Metropolitan networks and the next American economy

Throughout history, all cities that have progressed from small settlements to great metropolitan areas have had an underlying economic rationale, a reason why people could make a living there. A city may have prospered because it was founded at an advantageous location for trading, at the confluence of rivers or at the crossroads of trading routes. In many instances, the urban economic engine was propelled by ports built at natural harbors. In other cases, it was access to nearby raw materials, such as coal or iron ores to support industries. In the modern era, it is increasingly human capital and knowledge advantages, such as higher education assets or specialized financial expertise, that established economic primacy. At every stage, the support system we now call 'infrastructure' undergirded urban progress.  

Nearly as important, and closely intertwined with economic function as a determinant of growth, is a city's livability and quality of life. Historically, the people who supported the urban economy-the manual workers, the capital providers, the visionary builders, the irrepressible entrepreneurs, the transporters of goods, the supportive merchants, and the public officials-have had to live nearby. In an earlier era, that meant residential districts a short walk or carriage ride from the economic centers. As cities grew and modes of transportation evolved, metropolitan residential communities spread to ever more distant sites and generated first the inner-ring suburbs and then the far-flung exurbs. Infrastructure to support the urban quality of life, from basic utilities to mass transit, has made cities livable. 

Historically, our most successful cities have been those that offered individuals access to economic opportunity. Waves of immigrants-both international and domestic-have made their way to U.S. cities to find better-paying jobs, markets for new business start-ups, and ladders for upward mobility. These immigrants and their entrepreneurial drive have in turn helped fuel cities’ growth, innovation, and prosperity. But some new arrivals have faced prejudice, discrimination, and exclusion, blocking or slowing their pathways to success. So full and fair access to opportunity remains an aspiration that cities have not yet fully realized. Economic upheavals are the growing pains of transformation.

Economic upheavals are the growing pains of transformation

The U.S. economy has undergone several fundamental and well-chronicled transformations. Looking back, the transitions from an agrarian society to an industrial base to a technology and services economy are clear. Each of these transitions has been economically disruptive and socially wrenching and many of the powerful societal dislocations have played out in the nation's cities.

In the agrarian period, because the emerging population centers needed the agricultural products of the nation's farms, city merchants organized themselves and built the infrastructure to receive, process, market, and ship every manner of foodstuffs for the people who lived there and in nearby communities.

Then came the industrial era, and with it, the forces that shaped the modern manufacturing city. Great cities prospered and grew as hosts to the factories that made cars, appliances, armaments, and consumer goods. As recently as the 1950s, America's large factory cities, such as Cleveland, Detroit, and Chicago, had almost half their total workforces employed in manufacturing jobs. Even cities in the growing South and Southwest, such as Los Angeles, Atlanta, and Dallas, had manufacturing employment totals near 30 percent. Workers lived in adjacent neighborhoods often identified by the plants where the majority of residents worked. The infrastructure of the industrial era was massive and has defined the character of America’s cities for generations. 

When the next American economic transformation occurred, it was particularly devastating for the "smokestack" cities. As industries went offshore, left for green grass sites, or were shuttered outright, it was the cities that were left with the residue of the industrial economy. The firms could move, the capital was mobile, the jobs could be relocated, and modern operations sites could be selected elsewhere. But, by definition, the physical sites, the massive plants, the emptying neighborhoods, and the decaying infrastructure were not mobile. They stayed behind-unmaintained, deteriorating, and blighted.

As this process unfolded through the 1960s and 70s, it was characterized as an "urban crisis." The unclear and uncertain outlines of profound economic change were conjoined in the public dialogue with demographic and racial changes to paint a desperate picture of the nation's central cities. The tumultuous forces of the era-riots, political contentiousness, civil unrest, reduced municipal revenues, and heightened fear of crime-all added to the picture of urban decline. In retrospect, it is possible to see that it was not accurate to define such massive tectonic shifts as simply an "urban crisis." It is clear in hindsight that massively disruptive tremors of the kind that periodically transform American society shook the nation and that America's cities were at the epicenter. The 'next' American economy.

The "next" American economy

Over the last 30 years, a new American economy has emerged, steadied its legs, and, in the process, transformed America's institutions. An American economy once driven by manufacturing is today fueled by services, technology, health care, education, science, new media, and international trade, largely focused in the nation's metropolitan centers. And as has always been the case at the moments of convergence between national economic currents and urban economic flows, our cities are being reshaped once again. This time, the new economy industries are urban friendly; that is, they thrive on the natural power of cities to pull together creative professionals from diverse backgrounds, sustain great learning centers, support interesting restaurants and night spots, offer the latest consumer goods in fashionable shops, and assemble people for exciting events in great public spaces.

The nation's vibrant metropolitan centers, which produce 80 percent of the nation's GDP, require a mix of workers and, therefore, a mix of housing and commercial uses. As has been true throughout urban history, economic function drives demand for urban infrastructure, and this 21st century urban rebirth requires new types and levels of urban investment. Helping cities thrive by tracking the performance of metro networks.

Helping cities thrive by tracking the performance of metro networks

Henry Cisneros Former HUD Secretary and Founder and Chairman, CityView