Thursday, August 2nd, 2012
A few recent news stories caught my eye that I wanted to highlight.
Transport Tax Crushed at the Polls in Atlanta
The proposed sales tax increase in Atlanta that would have funded a large capital program for transit and highways went down to a bigtime defeat. This was interesting since capital referendums generally seem to do well.
There’s still a lot to process on this. Richard Layman had some thoughts on his blog that are worth a read. A couple things stuck out at me.
First is the unlikely anti-tax coalition of the Tea Party, the Sierra Club, and the NAACP. When I noted how the Tea Party types and the NAACP had joined forces in Cincinnati to oppose a streetcar, I was assured by locals this was not the start of a trend but came from the personalities involved. But here we see it again. I’m not sure if this is the start of a trend or not, but it’s something to watch. I’ve noted for a while now that the populist wings of the left and the right are fed up with the establishments of their respective parties. At some point could there be a left-right populist alliance against the big money interests? I’m not saying that’s the case here, but there are interesting points to ponder.
The second is where this leaves at Atlanta. As I noted in my piece “Is It Game Over for Atlanta?.” this is a troubled region that lost huge amounts of jobs, saw the worst erosion of per capita income of pretty much any big city, and even saw per capita GDP declines. And it’s choked with traffic and other assorted infrastructure ills. Meanwhile, places like Charlotte, Raleigh, and Nashville offer a lot of the Atlanta experience without the same level of problems. Atlanta is no longer the only game in town in the Southeast. Maybe a big infrastructure program isn’t what Atlanta needs, but if not, what’s the plan?
Lastly, with the federal spigot drying up and states broke, urban regions are going to have to find ways to invest in their own highway and transit infrastructure the way they’ve largely invested in their own airports. We see many cities stepping up and voting in infrastructure spending (albeit excessively skewed to transit in my view) while others vote it down. If this keeps going, we’ll get a real life test of where the choice of investment vs. disinvestment gets you.
Google’s Motorola Mobility Unit Moving to Downtown Chicago
In the wake of Google’s acquisition of Motorola Mobility, it is moving the headquarters and 3,000 employees downtown from suburban Libertyville. This is being touted as a huge coup for Chicago’s tech hub ambitions.
From a regional perspective, this is a net nothing. However, it clearly goes to show the ongoing power of the Chicago Loop not just as a tourist and quasi-public sector downtown like so many, but as a bona fide commercial powerhouse. I can’t prove this with data, but it seems to me that Chicago may have the strongest trend of any city in America of corporate relocations from the suburbs to downtown.
This is also a tribute to Rahm Emanuel’s star power. Economic development via Rahm’s Rolodex appears to be working. He started courting Google’s then CEO-Eric Schmidt for major investment in the city some time ago. This goes to show the advantage a city like Chicago has. Very few cities have mayors that can get any CEO in the country on the phone whenever they want. Chicago does.
On the other hand, I can’t agree with the schadenfreude some are feeling over the prospect of wind swept parking lots at vacant suburban office complexes. This is really no different than suburbanites who left rejoicing over the city’s ills. Ultimately, Chicagoland is a single economic region. And I hate to break it to you, but while moves like this make huge headlines, the majority of the economic and population growth will continue to be in the suburbs. At some point the burbs may get fed up with Rahm’s poaching, and that would bode ill for the type of regional cooperation that’s critical needed to move the area forward. I think Rahm should think about bringing his era of active recruitment of suburban firms to a close in the reasonably near future.
Why Detroit Deserves to Lose
Yet another saga out of Detroit illustrates why this city and region have fallen so far. The city has been hemorrhaging people and jobs for decades, has likewise been mis-managed for decades, and is flat broke. Basically, the city would go bankrupt without state financial support. Unsurprisingly, when the state gives you money, they put strings on it. This has resulted in a big tussle back and forth over the degree of state control, some of which is legitimate and natural.
But a recent debate over the future of Belle Isle, a Frederick Law Olmsted designed park on an island in the Detroit River that’s owned by the city, has shown the type of attitude that’s held Detroit back so long.
The city is broke and can’t afford the park anymore. The park also needs major repairs. The state said they’d take it over under a long term lease as a state park and make the investment to fix it up. Sounds like a win-win to me.
Apparently not to Detroit’s leadership, which has gone apoplectic. Saying “hands off our island” they are protesting state control over the park. What do they want instead? It’s pretty simple. As someone put it, “state support without state control.” In other words, give us your money and go away.
This is the exact same attitude Detroit has taken on everything. It’s why, for example, the Cobo Center sat in a decrepit state for so long with no action, for example. Detroit wanted suburbanites to pay, but wanted the city to retain control of the asset. We’ve seen where this has gotten Detroit.
Regarding Belle Isle, Mayor Dave Bing said, “I have never in my 46 years in this city seen a governor of the state of Michigan involved in city politics like this one.” Given the state of Detroit today, one can’t help but ask, what took the state so long? It should have intervened long ago.
As always, Detroit’s leaders continue to try to point the blame at outside people and forces instead of taking a cold hard look in the mirror. These guys just aren’t serious.
Louisville Aging Cluster
The New York Times has a piece on Louisville’s efforts to build an economic cluster around care for the aging. I can’t say how successful this is likely to be, but I think it illustrates good thinking. Everybody and their brother is saying their economic future is some variant of life sciences (and high tech, advanced manufacturing and logistics, and green tech). They can’t all win in those general markets. And Louisville in my view really isn’t that well positioned.
So rather than try to make some big generalized push, the idea is to look for a specialized part of the industry where you do have more leading capabilities, and try to focus on that. That’s exactly what Louisville is doing here with aging care. There are supposedly something like 500 local companies doing work related to that. It’s also right down the rails of the demographic changes happening in America and the world. We’ll see how this plays out, but this sort of more specialized thinking is how cities ought to be looking at economic development strategies.
Sunday, November 20th, 2011
[ I wrote this before the 2010 Census results came out that showed Atlanta to have had the most over-estimated population of any large city in America. The Census Bureau had projected huge central city growth there, but in the results came in flat instead, falling a full 123,000 below what was expected. I have elected not to update the piece to reflect these numbers, but keep them very much in mind. The story in Atlanta seems to be even worse than I'd previously considered - Aaron. ]
Atlanta is arguably the greatest American urban growth story of the 20th century. In 1950, it was a sleepy state capital in a region of about a million people, not much different from Indianapolis or Columbus, Ohio. Today, it’s a teeming region of 5.5 million, the ninth largest in America, home to the world’s busiest airport, a major subway system and numerous corporations. Critically, it’s also become the country’s premier African-American hub at a time of black empowerment.
Though famous for its sprawl, Atlanta has also quietly become one of America’s top urban success stories. The city of Atlanta has added nearly 120,000 new residents since 2000, a population increase of 28 percent representing fully 10 percent of the region’s growth during that period. None of America’s traditional premier urban centers can make that claim. As a Chicago city-dweller who did multiple consulting stints in Atlanta, I can tell you the city is much better than its reputation in urbanists’ circles suggests. I loved working there and I could happily live there.
Yet the Great Recession has exposed some troubling cracks in the foundations of Atlanta’s success. Perhaps it’s too early to declare “game over” for Atlanta, but converging trends point to a possible plateauing of Atlanta’s remarkable rise, and the end of its great growth phase.
Atlanta grew strongly in the 2000s, with growth of over 1.2 million people, a 29 percent rise that beat peer cities like Dallas and Houston. But look at the recent past and see a very different dynamic. Domestic in-migration has cratered, only reaching 17,479 last year, or 0.32 percent. While migration did slow nationally last year due to the economy, Dallas and Houston continued to power ahead. Dallas added 45,241 people (0.72 percent) and Houston added 49,662 (0.87 percent). Even Indianapolis added 7,034, but that’s 0.42 percent on a smaller base, meaning Atlanta is actually getting beat on net migration by a Midwest city.
With growth faltering, Atlanta’s jobs engine is also sputtering. With over one million new people, Atlanta added almost no jobs in the last decade. From 2001-08, its GDP per capita actually declined by 6 percent. And over that same period its per capita income declined from 109 percent of the U.S. average to 95 percent, a stunning 14-point drop that was the worst of any large city.
Atlanta also has a myriad of infrastructure problems. It suffers some of the highest water and sewer rates in the nation, double those of New York City. As former Councilwoman Clair Muller put it, “I’m not sure being No. 1 in the country for water and sewer rates is a good selling feature.” It also faces a shutoff of water from Lake Lanier — a political issue, but one that highlights that Atlanta has done little to expand water resources in the last 50 years.
The biggest infrastructure issue for Atlanta is transportation. Atlanta’s freeways are among the world’s widest, but this disguises the extent to which its roadway infrastructure is woefully insufficient. Atlanta has a simple beltway and spoke system similar to Indianapolis and Columbus, much smaller cities. Other big cities like Houston, Dallas, Minneapolis and Detroit have much more elaborate systems that don’t rely on a single ring road, but instead webs of freeway with multiple “crosstown” routes.
But Atlanta’s greatest road problem lies in the lack of arterial street capacity. Atlanta’s suburban arterial network is mostly former winding country roads, many of which have never been upgraded to handle current demands. Most upgraded streets are radial routes, not crosstown ones, which forces even more traffic onto the overloaded freeway network.
For those who prefer transit, Atlanta hasn’t invested there either. It built the MARTA heavy-rail system as an extremely forward-looking transportation investment, mostly in the 1970s and early ’80s. This was built before Portland’s system and is far better than light rail to boot. But there has been almost no expansion of the network. The state of public transport has been largely frozen for some time. Meanwhile, Dallas, Houston, Phoenix and others have invested billions.
Bad traffic congestion and other infrastructure ills didn’t matter much when Atlanta was the only game in town. For a long time, anyone who needed a presence in the Southeast found Atlanta the easy or even only answer.
But no more. Atlanta is now surrounded by upstart, faster-growing cities such as Charlotte and Raleigh-Durham, Nashville and Charleston, S.C. — all in many ways with ambitions once characteristic of Atlanta.
Atlanta’s problem lies in its insufficient differentiation from these other places. Other than the airport, a clear major asset to Atlanta, how much do you actually lose by moving to Charlotte or Nashville? Your commute will even improve. These other cities also now have the talent to compete for a lot of the business Atlanta used to pick up without working for it.
Charlotte chamber of commerce chief Bob Morgan said, “To understand Charlotte, you have to understand our ambition. We have a serious chip on our shoulder. We don’t want to be No. 2 to anybody.” That’s the way Atlanta used to talk.
Atlanta does seem to realize it’s in a different competitive world. Like Chicago and other growth stories before it, as Atlanta got big and rich, it decided it needed to get classier as well. To go for quality, not just quantity. And to embrace a more urban future for its core.
But it might be too little, too late. Atlanta is urbanizing, but despite the huge influx of people into the city, it’s not there yet. Atlantic Station got built and attracted lots of press, but numerous other mixed-use projects were killed by the poor economy. Ambitious projects like the Beltline park and transit loop lack funding.
Atlanta is left in a sort of “quarter way house,” caught between its traditional sprawling self and a more upscale urban metropolis. It offers neither the low-traffic quality of life of its upstart competition nor the sophisticated urban living of a Chicago or Boston.
Cities, like companies and people, go through a life cycle. There’s the youthful founding, the explosive growth phase, then maturity and, for some, decline. Atlanta has been one of the boomtowns of the current age. Like other cities before it, that growth will come to an end one day. It is then that we’ll see if, like Chicago and New York, Atlanta will succeed as a mature region and truly claim a place in the pantheon of great American cities, or instead decline or stagnate like so many others did.
Atlanta is far from dead, but it may be facing the beginning of the end of its growth cycle. What will Atlanta be when it grows up? The answer will be the true measure of its greatness as a city.
This column originally appeared in the Atlanta Journal-Constitution on October 26, 2010 and is adapted from a post that originally appeared in New Geography.
Wednesday, May 19th, 2010
My latest post is online at New Geography. It’s called “Is It Game Over for Atlanta?”
Many of America’s large cities went through a period of hypergrowth before leveling off: Chicago, Detroit, Los Angeles, etc. Some transitioned to a successful maturity, others did not. Today’s growth stories like Houston, Dallas, and Atlanta will be no different. One day their growth period will end, then we’ll see what they are really made of.
In my piece I outline the evidence that Atlanta might be the first of these to be peaking out, thanks to a surprising plunge in in-migration, a lack of infrastructure investment, declining ambitions, new competition, and a recession-interrupted transformation to a more urban city. Other than for its airport, there’s little reason anyone has to be in Atlanta these days. If Atlanta were a stock, I’d be thinking about shorting it and buying into some of its scrappier regional upstart competition. It’s time for a gut check in the Capital of the New South.
Thursday, March 4th, 2010
My latest post is online at New Geography. It is called “The 10% Solution for Urban Growth“. My thesis is that for cities below the top tier (tier one’s are already seeing a major urban influx because of their high quality product and economic changes), the best policy is to seek to capture about 10% of net new regional growth for the urban core. If we can get more, great, but let’s start with that base goal and develop a strategy to get there.
This might seem particularly unambitious, but it would actually be totally transformative:
Cincinnati provides another example. It is a metro growing a bit less than the national average, but still adding people at a rate of about 150,000 per decade. The city of Cincinnati declined from a peak of 503,998 in 1950 to 333,336 today, a loss of 170,000 people. Again, if the city captured 100% of just regional growth, in little more than a decade it would be back to a record high population. That’s not realistic of course, but 10% of that total, or 15,000 people, would still make a tremendous impact on the city. Like Indianapolis, there’s already some sign of an inflection point, as the city population began growing again in the 2000′s.
Can this 10% solution really happen? The answer is a resounding Yes, because it is already happening in Atlanta. Its reputation as a sprawlburg overshadows the fact that it is experiencing one of America’s most impressive urban core booms. The city of Atlanta has added almost 120,000 new residents since 2000, an increase of 28%. This is a mere 10.5% of the metro area’s growth during that time – but it has totally changed the city. Atlanta lost over 100,000 people from its 1970 peak, but is now at an all time high.
I know many people would love to see a more aggressive return to the city, and even view it as an imperative for environmental or other reasons. But just because it is desirable, doesn’t mean it is going to happen. The numbers just don’t add up for it, which you can read about in my piece.
Also, excessive rhetoric about the need for mass re-urbanization is actually counterproductive outside of those few cities where people are already primed to accept it. James Howard Kunstler comes to mind. Don’t get me wrong. I own some of his stuff and enjoy reading it. He’s a great writer and I enjoy a good screed as much as anyone from time to time. But he obviously has nothing but contempt for the suburbs and the people who live in them. Given that in most places in America, suburbanites are in the majority, and we need their votes for the Congressional and state action we have to have to reinvigorate our cities, I don’t think picking a fight is advisable. This sort of over the top writing or advocacy for change only scares people and lends itself to caricature as urban advocates wanting to force people back into overcrowded tenements and such, when I’m not aware that’s actually the case.
Again, if we can get more than 10%, great. I’m all for it. But I’d rather set a modest, realistically achievable target that we can hold ourselves and our leaders accountable for reaching than a pie in the sky vision of growth that isn’t likely outside of places like New York City. And in practice today, few cities are getting anywhere near 10% of regional growth in the urban core.
Obviously this only works if your region is growing. If you are stagnant or shrinking, you’ve got a bigger challenge on your hands. There the imperative is to restart the regional economic and demographic engine. Hopefully the core can play a role in doing that.
Saturday, May 10th, 2008
I saw an interesting thread on this over at skycrapercity, and thought I would repost some of the renderings and photos here. Note that many of these proposed developments are actually in the suburbs. I’m not endorsing these developments by posting them here, but thought they would be of interest to readers.
Proposed in Roswell
From this the AJC: “The man who turned an abandoned steel mill in midtown Atlanta into the booming Atlantic Station minicity unveiled his plans Tuesday for bringing that style of intown living to the northside suburbs.
The $2 billion development, which would be built along Ga. 400 in Roswell, calls for 3,000 residential units and as much as 750,000 square feet of office space in five high-rise towers.
The high-rises would be surrounded by European-style plazas, a 2 1/2-acre lake, a community center and lots of green space — even on rooftops, where people can gather high above their community.”
Here was one called Global Station proposed for Gwinett County. Supposedly it is dead, which might be a good thing since the design is questionable.