THe Blog

December 08, 2015

A New Urban Opportunity Agenda

Courtesy: City Journal


Edward Glaeser, in this City Journal article, calls for a more forward looking urban policy that unleashes urban entrepreneurship, creates a competitive education system and reduces barriers for building affordable housing to lead the fight for economic opportunity.


"........Gotham had opted for a full-throated progressive mayor, a man who, in the hope of reducing inequality and helping the city’s poor, favored traditional public schools; steep taxes on those making more than $500,000; a $15 local minimum wage; and extensive regulatory requirements for the construction industry, imposed in the name of affordability. As Bill de Blasio may have started to learn, however, mayors with such huge expectations have often overseen urban failure. In the sixties, liberal John Lindsay’s egalitarian mayoralty left New York with more dangerous streets and less balanced books—and no more equal. As the redistributive mayor of Detroit from 1974 through 1994, Coleman Young—a hard-left politician who had supported Marxist Henry Wallace over Democrat Harry Truman in the 1948 presidential race—watched his city implode, burning itself every Devil’s Night and suffering nation-leading poverty and murder rates. The reason isn’t hard to grasp. The core deliverables of city government—safe and clean streets, good schools, a favorable economic environment—are hard enough to achieve and maintain without also seeking to eradicate locally the inequalities that abound in our highly unequal world."

".....A meaningful center-right alternative to the new urban progressivism....must show how it can do more to fight poverty and promote economic mobility than can any liberal fix. This next urban agenda, which respects and draws on the power of free people and free markets, should seek to empower urban entrepreneurialism, build a competitive and regularly assessed urban education system, and unleash a vibrant market for labor and housing. Cities can lead the fight for economic opportunity but only if they’re places of private entrepreneurship and public innovation, not battlegrounds for class warfare."

" urban progressives aspire to close the gaps in wealth that exist between their cities’ richest and poorest residents—and they see local redistribution as the way to do it. There’s so much money out there—they reason—that surely we can solve everything by hiking taxes on the wealthy and pouring taxpayer money into new social services. But their philosophy runs smack into a central theme of urban economics: heavily taxing the rich locally would just encourage them to move out, looking for friendlier tax environments in other cities or states. Coleman Young’s efforts to right social wrongs may have produced a more equal Detroit—but it was an equality of desperation, since wealthier Detroiters just moved outside the city limits. And how is it ethical or just for antipoverty programs to be paid for primarily by the neighbors of the poor?"

 "A new urban opportunity agenda can experiment with various new ways to uplift the poor. If such experiments are carried out with limited cash outlays, they could create a model for national policy, too. After all, in the current environment, with Congress under Republican control, there’s unlikely to be much federal enthusiasm for any new taxing and spending on social problems." He says. 

"Nurturing entrepreneurialism should be a fundamental component in an opportunity agenda. Full of suppliers and customers, cities have always been great places for entrepreneurs. And entrepreneurship is a potent tool in fighting urban poverty because it provides a way for poorer residents to help themselves—often by creating jobs or offering services for their own community. Think of immigrant neighborhoods, where starting a small grocery store or a nail salon has become a common path upward for many new Americans."

" For free-market supporters, regulatory relief is a better way to help urban entrepreneurs......One way to tackle regulatory relief would be for cities to set up one-stop shopping for business permits. Instead of dealing with a dozen agencies to get the needed permissions to open, as is too often the case today, an urban entrepreneur could visit just one permitting authority to get the green light for a new business. The permitting authority might still draw on the expertise of the fire department or public-health officials for safety questions, but it would significantly speed up and improve the regulatory experience of start-ups."

"Education is perhaps the most important tool in opening up greater economic opportunity for the urban poor....Yet the past two decades of education reform have taught us that improving urban public schools is anything but easy. Many administrative barriers and entrenched interests—above all, powerful teachers’ unions—get in the way of fixing underperforming districts. Just throwing more money at the schools seems to do almost nothing to boost academic outcomes..."

"For many on the left, urban ills like long-term poverty and inequality and lack of affordable housing can be fixed by regulating businesses more aggressively...they argue, the bad behavior of businesses helped cause those problems. So ....Why not require developers to build affordable housing as a condition of doing other business in the city?....[but] Such regulation also induces behavioral responses that often run completely counter to the intent of the regulation...."

"Another barrier to the building of new urban housing is the property tax. Currently, cities tax the total value of real estate on a site. If you build more, in other words, you pay more....A tax on the value of land can probably raise just as much money as a tax on real estate, but it doesn’t deter construction."

"We need a more forward-looking urban-policy approach. Unleashing urban entrepreneurship, creating a richly competitive educational system providing everything from effective pre-K to up-to-date vocational training, and reducing barriers to building lower-cost housing and hiring less skilled workers should be primary elements of that approach." 


Read the entire article here. 

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