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A New Urban Agenda

Daniel D. Luria and Joel Rogers

Cities and their surrounding inner-ring suburbs--what we will here call "metro" or "urban" regions--are the neglected stepchildren of American politics. More than half the population lives in them,1 and they suffer from all sorts of problems--from ghetto crime, unemployment, and racial segregation to environmentally-degrading and fiscally-unbalanced suburban sprawl--but they are not subjects of constructive political debate. Commonly, indeed, discussion of our urban areas serves only as an occasion to express despair about economic dysfunction and social disintegration, and the resistance of both to political remedy.

That despair is justified, we are just as commonly told, by an Iron Law of Urban Decay: As incomes rise, workers move to suburbia; when suburbs mature, they resist paying taxes to support the metro core; as the tax base declines and services deteriorate, the middle-class flees, leading to further erosion; poverty concentrates among those left behind, and they become "different"--disconnected from labor markets, without role models for advancement, lacking the human or financial capital even for bootstrap-pulling. In this context, we are told, the best that can be hoped from central cities is peace, or at least a segregation of the violence. The best that can be hoped for suburbia is . . . well, more suburbia. But further sprawl only erodes the tax base of inner-ring suburbs, wedging their residents between the spreading deterioration of the urban core and the new roads, sewers, and schools for their increasingly distant suburban "neighbors" on the edge. For their problems, angered inner-ring suburbanites tend to blame their more proximate neighbors in the central cities, people generally poorer and darker than themselves. Meanwhile, the wealthy seek to insulate themselves--taking refuge in luxury urban high-rises, or cloistered condo communities, or exclusionist "favored quarters" of exurban development.

It is an ugly business, all the more so because it does not have to be this way. If we wanted, we could reconstruct our metropolitan regions. Taking full advantage of their dense concentrations of people, skill, and infrastructure, we could transform them from sites of hideous squalor, stark inequality, and numbing natural destruction to vibrant centers of high-wage, environmentally-sustainable economic activity and civil social life. If we did, the benefits would be massive. Most directly, metro reconstruction would markedly improve the welfare of urban populations. More broadly, it would make substantial inroads on addressing the ruinous inequality and declining living standards that currently define national economic life. Finally, with the economy conditioning most of the rest of our lives together, such reconstruction would have large political and social benefits. We would regain some measure of democracy and social peace among the people of this country, making meaningful our now-fragile commitments to shared citizenship, by focusing resources where most people actually live.

Despite these benefits, any serious project of reconstruction will need to be fought for. That fight will require a wide-ranging alliance of interests: large numbers of people, now divided from one another, must be persuaded of their common stake in its success. And persuasion depends on the availability of a plausible project capable of uniting these different interests. Can such a project be stated? We think so, and present a case for our affirmative answer here.

For reasons of space, we present the project schematically, without reference to the particular settings and histories--in cities as diverse as Milwaukee, Minneapolis-St. Paul, Portland, Seattle, and Cleveland--that inspire our confidence in the possibilities of metro reconstruction. Furthermore, while we have included lots of details about what needs to be done and by whom, we understand that such details are provisional: the best way to proceed will undoubtedly differ from case to case, and, as projects of this kind unfold, we will all learn more about the relative advantages of alternative strategies. Still, enough is known now about what works, and what does not, that a new urban agenda can be stated. And the stakes are high enough to think, we believe not irrationally, that urban politics and policy might once again be rescued from obscurity and despair, and made an issue for political debate and popular mobilization.

Before getting to that agenda and its politics, however, we need first to make the case that something is worth doing, and that it can in fact be done--that the Iron Law of Urban Decay is imposed by political artifice, not nature.

Why Save Cities?

How did cities get into their current mess? There is no simple answer, but an important piece of the puzzle lies in American public policy. That policy is, in a word, anti-urban. A bias against cities, evident in contemporary public discourse, is a longstanding feature of the American political economy, and plays a central role in our tax code, major economic development programs, government purchasing, and other exercises of public power.

The Bias

In contrast to most developed capitalist nations, American public policy slights urban renters in favor of suburban homes, urban bus and subway riders in favor of suburban automobiles, and urban infrastructure in favor of ex-urban and rural development projects. Simultaneously, we do not require non-metro regions to pay the costs of maintaining the poor and dispossessed who are left behind by such acts of favoritism. Whether this anti-urbanism originated in genuine concern about leveling the wealth of different regions, or in racism, or in some misplaced notion that the happiest life was always found behind the wheel of an automobile, the general effect has been to artificially lower the costs--to individuals and firms--of living and working outside our metro regions, while artificially increasing the costs of living and working within them.

Though it is hard to calculate precisely, the subsidy to non-urban regions is on all counts considerable--annually, on the order of tens if not hundreds of billions. We have spent trillions building non-metro roads, but nowhere near that on metro ones or mass transit. Federal annual funding for mass transit has never been more than one-fifth of highway funding, and state ratios are even more unbalanced. The overwhelming share of federal and state economic development program support also goes to non-metro sites--more highways, sprawl-supporting infrastructure, exurban tax credits and low-interest loans for new development. Similarly, the deliberate siting of military bases and other government facilities outside cities or more developed regions has been and remains deliberate national policy.

So public policy substantially reduces the costs of living and investing outside metro areas, and thus encourages people to make those choices. But why should anyone object? Leave aside narrow questions of equity--why, for example, metro residents should be taxed, often regressively, for programs that hurt them. Leave aside aesthetic and cultural disagreements about whether city life is vibrant or merely vulgar. And assume, against all evidence, that suburbanites can insulate themselves from decaying urban cores. Are there any good reasons to oppose policies that have contributed to urban decline?

Why Care?

There are two reasons: one of political morality, the other of economics. As to political morality: lots of people live in cities and are likely to remain there; democracy is supposed to be "for the people"--all of them. With 130 million people in our urban areas, and 80 million (20 million of them children) in their declining central cities, anti-urban policies don't qualify. Furthermore, very large portions of this population are exceptionally poor, in receipt of exceptionally bad public services, and subject to exceptional violence. No one disputes the results--in high infant mortality, poor health, stunted development, shattered lives, and heavy grief.

On the economic side, anti-urbanism is very costly. For starters, sprawl and central- city degradation is wasteful. It wastes land, water, and energy, and squanders existing assets; as new houses, factories, and schools go up in the outer rings, perfectly good buildings, with established links to usable infrastructure, get boarded up further in. Take the excess costs on new construction and natural resources, add in the untimely depreciation of old capital stock, it's easily $300 billion in annual waste.

Then there are the economic costs of human neglect. Abandoning our central cities means forsaking the productive potential of their inhabitants while containing their resentment. The costs of containment are considerable, as ballooning budgets for new prisons and police make evident. And the opportunity costs of all that potential productivity are truly enormous. Forget about the hidden future Nobel Prize winners. Simply subtract the average lifetime earnings of those without decent health, education, or job access from those with these basic goods. Multiply by 80 million, or even 20. It's a big number--in the trillions--which translates into a lot of foregone tax revenue for the general population.

Furthermore, there is cost linkage. Many suburbanites are prepared to pay the costs and forego the benefits just mentioned as the price of their isolation. But that isolation is an illusion. Within regions, the economic fortunes of central cities and their suburbs, especially their inner-ring suburbs, are increasingly entwined. By the late 1980s, across a very wide range of metro regions, every $1,000 gained or lost in per capita city income was associated with a $690 gain or loss in per capita suburban income.2 Rotting central cities mean a poorer suburban future.

The really big cost, however, derives from the role that metro regions play in determining the pattern of national economic activity. Put baldly, revived urban regions are key to reversing the present stagnation in American living standards. This is a large claim: defending it will require that we step back briefly from the dynamics within metro regions and consider broader trends in the national economy and what is required to reverse them.

A High Road?

Despite all the talk about how American wages are now set in Beijing, adverse trends in American income (including income distribution) result today less from the downward pressures of international competition than from domestic policy choices.3 Specifically, we have made "low-road" strategies of response to new competitive pressures too easy and "high-road" strategies too hard. Low-road firms compete by keeping prices down, which means keeping costs down--beginning, typically, with wages. Applied across the economy, low-road strategies lead to sweated workers, economic insecurity, rising inequality, poisonous labor relations, and degraded natural environments. High-road firms focus on quality competition (with higher wages supported by customer willingness to pay for higher quality), require continual innovation in quality, and thus depend on more skilled and cooperative workers. Generalized, high-road strategies are associated with higher productivity, higher pay and better labor relations, reduced environmental damage, and greater firm commitment to the health and stability of surrounding human communities (needed to attract and keep skilled workers and managers).

Firms can make plenty of money on either path, but social gains are vastly greater on the high road. The principal political-economic failure of the past two decades--and it is political as much as economic--is that we have not done what we must to move the economy to it. Moving to the high road is associated with various transition costs, and staying on it depends on a variety of social supports. Those supports include effective educational and training institutions; better functioning labor markets, with fuller information about requirements for job access and advancement; advanced infrastructure of all kinds; modernization services and other means of diffusing best manufacturing practice; and, throughout, barriers to low-road defection. Because such supports typically lie beyond the capacity of individual firms, they need to be provided socially. We have not provided them.

Back to Metro

Here is where metro areas come in. Whatever their present difficulties, metropolitan economies are the natural base for a high-road economy. To the extent that we now have any "high-road" production and service delivery in the United States, it is already heavily concentrated in metropolitan regions. Moreover, this correlation between metro regions and the high-road strategy is no accident: a high-road strategy must be a metro strategy because the high road requires the sheer density of people and firms that is definitive of metro regions.

Metro density helps high-roading in three ways. First, density facilitates worker organization by providing the proximity and sheer numbers needed to support the infrastructure of new organizing. Worker organization, in turn, directly helps to close off the low road by obstructing its impulse to wage-reduction. And worker organization helps pave the high road too. Without the knowledge and cooperation of workers, firms will find high-roading all but impossible--and both are easier to secure if workers are organized and confident that they will also benefit from increased quality and productivity.

Density also helps firms more directly. Economists, geographers, and economic development analysts use the concept of "agglomeration" to describe the benefits in skills, productivity, and consumer access that result when particular activities are concentrated in particular places. In addition, firms in such regions don't just happen to be near each other and share a regional labor market. They do business with each other in a way that connects them as if, in some ways, they were complementary plants of a single enterprise. Agglomerations are in turn associated with "increasing returns" on any given investment. When a single firm in one of these agglomerations improves its cost and quality performance, it creates a competitive advantage for the customers and suppliers in its cluster. Simply put, firms learn more and faster from each other.

Finally, density helps relieve the costs of providing the public goods (again, quality public education and training institutions, formal supports for cross-learning and upgrading among firms, integrated regional labor market services and worker credentialling systems, modern forms of transport, energy, water supplies, and communication linkages) on which such advanced production depends. It is much easier and cheaper to supply such goods with the human and material resources that density provides.

So here, in brief, is the argument: To combat further inequality and wage decline, we need to generalize a high-road competitive strategy. Getting firms to adopt and stick with that strategy will require a more demanding high-road frame for competition (closing off the low road) and a variety of specific supporting services and institutions (pavement for the high road). Neither can be supplied by individual firms acting alone. Density is the midwife to their achievement. And density means metro. A fair economic future, in short, depends on the viability of our urban areas.

How to Do It

But are metro regions really viable? What would it take to repeal the Iron Law, end the anti-urban bias of public policy, capture the natural advantages of density, and turn our policies more deliberately to building the infrastructure for high-road competition? Putting aside all-important questions of political will (we return to them later) and focusing for now on issues of public policy, the answer proceeds on two related tracks: we need a new array of policies for federal and state governments, and--coordinated with them--a new set for economic regions.

Track One

At the federal and state levels of government, the essential tasks are to keep states and communities from pursuing a competitive race to the bottom, raise minimum standards on firm performance, and get out of the way of the organizing needed to realize gains from cooperation. None of this need imply any new public expenditures. What it would mean is that federal and state governments would:

(1) Remove subsidies to low-roading firms. As an initial step, governments should announce that they will not award contracts or development grants to firms paying wages below some minimum level (say, sub-poverty wages), or polluting above a certain level, or with a record of illegal resistance to worker organization. They should then move to mandate such standards generally, and gradually raise them. For example, phasing in a massively increased minimum wage--say, to $10 an hour within 5 years--would do wonders for shutting down the low-road option and requiring firms to compete by improving quality. (Of course, there is no point urging firms onto a high road only to push them off a cliff. So this first element must be understood and treated as part of the larger project.)

(2) Discourage "bidding wars" between and within states. Governments often spend billions simply to lure business from one region to another, with no net gain for the national economy. One way to discourage this practice would be to tax any government bids at the next highest level of government (the federal government taxing the states, the states their local governments), or condition aid from those higher units on the lower one's participation in non-aggression pacts with colleagues. Of course, one region's "subsidy" is another's "investment for the future." So we need criteria to distinguish genuine investment that might also be expected to lure firms--for example, spending for better educational systems--from direct payoffs and abatements. But this task is not insurmountable, and even agreement on basic guidelines for the most extreme (if common) forms of current subsidies--e.g., those drawn through regressive taxes on people who are not aided by the resulting employment--would represent a big advance.

(3) Target development supports to regions on a per capita basis. As a general rule of public policy, we should spend the money where the people are, thus encouraging local governments to increase density rather than avoid it. And let the natural agglomerations of people and firms be rewarded by letting them recapture their individual tax dollars for collective self-improvement. Here too there are important issues of design. We don't want incentives to agglomeration to be so intense as to encourage overcrowding or insupportable population growth within regions. But the basic idea of removing disincentives to otherwise naturally-occurring agglomeration provides some guidance, and even modest progress toward per capita equalization seems justified on economic and social, as well as democratic grounds.

(4) Encourage the growth of economic development authorities on a functional, regional basis. While more than half the population lives in what we've been calling metro regions, only 6 percent is subject to any significant metro governance. Moreover, the sheer number of sovereign sub-jurisdictions in these regions commonly poses formidable barriers to planning. The Chicago metropolitan region, for example, includes 265 separate municipalities, 1,200 separate tax districts, and parts of six different mega-counties. State and federal government could provide incentives for more regional administrative structures--which are needed minimally for basic infrastructure development--by making development aid and other supports by higher levels of government contingent on the development of such structures lower down. In very few cases is there actual dispute about what the boundaries of the regional economy are: the problem has been an absence of national or state leadership in fostering regional frameworks for economic development and planning.

(5) Directly encourage high-roading. In all aspects of economic development spending, infrastructure support, pollution prevention and abatement programs, and the like, reward regions or states that take the subsidiary policy steps needed to move toward high-road production. Comparative progress toward the high road is measurable. If measurable, it should measured, with receipt of special federal monies contingent on achieving progress. And, independent of what the states do, the federal government should itself be much more attentive to targeting its resources to encourage high-roading. It should target aid to integrated regions, clusters within them, firms within those clusters. The lead federal "manufacturing extension" agency--charged with upgrading the performance of the small and medium-sized shops that provide six of every ten manufacturing jobs--spends $100 million a year, and could reach literally tens of thousands of small- and medium-sized manufacturers, already supplying (or trying to supply) to high-road clusters, if that money were appropriately targeted on metro agglomerations.

Together, these five elements would work to remove the anti-urban and low-road bias from contemporary state and federal policy; they would encourage 18th- and 19th-century jurisdictions to consider the realities of late 20th-century regional economic dependence; and they would encourage both firms and regions to exploit the advantages of density.

Track Two

Higher levels of government, however, can only do so much to foster metro reconstruction. To be sure, moving the national economy onto a high road would be of manifest national benefit. But because a high road policy must be a metro policy, regions themselves must play a large role in designing and implementing it. What, then, should the regions do?

The short answer is that they need to break squarely with the conventional economic development strategy (hereafter, CEDS) still pursued by most cities and counties--the strategy that lies behind the Iron Law of Decay--in favor of a high-road project that takes full advantage of metro density. To fill out this answer, lets distinguish CEDS and our alternative on five dimensions.

(1) What Kind of Jobs? CEDS adapts to urban decline by promoting job growth without concern for the kind of jobs generated--which uusually means promoting low-wage jobs. But low-wage jobs drag down wages elsewhere, encourage further low-roading, eat away at the margin of struggling high-road firms, and draw on the tax base (the employers providing them still need basic infrastructure, and the employees occupying them still need basic services) without proportionately contributing to it. Tax-base erosion, in turn, leads to cutbacks in public goods and suburban flight: the Iron Law again. Nevertheless, the strategy is perversely self-enforcing: as the city gets more squalid, desperation fuels the view that jobs, any jobs at all, are what is needed, and the thought that the only alternative to low-wage employment is no employment at all.

A natural alternative is to direct dollars only to jobs of a certain kind, while building supports for them. Relying on a politics of opportunities and constraints, localities should make it easier for "good" employers to stay and expand--through the provision of a variety of services and opportunities for their improvement and competitiveness--while making it harder for "bad" employers to do so--by insisting on certain standards on wages, pollution prevention, and so on. Such a policy could start by setting conditions on the receipt of government contracts and economic development supports and--especially supported by our new state and federal framework discouraging a "race to the bottom" between regions -- move to mandates on private activity.

(2) Attraction or Retention? CEDS focuses on attracting business rather than retaining and renewing the existing base of firms. It squanders one of the greatest assets of density, which is the natural grouping of similar firms--drawn together by the cross-learning, joint production, and other mutual support that proximity provides--in distinct industries or industry clusters. Mature metropolitan economies thrive when their core businesses upgrade, link to one another, or attract or spin off related enterprises that benefit from spatial proximity to existing industry leaders. But, as emphasized earlier, upgrading, networking, and incubating indigenous firms requires an infrastructure of support (technical assistance, training, and the efficient supply of modern public goods). And while providing these is in the long run much more satisfying, in the short run it is easier to attract another Walmart. The principle become self-confirming as neglect of "the ones that brung ya" leads to decline in existing sources of wealth, making the attraction of new and different firms more compelling as an option.

Our alternative development strategy would focus on retention, renewal, upgrading, linkage, and incubation of existing firms--with local authorities investing in the infrastructure needed to realize gains from agglomeration. Through "early warning/early intervention" networks, they would recruit firms and workers to monitor the signs of distress in challenged firms, and develop the technical and financial intervention wherewithal to save jobs worth saving. At the same time, they would actively promote cross-firm learning and sectoral growth by encouraging firms to join together in marketing their products and training workers. And, drawing on the accumulated pension and other savings in the region, they would develop regional investment funds to support such intervention, increase community ownership of firms doing business there, and support promising spin-offs and incubation centers.

(3) Generic or Targeted Benefits? CEDS relies on generic tax abatements and other fiscal giveaways, rather than targeted breaks and regulation. Again, best evidence is that such enterprise zone-type development models simply do not work, and eventually erode the city's fiscal base. The jobs generated are seldom high-paying or associated with significant capital investment; the firms take the benefits and move on. In contract, much evidence suggests that by a gradual tightening of regulatory controls on production standards--whether minimum labor costs or emissions standards--business can be encouraged to innovate in ways that improve both productivity and the quality of community life. Doing this, however, requires a willingness to impose significant costs on current business, while insulating it from competition from non-complying competitors. Most city governments have been unwilling or unable to make this crucial step. The result, however, is a race to the bottom among jurisdictions who offer escalating packages of sweeteners for investments firms had already to decided to make.

Our alternative would set performance conditions on the receipt of public funds--tying subsidies to the achievement of specific ends--and "claw back" those funds from firms that do not meet the conditions. The more extensive the support from the government and allied private institutions, of course, the more extensive the demands that could reasonably be made on the firms receiving it.

(4) What Role for Markets? CEDS sees greater public control and accountability as bad for the economy, and it worries when unions and community organizations put pressure on economic policy. Starting from the largely correct perception that government and the general public are ill-prepared to instruct business on how best to achieve particular standards or ends, it arrives at the incorrect conclusion that they are incapable even of specifying them.

But modern economies operate best when they can rely on a fair degree of public support for business goals--support best achieved when the public has significant say in setting those goals. And some associative action in the economy, including much that might be deemed "popular," is critical to the effective supply of the ingredients of advanced production. Design and construction of an effective training and credentialing system, for example, requires local knowledge of a variety of distinct productive settings and the ability to figure out policies that make sense across them. Confronting such issues, the state is commonly at a loss, as are individual firms. Unions and employer associations, with detailed knowledge across particular sites and the ability to compel performance within them, are critical to success.

Building on these observations, our alternative would continue to let markets do what they do best--allocate scarce resources with some efficiency, and punish the non-competitive--but would be unabashed in letting public authority and popular organizations to say something about what the goals of economic activity should be. And, breaking with "live free or die"/"private markets or public hierarchies" models of regulation, it would explicitly assign representative non-state institutions with local knowledge or other capacity not found in government itself (again, unions, employer organizations, community organizations) a role in economic administration. In our examples above, it might give substantial control over resources for skill training to sectoral training consortia, or control of the early warning network to responsible area unions.

(5) Public Goods? CEDS neglects the role that public goods of many kinds--from the traditional "economic" ones of transportation, technical assistance, and education and training to the "social" ones of recreation, safety, and clean environments--play in a local economy. In this, local economic development efforts are behind the learning of most advanced businesses, which rely on the economic goods for production and the social goods to attract and retain a skilled workforce and managerial personnel. Since no individual is able to provide this economic and social infrastructure on its own, the decision about whether or not to provide it is among the most crucial that local economic development authorities can make. But the ability of such authorities to provide infrastructure will depend directly on the population of high-roading firms and associations with a stake in it: the failure to provide decent infrastructure will drive that population down to the point that authorities will only be able to attract low-road firms seeking low-income markets and low-cost labor.

Instead of neglecting high-road infrastructure, our alternative would build it. Sometimes this would mean serious investment--as in effective transit systems connecting job seekers to work throughout the region, or the provision of training. More often than commonly thought, however, it would simply mean fostering cooperation among existing interests, or simply convening discussion of common problems--among players who know what the problems are and collectively have the resources to solve many of them, but who heretofore have had no incentive or support from public authority in solving them together. In such situations government in effect says: "Here's a problem that we all know exists; you design a feasible solution accountable to the following values and show me how to pay for it; we will then pass a law making sure nobody defects from the necessary deal."

Consider the effects of systematically pursuing a program of this kind: the federal and state reforms, as well as the inversion of CEDS just described. Sprawl would be reduced, planning capacity would rise, wages would increase and inequalities decrease, neighborhoods would become less segregated and safer, public goods would be more abundant: democracy would more evidently show its contribution to the economy. And, as with any good strategy, it would be self-reenforcing: As subsidies to sprawl decrease, the attractions of metropolitan locations rise; as investment returns to metro cores, productivity within them increases, making higher wages more affordable; as organization of the real cluster basis of the economy proceeds, standards for job entry and advancement can be formalized and publicized, which helps to equalize wages; better wages secure the tax base; that helps pay for the expensive public goods which both further reduce inequality and attract high-roading firms; with more abundant public goods and better job access, central city residents look less "different," further promoting their hirability; and with greater regional power over something employers really want--skilled labor, infrastructure, technical assistance, credit--the ability of regions to discipline free-riders and defectors from common norms (e.g., on fair housing and hiring, land use, tax-base sharing) rises. In the limiting case, the economy actually serves the people, rather than the people struggling to serve an anonymous and immoral economy.

Who Can Do It?

But who could put all this together? And is it reasonable to hope that they might?

Part of the answer is that it is happening already. Across the country, you can find different pieces of the project we have recommended. At least a few regions do have metropolitan government, sensible planning policies, tax-base sharing between rich and poor neighborhoods within the same region, regional standards on zoning--including, critically, fair housing policies that put poor minorities next to opportunity. Many cities and counties, and some states, have passed "living wage" or "anti-subsidy abuse" legislation putting enforceable conditions on receipt of public development monies. Many local planning and development departments have begun to target their resources toward the improvement of existing clusters of firms. And there are countless "visioning" exercises--more or less effectively uniting diverse communities within regions--to establish benchmarks on regional performance and at least begin discussion of its requisite infrastructure.

This said, these efforts remain exceptions; given continued low-roading competition, they are that much harder to sustain. Nor, with the possible exception of Portland, is any one of them truly comprehensive--putting the governance, planning, finance, standards, supports, and popular organization pieces together. Nor, to return to where we started, do any of them enjoy appropriate support from the state and federal governments. Very few of these efforts have, therefore, reached critical mass, tipping the dynamics of their regions.

Still, the fact that so many initiatives are already in motion, from diverse quarters--some led by local government officials themselves, others by business, labor, community groups, or particular issue advocates--suggests a wide-ranging potential alliance out there, waiting to be organized. To appreciate its range, consider the different urban political forces--at each other's throats for so many years--who are now coming to recognize the limits of mutual antagonism.

The current scene pits labor against community, the employed against environmentalists, and central cities against the inner-ring, while obscuring relevant divisions within business, and letting the rich exurbs get off too cheap. But many of the mutual antagonists in this old politics are beginning to see an interest in alliance. White-dominated labor increasingly recognizes that its declining city membership no longer suffices to protect it against lowwage privatization and the destruction of regional labor market standards, let alone assure the public investments needed to support highwage production and services. It needs the voting support of (heavily disorganized) central city Black, Latino, and Asian populations: to get that support, it will need fully to open itself to them. Those populations, in turn, know that their economic devastation will not be reversed anytime soon through an increased welfare effort or expanded public sector. They need private sector investment and jobs within their communities, and access to jobs without, and they need those jobs to pay a living wage. And increasingly they recognize that these things are more likely achieved if they are allied with unions.

Environmentalists and those concerned about organization inside firms, meanwhile, are finding common ground on the supplyside of production. Just as unions have found that they can only defend member interests by getting involved in decisions about technology, product strategy, investment, and work organization, environmentalists recognize that moving from pollution abatement to sourcereduction requires a presence inside the firm. Innerring suburbanites, whose kids are also joining gangs, and who are in many cases losing employment at faster rates than the central cities, are waking to the fact that the same lowwage sprawl that has almost destroyed the central cities is now destroying them. And both central and inner-ring recognize their common interest in getting the rich suburbs to carry their share of regional burdens. Finally, metro business itself, at least that part of it that cannot easily flee (for example, because of existing collective bargaining agreements, or pension obligations, or heavy sunk investment in plant and equipment), is interested, like any good business, in limiting competition to itself, interested in particular in eliminating the low-roaders now taking away their margins.

Put these forces together in any metro region--and the program outlined here has a real chance of benefiting all of them--and you have a powerful political coalition.

Again, we're only talking about what we might reasonably hope for. As with any good, lots of obstacles might obstruct its achievement. But material interest strongly supports this grand coalition. And recent experience in mobilizing directly on that interest--be it the grassroots Campaign for a Sustainable Milwaukee, or legislative efforts at more tax-base sharing in the Twin Cities, or the more business-led efforts in Louisville or Cleveland--suggest the possibilities of real movement. What is most urgently needed are some enterprising politicians, labor leaders, savvy community organizers, or sensible metro businesspeople to get in front of a parade that's waiting to form.

And if people get organized, elected officials can be made to follow. In getting the relevant state and federal policy supports, the gravamen of success is simply stated: an alliance of the city and inner-ring suburban delegations--still, in combination, a clear majority in Congress and most state legislatures--to press the general interest against recalcitrant rich suburbanites and low-road firms. If the general interest doesn't move those delegations, the fact that their respective constituencies are getting unfairly and jointly savaged should. Someone should invite our currently divided metro officials into a room together, show them a few numbers, and point to the large mixed crowd of constituents preparing to march outside.

This essay draws on our collaboration with other members of the Midwest Consortium for Economic Development Alternatives (MCEDA). See Metro Futures: A High-Wage, Low-Waste, Democratic Development Strategy for America's Cities and Inner Suburbs (New York and Madison: Sustainable America and Center on Wisconsin Strategy, 1996).

1About 80 percent of Americans live in what the Census Bureau terms "Metropolitan Statistical Areas" (MSAs). These include not only central cities and their working class suburbs, but outer-ring "bedroom suburbs" as well. There is no standard, accepted definition of the "inner-ring"--contiguous with the central city, working class, mixed use, with historic ties to the central core--but our research on midwestern cities such as Milwaukee and Detroit suggests that, as of the late 1980s, at least 65 percent of the MSA population lives in them or central cities.

2 The calculation comes from a study of 59 metropolitan areas. See H.V. Savitch, David Collins, Daniel Sanders, and John P. Markham, "Ties That Bind: Central Cities, Suburbs, and the New Metropolitan Region," Economic Development Quarterly 7 (November, 1993): 341-57. The study notes that the share of suburban income associated with central city density and income increased substantially over the 1979-87 period observed, suggesting tighter linkage.

3 While internationalization is very important, we believe it has been exaggerated as a bar to the sort of reconstructive program offered below. Most US manufacturers buy and sell overwhelmingly to themselves, and the long-run trend of the US economy is toward more services, usually not traded on even a national basis, much less internationally. Even when competition is international, alternative strategies with very different social consequences are available. Choices between them can be shaped by factors clearly under popular control. Even the diminished state retains a large share of employment and purchasing power, not to mention the ability to pass laws; it can use that power to establish standards on economic practice, to support some strategies of industrial restructuring over others, to establish markets for better sorts of economic practices as well as products, to limit public supports to those adhering to public standards. And even a rootless capital relies, in its most advanced productive forms, on immobile public goods--decent school systems, transport systems, safe neighborhoods, clean environments--which if provided in places can in fact help root investment there.

Originally published in the February/ March 1997 issue of Boston Review

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