Urban Legend

The craze over coffeeshops and condos won't revive American cities. Improving urban life for the middle class will.

By Joel Kotkin

Tagged Middle ClassUrban Policy

Cities have always served many functions: as centers of religion, political power, and commerce. But one of their most important tasks has been to serve as engines of upward mobility and aspiration. Nowhere has this been more true than in American cities. From the earliest period of American settlement, European observers were often struck by the remarkable social mobility found in America’s urban centers. The average nineteenth-century American factory worker, whether native-born or an immigrant, enjoyed a far better chance–and his offspring an evenbetter one–of rising into the middle or even upper classes than his European counterpart.

This is not to say that Industrial-era American cities constituted a
workers’ paradise. Virtually every major city had its share of slums,
and in the most important American metropolis, New York, the rate of
infant mortality actually doubled in the mid-nineteenth century. Yet
aspiring newcomers kept traveling to American cities, from both the
surrounding countryside and the rest of the world, for one reason: the
prospect of upward mobility. As historians Charles and Mary Beard noted
in 1930, there may have been poverty “stark and galling enough to blast
human nature,” but “all save the most wretched had aspirations.” There
was, as they put it, “a baton in every toolkit.”

So newcomers in search of a better life–the Irish in the 1840s,
Italians and Eastern Europeans toward the century’s end, African
Americans from the South following the first World War–propelled urban
growth. As late as 1850, the United States had only six cities with a
population of over 100,000, constituting barely five percent of the
population. By 1900, there were 38 such cities, and they now housed
roughly one in every five Americans. “A metropolitan economy, if it is
working well, is constantly transforming many poor people into middle
class people … greenhorns into competent citizens,” the great
urbanist Jane Jacobs wrote. “Cities don’t lure the middle class, they
create it.”

Sadly, in recent decades, this notion of cities as mechanisms for
upward mobility has broken down. Many cities, rather than trying to
uplift their working class and nurture a middle class, have chosen to
concentrate on “luring” the affluent, the hip, and the young as their
primary development strategy. In some cities, such as in Boston, New
York, and San Francisco, this has created the basis for a new kind of
urban area, the “boutique city,” which effectively abandons the middle
class for the allure of an elite-based strategy focused on top-tier
business services, arts, and hip culture.

Many other cities, particularly hard-pressed former industrial
centers like Baltimore, Cleveland, Philadelphia, and Detroit, have
attempted to follow this “cool city” model without much success. They
may have developed Potemkin villages of coolness in their center, but
they remain among the poorest and most neglected regions of North
America. Cleveland, for instance, with its much-ballyhooed downtown
renaissance catalyzed by the Rock and Roll Hall of Fame, ranked first
in urban poverty in 2004.

In contrast, there is a group of cities which most commentators
consider chronically unhip–primarily sprawling new cities of the South
and West–but which are actually the most dynamic in the creation of
middle-class residents. These cities–such as Phoenix, Houston,
Charlotte, and Las Vegas–have traditionally put their focus on their
basic infrastructure and economic competitiveness and, for the most
part, enjoy relatively low costs of living, particularly for housing.
As unhip as they may seem, it is these cities that present a model for
how urban America can not only rejuvenate itself, but rejuvenate
America’s central promise of upward mobility, as well.

The Rise of the Boutique City

Traditionally, progressive urban leaders embraced Jane Jacobs’s
mission of building the middle class and providing avenues of
aspiration. The old political machines did this crudely, dispensing
patronage and finding jobs for newcomers. Later, the Progressive
movement, the New Deal, and the Truman Administration promoted upward
mobility largely by building critical, wealth-creating infrastructure:
schools, roads, bridges, mass transit, public parks, and housing.

Culture did play an important role in this traditional urban model,
but generally it wasn’t a major part of the city government’s
job–rather, the arts were funded by those individuals who made fortunes
there. Indeed, the great cultural assets of places like St. Louis,
Cleveland, or Philadelphia–such as these cities’ world-class
orchestras–owe their existence to the cities’ own aspirational past.
This is true even in some newer cities like Los Angeles, whose greatest
artistic monuments bear the names of those–Getty, Disney, Geffen–who
found that city a place of unlimited opportunity.

In other words, the economy came first, and the amenities followed.
But such an approach has been gradually abandoned over the past few
decades, replaced with a strategy that puts the cultural horse before
the aspirational cart. This shift well predates the early 2000s rage
over public policy scholar Richard Florida’s gospel asserting the
primary need for a “creative class” of well-educated, hip, single, and
gay people in the urban core. Rather, it began as urban decline became
painfully evident in the 1960s and 1970s. Aware that the middle class
as well as many companies were moving out, cities, particularly New
York and Chicago, placed their future hopes on seizing “the commanding
heights” of the global economy–notably the finance, design, project
coordination, and information industries. Although planning for the
“commanding heights” did leave an appropriate legacy of high-rise
office towers, this elitist strategy fundamentally failed to reverse
the out-migration of headquarters, jobs, and the middle class outside
the urban core.

Like aging dowagers, many cities have sought to arrest their decline
by applying both a touch of rouge and some serious cosmetic surgery.
This is the urban landscape of the “boutique city”–one dominated not by
middle- or working-class concerns, but by elite culture and the antics
of celebrities, whether cultural icons, financial titans, foundation
bosses, or media moguls. The boutique city is the playground of Paris
Hilton and P. Diddy, as well as the assorted “masters of the universe”;
it not a place with playgrounds for working-class and middle-class
kids. These cities are almost obsessively concerned with “coolness” and
“hipness,” being “with it” and “trend-setting.” Boutique cities, like a
high-end specialty merchandiser, have little use for the general run of
the working and middle class, whose needs are assigned to the domain of
Target, Wal-Mart and other suburban merchandisers. Indeed, if the
makers of the boutique city worry about anything besides themselves, it
is usually not the disappearance of this hardworking middle class, but
how to deal with the potential threat represented by the alienated
underclass, with its potential for lethal mayhem. Many denizens of
these environments do not see the city as a place that holds their
commitments, but only one locale that, for a period of time or a
particular season, seizes their fancy. Many are not even full-timers,
instead flitting to Florida, Malibu, Palm Springs, Europe, or the
Hamptons, depending on the season and their latest whims (since the
1990s, for example, the number of Manhattan residences serving as
second homes has grown by as much as three-fold).

Spatially, the boutique city can be found in certain
locations–Manhattan, Chicago’s “Gold Coast,” much of San Francisco,
Seattle, and West Los Angeles–but it can best be viewed as an
interconnected archipelago of interrelated elite communities. Its
fundamental economic power lies not so much in the efficiency of place
but in harnessing the influence of the media and financial elites. It
depends also on the energies of a steady stream of young, educated
workers and legions of poorly paid, often immigrant, service workers.

To understand the change from a traditional to a boutique city, it
is instructive to look into the evolution of our greatest urban center,
New York. For much of its history until the 1950s, New York’s economy,
including its manufacturing sector, more than held its own against the
rest of country. Although it always had its slums, the city also
boasted scores of solidly middle- and working-class neighborhoods. But
starting in the mid-1960s, New York’s job engine began to sputter as
manufacturing firms and corporate headquarters decamped, and the city
failed to find industries of comparable size and quality to replace
them. By 2000, the city’s overall employment stood at less than
that in 1969 (and this during a period in which the number of positions
grew by 61.3 million, an increase of 87 percent). Five years later,
despite a much-ballyhooed recovery, yet another 100,000 more
private-sector jobs had been lost.

Equally troubling, throughout this period the city’s employment
pattern became ever more characterized by a mix of elite and low-wage
employment. Since 2002, much job growth has been concentrated in the
lower-paying retail and hospitality industries. As a result, median
average wages, including for college graduates, have not kept up with
inflation. Yet, at the same time, there has been robust income growth,
paced by often-spectacular gains at the upper echelons of the financial
and business service sectors. There may be as little as a third as many
Fortune 500 headquarters in New York today compared with 1955, but
those that remain employ a relatively small number of people at rapidly
escalating wages. These changes have had a severe impact on New York’s
demography. While it is true that the city continues to attract legions
of talented people under 35, this inflow is more than balanced by an
out-migration of people over that age. Nor does the current “boom” seem
to be changing this reality. Since 2000, in New York City and its
environs, rates of domestic out-migration, already among the highest
nationwide, have actually accelerated.

These developments suggest a tragic conclusion: the decline of New
York’s historic role as an incubator of upward mobility. Back in the
’60s, Jane Jacobs could still predict that Latino immigrants to New
York, mainly from Puerto Rico, would inevitably make “a fine middle
class.” Yet today in the Bronx, the city’s most heavily Latino borough,
roughly one in three households live in poverty, the highest rate of
any urban county in the nation. At the other extreme, Manhattan, where
the rich are concentrated, the disparities between the classes have
been rising steadily. In 1980, it ranked seventeenth among the nation’s
counties for social inequality; today it ranks first, with the top
fifth of wage- earners earning 52 times that of the lowest fifth, a
disparity roughly comparable to that of Namibia.

It’s not just New York, either. Beyond the Big Apple, the middle
class has disappeared from many urban communities, and nowhere more so
than in cities that consciously promote their boutique status. A recent
Brookings Institution found that, since 1970, cities have become
dramatically more bifurcated between rich and poor neighborhoods. Fewer
than one in four urban neighborhoods had a middle-class “profile” in
2000, compared with almost two in four three decades earlier; although
suburban areas also suffered a decline in middle-class neighborhoods,
overall they had nearly twice the percentage. San Francisco, despite
its avowedly liberal, even radical politics, is becoming a particular
poster child for social inequality–a cross, in the words of historian
Kevin Starr, “between Carmel and Calcutta.” The difference between
African American and white incomes in this liberal bastion, for
example, is almost three times the national average.

In many cities, the shrinking of the middle class has brought about
an overall drop in population. Although New York, with its large
immigrant population, still enjoys slowing yet positive population
growth, many other boutique cities, including some which gained
population in the 1990s–such as Boston, San Francisco, and Chicago–have
all lost population over the past five years. Some boosters explain
this depopulation as a sign of a “qualitative” improvement in the
population, a kind of genteel version of ethnic cleansing where middle-
and working-class families are being replaced by well-educated,
affluent, and often childless households. They point to certain
positive developments, such as the proliferation of upscale
restaurants, art galleries, trendy shops, and architecturally pleasing
hotels and condos. Yet look at what’s missing: middle-class jobs and
families. Boutique cities like San Francisco, Seattle, Boston, and
Portland, Oregon, rank among the American cities with the lowest
percentages of children. In San Francisco, there are more dogs than
children. And why? Extremely high housing costs and an economic
environment that provides few middle-class opportunities. Since 2000,
almost all these cities have produced far fewer jobs–even in business
services–than the nation as a whole or their surrounding suburbs. Put
simply, all but the richest families don’t see a future that they can

The Potemkin City

Despite the limitations of the boutique city, many other urban
areas’ fondest wish seems to be to emulate their example. This includes
less-favored cities like Philadelphia, Cleveland, Cincinnati,
Baltimore, Detroit, St. Louis, and Newark. Both political and business
leaders in these cities have pegged their future on luring the hip and
affluent demographics to their long-benighted burgs with a slew of
high-cost cultural amenities. The results are Potemkin villages of art
museums, performance centers, tourist attractions, luxury hotels, and
condos enthusiastically promoted both to locales and visitors as
evidence of urban renewal. Yet these projects have rarely done much
more than restore property values in a small area, and not one can
claim that its economy has had anything remotely like a major rebound.
If you measure job growth in the new century, much-heralded
“renaissance” places like Baltimore and Philadelphia sit at the bottom
of the pack, well behind even the most anemic boutiques.

There is perhaps no more searing evidence of the limitations of the
Potemkin strategy than New Orleans. Once a great industrial and
commercial center, the city’s economy–despite its huge port–has lost
most of its sources of middle- and working-class employment. Even
before Katrina, it had roughly half the percentage of jobs in
manufacturing and wholesale trade than the national average. Instead,
over the past quarter-century, New Orleans chose to focus on arts,
culture, and tourism. Unfortunately, tourism does not readily provide
much middle-class employment or social mobility. Before Katrina, nearly
40 percent of New Orleans households, nearly all of them black, earned
less than $20,000 a year, twice the proportion in the rest of the
country. Whatever might have worked for Garden District elites or the
operators of the tourist hotels failed the rest of the city’s
population on a staggering scale.

Yet while New Orleans gets the tragic opportunity to rebuild itself
anew, most older industrial cities do not. They lack New Orleans’
natural appeal, but they still think that Potemkinism can work for
them. In Michigan, for example, Governor Jennifer Granholm’s urban
strategy has focused on the notion of creating “cool cities.” Since
2002, she has promoted the growth of art galleries, coffee houses, and
other yuppie accoutrements as a means to restart the state’s urban
areas. Although perhaps some urban Michiganders now might see
themselves as cooler, their cities–most notably Detroit, led by its
self-professed “hip-hop Mayor” Kwame Kilpatrick–still rank consistently
at the bottom of American urban areas in terms of job growth and near
the top in terms of population loss.

In Baltimore, Mayor Martin O’Malley has identified the migration of
gays and artists as key to his city’s revival. Even before O’Malley’s
administration, Baltimore had looked to tourism–centered around the
Inner Harbor “festival marketplace,” two new sports stadiums, and the
National Aquarium–to revive its long-sagging fortunes. In 2003,
O’Malley packaged all this around what has to be among the most bizarre
slogans in recent memory–”The Greatest City in America.” To be sure,
things in early-twenty-first-century Baltimore were pretty good for
real-estate speculators, who cashed in on a property bubble and the
migration of some professionals from an even more overheated
Washington, D.C. property market. But Baltimore’s overall performance
was far from the “greatest.” Demographic decline has continued
apace–population, which dropped 11 percent in the ’90s, has fallen
another 2.3 percent. The city still has thousands of abandoned homes
and, to make things worse, a homicide rate that is perennially among
the nation’s highest. “What good is it to be hip and cool,” one local
talk-show host asked me, “if you’re dead?”

Cities of Aspiration

Surveying the urban landscape, one lesson of the past few years
starts to become clear: It is hip to be square. In an age of loft
condos and lattes, the least appreciated American urban form may turn
out to be the one that still best adheres to the traditional role of
cities as generators of upward mobility. These are the new Sunbelt
cities–places like Houston, Charlotte, Orlando, and Phoenix–whose
sprawl and rough edges often elicit derision from traditional
urbanists, even as they attract newcomers and create middle-class jobs
and entrepreneurial opportunities. Between 1994 and 2005, the Phoenix
area expanded its job base by 52 percent, Orlando by 48 percent,
Charlotte by 31 percent, and Houston by 25 percent. In comparison, New
York and greater Chicago expanded by only single digits, while the
Cleveland, Baltimore, and Philadelphia areas all lost jobs.

The differentials in housing are, if anything, starker. In cities
like San Francisco, less than one tenth of households could afford a
median-priced home; in Phoenix, one-third can do so, as can over half
in Dallas, San Antonio, Charlotte, and Houston. Of course, one can
argue that there are cities with even lower housing costs, notably in
the depressed Midwest. But, unlike those old industrial centers, the
Sunbelt cities are in a rapid growth mode, creating large numbers of
new jobs while attracting new residents both domestically and,
increasingly, from abroad.

What drives the growth of these cities are the very aspirations that
have created great urban centers throughout history. Phoenix and
Houston, in terms of their job growth and appeal to those seeking a
better life, resemble New York, San Francisco, Chicago, or Pittsburgh
at the turn of the last century. Like the great American boomtowns of
the nineteenth and early twentieth centuries, today’s aspirational
cities are protean, being constantly redefined by newcomers. In fact,
almost a third of all Phoenix residents, according to the 2000 census,
arrived within the past five years. The prototypical Phoenician, or
Houstonian, like their counterpart in New York a century earlier, is
often someone who came with little more than hopes to create a better
life. “We came with nothing. We came here because it had wealth that
was increasing. You can find opportunities,” Phoenix entrepreneur Deb
Weidenhamer told me. “People come here for a new start and come with
ambitions”Longevity here doesn’t matter here. You can be here ten years
and it’s like you’re an old fogey–on the East Coast, you’d be like a

Of course, even within Phoenix or other aspirational cities, some,
particularly in the media, yearn to follow the trends observed in
boutique cities like Boston, Seattle, or San Francisco. These cities
are held up as paragons of urban progress, in large part because of
their concentration of high-wage jobs and “creative” professionals.
This approach misses many critical points. First of all, even hip,
educated young people migrate to where the jobs are; according to the
2000 census, Las Vegas, Charlotte, Atlanta, and Phoenix experienced a
higher rate of migration by the young, single, and college-educated
than San Francisco or Seattle. These patterns have likely accelerated
since San Francisco, Boston, and other boutiques saw their economies
slow in the ensuing five years.

Equally important, the lower cost of living in most aspirational
cities translates into a better lifestyle, including for professionals.
San Francisco and the Silicon Valley may generate higher wages in
fields like software of financial services, but weighted against the
cost of living, Phoenix, Dallas, and Houston actually deliver to their
workers, in real terms, higher purchasing power. Critics also
make much of the fact that cities like Phoenix have experienced
somewhat lower per capita income growth than other regions. This,
however, stems in large part from the area’s rapid growth in both
household size and population. Places with few children, like San
Francisco and Seattle, tend to have higher per-capita incomes; the
little tykes can have a powerfully negative impact on such incomes, as
do new arrivals who often come with more hope than money in their

Yet, despite these facts, many journalists and policymakers seem
determined to spread the boutique model. This approach often has a
certain political logic. The construction of new hotels, condos, art
museums, and performing arts centers presents mayors with tangible
assets to show off to their constituents. Large property owners,
developers, hotel and construction unions, and arts foundations also
tend to support such an approach to urban development, for obvious

One can see this pattern in cities like Los Angeles, which straddles
the line between an aspirational city–with strong population growth and
grassroots entrepreneurialism–and a boutique city. Mayor Antonio
Villaraigosa, an erstwhile progressive firebrand, has put much of his
prestige on the line to back huge subsidies for entertainment, condos,
and hotel development in the city’s downtown. As a result, his
popularity has been soaring among billionaire developers, such as
Phillip Anschutz, a right-wing Coloradan whose massive $2.5 billion LA
Live project depends heavily on a $300 million city subsidy for a
luxury condo and hotel tower next door. As is so often the case, the
goal is to “lure” not only tourists but the rich, powerful, and hip to
the urban core. Villaraigosa has also signed up to back the schemes of
another billionaire, Eli Broad, in his attempt to turn downtown’s
doughty Grand Avenue into a West Coast “Champs d’A­ï¿½lysées.” This
development also has been made possible through sweetheart deals with
government agencies, in this case Los Angeles County, for the land to
build Broad’s vision, and may need other, more direct subsidies to
pencil out. Broad, who made his fortune building suburban tract homes,
is a particularly peculiar case: a self-made Sunbelt billionaire
(originally from the Detroit area) whose view on urban greatness
nevertheless follows a conventional twentieth-century notion of a
downtown-centric city.

It is dubious how much this kind of policy promotes upward mobility
outside of a selected group of hotel workers and those involved in the
building of these structures. Meanwhile, the city’s economy
consistently underperforms compared with others in the region, in large
part due to higher taxes, a difficult regulatory regime, decaying road
systems, and dysfunctional schools. Not surprisingly, Los Angeles,
according to research by the Brookings Institution, has lost
middle-class residential areas at a high rate, as well as endured a
growing concentration of poorer neighborhoods.

Towards a New Urban Strategy: Back to Basics

Today it appears that most cities–even if they have the money–will
not invest it in ways to stimulate the middle class and broad-based
economic growth. Instead, once a city’s fiscal picture brightens, the
first people to be rewarded are the public employee unions. In the
summer of 2006, for example, both New York and San Francisco, each
benefiting from the real estate bubble, rewarded city workers with good
raises that did not include tough productivity incentives. They also
failed to confront the thorny issues that threaten their long-term
future, such as their massive pension obligations (in the case of New
York, this obligation has been estimated at roughly $40 billion). As
the property markets–that fueled much of this revenue growth–continue
to cool in the coming months, the foolhardiness of these decisions will
become ever more apparent. As a result, the city is stuck with
declining revenues and increasing payrolls, without enjoying any of the
added productivity benefits that would have resulted from smart
investments in labor.

These political realities are just part of the problem; many of the
biggest barriers are the products of economic evolution.
Late-twentieth-century cities like Houston, Phoenix, Charlotte, and
Dallas were essentially built to meet the tastes of the mass of
Americans for a detached house, a yard, and an automobile commute. They
also enjoy, for the most part, more up-to-date infrastructure, such as
major airports surrounded by lots of land allowing for expansion, which
is increasingly critical to urban growth. In this respect, older
cities–even if they had a change of heart politically–have more limited
possibilities for middle-class mobility and economic growth. In many
cases, these cities have scarce open land to develop and are, for
better or worse, stuck with a housing stock and infrastructure dating
back, in some cases, to the nineteenth century. Yet at least some of
these depressed older cities, and even parts of some of the most
prominent boutique cities–such as outlying sections within the cities
of Chicago as well as the outer boroughs of New York–still have the
potential for aspirational growth. In some cases, as in parts of
Queens, middle-class families, many of them immigrants, have already
moved into once-declining neighborhoods and turned them around.

However, America’s older cities do not need to face this choice
between growing irrelevance and continued decline. For all their
problems, they retain an impressive array of physical building blocks
for future success: critical infrastructure, a varied housing stock,
universities, hospitals, research institutions, and attractive
residential neighborhoods. They offer options to walk or take public
transit to work, options that appeal to a small but significant part of
the workforce. These opportunities could be seized by a new approach
that focuses not on an essentially ephemeral strategy of making cities
themselves “cool,” but by a longer-term approach that seeks to reclaim
them for the middle class and the upwardly mobile. This requires a
return to the basics of urban policy, focusing on such things as
infrastructure-development, improved schools, and enhancing the
efficiency of urban governance. Rebuilding and reclaiming housing in
inner-city areas for those who live there, as well as new middle-class
residents, would be one start. Making the climate more attractive for
entrepreneurs and small businesses would be another, coupled with
expanding skills and vocational training for local residents so that
they can take the jobs these firms create. Improving urban schools, a
more daunting task, could be accelerated, perhaps by developing more
charter schools or drastic reform of frequently union-dominated school

This “back to basics” approach would work not just for traditional
urban centers, but also for those outlying areas, particularly older
suburbs, that now confront many of the opportunities and challenges
usually associated with core cities. In many cases, particularly in the
Northeast and Midwest, these areas are not so dissimilar in their
densities and development patterns from Sunbelt cities and they can
more readily follow their model. These include places like Arlington,
outside Washington, D.C., or close-in suburbs, such as University City
and Maplewood, just outside the physically constrained borders of St.

Perhaps the most spectacular example of this approach can be found
in Houston. For decades, the city has focused largely on the
fundamentals of growth, pressing relentlessly to dredge its harbor,
improve drainage, and construct state-of–the-art industrial facilities.
With a gritty efficiency, the city has transformed itself into a major
global center, assuming leadership of the world’s energy industry and
quietly building the world largest medical complex. [Full disclosure: I
am a working on a project about the future of Houston for the Greater
Houston Partnership. I have also worked on projects in Los Angeles, New
York, St. Louis, among other cities, all of which, along with Houston,
I feel free to criticize.]

This did not happen by coincidence. During the ’90s, Bob Lanier, the
son of an oil refinery worker who grew up in nearby Baytown, served as
mayor. When he took office, the city he inherited was in deep trouble;
it had lost some 200,000 jobs in the near-total economic meltdown after
the energy bust of the 1980s. Its once-proud skyline was filled with
“see-through” towers, empty of workers. Lanier, a former developer and
lifelong Democrat, helped turn the city around by doing the little
things and doing them right, such as filling potholes, streamlining
regulations, reducing crime, and improving services to the city’s
varied neighborhoods. Most of all Lanier focused on infrastructure:
roads, sewers, and cleaning the streets. At a time when many cities
have chosen to eschew road- building and actually encourage gridlock,
sometimes with the hope of forcing greater densification, Houston has
chosen to build new roads, including tollways, as well as an expanding
mass-transit system. As a result, it is among the few major American
cities to see commute times diminish over the past decade.

This is not to say Houston is without problems. It has significant
rates of poverty and large areas of poor housing. It is also struggling
to accommodate upward of 100,000 Katrina evacuees, many of them poor
African Americans. Yet what has come out clearly in scores of
interviews and discussions with a broad array of Houstonians–from
business leaders and current Mayor Bill White to community activists in
the predominately African American Third Ward and Katrina refugees–is
that many residents regard opportunity as their city’s primary
attribute. Certainly, people do not move primarily to humid and flat
Houston for the weather or topography; they come largely for the chance
to succeed.

Other cities, such as Charleston, South Carolina, also have thrived
using this approach. Led for over three decades by Mayor Joseph Riley,
Charleston is best known for its well-preserved downtown, but it has
also made major investments in education and critical infrastructure,
such as its rapidly expanding port, which has doubled its activity in
the past decade. As a result, Charleston, once a prototype of Deep
South somnolescence, has enjoyed not only remarkable job growth, but
also a rapid diversification of its economy. Over the past decade,
professional and business-service employment in the area jumped 80
percent, twice the growth of the hospitality industry. Key blue-collar
industries, such as trade, construction, and even manufacturing, which
rose 9.1 percent between 1994 and 2004, also enjoyed steady growth. At
the same time, Charleston has made a successful shift toward an
information-oriented economy: Its ranks of college-educated people,
once well below the national average, now surpass that of the country
as a whole. The changes are particularly striking at the high end;
since 1980, the number of Charleston-area residents with advanced
degrees has expanded almost 160 percent, eight times the rate for the
rest of the country. It may not be on the level of New York or San
Francisco, but its rate of progress is far more rapid.

Yet perhaps the best case for back to basics may not be in the
Sunbelt, but rather in the hard-hit industrial Midwest. At the dawn of
the twenty-first century, places like Kalamazoo, Michigan, an
industrial city in the southwestern part of the state, was told by
Granholm that its future lay in attracting “the creative class.” A new
image, “Cool Kalamazoo,” was going to remake the region of 350,000
people. It didn’t turn out that way. As Michigan’s economy has
declined, the notion that being “cool” was the key to survival became
something of a bad joke. Recent surveys, for example, find that one in
three Michiganders considers theirs a “dying state,” and four in ten
are thinking of fleeing, including the young. “It’s still
Depression-era around here,” Ron Kitchens, head of Southwest Michigan
Now, a local economic development group, told me. But one thing may be
said for the hard times in places like Kalamazoo: It has spurred young
leaders like Kitchens to focus on a different strategy. They are
raising capital for new startups in information, life sciences,
services, and other growth industries, many of them operating out of an
abandoned General Motors plant. They are looking at improving the
transportation infrastructure–particularly the regional airport–to
better connect the city with the rest of world. Perhaps most important
of all, they are investing in the skills of their people. Local
foundations are financing what is now called “the Kalamazoo promise,”
which essentially guarantees 65 percent of college tuition costs for
those who attend the city’s schools.

“Hungry people’s first priority is not to eat cake,” Kitchens said.
“You can have an art center but it does not sustain your city. Making a
successful city is not magic. It’s blocking and tackling. Government
can be a catalyst in doing that, and that’s what we’re doing. You’ve
got to give the ordinary people a sense of hope. That’s what successful
places always do.”

The Future of American Cities

Ultimately, the critical question for cities boils down to what
essential purpose they should serve. Are cities to become, as H.G.
Wells predicted over a century ago, merely entertainment districtswhat
he called “places of concourse and rendezvous”? Or have cities been
rendered irrelevant as economic units by technology, as George Gilder
has argued? After all, a broadband hook-up in Bismarck, North Dakota is
just as connected to the world economy as one in Brooklyn. Or it could
well be that cities, under current trends, will devolve into socially
bifurcated regions increasingly irrelevant to America’s mainstream
political culture, islands of ultra-affluence and poverty, many of
whose residents are either temporary or part-time.

As a lifelong urban dweller, I don’t believe that our cities’ best days must lie behind them, particularly
if we are to include more sprawling, multi-polar cities like Phoenix or
Houston. Cities still possess many critical assets like historic
neighborhoods, freight and rail connections, major hospitals,
universities, and research institutions, which make them invaluable
assets to the surrounding regions and the nation as a whole. There are
also intangible assets that make the fate of cities critical to the
future of the republic. For one thing, they are repositories of much of
our historical memory; no matter how much the suburbs and exurbs
evolve, they are unlikely to provide the sense of place and cultural
focus that resides in the urban core. This is most true in older
cities, such as New York, Philadelphia, and Boston, but also, to a much
more limited extent, in more vital places like Houston, Dallas, and

And as today’s aspirational cities show, America’s urban centers can
still be, with the right leadership and smart policies, the engines of
upward mobility that have powered this country for the past century.
But to do so, they must pursue such basic strategies as encouraging
entrepreneurial growth, reducing regulatory and tax barriers to
business, creating efficient transportation systems, improving
education, and prioritizing public safety and public open space. It
would be far better to spend the hundreds of millions now wasted by
many cities on convention centers, boutique hotels, performing arts
centers, and subsidized condo development on these more essential
services, the true sinews of an expanding urban economy.

To be sure, fancy bookstores, organic markets, sushi bars, and art
galleries are important parts of urban life, but they only represent a
critical factor for a small slice of the population. And they will come
along naturally, as arts and amenities tend to, with economic growth
and wealth creation; focusing on amenities first gets the urban
equation completely backward.

Great cities are about many things, but none more than being a place
for a broad spectrum of people to improve their lives and that of their
families. Great cities are about real diversity of ages, family types,
and incomes, not just agglomerations of the affluent. What we want for
our cities is what we should want for our country as a whole: to be a
place of great opportunity, hope, and a better life, particularly for
those who still consider this part of their American dream.

Read more about Middle ClassUrban Policy

Joel Kotkin is an Irvine Senior Fellow at the New America Foundation. He is the author of The City: A Global History, to be published in paperback by Modern Library this fall.

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