After a decade of hyped-up rhetoric about an urban "renaissance," the word from city halls across the country these days is decidedly downbeat.
In the 1980s, a proliferation of downtown office towers, festival marketplaces, convention centers and hotels was hailed as evidence that older, decaying Frostbelt cities had made a miraculous comeback from the crisis of the 1960s. "Messiah mayors" such as Baltimore's William Donald Schaefer and Cleveland's George Voinovich were credited with engineering remarkable turnarounds in their cities.
Today, however, only an ostrich could ignore the renewed sense of crisis enveloping urban America. Increasing levels of inner city poverty, rising rates of crime and inadequate housing, cuts in social services and collapsing school systems -- these are now the images of urban America. A recent article in Newsweek even posed the question: "Are cities obsolete?"
In no city has the shift from a renaissance to crisis mentality been more abrupt than in Baltimore. Only five years ago, respected urban affairs writer Neil R. Peirce dubbed Baltimore the "Cinderella city" of the 1980s, "the town other cities seek to copy to revive their own decaying downtowns."
Today, despite the glitter and bustle of the Inner Harbor, Baltimore is so poor that Mayor Kurt L. Schmoke proposes saving money by closing the public schools for a week and shutting down branches of the public library -- all this by a mayor who proclaimed Baltimore "the city that reads." The same Neil Peirce and associates, in their 1991 report "Baltimore and Beyond," now conclude that Baltimore "is becoming poorer and poorer, losing more middle-class residents every year. Without some real help, Baltimore is in danger of becoming America's next Detroit or Newark."
What happened? Why, after a decade of renaissance rhetoric, do cities like Baltimore find themselves facing full-blown urban crisis? And what are the prospects for older, Frostbelt cities in the 1990s?
The evidence now seems overwhelming that nothing resembling genuine renaissance occurred in urban America in the 1980s. There was, of course, a spectacular boom in downtown corporate offices and an impressive array of public-private redevelopment projects in cities across the Frostbelt. But boosterish mayors over-sold these developments as indicators of a city-wide economic rejuvenation. As historian Jon Teaford has written, this was an era in which "messiah mayors were dedicated to perpetuating the public relations hype and putting on happy faces."
Stripped of the hype, though, the "renaissance" activities of the 1980s can be best understood as the urban manifestation of the Reagan-era "casino society."
Urban redevelopment, '80s-style, was a frenzy of real-estate speculation and deal-making built on tax gimmicks, public subsidies and easy credit that obscured the economic devastation that continued throughout most of the city. Reagan-era policies, particularly the liberalization of depreciation allowances on buildings, turned downtown offices, hotels, restaurants and shopping malls into first-rate tax shelters.
The willingness of "entrepreneurial" city governments to foot much of the redevelopment bill -- in the form of direct subsidies, tax abatements, tax-exempt financing, infrastructure, land write-downs and the like -- enticed more and more speculation. However, like American economic policy generally in the 1980s, this kind of urban redevelopment epitomized short-term deal-making instead of productive, long-term investments.
This short-term thinking is seen most clearly in the neglected social and human infrastructure of "renaissance" cities in the 1970s and 1980s. Even observers such as MIT's Bernard J. Frieden and Lynne B. Sagalyn, thoroughly sympathetic to the "Downtown, Inc." approach of renaissance cities, acknowledge that in order to generate budget savings to subsidize developers' profits, mayors sacrificed "public employees and the residents who needed them to protect their neighborhoods, teach their kids, and care for their health."
Baltimore provides an apt illustration of this trend: between 1971 and 1985, when then-Mayor Schaefer was providing millions in incentives to developers, municipal spending on public education, in inflation-adjusted terms, was slashed by more than 25 percent.
Nothing could more tragically illustrate the perverse short-term logic of the '80s-style urban "renaissance." The true long-term economic future of the city, an educated and productive labor force, was seriously compromised to help provide resources for tourist attractions, convention facilities and specialty retailing.
Ironically, the costs of this strategy are painfully obvious to local business leaders today, as many regard Baltimore's disastrously flawed public schools as the city's most serious impediment to economic development.
Thus, while the 1980s downtown casino of Frostbelt cities yielded handsome profits for developers and plaudits for entrepreneurial mayors, few direct benefits reached city neighborhoods. Many of the jobs created, particularly the best ones, went to suburbanites. For example, nearly 80 percent of the managerial and professional jobs in downtown Cleveland and St. Louis are held by suburbanites. (The figure is 60 percent in Baltimore).
Compounding the failure of downtown redevelopment to deliver jobs for city dwellers was the continuing decline of urban manufacturing and deep cuts in urban-oriented federal spending the 1980s. The result: social and economic devastation in city neighborhoods. In fact, the most significant trend in Frostbelt cities in the 1980s was not downtown revitalization, but the growing concentration of poverty and social distress in the predominantly black ghettos of inner cities.
In Cleveland, for example, estimates are that the city's poverty rate increased from 27.2 to 40.6 percent during the 1980s; by 1991, more than half of Cleveland's black population was poor.
Throughout the Frostbelt, as sociologist William Julius Wilson has argued, the number of inner city neighborhoods in "extreme poverty" -- with rates that exceed 40 percent -- rose precipitously, particularly as an emergent black middle class began leaving the ghetto for suburbia.
Blacks had been particularly reliant on production jobs in city factories; thus, the restructuring of Frostbelt economies, particularly the relocation of industrial employment away from central cities, has had particularly devastating consequences in black neighborhoods. In many such inner city areas, local income now is disproportionately derived from welfare payments and criminal activity.
In Milwaukee, for example, estimates are that more than 43 percent of the income for black residents in the city comes from government transfer payments. In city after city, the conclusion is inescapable: the private sector has utterly failed to develop adequate employment prospects for inner city residents.
In short, despite the renaissance hype of the 1980s, the urban crisis never really went away -- and, in a variety of ways, deepened considerably. Moreover, cuts in federal aid, combined with the ongoing exodus in the 1980s of middle class taxpayers from cities to suburbs, have left city governments with fewer and fewer resources with which to deal with pressing human needs or creatively rebuild their local economies. By 1991, virtually all Frostbelt cities reported fiscal stress with some major ones, such as Philadelphia, on the brink of bankruptcy.
Most ominously, as Robert Reich, a Harvard political economist, has pointed out, in metropolitan America's increasingly polarized society, the economically mobile have "seceded," mainly into homogeneous suburban enclaves where their "earnings need not be redistributed to people less fortunate than themselves." Or, if they remain in central cities, secessionists carve out privatized existences in which their children are sent to private schools and in which they address many of their needs (security, recreation, sanitation) through private rather than public services.
Either way, secessionists staunchly resist paying the taxes to support the public investments most needed in predominantly black and Hispanic urban neighborhoods -- as advocates of the Linowes plan discovered last year in Maryland.
The upshot of all these trends is a gloomy and potentially explosive prospect for urban centers in the 1990s. Clearly, progress must be made in three areas if cities such as Baltimore are to survive their latest crisis and perhaps inaugurate in genuine renaissance:
* Regional cooperation.
Despite their obvious difficulties, Frostbelt cities generally remain the economic hubs of their regions (Detroit is one obvious exception: there is now more office space located in suburban Troy and Southfield than in downtown Detroit). More than half of Baltimore County's working population works in Baltimore City.
In short, while many suburbanites may have "seceded" from cities, they still have a stake in urban fiscal health, and they still enjoy cultural and social activities centered in cities. With some responsible local leadership, and perhaps some political hardball, this economic interdependency should be nurtured into systematic cooperation in revenue sharing and other areas.
* Job creation.
Conservatives may rail about a dysfunctional, non-working urban underclass, but the fact is that, even in an economy based primarily on services, large-scale job creation reduces poverty. In Boston between 1980 and 1988, when conditions approached full employment, the poverty rate dropped from 18.0 to 11.5 percent; among black families it declined from 29.1 to 13.4 percent. Cities can do some things in this area, but the federal government must undertake a massive urban job creation program, including productive public works employment, if ghetto poverty is to be alleviated.
* Education.
Mayor Schmoke has it right, in theory if not in execution: improving public education is urban America's number one priority. Along with crime, concern about schools is the leading reason cited by taxpayers for leaving cities. Moreover, educational competence and literacy are increasingly vital if city youth are to effectively participate in an economy marked by rapid technological and workplace change.
There are no magic panaceas, although as Jonathan Kozol has eloquently argued, the "savage inequalities" of educational financing need to be fundamentally overturned and more resources made available if we are to create any meaningful opportunities for children in inner city schools.
Marc Levine is director of the urban studies program and the Center for Economic Development at the University of Wisconsin-Milwaukee. He is working on a history of the Baltimore "renaissance."
vTC