Planning for a New Century: The Regional Agenda

Planning for a New Century: The Regional Agenda

by Jonathan Barnett

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ISBN-13: 9781597266161
Publisher: Island Press
Publication date: 04/16/2013
Sold by: Barnes & Noble
Format: NOOK Book
Pages: 232
File size: 4 MB

About the Author


Jonathan Barnett is professor of city and regional planning at the University of Pennsylvania, an urban design consultant to many cities and suburbs, and author of The Fractured Metropolis (Harper Collins, 1996).

Read an Excerpt

Planning for a New Century

The Regional Agenda


By Jonathan Barnett

ISLAND PRESS

Copyright © 2001 Island Press
All rights reserved.
ISBN: 978-1-59726-616-1



CHAPTER 1

Regional Imperatives of Global Competition

Theodore Hershberg

The Global Economy, Regions, and Regional Cooperation

Americans are growing more aware of the metropolitan areas or regions in which they live. This new consciousness is developing in metros as diverse as San Francisco, Portland, Phoenix, Denver, Austin, New Orleans, Atlanta, Chicago, Philadelphia, Baltimore, and Buffalo. It is accompanied by an interest in regional cooperation because, in the absence of regional government, this strategy makes it possible for central cities and their surrounding communities to seize opportunities in a timely fashion and solve problems that cut across the political boundary lines that separate them.

This growing interest in regions and regional cooperation springs from many sources. There is recognition that the solutions for many serious problems facing cities are embedded in metropolitan contexts. The devolution from federal to state governments of both decision-making authority and funding has persuaded many people that cities and their surrounding suburban communities stand a much better chance of securing these funds and policy controls if they work together as a region than by competing with each other.

As cities and suburban communities realize that the de facto economic development strategies of the past three decades—federal spending on health care and defense—have stopped generating substantial numbers of new jobs, they have begun to collaborate on strategies to move their regions in new economic directions. Particularly in the Midwest and the Northeast, where suburban economic growth has been sluggish because the steady flow of jobs and people out of central cities over the past thirty years has finally slowed, business leaders have taken a new interest in regional economic development strategies.

But persuasive as these arguments may be, they pale in significance next to the importance of the global economy in explaining the sharply growing interest in regional thinking and regional action. When historians chronicle the last quarter of the twentieth century, they will be unanimous in concluding that its defining phenomenon was the emergence of the global economy. In 1960, imports and exports equaled 11 percent of the American economy. By 1990, they accounted for 25 percent and, by that decade's end, they exceeded 30 percent. America already exports 33 percent of its total agricultural output. Imports and exports account for 40 percent of Fortune 500 company profits and 20 percent of corporate profits overall. Forty percent of commercial loans are made by foreign lenders and 30 percent of automobiles sold here are made abroad. Between 1992 and 1997—that is, before the economic slowdown in Asia—one in every three new jobs in America was created in the export sector. Ten percent of the nation's $6 trillion in private pension funds are invested in Asian companies alone. Whether one embraces or laments these changes, the evidence makes clear that the global economy has arrived and is expanding rapidly.

Three major forces drive the global economy. The first is free trade. Although it is more accurate to say "managed trade"—ways of regulating and taxing the goods and services that flow across national borders—the long-term trend is unmistakably toward eliminating barriers and creating free markets worldwide.

The second force is global capital markets. Money is the lifeblood of business and vast flows of funds now characterize the global economy. Although the value of goods and services in the American economy totals roughly $8 trillion annually, every working day $2 trillion circulate electronically among banks around the world. Although it remains easier to acquire venture capital from domestic lenders, for the first time in modern history these funds are available on a global basis, meaning that money can now be found to finance good deals regardless of their location.

Third, we are in the midst of an extraordinary revolution in terms of communications and information technology, which has a lot to do with facilitating both global trade and global capital markets. To illustrate what is happening, Nicholas Negroponte, director of the media lab at the Massachusetts Institute of Technology, relates a story in his recent volume, Being Digital. A group of youngsters are asked whether they would choose a million dollars or a penny-a-day doubled for a month. Most immediately take the million dollars; the brighter students start counting on their fingers, but when they arrive at the middle of the month and their total is still in the low three digits, they too elect to take the million dollars. But if the month is February, the total is a bit more than $1 million; if the month is June, the total exceeds $5 million; and if the month is January—that is, a month with thirty-one days—the total is $10.37 million!

Why relate this story? The doubling occurs every day, Negreponte explains, but the payoff really comes at the close of the month. Up until now all the talk about the information superhighway has been a lot of hype, but as he points out, we have come at last to the "end of the month" where truly remarkable changes are under way.

The Internet is changing how people communicate and how commerce is conducted. Today 200 million people (112 million in America) are on the net, and this number is expected to reach 1 billion by 2003. Estimates for the value of "business to business" sales on the Internet in 2004 range from $2.4 trillion to $7.3 trillion, which helps to explain why Internet stocks are going through the roof. Our televisions, computers, and telephones, courtesy of new common digital standards, will soon be merged. Within six to ten years, technology will make it possible to link every person on the globe via low-orbit satellite and portable cell phones equipped to handle video and data as well as audio. The smartest people in corporations and institutions of all types around the globe are thinking about how to position their organizations to take full advantage of these remarkable changes.

The most important lesson the global economy teaches is that regions—not cities or counties—will be the units of economic competition. The view that regions are becoming the key units in the future is widely held. According to Victor Petrella, chief of forecasting for the European Union, "Within 50 years, nation-states will no longer be the most relevant socioeconomic entities and the ultimate political configuration. The real decision-making power of the future will be transnational companies in alliance with city-regional governments." Kenichi Ohmae, a former partner at McKinsey & Co. and author of a dozen books on corporations and global trade, writes about it this way in The End of the Nation State: The Rise of Regional Economies: "The noise you hear rumbling in the distance is the sound of the later 20th century's primary engine of economic prosperity stirring to life. Companies will no longer organize their international activities on the basis of national borders. Region-states have become the primary units of economic activity through which participation in the global economy actually takes place."2 Finally, Neal Peirce, the nationally syndicated columnist, and Curtis Johnson, his coauthor in "Peirce Reports" on seventeen American regions, explain it this way: "Only when the central city and its surrounding counties work together, will they be able to compete effectively. It won't be America vs. Japan or Germany, but Greater Philadelphia vs. metropolitan Stuttgart or metropolitan Lyon."

Why are regions understood as the basic units of domestic and worldwide competition? The creation of goods and services depends upon key resources, labor force, transportation, infrastructure, and environment, each of which is regional in scope. In America, roughly half the commuting population in metropolitan areas crosses a county line each working day. Regions must cultivate a quality indigenous labor force, or by definition they become less competitive, because the higher wages employers have to pay to attract qualified labor from other regions increases their costs. All transportation networks—roads; highways, mass transit, and rail—are regional in scope. So, too, is the infrastructure, whether water mains or sewer lines or underground cable that carries digital signal. The environment can only be understood as a regional system. Neither polluted air nor contaminated water respect political boundary lines. They flow freely within watersheds and move with the prevailing winds.

Moreover, only regions have the scale and diversity to market goods and services on a global basis and to attract foreign investment. When growth or unemployment rates are reported for the nation, a single figure is provided. But these numbers are statistical averages of economic activity across hundreds of metropolitan statistical areas with significantly different rates. The national economy has always been understood as an aggregate expression of our many metropolitan economies, but in a global economy, where regions are the units of competition, it pays to focus more self-consciously on the health of specific regions.

Elected officials, economic development professionals, and corporate leaders share the desire to expand the tax base, increase the number of jobs, and grow the economy. But before creating strategies to achieve these ends, Russell Ackoff, professor emeritus at the Wharton School of the University of Pennsylvania, offers a critical distinction between "growth" and "development," terms that most people use interchangeably as synonyms. "Growth" is a concept concerned with size and expansion, he explains, but "development" is a concept concerned with competence and capacity building. This distinction is even more important in an era of dramatic change, such as today, when, as Peter Drucker argues, we are midway through two meta-transformations: from a domestic to a global economy and from an industrial to a post-industrial society. To maximize growth, we should think first about development—What new institutions must be put in place? How should we be repositioning ourselves? What new ways of looking at and thinking about the world are required to take advantage of this rapidly changing environment?

The region, as the unit of competition in the global economy, is itself a critical developmental concept, and regional thinking and regional action are key developmental approaches. This is why regional cooperation has become an indispensable strategy for the future.

The bad news for those promoting regional cooperation is there is no formula for swift success, which, if faithfully followed, will yield guaranteed results. First, the roots of our parochialism are deeply embedded in the soil of race, class, and politics, and, over a very long period of time, they have grown tough and very resistant to change. Even if a formula existed, it would be more an art than a science, more like a recipe for preparing béarnaise sauce than brewing tea. Second, it certainly would not be swift. And, third, there aren't many success stories—as in someone out there who's really done it and can say, "Okay, what's the next problem?"

The rate at which progress is being achieved depends largely on perspective. For activists working in "real time"—that is, day-in and day-out—progress can be painfully slow. But when examined over decades, excellent headway is being made. As few as fifteen years ago, with the notable exceptions of Minneapolis, Portland, and Toronto, "regional cooperation" existed largely as an oxymoron. The really good news today is that regional cooperation is on metropolitan radar screens all across the United States and that virtually every major region and many smaller ones are engaged in some sort of regional thinking and action. More often than not, these efforts are driven by the corporate community, with involvement from the civic and public sectors. But regardless of who leads, regions will do best when all three groups are at the table.

The global economy can be likened to a great train coming through every region in the world, and each region must decide on the kind of station needed for getting on or off the train. Regions that learn to act cohesively and can transcend parochial thinking and find ways to overcome the formidable barriers of race, class, and politics, will do much better than regions whose business, political, and civic leaders are unable to work together.

The global economy poses four major challenges to every region:

1. Develop your human resources because people will be the basis of comparative advantage in the future.

2. Lower the cost of your goods and services because the global economy is characterized by fierce competitiveness.

3. Use your scarce investment capital wisely, which, among other things, means reducing or eliminating the costly redundancies and waste created by suburban sprawl.

4. Stabilize the core city of each region because in no place is there evidence of regions doing well when their core city has deteriorated.


Develop Human Resources

The development of human resources is without reservation the most important challenge facing regions. Everything else can be gotten right—the best land use policies, outstanding arts, culture and related amenities, and a highly efficient transportation network—but if a region lacks a skilled labor force, its future is bleak.

The floor on which Americans have been standing for the last twenty years has been tilting, and people without real skills have been sliding toward reduced wage levels. The angle of tilt grows inexorably sharper each year as global trade and technology advance. If our children and grandchildren are to be secured to firm economic ground in the future, they must be provided with lifelines that are fashioned of far higher skill and education than was ever required in the past.

Although the American economy is doing exceedingly well in aggregate terms, not all American families are sharing in the rewards of this growth. According to the U.S. Census of Income, over the past twenty years, the bottom three-fifths of families have actually lost ground and the second-to-highest fifth has made modest gains. The top fifth, in contrast, have gained 25 percent and the top 5 percent have gained 44 percent.

This distribution of income represents growing inequality, a significant departure from the pattern established in the decades following World War II. In December 1994, the Federal Reserve Bank of New York convened a panel of eighteen prominent economists and asked them to explain the sources of income inequality. Their consensus response was that 9 percent resulted from the erosion of the minimum wage; 10 percent from the decline of labor unions; and 10–20 percent from growing global competition—simply put, when faced with low-cost and decent-quality goods and services created abroad, American employers hold down the wages they pay to their workers (which in large part is why we can have 4 percent national unemployment and no inflation to speak of). But the economists attributed fully half of the explanation for growing income inequality to "new technologies that favor the better educated."

American schools always did a good job with the top fifth of their students. What happened to the remaining 80 percent did not matter because they went out into a robust manufacturing economy and received middle-class sustaining wages for relatively limited skills. Through the 1940s and 1950s and to 1964, the typical blue-collar worker earned enough for Mom to stay at home and raise the kids, and there was enough money left over for a second car.

The typical worker in 1973 earned higher real wages than the typical worker in 1997. But our standard of living did not fall because this decline in wages was softened and obscured by the entry of unprecedented numbers of women into the labor force, creating two-income families where the earnings of one had sufficed in the past. The "rubber band" has been stretching, with Americans working longer hours and holding more jobs than they have in a generation. But absent polygamy, there will be no third spouse to send into the labor force to bail out families in the next decade.

The report of the Commission on the Skills of the American Workforce, America's Choice: High Skill or Low Wages!, explains why the days of a robust manufacturing economy are never coming back. If companies all over the world can buy the same foolproof machinery to compensate for deficient worker skills, and billions of people around the world will use that machinery for $5 or $10 a day, let alone the $10 or $15 per hour plus benefits that American workers want, the moral of the story is clear. You cannot compete on the basis of wage, you can compete only on the basis of skill.


(Continues...)

Excerpted from Planning for a New Century by Jonathan Barnett. Copyright © 2001 Island Press. Excerpted by permission of ISLAND PRESS.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

Table of Contents

Contents

About Island Press,
Title Page,
Copyright Page,
Foreword,
Editor's Note,
Introduction: An Agenda for a New Century,
PART 1 - The New Metropolitanism,
Chapter 1 - Regional Imperatives of Global Competition,
Chapter 2 - Planning Metropolitan Regions,
PART 2 - Managing Growth and Conserving the Environment,
Chapter 3 - Social Equity and Metropolitan Growth,
Chapter 4 - Regional Design: Local Codes as Cause and Cure of Sprawl,
Chapter 5 - Next Steps in Controlling Pollution,
Chapter 6 - Highway Planning and Land Use: Theory and Practice,
PART 3 - Education, Safety, and Welfare,
Chapter 7 - Improving Primary and Secondary Education,
Chapter 8 - Improving Public Safety in Cities,
Chapter 9 - Welfare Reform, Reproductive Reform, or Work Reform?,
PART 4 - Restoring Older Urban Areas,
Chapter 10 - Housing and Urban Communities,
Chapter 11 - Restoring Natural Resources and Rebuilding Urban Communities,
Chapter 12 - Downtowns: Competitive for a New Century,
Afterword: The University and Civic Engagement,
Suggestions for Further Reading,
About the Contributors,
Index,
Island Press Board of Directors,

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