RF: That’s true. But with Donald Trump in office and the Republican Party in control of Congress there is little the federal government will do. And the bigger issue is our political divide, which in effect creates a vetocracy in Congress where it is impossible to get much of anything done.
Given the size of the U.S. and its political divide, I think the only way forward is probably to begin to devolve power away from the feds and the states to the local level. It would enable different kinds of places to focus on what they do best. Superstar cities and tech hubs could invest their tax revenues in transit and knowledge institutions and affordable housing and upgrading service jobs; they can pay service workers more, have higher minimum wages and pay more taxes. But, less dense, less expensive places could compete on costs; they work to attract more cost-sensitive industries; they can offer much lower taxes and much lower costs of living.
If we can empower local government and learn to respect each other's values and ways of life, maybe we can learn to more peacefully coexist. The alternative is much less attractive.
NS: In terms of politics, though, aren’t things actually worse at the city level in some ways? As you discuss in your book, much of the left’s effort on urban issues has focused on things like gentrification and the impact of venture capital, neither of which actually has much of an effect on affordability. More fundamentally, existing homeowners have lots of political power in cities, while prospective future residents—people who don’t yet live in a city, but might move there if it were more affordable—have no voice by definition. This seems to make the politics of cities inherently dysfunctional, because the people with all the power are those who least want change. Don’t we at least need state-level initiatives—like California’s current push for affordable housing—to overcome this local bias?
RF: Agreed. And these sorts of local-state policy combinations or alliances are likely to make spatial inequality between cities worse. We are already seeing efforts to combat extreme Nimbyism, or what I call the New Urban Luddism, in cities like New York, San Francisco, Los Angeles and Toronto. There is growing opposition to it now, and pressure to build and develop more housing to keep these economies growing, generate jobs and address affordability and inequality.
But here’s the rub. How many states and provinces will really be able to help cities and metro areas address the crisis by overcoming local zoning restrictions, investing in more affordable housing, investing in transit and high-speed rail, etc.? The answer is a very short list. Many Sunbelt cities have less onerous land use regulations and do build more. But, many Southern red states will be dead set against making greater investments in their universities and even more so for making the kinds of transit investments required to overcome their growing congestion woes. So that leaves California, New York, Massachusetts, Washington, Colorado and Ontario, where I live; and maybe a few others over time as they develop and their politics changes—perhaps Texas, as its major cities and metro areas like Austin, Dallas, Houston and San Antonio grow more powerful and realize that the state government and legislature are operating as a constraint on further growth.
The end result is that these few states—and their existing superstar cities and knowledge hubs—will attract even more talent, generate even more innovations, raise wages and salaries, and grow more. The end result is the emergence of a handful of true city-state complexes—made up of superstar cities and knowledge hubs with the investment and support of their state or provincial governments—that pull further and further away from the rest.
This article was provided by Bloomberg News.