Urban Living Remains Optional

    Starting with the first oil crisis in 1973, it’s become de rigueur for the press to accompany every spike in energy prices with a spate of stories explaining how the higher costs will inevitably lead to the revival of the long declining industrial cities of the Northeast and Midwest. But don’t count on a boom in Baltimore or Cleveland anytime soon.

    This iteration’s model might be the June 25 New York Times article entitled “Fuel Prices Shift Math for Life in Far Suburbs,” neatly encapsulated in the photo caption, “As gas prices climb, people who once considered an exurban commute are now considering center-city living.”

    Such wishful thinking from news reporters, who live in cities, and urban planners, who have an even more direct stake in them, enhanced by the mortgage crisis and the presidential election, has obscured the fundamentals that will continue to determine where people choose to live and, by extension, which cities thrive. Job demand, tax levels, well-provided services — especially garbage, police, transportation infrastructure and schools — and a resilient and diversified job base remain key.

    In New York, for example, even as the economy has grown since 9/11, it still has less jobs than it did on September 10, 2001, meaning the city now depends on a relative handful of high-paying positions, and is at the mercy of a relative handful of large employers and very well-paid employees.

    As job growth continues to occur mostly on the periphery, where space is cheaper and taxes tend to be lower and the inclination is to fight to attract businesses, not see how much tax and fee money can be extracted from them without inspiring them to leave, people still have options. And despite the cries of the New Urbanists, it’s not always the easiest thing to go from, say, one part of Chicago to another. To the extent that job growth occurs mostly on the periphery, people still have options, and clustering in the exurbs seems more likely than a mass return to the center.

    While white flight seems to have stabilized, city life remains most appealing to the youngest and oldest members of the middle class — meaning those without children or whose children have left the home. In short, urban living remains an appealing, but optional mode of existence most appealing to the very poor, the very rich, young singles and older empty nesters.

    There are, though, a few new and relatively little-noticed developments in play that will have dramatic and unpredictable effects on the urban experience over the next several decades. Here are three worth tracking:

    • Telecommuting. High gas plays into it, but more generally there’s little reason to have many workers sharing a physical space, purchased or rented by their employers, for 40 hours a week. Expect a new model that compels many information workers, in the broadest definition, to show up for a day or two a week for face time, but otherwise to rent shared work spaces or to work from their homes. While this trend may have begun with freelancers bringing laptops and surge protectors into Starbucks, much more is coming, even if the trend has been retarded by the reluctance of managers to serve as early adaptors to the trend.

      The upshot will be a retrofitting of office space to residential use, which will serve as a countervailing pressure to sky-high residential rents in high-demand cities like New York and Chicago, while adding to the excess unoccupied inventory in shrinking cities. Purchasers will benefit from lower prices, but the repurposing of hundreds of millions of square feet should be a serious damper on the new construction industry and market.

    • Intelligent pricing (sunk costs raised). Bloomberg’s slap-dash congestion pricing plan may have happily gone down, but other more serious ones with elements like congestion parking and variable fees will emerge. The danger here can be seen in one early, if clumsy, example of this trend—smoking taxes, which were pushed through, as were smoking bans, through arguments about the sunk health costs smokers incur.

      The trouble, of course, is that any time fees are used both to influence behavior and to generate revenue, the need for money eventually trumps all other goals.

    • Continued reductions in privacy. London is again the model city here, but really this is a national and international trend. As governments are able to collect and store more information, they will, and information that can translate into imperative and immediate actions naturally consolidates in the executive branch. DNA databases, fingerprinting, security camera footage, phone record and even metrocards and EZ passes, along with storage and sifting of publicly accessible information, will redefine privacy downward, even as civil rights-and-liberties types fight a rear-guard battle against a technological fait accompli. Much as governments will always spend all of the monies available to them, they will collect and use such information.

    Working out safeguards — and reporting on already accomplished abuses — will be a major sport in years to come, and will likely bring down at least one national-profile big city mayor in the next decade.

    Harry Siegel is an editor for Politico.