C: The Rise and Dominance of Urban Renewal
The Formation of the Post-War Progressive Coalition
Is this redundant to the Quasi EDO below???????
So it appears that demobilization of soldiers occurred almost simultaneously with the mobilization of a new, upgraded, revitalized business community. The newly emerging postwar business progressives were the first element in an informal coalition which became an important element of most big city urban political systems. The other two elements in this loose tripartite coalition were an independent (of the political machine) mayor and his major bureaucratic allies, budgeters and especially urban planners. The rise of the first element, new, expanded, vastly more powerful local business elite, was the essential ingredient of the Progressive Coalition, but it was unable to achieve its urban reform and revitalization agendas without powerful allies.
Politically, it is likely that most of the business participants were associated with the Republican Party, but in most Northeast-Midwestern cities their political philosophy was Progressive in nature and by today’s standards would not be considered as conservatives. In the 1940’s these business progressives include much of the middle class (which for the most part held middle management positions in corporate America). They had a serious political problem; they were losing votes because of decentralization. It was becoming a lot harder since FDR to win local elections as urban constituencies had become associated with the New Deal and its programs. The problem was the many large city Democratic Parties and city governments were dominated by political machines. In essence, business progressives needed Democratic votes to accomplish their purposes and secure passage and funding of their urban initiatives.
Opportunity for Democratic votes came in the form of the maverick Democrat whose ambitions were in some way thwarted by the machine. In city after city maverick political leaders would revolt against the boss and into that opportunity-fissure would leap business progressives. Sincere or otherwise, maverick mayoral candidates would conduct an anti-boss campaign and in the postwar atmosphere and environment they got themselves elected.
Antiboss rhetoric had long been a part of city politics, and a loyal corps of middle-class, good-government advocates responded to antiboss rhetoric like Pavlovian dogs salivating at the sound of a dinner bell. Thus attacks on the political machine could galvanize a significant segment of the population, drawing the full forces of the citizen crusaders into the fray. Moreover, revelations of widespread corruption and gross incompetence could even shift working class votes into the reform column[1]
The problem was in order to win that election maverick mayoral candidates had sought and received the approval, support, and financial contributions of the new business leadership. Upon election, without the traditional resources of the political party, the new mayors needed continued support in the form of expertise, bureaucratic managers and frankly, a bit of the power held by the new private EDO organizations–as well as that of the Chamber.
Though the new political leaders …proved attractive to the business community, they were not invariably political conservatives or pliant tools of big corporations. Two of the most notable of the postwar breed of mayors, Hubert Humphrey of Minneapolis and Joseph Clark of Philadelphia earned a national reputation as quintessential liberals….But the new political leaders did not need to be business spokespersons. Instead, they only had to be able to earn the respect of the business community. In the eyes of the business leaders, they had to appear energetic, honest and able[2].
The takeaway from this is that the reform mayor, having broken away from the city’s traditional power base, the political machine, needed to develop his own coalition of support in order to implement his political platform and carry forward honest, competent government after he had thrown out the machine hacks. The new mayor was largely on his own; the city council usually was controlled or heavily impacted by the old political machine–as was the city hall bureaucracy. Business in its turn needs someone who could win elections and handle the politics of the city and its legislature. Both wanted efficient honest competent government–and to solve the plethora of issues associated with the contemporary urban crisis. Match made in heaven or not, the newly mobilized business community and its corporate leaders and the independent mayor formed an informal alliance of interests and shared resources.
There was still one loose end: the mayor needed expertise, competent management personnel and tools with which to control city hall. These came in the form of professional management associated principally with the planning profession and municipal budgeting. Planners, in particular, held a keystone position in that they possessed an expertise vital to the businessman’s modernization agenda of the architect, the downtown real estate community, the politics of mayoral control, the instabilities of federal dollars and the strongest possible link to the Managerialism perspective. In those few large cities with city manager form of government, the planner was a natural. While not ignoring the closeness and utility of budgetary and fiscal management officials to the mayor, their impact was more control-oriented and focused on providing several important tools and financing methods for the future economic development initiatives. Planners, for the most part, had the ideas and plans for how to attack the urban crisis of the forties and fifties.
Why were urban planners so central to future events? Both zoning but especially comprehensive planning (master planning) focused on the physical and infrastructure aspects which were fundamental to the definition of the urban crisis at that time. As explained previously, decentralization was driven by obsolescence, need for infrastructure modernization, increase in housing supply and removal of blight–all of which were physical and infrastructural. Key to the use of critical physical economic development powers such as eminent domain is the detailing of the need for a public taking and a “determination of blight”; planners and plans were pivotal to both. Finally, we cannot ignore the simple realities that planners had played a prominent role in urban revitalization and economic development since the “City Beautiful” period–that planning also could be regional, as well as municipal-based and that the Progressive-New Deal federal government had clearly embraced area-wide planning as an important spigot for federal dollars–it would have been impossibly difficult to exclude them from a major role in confronting the post-war urban crisis.
Philadelphia and Pittsburgh were leaders in this early period and serve as a wonderful example of how this coalition informally came into existence. One of the most famous of these anti-machine reform mayors was Philadelphia’s Joseph Clark. Elected for the first time in 1949, the Democratic Clark, having successfully taken on the Republican machine, began to dismantle the old regime and in its place install the new reform government. Clark …
filled city hall offices with his socially prominent friends and with persons recruited from out of town because of their reputation as top-notch administrators. Ability and expertise seemed to be the criteria for Clark’s appointments and not local political credentials. Especially significant in the coming renaissance initiatives was Clark’s city planning chief, Edmund Bacon. With its officers chosen, the Clark administration presided over a capital improvement program of a magnitude unprecedented in Philadelphia history, and the new regime’s vigor and rectitude won national applause as well as the close cooperation of the Citizens Council and the Greater Philadelphia Movement [3]
As the reader may have surmised, our so-called Progressive Coalition was anything but a formal alliance. Its closeness and solidarity waxed and waned, city by city, time period by time period. A few cities, Dallas is the poster child (Buffalo also), hardly moved down this path at all; other cities followed Philadelphia’s path (for example, Mayors Anthony Celebrezze of Cleveland and Raymond Tucker of St Louis). Even the notorious machine driven Chicago elected a reformer, Martin Kennelly for two terms (1947-1955).
Several other cities, such as New York (Robert Wagner) and Boston (John Hynes) were hybrids, and on the whole, not very successful in their reform agendas. Amazingly or not, several machines produced “reform bosses”, for example Baltimore’s Thomas D’Alesandro, Jr. and Pittsburgh’s David Lawrence (who became synonymous with urban renewal driven by its private sector partner, the Allegheny Conference). In almost all instances, even where the Coalition was weakest or ineffectual, the elements of the Coalition coalesced or meaningfully attempted to do so.
Overall, the trend, however, was toward a politics that downplayed seething ethnic divisions and discarded old-fashioned partisan loyalties and the traditional party organization…. Reinforcing the decline in the significance of political parties and party organizations was the marked drop in Republican electoral strength in urban areas during the 1950’s…At the beginning of 1946 [in Northeast-Midwestern city elections] five of the ten [cities] were Republicans. Moreover, in four of the ten, Republicans controlled the city council….During the late 1940’s and the 1950’s, however, middle-class Republicans moved out of the city and solidly Democratic blacks moved in… Consequently, Republican fortunes nosedived in the major central cities, and most of the major metropolises became one-party towns[4].
As we are fond of repeating, diversity and variation are the best descriptors of what was occurring in economic development. Anti-reform mayors may have shared many characteristics, but they also exhibited important differences which are critical to an understanding of local economic development and urban policy-making.
Over this time period the importance of party and party organization declined to the point that one-party towns were characterized by factional party politics with “candidate-entrepreneurs” seeking the top mayoral post in a sort of king-the-hill type career move. In a one-party environment, party loyalty means little, independence is a way of life, and politics over the years moves from one ad hoc campaign-administration to the next–lacking continuity and seriously impeding sustained program implementation. Certainly, this “small d” type of politics is more democratic and receptive to issue-politics; it does, however, come at some cost in the ability of a municipality to follow a sustained and comprehensive revitalization effort. In that this style politics continues, for the most part, to the present day, we might remember how it got to be that way. This time period is when it started; and ultimately the core reason for this factionalism and instability is the inability of a viable two-party system to function at our local levels.
The Formation of Private EDOs
Should This be integrated into Progressive Coalition and shortened
A lesson we draw from our 1945-1950 landscape may be that its most prominent aspect is the, all too fragile dominance of large central cities. We already understand through past comments that central cities saw themselves in some level of crisis. Obsolescence, decentralization (suburbanization), blight, pollution, and the need to modernize infrastructure to catch up with critical technological, transportation and industrial innovations of the past decade and a half too mention the most obvious set of problems needed to be confronted. As we learned in the last chapter, the business sector had picked up the baton throughout the thirties, but certainly in the period immediately preceding entry to the war. The public sector in the form of a new style of non-machine mayors armed with their progressive planners seemed relatively open to a 1950-s style public-private partnership-particularly in that resources were limited. But then Pearl Harbor was bombed.
The relative prosperity during the demobilization period (1945-1946) came as a surprise to many. Also too much had been deferred for too long and the general public wanted to make up for lost ground during the Depression and War (pay raises, for instance, cars and all sorts of consumer goods–including vacations). On top of all this in-migration by Blacks, Appalachian whites and Puerto Ricans (depending on where one lived), all impoverished, added new needs, demands, and problems to solve. Despite a macroeconomic prosperity, the central city economy was largely stagnant and the CBD in many cities exhibited declining sales and increased office vacancies.
The federal government emerged from the war as one of the two hegemons of international politics–a relatively sudden and massive transformation from an isolationist past, consumed its immediate attention and pocketbook. There were to be no new federal programs or flow of dollars to handle urban problems. Local government was on its own to confront what seemed to be a perfect storm of demands, limited resources, and stressed politics. In particular, it seemed that demobilization had intensified the threat of serious decentralization as the combination of a serious housing crisis (both shortage and quality) and household formation created conditions and demand for action that could not be easily postponed to another day. Little appreciated now in 2013, the political system in 1945 was under unusually severe pressure–and without resources with which to respond.
Into the breach once again stepped business leaders and the private sector. Depending upon the city, the first task was usually to topple the decaying, neighborhood oriented, frequently corrupt and very incremental machines, bureaucratic hacks and their bosses. In these cases the precondition to deal with the urban crisis was to set up a new urban political structure with the will and the capacity to respond and implement reform. In other cities, where a Progressive business-led coalition had already “tossed the bums out” the need was to (1) prioritize the problems, (2) develop solutions, and (3) figure out how the city could pay for all this reform. Municipal planning, management and upgrading fiscal capacity were the effective preconditions in this type of central city.
Neither of these situations corresponded well to the nature of the business constituency which had formed in the 1940 years. The Urban Land crowd, real estate-based businesses and the Real Estate Board, were too narrow and self-serving to be sufficient to the tasks at hand. To be sure the “downtown” business community was still a necessary and vital element of any new business coalition, but a broader, more private sector, base had to be constructed to, if nothing else provides electoral muscle, administrative competence, and non public resources.
In particular, the “city fathers” (and mothers if they had them) had to step up to the plate. Real change required real power if it was to be achieved. As Teaford observes this mobilization of the private business community was not an out of the blue phenomenon. To the contrary, in the culture of the day this business involvement was expected and desired. Business involvement was viewed as absolute precondition to affect change. After all, a core dynamic of the urban experience in America has been described as Privatist.
But from the beginning of American urban settlement business leaders had expected municipal cooperation in the boosting of local fortunes, whether through aid in attracting railroad lines in the nineteenth century or support for harbor projects or world’s fairs in the twentieth century. Moreover, a sense of noblesse oblige and the desire for a good public image had traditionally encouraged business leaders to contribute money and energy to civic improvement schemes. City hall was expected to maintain a favorable business climate, and business chieftains were expected to raise the civic and cultural stature of the community[5]
What was needed in 1945, however, went far beyond this more traditional model of business-public partnership. On top of that, the structure of American capitalism had radically changed over the years.
Industry Concentration, a midwife for Progressivism’s birth and nanny for its adolescence, had been largely achieved by the 1920’s. The scale and size of many private corporations had grown to be at least regional, usually national, and in 1945 was looking abroad for opportunities. The United States, home to what would be the new reserve currency, the United Nations, and leader of the Free World was a/the global leader. The traditional urban hierarchy, the precise calculations of central place-market area analysis, while descriptive of an economic market area, did not account for the more political and social consequences of a new American corporate structure and leadership opportunities. There was a new style corporate leadership which resided in our central cities: cross-border elite.
Cross-border elites were something new to the American scene in 1945. Absorbed in the making of their industry oligopolies and maintaining these corporate behemoths in the challenging times of the Depression and Global War (indeed called to Washington to organize and operate the home front economy to wage that war), these elites had largely declined to participate in state and sub-state economic development to this point. Used to thinking about the “big picture” in Washington D.C., these cross-border business elites returned to their corporate headquarters in 1945-46–demobilized much like the American soldier. But you can’t keep cross-border elites down on the farm, once they have seen Washington D.C. Back in their home communities these new elites uncovered an urban crisis which required their involvement, and, of course, leadership. The urban crisis begged for their attention and these elites forged a vision lead their home communities out of the Wasteland[6] and into the Promised Land. Their vision for addressing that crisis, however, were far more bold and embracive than that of the Urban Land real estate crowd which had previously dominated their home town business politics to that point.
The corporate elites had the confidence, resources and the power to remake the big cities: as they had in the city beautiful years–they would simply build it anew and modern once again. They could recapture the urban refugees who fled to the peripheries of the central city and the mostly unincorporated areas which were fast becoming the suburbs. How? Through a more attractive and modern central city, with a prosperity restored sufficient to overcome the obvious poverty of the transition zones and by metropolitan planning, metropolitan authorities and service districts which could both finance and tie in administratively those areas which escaped physical recapture by the central city. In the minds of these elites, the central city was primary–the headquarters of the region.
A sick, grimy, rundown corporate headquarters was a visible indicator of a corporation in trouble. In this mindset, borders mattered little. Each border marked the limits of one small pool in which little elites swam, played and ate. These little elites in little ponds could be managed, some recruited, to advance the interests of the mega cross-border elites on whom they were either dependent on or deferential to for sustenance or opportunity. Progressivism, always a big tent with usually more than “three rings” underneath its’ roof, had encountered a new global transformation and had morphed its Privatist-Progressive ring to create yet, another version of Progressivism. All this new version of Privatist-Progressivism required to operationalized its vision were (1) a cross-border elite-led “Vault”-like EDO; (2) a workable public-private partnership which could supplement its vision with appropriate and specific skills and expertise; (3) and a federal (or if necessary, state) “sugar daddy” to pay for it all.
The power and perspective of this new corporate cross-border leadership had to be tapped–and in 1945 many of these elites wanted to be tapped to play in the game of urban revitalization. In fact in many instances it wanted to lead the public sector. In many ways, this new leadership fundamentally set the tone and the muscle behind the operations and prosperity of more regional and local firms–and the downtown real estate community as well. But if the new powerful corporate elites had to play and pay, they needed a structural base from which to launch their initiatives and staff the management of these initiatives.
The new role, increased power, and more complex set of initiatives required to confront crisis and restore central city prosperity required a more specialized economic development-oriented organization than existed in the chamber of commerce[7]. Certainly the Chamber would be part of the business coalition that would operate out of this new EDO, but the new EDO had to assemble and concentrate private power and, equally important, expertise, insight and resources and hurl these forces to solve priorities in a focused, sustained and competent manner.
Possibly the first of this new private EDO type was Pittsburgh’s Allegheny Conference found in basic form in 1943. Its board and membership grouped the who’s who of Pittsburgh’s corporate leadership–in particular Richard King Mellon (Mellon Bank). Participation in the organization was personal to the corporate leaders themselves, not their designees or secondaries. Mellon’s power was both legendary and extended to Harrisburg, the Republican Party and to other numerous corporations on which he served as a board member, lender, or business partner. The other corporate leaders, perhaps in a reduced scale, offered identical relationships as well as judgment, access to expertise and resources of all kinds. If Pittsburgh had assembled a new type of economic development organization (EDO), it had also created a role model for other communities to latch onto for their salvation.
Over the next decade (one might keep in mind these organizations, composed of powerful fat cats, are like their feline counterparts, quite difficult to herd–the need for a business statesman to bridge egos, inattention and rivalries is imperative), big cities formally or informally assembled these EDOs. Boston’s “Vault” is often the name attached to such EDOs, but “the Vault” was, in fact a “Johnny comes lately” and it was very, very informal to the point of secrecy–exactly the opposite of the Allegheny Conference. In any case some noteworthy organizations that developed using the Allegheny Conference as their inspiration were: Baltimore (Greater Baltimore Committee founded by James Rouse), St Louis (Civic Progress Inc)[8], The Greater Philadelphia Movement, and Cleveland’s (Cleveland Development Foundation). All of these organizations (or their successors) survive today and remain major forces in their region’s economic development policy-making system. Over the next several decades many, probably most large cities-regions have embraced this model and since the 1990’s, in particular, this model has been adapted to advance regionalism in its various forms. Also, this model of EDO was copied by many smaller urban centers throughout the following years. Working to construct-facilitate some version of the EDO-type in a period of crisis has been a very common response of economic developers.
A second, more focused, type of private EDO also appeared during the immediate postwar period: the downtown, CBD, revitalization EDO. Often created by major downtown retailers and others from the Urban Land crowd, these EDOs (and some never incorporated and were therefore informal–usually operating out of the Chamber or the previously mentioned Allegheny Conference type, were dedicated to bringing back the CBD and combating decentralization and its effects on the downtown districts. Some examples of this type of EDO are: Chicago State Street Council (which actually was formed in 1927), Baltimore’s Committee for Downtown, Minneapolis’s Downtown Council, and Downtown in St Louis Inc.
A third set of EDOs appearing on the scene were broader in their membership and constituency and were diverse in their goals and in their focus. In Philadelphia the Citizen’s Council on City Planning advocated mobilizing citizens to support city planning and its initiatives. Alongside it were other groups such as Association of Philadelphia Settlements, Central Labor Union, City Business Club, North Penn Community Council, NAACP, and the Inter-Racial Committee of Germantown[9]. All the larger cities and many smaller ones formed equivalent types of organizations which either dedicated the whole or part of their effort into economic development.
We, of course, may be incorrect but this period is the first instance we have found of widespread citizen participation and interest in economic development-related activities. Most of these organizations would not be classified as EDOs (some would, of course) but economic development policy-making systems, at least in the larger cities, became more robust, complex, representative and complicated in the period following 1945. If we are correct, this is an important and critical hallmark in the evolution of the profession and may well indicate the arrival of economic development as a significant policy area in the urban public policy system.
It is also very important to note that the composition of these new players varied widely from city to city–it was not just the usual suspects with the same type of interests, urging more or less similar proposals with relatively equal effectiveness across all cities. This lends considerable support to a major finding of this book: that cities differ in their making and the choices of economic development policy. Why these cities differ instead of simply drawing out the usual combinations of folk interested in, or affected by economic development, but instead elicit different cluster of issues, by different folks, in varying intensity and effectiveness is an important support that something deeper, a political culture, affects economic development policy-making and distinguishes among cities and policy jurisdictions in economic development policy-making and implementation.
Throughout the Northeast and Midwest, corporate chieftains, downtown merchants, and civic activists claiming to speak for a broad range of groups all agreed that the older central cities had to launch initiatives to overcome obsolescence and achieve rejuvenation. Through downtown business figures were to be disproportionately significant in the struggle for revival during the late 1940’s and the 1950’s, renewal schemes were not the product of small cabals of plutocratic overlords who foisted them on an unwilling public. A number of private groups were demanding action and …could prove feisty foes of public officials who dragged their feet.[10]
Someone’s Got to Pay For All This!
Before the Progressive Coalition could go about doing its evil deeds, it obviously had to find a way to pay for whatever it was that it determined needed to be done. The reader equally obviously recognizes the fundamental antipathy of Americans to taxes and so a good starting point is to find a way to pay for the urban revitalization agenda without raising taxes abruptly or dramatically.
The usual manner of handling capital improvements (as opposed to operating costs like staff and paper clips) was through general obligation bonds (go). Several features of the go bond limited its usefulness. Because of past extravagance and municipal defaults, states had placed limits on the debt amount that could remain outstanding (unpaid). When a municipality reached its “cap”, it could not issue additional debt until it retired (paid) some past issuance. Secondly, interest rates, which of course, fluctuate, could increase/decrease the annual cost of debt maintenance and make it more costly/cheaper to issue new debt. Debt service was also an issue. The more debt issued, the higher the annual debt service, the more likely a property tax increase would be required. Thirdly, municipal debt was tied to the property tax and, obviously, decentralization meant a declining tax base for most large cities.
The most serious limitation, however, is that in most cities, debt issuance required voter approval in a referendum. Not good! The municipal bond would be most useful in financing those portions of the revitalization agenda for which a broad supporting consensus existed or could be created. And interest rates remained low. And debt ceilings were not a factor. Obviously, these financing realities would, in itself, affect the implementation of the Progressive urban agenda and create even more diversity and variation among cities. The support of business was absolutely essential in these bond referendums.
Despite these obstacles, a number of cities were able to issue critically important bonds to finance infrastructure in particular. From 1946 to 1961 “Cleveland’s electorate approved $239 million …or 69% …of the total submitted”. Similar statistics applied to Baltimore, Detroit, Chicago, Cincinnati, and Philadelphia. Not so for Boston, Buffalo, Minneapolis and St Louis. For those cities fortunate to be able to issue bonds, by the end of the fifties their level of municipal indebtedness had increased, often dramatically. Chicago debt grew by over 400% in the period 1945-1958. [11]
Water and sewer did well because normally these functions were handled by a service district which did not issue municipal debt and issued a revenue bond[12] instead of a general obligation bond. Revenue bonds usually did not require voter approval and public awareness of service districts is historically low. Because of the availability of service districts and revenue bonds, much modernization of the central city infrastructure did occur–but an unexpected “leakage” resulted from these water and sewer revenue bond finances. Water and sewer authorities, with support from the city’s planning departments, sought additional revenues from usually unincorporated periphery areas outside the city (today we call them first tier suburbs). Planners thought that the increased taxes would inhibit further growth of these areas and/or were caught up in the thralls of metropolitan regional planning (as a vehicle to capture suburban residents and make them pay for infrastructure). Mayor Daley of Chicago was famously quoted as saying …
What is good for the Chicago metropolitan area is good for Chicago … [and Chicago was] attempting to provide for not only its own needs and for the needs of suburbs it now services [1957], but also for the needs of suburbs that may be added to the metropolitan area during the next 25 years[13].
Daley was not alone and in the short run, city water and sewer districts prospered, Infrastructure costs for central city residents were indeed lower as a consequence–but so were they for the suburbs they served. The central city in at least one critical infrastructure often financed the growth of its adjacent suburbs.
To accommodate the modernization requirements of the transportation system, the central city enjoyed the dubious benevolence of their state government and during 1946-1955 some support from federal highway funds.
For the burden of responding to the automobile fell primarily on state government. Washington D.C. provided expert advice but relatively new money. And state highway officials and park developers became even more convinced than ever before that localities lacked the competence to shoulder the demands of the new age…. [The states] assumed the task of financing and constructing highways … In the process, the states had to revamp their revenue structures and rely on new forms of taxation. The state ledgers of 1929 [therefore] were radically different from those of 1917[14]
To be sure, after the Federal-Aid Highway Act of 1956 the federal government would reimburse up to 90 percent of the construction costs of an interstate highway system. This state leadership did not originate in the post-World War II period. On the contrary the states had entered this picture much earlier, and prodded by the 1916 Federal Aid Act (followed by the 1921 Federal Highway Act), most states created their state bureaucratic units and assumed considerable responsibility for the provisions of roads, bridges and highways [during this time, 1924, Robert Moses was appointed Executive Director to the newly created (by Al Smith) Long Island State Park Commission]. Accordingly, throughout the fifties and even sixties the freeway, highway systems and interstate systems expanded greatly. The decentralizing road and highway infrastructure, which, of course, was to fuel suburbanization in the sixties, had been under construction since the 1920’s and even earlier. This vital infrastructure function had been under state jurisdiction for almost two generations previous to the post-World War II urban crisis.
The involvement of the federal government in airport construction, typified by the 1946 Federal Airport Aid Act (match funds which by 1959 had dispensed $500 million to local governments and transferred $1.6 billion in military aviation facilities. Airports also enjoyed service district and revenue bond advantages[15]. Some central cities (Chicago, New Orleans, Baltimore, Philadelphia, St Louis and Cleveland) could accommodate airports and in other instances, the central city retained property ownership and management control over the airport and some of its adjacent areas. Other cities lost control of their airport facilities (New York, Boston, and Newark, for example).
Most of this infrastructure was outside the central city limits, however, and no doubt, that it was absolutely necessary to install, this infrastructure, both highways and airports contained a strong decentralization bias. There was, in our opinion, and despite the damning indictments of much of academia and later Progressives, there was little option but to build the infrastructure. A state and federal highway system is not a luxury or a capitalist abuse, neither is an airport–most of which needed to be in areas outside the central city. The real antidote to the inherent negative effects of such infrastructure was, again in our opinion, the power to annex. That, however, is a story we shall tell in a later section of this chapter.
Transportation-related woes within the central city, however, needed to be financed by the central city–and they were critical to the economic and residential vitality of the central city.
Delays, accidents, blighted neighborhoods, central business districts choking on an overdose of automobiles, all dire symptoms of the omnipresent traffic malady seemed to point to debility and possible death for the aging central city….Improved thoroughfares would not simply facilitate the movement of vehicles but ensure the continued vitality of the traditional business center and free residential neighborhoods of the stream of cars and trucks so threatening to their quality of life [16]
There was no central city that could avoid this aspect of the urban crisis. Unfortunately, we think, central city planners, who had embraced the wide vistas and boulevards of Le Corbusier’s Radiant City, prepared master plans including expressways–lots of them–in every city. Controversial from the start, these expressways were in the early years of the late forties and early fifties actually quite popular with automotive consumers. As long as it didn’t go through your neighborhood or into your living room, most voters were ok, something had to be done. This popularity would change as the years went by, but in this time period the voter, resident, and consumer was on board with any bond issue required. Eighty-four percent of St Louis voters in 1955 backed their expressway bond issue[17].
Parking, however, was another more complicated matter. If anything, freeways and expressways only created the need for additional parking and therefore added to the crisis. So, every central city was off to the races in its efforts to address the parking crisis. The principal solution was to establish a series of parking authorities which could issue revenue bonds to acquire, clear, and build the garages and the surface areas (and re-circulate the traffic flows). No city was immune to the problem or the solution. Planners were quite on board (their hatred of the automobile was not yet apparent). Unfortunately, for the central cities they never seemed able to catch up with demand for parking and were constantly perceived by many as being behind the eight ball–again a perception that persists to the present. Parking garages often “went wrong” and became a source of scandal or a demonstration of municipal incompetence.
Public mass transit systems preexisted expressways, airports and water and sewer systems which for the most part were non-existent or grossly inadequate and therefore garnered prime attention of the city planners and decision-makers. Despite serious academic misgivings regarding the fate of private and public bus systems, and subways also during this period, these systems overall were not neglected. Philadelphia expanded its subway, Cleveland acquired and consolidated private bus systems and created a transportation authority. The Massachusetts state legislature created the infamous MTA and it purchased the Boston transit network from private ownership. Baltimore didn’t address the issue until the 1960’s. In the fifties Chicago expanded its light rail network and the New York State Legislature in 1953 created the much loved New York City Transit Authority (now MTA). Certainly, the most remembered transportation transformation of this period is the final acquisition in almost all cities of what remained of the street car lines (yes, the Curmudgeon has enjoyed San Francisco and New Orleans street cars) and private bus lines.
As we wrap up this section, the reader may ask us why she should care about all of this. As usual much of the description is obvious in that all one has to do is look out one’s window and see most of the same dynamics in operation today. That is one of our points: a great deal of how contemporary economic development came to handle (and finance) the absolutely vital infrastructure function was set in motion during the late forties and fifties. The airport, parking and transportation authorities certainly overlap into economic development and the recourse to such independent authorities was necessitated by the need to finance these vital activities in a manner compatible with the local sense of how finances could be sustained in their individual political and policy system over an extended period of time[18].
Some will argue that such authorities are a victory of the managerial approach discussed earlier–a separation of expertise from politics. They are. But that is not all there is to why our cities turned to independent authorities to operate and finance vital infrastructure. The existence of these authorities is also a recognition that vital infrastructure to be installed, reasonably operated and financed more or less appropriately meant that it had to be isolated from the central political and policy process. The inclusion of this function in the central jurisdictional policy process ran the risk of overwhelming that process and producing decisions inimical to the absolutely necessary provision of modern infrastructure[19].
This isolation from the jurisdictional policy process has worked, far from perfectly, but infrastructure was put in place. The cost to sub-state economic development is that these vital actors are set apart from the central policy process and left free to define economic development needs and strategies from their own (silo-like) perspective. In fact, they are free to think of themselves as not serving an economic development-related function at all. Or, at best, a function that takes a secondary priority to the authority’s need for organizational stability, bureaucratic coherence and financial capacity.
From the jurisdiction’s-community perspective the isolation and independence of arguably the most important single aspect of a community’s economic health and quality of life was placed under the control of an independent agency. That independent authority in most cases could only be controlled through recourse to a state government and legislature–and occasionally through informal cooperation idiosyncratic to a particular set of community leaders. Given that the independent authorities and the new style urban private EDOs shared many of the same business leaders on their boards of directors, an additional local lever of influence could potentially exist. In any case, the issue of control and coordination of this absolutely central aspect of local economic development, infrastructure, became fragmented during this time period and remains so to this day.
But there was one policy area, one infrastructure, which could not easily be spun off to an independent authority–at least in 1945: housing and neighborhoods. That policy area deserves its own section, in large measure, because it became the primary cog (transmission belt) in the evolution of the economic development profession.
Slum Clearance to Urban Renewal
Housing reform and slum clearance carried over from the 1930’s and early 1940’s. By 1945-46 old crisis had morphed into a spectacularly huge crisis–with immediate electoral consequences. What new catalyst had propelled the old housing crisis into high gear? The intellectuals call it “household formation”; voters and what passes for ordinary people in the 1940’s called it marriage and babies. Anyway, the soldiers had returned from war and one way or another, they formed households. The consequences of this intense household formation can be demonstrated by a tragic re-telling of the Curmudgeon’s earliest years.
Dad, a medic who received a silver star in the Battle of the Bulge, came back in early 1946. He met my mother around Christmas that year. Married in May 1947, I was born in February 1948. My mother always told me to not believe the rumors: I was, in fact, premature (and, I might add, have remained so through the course of my life). My parents (and I) settled down in my grandparents four room, one bathroom, apartment, and there we remained until 1952–to the delight of all parties. This heart-warming, close-knit family life with multi-generations sharing the same roof (and bathroom) was certainly the golden age of families. This golden age, however, created and unleashed the fury of millions to end this revolting and obnoxious linkage of generations and to get out of it as quickly as they could.
Anyway, the cities needed housing, both apartments and detached homes, badly and fast. Electoral pressures were considerable. Springing into action in this exciting and crisis-filled time, was a coalition composed of the mayor/city manager, salient departments, and business-leaders (and chamber and real estate allies) which strongly resembled the Progressive Coalition described in the last section. In fact, it was.
And so, as soon as funds could be identified, city after city restarted their housing and slum clearance programs. The usual procedure was for the redevelopment agency to condemn and clear the site and then make it available for sale to private developers. The Redevelopment Agencies cranked into operation using the powers entrusted to them in the 1941 legislation described earlier. During the war years, other states had approved similar legislation; Maryland (1943), in 1945 Minnesota and Pennsylvania, 1946 Massachusetts (including a tax abatement), and 1949 Ohio and Missouri (tax abatement as well).[20]
Most of the older central cities acted promptly to implement the state laws. By 1948 Baltimore, Chicago, Minneapolis and Pittsburgh had created redevelopment authorities guided by leaders from the business community with a heavy representation from the real estate and building industries. Moreover, in November 1947 Chicago voters approved a $15 million bond issue for urban redevelopment, and one year late Baltimore’s electorate endorsed a $5 million bond proposal for the same purpose. In 1949 Minneapolis levied a special property tax … to finance the survey, planning and acquisition of land for redevelopment. Meanwhile, Detroit’s city council had appropriated $ 1 million from general tax revenues for land purchases….Responding to this flurry of activity at the state and local level… the proceedings of the American Society of Planning Officials included in a report optimistically entitled “Urban Redevelopment is Under Way”[21]
Part of the reason for this flood of legislation and redevelopment activity was the passage of the 1949 Housing Act which included an urban development provision authorizing the acquisition, clearance and sale of land by a redevelopment agency as eligible activity under the act and for which the federal government would pay two-thirds of the cost. The “shape” of these housing and slum clearance projects continued to reflect Le Corbusier’s Radiant City high-rise and broad avenue format. The cost to the local governments, however, was much less than amounts they were spending in the other areas mentioned in the previous section. Indeed, most of the early projects in the 1940’s and 1950’s were locally and private funded without any significant federal contribution. For instance in Pittsburgh, of ten redevelopment projects undertaken previous to 1958, only one received any federal funding[22].
Housing reformers had created their own professional association, National Association of Housing Officials (NAHO) in 1933 seven years after AIDC’s creation. Unlike AIDC, NAHO was not primarily, nor even secondarily, an economic development oriented association. That would change considerably in 1953 when NAHO altered its constitution to allow redevelopment officials into its membership and changed its name to National Association of Housing and Redevelopment Officials (NAHRO). Redevelopment agencies, which by the end of the decade were primarily urban renewal agencies, now enjoyed a professional association to represent their interests. NAHRO, however, was no clone of AIDC.
Instead, NAHO had been a leading force for pressing the Federal government to approve the Housing Acts of 1937 and 1949–both of which moved the Federal government into slum clearance and subsequently urban renewal. And NAHO played a critical lobbying role ultimately setting the stage for the separation of economic development from pure housing by pushing for changes in federal legislation–an achievement reached in the Housing Act of 1954. In its earliest years, NAHO /NAHRO, again unlike AIDC, were primarily federal lobbying entities and secondarily a professional development association. AIDC never really expected, contemplated or wanted an extensive Federal role and viewed itself primarily as a professional development association.
Not surprisingly as it evolved through the late 1940’s, but especially during the 1950’s, urban renewal mutated into several variations. It did not take very long before some mayors (and their bureaucratic and business allies) felt opportunity existed to extend the slum clearance and public housing model into non-housing ventures which we will artfully label urban renewal. Urban renewal is the name attached to a series of programs and initiatives, which at root attempted to modernize central city land patterns/ infrastructure and overcome dysfunction which rendered the central city unable to adjust to new technologies, logistics, modes of transportation, or changes in popular expectations which today we call, the American Dream.
Several municipal approaches departed from housing entirely. For instance, commercial and CBD-based (Pittsburgh, Boston) and many hybrids (New York City, Minneapolis, Cleveland, and Chicago)[23]. Other cities were reluctant or unwilling to venture into non-housing areas and instead tried to use housing as a form of neighborhood redevelopment (partly to remediate slums and create a sustainable neighborhood and, partly to retain residents departing to the suburbs) (Baltimore, St Louis, Detroit, and Philadelphia); In essence, within a very few years cities differed on their use of urban renewal. Logically, the coalitions of support in these cities varied by the type of redevelopment program they followed. Redevelopment was morphing into areas far removed from housing and was certainly by the very early fifties becoming an economic development, business development strategy.
The neighborhood/housing projects ran into considerable difficulty in rather short order. The path-setting Baltimore Plan launched as early as 1945 by Mayor McKeldin coordinated city bureaucracies into a hopefully sustained joint program to what we today call concentrated code enforcement of targeted neighborhoods. Committees of neighborhood residents were established to ensure sustained housing rehabilitation and a housing court empowered to enforce it. (1947). In addition, selected blocks acquired new public housing. Philadelphia (St Louis and Detroit also) followed suit with similar style initiatives. By the early and middle 1950’s all had either failed or been discontinued or were exhibiting serious flaws. The housing-neighborhood model was much more controversial, yielded few permanent results, and was flat out less glamorous and , if proponents of the growth coalition are correct, it lost out to the superior political power of the downtown and real estate sectors who preferred the commercial-CBD model. Within a decade of the war’s end, urban renewal had left housing reform in the dust.
In Philadelphia as in Saint Louis, Detroit and Baltimore, a blitzkrieg attack by
city inspectors and an aroused grass-roots leadership were intended to galvanize
blighted communities and rid them of their worst features. Yet in one city after
another community organization and rehabilitation campaigns produced
disappointing results. In too many cases effective community organizations did not
perpetuate rehabilitation projects….Without these external supports the programs
generally collapsed.[24]
The tendency, dominant by the late 1950’s with the seeming ineffectiveness of the much heralded “Baltimore Plan”, was instead toward large-scale commercial and non-profit redevelopment projects. This model was pioneered by Pittsburgh’s mayors David Lawrence and later Richardson Dilworth, the Allegheny Conference on Community Development and the Pittsburgh Redevelopment Authority.[25] The Allegheny Conference, a public private business “coordinating mechanism for civic action”, a spinoff from the war-era Planning Commission incorporated in 1944, pushed for redevelopment of “Pittsburgh’s Golden Triangle” area. The newly elected progressive mayor David Lawrence (1945) embraced the initiative and redeveloped a historic site and rundown railroad yards and warehouses.
Using eminent domain and local public funds, land was assembled and in partnership with Equitable Life Insurance a complex of office buildings was built (Gateway Center). Growth in the project area continued throughout the decade and Pittsburgh’s Golden Triangle became the urban renewal model that all wanted in their backyard. Philadelphia’s mayor Joseph Clark acquired an almost equal hero-like status for his much heralded-Penn Center project. Interestingly, federal funds never touched either project.
Throughout the 1950’s, the Pittsburgh urban renewal model was adopted, in varying degrees by most large cities; but its impact on the budding economic development profession was just as spectacular. Detroit in 1947 redeveloped its civic center (Saarinen was architect), followed by a Veterans Memorial Hall (1950), the City-County Building in 1955 and Ford Auditorium. Baltimore, having left behind its neighborhood model, embraced the Committee for Downtown and the Greater Baltimore’s (with Rouse as chair) initiative to redevelop its CBD, the Charles Street Center–issuing its own $25 million bond to do so. In fact, none of the projects discussed in this paragraph enjoyed federal funding. Downtown projects conducted in this period did include a wide variety of anchors and individual projects. For example, in 1950 Milwaukee started construction of Milwaukee County stadium, the first sports stadium built entirely with public funds, and which in 1953 would lure the Boston Braves to Milwaukee. Previous stadiums built with public funds to this point in time (Los Angeles Coliseum (1923) Soldiers Field (1929) and the Cleveland Municipal Stadium (1931) were built as a component of an Olympics attraction initiative. If so, Milwaukee would be the first to use sports stadiums and sports teams as an explicit element of their business promotion, urban renewal and metropolitan revitalization strategy.[26]
The city most identified today with urban renewal is, of course, New York City. New York did take considerable advantage of Title 1 federal funds and its redevelopment czar, a character named Robert Moses started his urban renewal career building housing and public housing–lots of it. By 1958 Moses had built or had under construction over 15,000 units.
Caro and Manhattan Projects: the Rise and Fall of Urban Renewal in Cold War New York, Samuel Zipp, Oxford University Press, 2012
Urban renewal, today we call it redevelopment, evolved from housing reform and slum clearance which began in the 1930’s. Its evolution, however, involved some striking contradictions in that it was clearly driven by federal legislation and the promise of significant federal dollars. But having said that, the federal dollars did not arrive in meaningful amounts until after 1958. By that time, urban renewal not only had clearly separated itself from housing projects, had spun off its own professional association, and nearly every major city in the nation had launched, and paid for out of its own source revenues, a series of urban renewal projects. Going with the observation that if you pay for it, you own it–urban renewal in the 1950’s was clearly a sub-state innovation, under local leadership and direction[27].
If our last statement is reasonably correct, than it seems that urban renewal (possibly contrasting with housing) in this early pre-1958 period was a local-municipal-big city policy innovation. Facilitated by is Progressive business connections, urban renewal legislation was pressed first upon the state for enabling powers and structural resources and then upon the federal government for financial resources to augment local capacity. Again, if this bottom-up is accurate, the federal government in later periods is going to bet a somewhat undeserved bad rap for financing what was a local innovation under local governance, bureaucratic implementation and local perceptions and priorities. The federal government’s role was much more shoveling coal into the furnace than designing, operating and assuming responsibility as to how well the furnace operated.
Also, as we shall discover in subsequent chapters, the misidentification of urban renewal with one of the models of urban renewal (the commercial-CBD model) and the re-characterization of the role and motivations of the early Progressive business community into a greed-induced distortion and redirection of municipal public investment and involvement away from depressed neighborhoods and the folks who lived in these transition zones by downtown real estate business (the growth coalition) is a bit unfair and selective in its recall of the history of urban renewal.
There was a viable and decade (or more) sustained model of urban renewal which centered on neighborhoods, slum clearance, housing rehabilitation and code enforcement. This neighborhood-based model was followed in whole or in part by several major cities (Baltimore and Chicago among others–Atlanta and even Boston as we shall shortly see). The neighborhood model encountered early opposition and non-acceptance by neighborhood residents (for obvious reasons (Jane Jacobs will later speak to this) including the sad and incredible reality that no serious relocation assistance was provided to displaced residents).
The business elites of the period tried to make the neighborhood-housing model work, for reasons of profit and to combat decentralization thus saving the central city from further decline. In this pre-1960 period, the motives of the private sector and the reasons underlying the recourse to urban renewal were more complicated than portrayed by analysts, media and academics some twenty or thirty years later. We are willing to concede, as we will demonstrate in our next chapter, that private sector involvement in urban renewal shifted dramatically in the post-Great Society period. The effect was most certainly to narrow the private sector leadership in urban renewal to the real estate crowd and the downtown business community–for the most part. That, however, is another story to be told later in this tale.
[1] Teaford, op, cit. p. 56
[2] Teaford, op. cit, pp. 55-56.
[3] Teaford, op. cit. pp. 57-58.
[4] Teaford, op. cit. pp. 62-63.
[5] Teaford, op. cit. p. 46.
[6] The reference here is to T.S. Eliot, the Wasteland (1922) –“Unreal City under the brown fog of a winter noon”. The Wasteland reflects our sense of how the central city had evolved at this time, and the spirit and the hope for its return to be led by a new elite. “Revive for a moment a broken Coriolanus. The boat responded Gaily to the hand expert with sail and oar. The sea was calm, your heart would have responded Gaily, when invited, beating Obedient to controlling hands. I sat upon the shore, Fishing, with the arid plain behind me. Shall I at least set my lands in order”? London Bridge is falling down falling down falling down.”
[7] The Chamber’s chief strength, that it represented, more or less, the entire community business community was also a weakness if the powerful new generation of national and international corporate leaders were to participate. The programs of the traditional Chamber were many and varied, from tourism, to advocacy, to industrial promotion, to golf games and luncheon speakers. The new structures of economic development were, however, much more structures of corporate power and expertise applied to a particular city’s needs and problems. The ambition and the complexity, required to attack problems such as obsolescence, decentralization or infrastructure modernization, were on a scale vastly different than tourism and industrial promotion. For example, given Dillon’s Law the city often had not legal or structural power to even deal with some issues and it was clear at the outset that states, certainly, and most likely even the federal government would need be brought into the picture. The new private EDOs would, of necessity, be structures of power, expertise, and sustained coordination–not representation of diverse constituencies.
[8] The Civic Progress League was particularly encompassing of several functions. It controlled the United Fund (United Way). It also housed the Hospital Planning Commission, the Regional Industrial Development Corporation, and by the time of the Great Society (1966) it would exercise considerable influence over the city’s Model Cities Program and the Human Development Agency (St Louis poverty agency). See Dennis R. Judd, op. cit. p.113.
[9] Throughout all this section we have used Teaford extensively; in particular, pp. 44-54.
[10] Teaford, op. cit. p. 53.
[11] Teaford, op. cit. pp. 69-71.
[12] Revenue bonds (which are different from industrial revenue bonds) allow a public entity to issue a bond whose repayment and collateral is based on revenues/payments/proceeds generated by the service/infrastructure created by the bond. The asset created by bond financing is controlled and owned by the public entity. They are regulated by the state. The industrial revenue bond allows for the asset to be owned and controlled by a private party or company. It allows a public entity to issue a taxable bond to benefit a private firm. While the costs to the private firm are generally higher than a normal mortgage, the interest rate is lower. Usually, the IRB is a taxable bond issuance unlike an industrial development bond–which is different from an industrial revenue bond.
[13] Teaford, op. cit. p. 91.
[14] Jon C. Teaford, The Rise of the States: Evolution of American State Government (Baltimore, Johns Hopkins University Press, 2002) p. 97.
[15] Teaford, op. cit. p. 94.
[16] Teaford, op. cit. p. 95.
[17] Teaford, op, cit, p. 96.
[18] For a wonderful description and analysis of “urban public investment”. i.e. infrastructures see Alan Altshuler and David Luberoff, Mega-Projects: the Changing Politics of Urban Public Investment (Washington D.C, Brookings Institution Press, 2003).
[20] ULI advanced a model format for state redevelopment legislation in 1946 (Seward Mott) entitled “principles to be Incorporated in State Redevelopment Acts”. Type I Redevelopment Agencies (ten already in existence at his time of writing) were deficient in that they were limited to housing, retained control of finished product and allowed less room or opportunity for private initiative–the good part of Type I was that it allowed for a Moses Bedford-Stuyvesant with its insurance company financing. Type II (approved in the BAWI states of Tennessee and Arkansas) were exclusively housing redevelopment agencies, were concerned with relocation and allowed NO room for private corporations. ULI preferred Type III (which was adopted by the majority of states by 1949, authorized the creation of an local urban redevelopment agency, governed by private citizens, separate from the housing authority, under local control and the cleared land could be reused for any purpose in accordance with an approved comprehensive plan and with the objective of securing the highest and best use of the area. Marc A. Weiss, “The Origins and Legacy of Urban Renewal” in Federal Housing Policy and Programs: Past and Present *J. Paul Mitchell, ed., Center for Urban Policy Research, 1985. pp. 260-261
[21] Teaford, op. cit. p. 106.
[22] Teaford, op. cit. p. 108.
[23] Jon C. Teaford’s, the Rough Road to Renaissance: Urban Revitalization in America, 1940-1985 (Baltimore, the Johns Hopkins University Press, 1990) pp. 105-120.
[24] Teaford, op. cit., pp. 116-118
[25] The best single source for the reader on this period is Jon C. Teaford’s, the Rough Road to Renaissance: Urban Revitalization in America, 1940-1985 (Baltimore, the Johns Hopkins University Press, 1990). See in particular Chapter 3, p. 108: Progress or Decay. We are also very partial to Alan Altshuler and David Luberoff’s, Mega-Projects (Washington DC, Brookings Institution Press, 2003) which is more infrastructure-focused than Teaford. Samuel Zipp’s Manhattan Projects: The Rise and Fall of Urban Renewal in Cold War New York (New York, Oxford University Press, 2010) presents a very helpful New York City-based evolution of urban renewal and links it to the larger Progressive coalition and its incorporation of what amounts to a revamp of the Pre-War American Dream. Zipp can provide a very detailed sense on the role of the private sector and its involvement and evolution in urban renewal governance. All of these sources, also implicitly deal with our Quasi Redevelopment EDOs. See also Dennis R. Judd, The Politics of American Cities, 2nd Ed, (Boston, Little, Brown, 1984) Chapters 3 and 4)
[26] Siegfried and Zimbalist, Journal of Economic Perspectives Vol. 14, No 3, Summer 2000, p.96; also see Zimbalist and Noll, Brookings Institution Press
[27] Teaford agrees “During the late 1940’s and early 1950’s, the federal role was as yet limited, and the physical rehabilitation of the cities depended primarily on state and local resources”, p. 121.
Ron W. Coan 