Thursday, November 1, 2007

What it will take: how 4 governors can reshape the Great Lakes region

What It Will Take

There’s a new essay about Buffalo in a national opinion journal, in which the author says Buffalo can’t be saved even with new federal spending.

That’s the central point made by a Harvard economics professor named Edward L. Glaeser. Glaeser recently published a depressing article, “Can Buffalo Ever Come Back? Probably not—and government should stop bribing people to stay there,” in City Journal, Autumn 2007 ( Billions in federal dollars have gone down a rathole here, he says, and more billions shouldn’t come, because they wouldn’t work to fix Buffalo.

I agree that if federal funds come the way they’ve always come, nothing here will change.

But I’ve seen federal spending help distressed cities. And effective progressive policies—especially regionalism, farmland protection, downtown universities and cultural spending—all require lots of public money. I’ve seen the positive economic power of federal purchases from local companies, like Moog in East Aurora, that supply our national defense and keep the dollars circulating here at home. Federal financial support for basic-science research underpins the future of Hauptman-Woodward Institute and Roswell Park. And following that example, I’ve directed local government spending to boost economic activity. As deputy county executive for the past several years, I’ve used my influence to steer millions into architectural preservation, brownfields redevelopment, urban parks and bike paths, cultural support and centralized services—despite suburban politicians’ foolish insistence on gutting county budgets while propping up separate suburban police departments, highway operations and even E-911 call centers, even after we built a state-of-the-art dispatch center to handle those calls.

The return on investment of smart public money is measurable and positive. Yet it’s impossible not to agree that 50 years of federal handouts to Buffalo, especially federal handouts to dumb projects and to welfare spending, have failed to help this community recover from deindustrialization, racial isolation and sprawl.

That’s because federal spending and federal policy have never addressed deindustrialization, racial isolation and sprawl. What’s missing here—and missing in other Great Lakes urban regions—is the federal and state policy commitment that would make new federal money actually effective.

Four decades after the murder of Martin Luther King, Jr., and the apocalyptic fires that gutted Great Lakes downtowns, it’s time for federal and state government policy to awaken to the reality that we can’t afford, and will never be able to buy our way out of, further suburbanization. What’s needed in Buffalo is the rigorous regional land-use planning policy of Toronto, Hamilton and Ottawa, which would best be achieved by regionalized or consolidated city-county government like in Toronto, Hamilton or Ottawa. What’s missing in Ohio, Pennsylvania, Michigan and right here in New York State is the policy and practice that has been in place in the Province of Ontario since 2001.

A smart mix of pro-city policies and public investment could be just the ticket for Buffalo. It’s the same ticket that would work for other distressed Great Lakes cities as well, if and only if the land-use policy changes.

Dumb dollars into smart dollars

Glaeser is right about one thing. Mere public-works projects alone can’t thwart the power of the negative megatrends that have shaped the American cities of the Great Lakes. He didn’t name those forces, but I will—the globalization of labor, suburb-driven rather than regional land-use planning and, of course, racism.

Harvard’s Glaeser concludes that Buffalo should shrink to succeed. Glaeser doesn’t address land-use planning or racism, and certainly neither he nor anybody else on the Right would ever concede that three decades of pro-globalization American trade policy have left Great Lakes cities with the costs of deindustrialization without much re-industrialization. The only places re-industrialization seems to occur is in Congressional districts like US Representative John Murtha’s, south of Pittsburgh, where he uses hundreds of millions in earmarks to subsidize defense contractors who employ tens of thousands of workers who would otherwise be unemployed or in the Sunbelt.

Nobody in their right mind would want to cut the flow of federal money that subsidizes high-tech, defense-related jobs, like those at defense contractor Moog in East Aurora or at Astronics in Buffalo. Only dedicated ideologues and naives would advocate cutting off National Institutes of Health or National Science Foundation grants to institute and university researchers.

But dollars for make-work projects? Glaeser is right: They don’t work.

That’s why I’m skeptical about spending $250 million on a retail complex in Buffalo’s inner harbor—even though saving the Commercial Slip, the Central Wharf and the Canal District was absolutely the right thing to do, because that’s our real heritage, and heritage sells. Retail needs density; retail doesn’t create density. We need policy, and investment, that creates density.

I actively opposed spending $250 million of public money on a proposed new convention center, because small-city convention centers are losers—but I actively supported spending more than $1 million of county money on the Frank Lloyd Wright boathouse, more than $3.5 million on the Darwin Martin House, millions more on other preservation and heritage projects, and about $6 million a year on cultural spending (which needs to become permanent, dedicated spending). Why? Because, frankly, quality sells. Putting more money into the Olmsted parks and parkways is good economics. Quality attracts and retains density.

Building our Buffalo brand on distinctive, high-quality attractions will take public money, and the public money will leverage private money. It already does on a ratio of about ten to one.

But it’ll take more than public money. It’ll take a fundamental change in public policy at both the federal and state level. Local elected officials alone cannot be tasked to change land-use policy. (Not that we shouldn’t try: We have empowered the planners, lawyers and engineers who report to me to lay out their best case for a county-wide planning body with real powers. Draft legislation that would create such a board is pending before the Erie County legislature.)

And even Glaeser, the anti-government writer, gets one part right when he says, “The hallmark of declining cities is having an excess of housing relative to demand. Econ 101 teaches us that any further increases in housing supply will just push prices down more.” The only thing he gets wrong is the word “cities”: Housing oversupply is the hallmark of declining metro areas. (Just ask the mayor of devastated, deindustrialized Youngstown, Ohio, who has decided to follow the prescription “shrink to survive.” Youngstown bulldozes derelict houses and creates green space rather than in-fill housing.)

So even if we have distinctive attractions, we’re doomed if nobody acts to stop the builders of subdivisions from increasing the housing supply beyond the market’s capacity to absorb it. Yet if state policy continues to be that town governments rather than a county planning board should do all the planning, that’s what will keep happening.

The Ontario solution

The answer for Michigan, Ohio, Pennsylvania and New York State may be sitting right in front of our Buffalo noses.

What the Province of Ontario figured out in the 1990s is that sprawling suburbanization costs too damned much. They figured out that high density is cheaper than low density. The per-person and per-area costs of roads, sewer systems, water systems, public safety, schools and utilities are lower where lots of people live together than in places where people are spread out all over the landscape.

The folks in Ontario also figured out that if the poor are isolated in urban centers, they cost everybody more and they stay poor. So the government of former Conservative Party Ontario Premiere Mike Harris chose another path—a path consistent with the “radical” anti-sprawl advocate David Rusk and endorsed by the Brookings Institution as well. Harris aggressively built on the consolidation or “amalgamation” policy of his Liberal and Conservative predecessors, and the result was that not only Toronto but also Ottawa and Hamilton all became regionalized governments—with regional land-use planning—by 2001.

Ontario remains just as chilly and gray in wintertime as Cleveland, Buffalo and Syracuse. Ontario continues to experience the “brain drain” as educated young people leave for warmer, drier places, though immigrants from across the planet arrive to replace them. But by having contained sprawl, the province preserved density in its cities and made the few precious acres of available farmland home to high-value-added agriculture (like wine grapes) rather than to suburban cul-de-sacs. Immigration continues, economic growth continues, industrialization continues, but it happens in a planful, sustainable manner that preserves open space and revitalizes urban centers.

The late Jane Jacobs of Toronto, who gained fame with her anti-suburbanization book The Death and Life of Great American Cities, pointed out an unanticipated benefit of new urban density in her last book. She noted that the economies of dense Ontario cities have become so robust that there is new, locally based manufacturing whose products substitute for imported manufactured goods. Urban density, in other words, has re-created conditions favorable to economic activity that globalization had previously destroyed.

In Ontario, it took a premiere of a province. In Pennsylvania, Michigan, Ohio and New York, it’ll take governors.

Pittsburgh—our new hero?

There is an old industrial city with a troubled urban core, suburban sprawl, brain drain and a control board. What is its conversation these days, and what is the governor of its state doing?

The city is Pittsburgh, the conversation is city-county consolidation and the governor is actively engaged. No surprise: Ed Rendell used to be the mayor of Philadelphia, and he is a realist tinged with pessimism, who once wrote that the cards are so stacked against old cities that our best solutions may still come up short.

But that’s not stopping them in Pittsburgh. There is an active, multi-party, consultant-assisted discussion underway about how to achieve regional regeneration, and city-county consolidation is the centerpiece. The big foundations are involved. The universities are involved. It’s not just the lone crusading county executive of Allegheny County who is making the case, as it was here in Erie County during Joel Giambra’s term. It’s the whole leadership of the regional community.

It’s time Eliot Spitzer of New York, Ted Strickland of Ohio and Jennifer Granholm of Michigan got involved, too.

Rudy or Hillary—does it matter?

The good news is that, after decades of scholarly research pointing out that suburbanization and sprawl are costly, ecologically dangerous, socially toxic and wealth-destroying epiphenomena of fractured governance and home rule, there seems to be some momentum to bring Right and Left together.

Call it a harmonic convergence.

Liberal critics of sprawl and of the automobile culture may have found a way to make their case to real-estate developers—and to tight-fisted, anti-spending budget hawks of both the Right and the Left who distrust big spending projects and don’t want to fund them anyway.

So if a conservative, law-and-order Republican with a pro-city agenda is elected president, the logical pitch is this: Condition federal aid to cities, towns and counties on their compliance with a directive to plan for increased density, unified Homeland Security command, protection for Republican-voting farmers and special incentives for real-estate developers in designated urban zones, because that’s the only way to get the expensive poverty of the cities to stop costing suburbanites so much.

If a liberal Democrat with a pro-city agenda is elected president, the logical pitch is this: The first dollar of wastewater treatment money, highway money, Homeland Security money and housing support goes to zip codes that have had high poverty for two consecutive censuses, because they’ve been starved.

Looming state

deficit: an opportunity?

As for New York State, there is somewhere between $1.5 and $2 billion spent on general state assistance to towns and cities every year. Whenever millions of dollars are at stake, there is great power.

The governor has a great deal of leverage—and could say, in his next budget, that state aid is conditional rather than guaranteed. At present, the plan is for the state to continue to do what the state does—which is to put a little money into a few grant funds, invite applications, set up a review process and then dole it out.

What the governor could do is make state aid to cities and towns conditional upon a plan for compliance with a new regime of regionalism.

It would be far too radical today to demand that cities, counties and towns all consolidate into Ontario-style regional governments (although the Canadians managed to do so…). But surely the state could demand that town governments turn their planning over to a county-wide land-use planning body—not just mandate the tepid half-step of mandating that towns have master plans. (Towns have master plans: Their plan is to think inside their own boundaries and to grow their own individual tax bases, no matter that their “growth” consists of poaching from old urban centers.) The state could command that the Empire State Development Corporation take over all local industrial development agencies, and thus put destructive sprawl-enablers like the Amherst IDA and the Clarence IDA out of business—and if the governor’s appointee as head of Empire State Development enabled sprawl or poaching, the governor could fire his appointee, and thus act like the new sheriff in town. The state could command county-wide accounting, personnel management, assessment, tax collection and other so-called “back-office” functions. Next stop: conditioning state aid on producing, within one year, a plan for integrating policing, road maintenance, sewer districts and water districts with county-wide or regional governance.

The largest parts of the state budget are Medicaid and aid to schools, both over $40 billion each. Just $2 billion goes to cities, towns and counties, with about $800 million apiece going to cities and towns for various functions. Is it too much to expect that 10 percent of the money that goes to towns should be withheld until towns comply with a new regime of county-wide planning, so that town-enabled sprawl stops destroying the value of city real estate? How about ending the handouts to towns that want to buy their own IT systems rather than becoming clients of county IT systems, which in many cases may require only small upgrades to become ready to handle all local back-office functions?

In a word, how about a state budget that reflects a policy directive from on high?

Call it an “Ontario Conference”

Imagine if Governors Eliot Spitzer of New York, Ted Strickland of Ohio, Ed Rendell of Pennsylvania and Jennifer Granholm of Michigan were to join together on ending land-use policies that subsidize sprawl and destroy the Great Lakes cities. They could call it the Ontario Conference, in honor of the pioneers north of the border, whose policy innovations have been realized for seven years or more.

Governors acting together, rather than going it alone, could change the course of economic history. But they could also spark a tremendous political firestorm.

Because every racist in four states would have a field day.

African-American politicians could say that these governors are out to destroy the hard-won gains of all those mayors, council members and representatives who represent jurisdictions and districts whose electorates consist predominantly of visible minorities.

Suburban home-rule advocates—basically, every town supervisor, councilmember, highway super, receiver of taxes and police chief—would screech about the heavy hand of state government taking away personal liberty, threatening community integrity or even, if there is a malaprop-inclined student of Jimmy Carter among them, threatening suburban “ethnic purity.”

In other words, little politicians can all be expected to squeal about the prospective disappearance of their fiefdoms. (It has been my experience that each town board member, town supervisor, city councilmember or state representative believes that s/he is the next member of Congress, governor or senator. The act of achieving elective office is like crack to the narcissists who dominate the noble profession of public service: Addiction is instantaneous, and they all want more and more and more.)

But even here, Ontario policymakers and politicians figured out how to get it done. They used clever messaging, tight deadlines and transitional “assistance” (i.e., they made sure that loud-mouths got state jobs). These tricks were all used to overcome the fear-mongers, and the certainty of cuts in federal and state aid for noncompliance was driven home with messaging that the bigger government was saving taxpayers money, so shouldn’t the smaller government do the same?

I recently spoke to a veteran Ontario consultant, formerly a provincial government aide, who is helping the oil-rich province of Alberta convince newly rich Edmonton and its suburbs to do things together, stop sprawl and take advantage—this time—of the boom economy that has come from the “oil sands” of the north. Out west, just as in Ontario, it was the province that took the lead. The premiere said to the locals, here’s a deadline: Get your act together according to your own design, or we’ll withhold all your aid and then come in and impose a solution. The locals figured it out—and their first act was to do a regional land-use plan that focuses on the city. Actual consolidation of governments may or may not happen. But if the land-use planning prevents low-density development from spreading across the plain, and thus the devaluation of older and urban areas, then the major economic benefit may have been achieved by integrated planning alone.

Cities are the key

Right now, in Buffalo and Cleveland, in Toledo and Rochester and Syracuse, there are cities with “good bones”—institutions, infrastructure and housing stock—that are primed to become magnets for re-migration and re-investment. These urban regions have spent 50 years watching their urban cores hollow out and decline, with those Potemkin Village projects that Glaeser criticizes all over the landscape, and sprawling suburbs that have gobbled up farmland and that have made a few cul-de-sac developers (but precious few homeowners) rich.

Something could be about to happen here that could change all that—or at least to put a stop to the continued erosion of New York’s cities.

At a hearing on October 24 in Buffalo, the governor’s Commission on Local Government Efficiency and Effectiveness got an earful from the usual suspects—Joel Giambra, me, Voice Buffalo, the rapid-transit people and other folks who invest their hearts and their wallets alike in the future of this town, and who would never agree with Professor Graeser that Buffalo is too far gone to save.

The Spitzer Commission also heard from Byron Brown, Buffalo’s mayor, who said, in essence, that Buffalo city government should continue to go it alone, and that the government itself is very efficient and is doing everything right—just look at CitiStat—and did not address the questions of land-use, sprawl, deindustrialization, racial isolation and concentrated poverty inside the 42-square-mile boundary of the municipality.

But Governor Spitzer, who was not present, does not really have the luxury of ignoring those issues. The governor, who is currently constructing the New York State budget for 2008-2009, has a revenue shortfall, a problem with paying for court-mandated assistance to poor schools, an overwhelming rate of increase in Medicaid spending—and a budget deficit of between $4 billion and $7 billion.

The people who advise Spitzer are probably so shell-shocked by Troopergate and the driver’s license controversy that they’ll be loathe to send the boss into battle with every single municipal official in each of the more than 4,000 little governments in New York State.

But that begs the question:

If New York State is so stuck in political distraction that it will eschew any move toward regional planning or Canadian-style consolidation, then is continued, city-destroying sprawl and wasteful localism (still) the official policy of New York State?

Is it New York State’s considered opinion that inequity and decline are the twin policy goals for Great Lakes urban regions?

Is nouveau Jim Crow, urban abandonment and farm-gobbling sprawl the three-headed legacy of the Baby Boomers who now control politics, business, finance and the media?

The cruel fact is that choosing a change of course is, as the much-maligned theorist Niccolo Machiavelli wrote, no guarantee of popularity:

“There is nothing more difficult and dangerous, or more doubtful of success, than an attempt to introduce a new order of things in any state. For the innovator has for enemies all those who derived advantages from the old order of things, while those who expect to be benefited by the new will be but lukewarm defenders.”

What policy-makers do today will have impact for decades to come. The refreshingly long-range thinking of UB’s John Simpson, who plans for the year 2020, should stimulate our state leadership to think similarly. The question they ask today, in Albany, should at least be this: When my second term is up in 2014, do I want Buffalo to look like Hamilton or Toronto or Ottawa, or do I want an “I told you so” from Professor Glaeser?

Bruce Fisher is Deputy Erie County Executive, and a rower.

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