The Heritage Foundation

Executive Summary #1216es on Smart Growth

September 1, 1998

September 1, 1998 | Executive Summary on Smart Growth

BG1216es:  What to Do About the Cities

America's older cities continue to deteriorate. More than three decades of federal programs and hundreds of billions of dollars in federal, state, and local spending have done little to stem the decline that has been under way in most older cities since 1950. Indeed, these programs may have served both to accelerate and to deepen the decline.

Much of the failure of these programs can be attributed to a series of policies that attempted to recreate in these cities the social, technological, and economic relationships that characterized America's urban communities at their peak in the 1920s but that have very little relevance today. In particular, and in an attempt to recapture their commercial dominance, cities have emphasized the interests of business and suburban commuters, and more recently of tourists, and the industries that serve them. In pursuit of this goal, cities have diminished the quality of life for their residents, whose relentless and uninterrupted flight over the past five decades is one of the chief reasons that most older cities have not recovered yet, despite costly efforts to revive them.

A number of historical factors combine to explain the plight of American cities:

  • The evolution and character of dominant cities were shaped by the Industrial Revolution and the technology of the time, when transportation costs were high and choices limited.

  • Expanding opportunities for manufacturing necessitated the concentration of labor, capital, and related support services in densely populated cities and milltowns so that all participants in the process were within walking distance of one another, of a rail station, or of a port.

  • Later, the advent of inexpensive, mass-produced internal combustion engines greatly lowered transportation costs while greatly increasing transportation choices, thereby freeing people and businesses from the dense urban environments that earlier technologies required.

  • As people moved, businesses followed their customers; and the suburbs became increasingly self-sufficient in commerce, jobs, culture, and entertainment.

  • The slow decline that began around 1950 accelerated after 1970 in response to the rapid deterioration in the quality of life within most urban environments as crime soared and the quality of education collapsed.

By misreading the problem, governments at all levels implemented policies that thwarted self-renewal and exacerbated the forces that contributed to the deterioration of cities. For the most part, these policies confused effect with cause and, in the process, pursued the impossible at the expense of the improvable. Specifically, these policies:

  • Placed excessive emphasis on such costly infrastructure projects as urban renewal programs, highways, public housing, mass transit, and commercial structures that destroyed neighborhoods but provided few benefits to city residents or city businesses.

  • Emphasized such costly schemes often while neglecting such basic city services as public safety and quality education that are important to existing and potential residents.

  • Implemented costly social welfare schemes to offset declining business activity. These schemes created concentrated pockets of poverty, crime, and social dysfunction that further hastened the demise of cities.

Government programs to remedy urban decay have served largely to foster dependency, to concentrate existing and emerging social problems within the central cities, and to favor businesses and commuters over city residents. As Indianapolis Mayor Stephen Goldsmith notes, "Federal urban policy drives wealth out of our cities. In fact, if we specifically designed a 'suburban policy' to drive investment out of our cities, it would look a lot like our current system."

Some notable successes in recent years, however, demonstrate that dramatic progress can be made if local leaders are committed to a different philosophy. A new breed of mayor has demonstrated that the simple act of providing such basic city services as functioning schools and safe streets at levels of quality comparable with those in the suburbs are likely to have a powerful payoff by attracting and holding hardworking, taxpaying households, as well as the job-creating businesses to serve them.

Although the responsibility for improvements in schools, law enforcement, and basic public services lies primarily with local officials, and to a lesser extent with state governments, there nevertheless are a number of initiatives that federal policy makers can pursue to help to facilitate urban revitalization. These include:

  • Ending the U.S. Department of Transportation's centrally planned, command-and-control transportation policies and give states, cities, and communities more discretion in allocating federal transportation funds.

  • Reforming the U.S. Department of Housing and Urban Development's housing assistance and community development programs to end the costly and inefficient project-based housing programs that destabilize inner-city neighborhoods. States and communities should have more say in how federal housing funds are allocated, and they should be permitted to link housing assistance programs more closely with welfare reform initiatives in order to reverse long-term patterns of dependency.

  • Further deregulating the federal job training initiatives of the U.S. Department of Labor and the U.S. Department of Education to allow states and cities to devote more resources to imparting basic education skills that most urban public school systems currently provide only inadequately.

Dr. Ronald D. Utt is Grover M. Hermann Fellow in Federal Budgetary Affairs at The Heritage Foundation.

About the Author

Ronald D. Utt, Ph.D. Herbert and Joyce Morgan Senior Research Fellow

Related Issues: Smart Growth