The Next Urban Agenda

Bruce Katz
Bruce Katz Founding Director of the Nowak Metro Finance Lab - Drexel University

January 28, 2007

The U.S. Conference of Mayors convened in Washington this week just in time to hear President Bush convey a renewed interest in domestic policy. As they digest the President’s priorities and the response from Congressional Democrats the nation’s mayors need to consider the next urban agenda. It would be a mistake to rely on the urban policy playbook from the 1970s, or even the 1990s. Cities and the suburbs surrounding them have changed dramatically over the past 15 years, and federal policy must change radically if it is to help cities extend their newfound prosperity and realize their full economic potential.

Broad forces have given cities a second life in the United States. Demographic forces—immigration, aging, the rise of nontraditional households—have reversed the urban population decline of the 1970s and 80s. At the same time, an economy based on innovation bestows new importance on densely configured urban places (where ideas are transferred easily from firm to firm) as well as institutions of knowledge, particularly universities and medical research centers, many of which are located in the heart of central cities and urban communities.

As a consequence, cities once left for dead—New York, Chicago, Boston, Louisville, and Chattanooga—are enjoying a rebirth. Asian and Hispanic immigrants are repopulating neighborhoods and spurring housing markets. Homeownership is up, unemployment is down. Cultural institutions, parks, and restored waterfronts are adding to the livability of many cities. The picture, of course, is not complete—poverty remains high, crime is a perennial issue and smaller cities like Camden and Hartford continue to struggle—but the general direction is positive.

At the same time, suburbs are no longer the picket-fence commuter enclaves of the post-World War II era. Instead, many older suburbs are facing challenges similar to cities—aging infrastructure, deteriorating schools and commercial corridors, and inadequate housing stock—while others are becoming more vibrantly urban, attracting high-density apartments, restaurants, walkable shopping districts, and the other amenities of successful cities.

Despite these transformative changes, federal policy remains locked in a time warp of Great Society ideas about how cities and suburbs are defined, what their challenges are, and how to address them.

Federal “urban” policy has largely been whittled down to a series of policies—subsidized housing, community reinvestment, empowerment zones —that focus explicitly on the “deficits” of distressed urban communities. This limited vision fails to recognize that cities and older places have assets and amenities that are highly valued by our changing economy. Renewing city neighborhoods in isolation disregards the metropolitan nature of employment and educational opportunities, and by concentrating affordable housing, actually inhibits the access of low-income families to good schools and quality jobs.

So what could this Congress do to move towards a 21st century urban policy, acknowledging fiscal and other constraints?

To start, existing housing policies must be overhauled. Rather than concentrate poor families in a few square blocks, federal housing policy must aim to create neighborhoods of choice that give urban residents access to functioning markets, attractive amenities, good schools and other essentials of community life. To this end, federal programs should expand housing opportunities for moderate- and middle-class families in cities and close-in suburbs, create more affordable, “workforce” housing near job centers, and give low-income renters the opportunity to move to areas with high performing schools. Demonstrations in the 1990s prove that these efforts have an enormous return on investment, for families and for communities, and can be funded by shifting resources from ill-conceived programs.

Federal policy can go further by expanding access to low-cost information on the market potential of cities. Private sector investors and entrepreneurs generally suffer from a paucity of market information on inner city neighborhoods. As a consequence, the unique assets of urban communities—dense living patterns, access to built infrastructure—frequently go unrecognized and untapped. The federal government could spur tens of billions of dollars in private investment by launching an Urban Markets Initiative to collect reliable information on urban market dynamics and create new tools to assess the true prospects for growth in U.S. cities.

Finally, the federal government should establish a bold new infrastructure policy for cities to ensure that investments from existing federal programs enhance the competitiveness of cities. By coordinating federal investments in areas like transportation, environmental remediation, and homeland security, the federal government could help civic leaders reconnect their cities to isolated waterfronts, clean up polluted sites, and encourage the kind of vibrant downtowns and pedestrian friendly neighborhoods that are valued in the innovation economy. A national infrastructure policy could have a transformative effect on U.S. cities.

In the near term, the challenge is not the lack of funding in many cases, but the absence of imagination and perspective.

These recommendations are just a start. But as America’s mayors converge on Washington this week, they should demand a federal urban policy that fully leverages the economic potential of our cities and older suburbs. What’s needed is a fundamental shift in philosophy at the federal level—from deficits to assets, from market-distorting programs to market-shaping investments.

The world has changed, to the betterment of cities. Will federal policy follow?

Bruce Katz is the Vice President and Director of the Brookings Metropolitan Policy Program and holds the Adeline M. and Alfred I. Johnson Chair in Urban and Metropolitan Policy.