Metro Potential in ARRA: An Early Assessment of the American Recovery and Reinvestment Act

America’s national economic crisis is also a metropolitan crisis, because metropolitan areas are the true engines of the national economy.

Home to 65 percent of the U.S. population, the largest 100 metropolitan areas alone account for threequarters of the nation’s gross domestic product (GDP), as notes the Metropolitan Policy Program at Brookings’ Blueprint for American Prosperity initiative. Strictly speaking, there is no single U.S. economy, but rather a tightly linked network of metropolitan economies.

And that is why it matters intensely how well efforts to revive the nation’s economy—including the American Recovery and Reinvestment Act (ARRA)—empower metropolitan leaders to marshal their given resources to boost prosperity.

To produce real prosperity local leaders require rich stocks of the fundamental “drivers” of productive growth—key innovation inputs, cutting-edge infrastructure, abundant human capital, and quality places. But metropolitan actors also need the discretion and power to aggregate, link, and coordinate those drivers to maximize their impact.

Therefore, it is a matter of both national and local concern to consider how ARRA, aka the “stimulus” package, will affect U.S. metropolitan areas, and to assess how easily—or not—its multiple funding flows may be utilized to bolster metro efforts to get the economy moving.

This report probes those questions by providing an initial overview of the intent, approach, and content of ARRA from the point of view of metropolitan America.

From that perspective, this policy paper finds that ARRA usefully directs billions of dollars towards significant investments in the four key drivers of prosperity that concentrate in metropolitan areas. At the same time, the paper concludes that ARRA does very little to actively support metropolitan leaders’ efforts to bundle and align ARRA resources to foster local and national recovery. This lack of attention means that the burden of optimizing ARRA’s implementation falls squarely on states, which control significant amounts of ARRA funding, and local and regional actors, who will have a number of opportunities to craft coordinated approaches to implementing the law and sparking recovery. 

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