THE FEDERAL GOVERNMENT
Western Infrastructure
Why mince words. Most of the West was literally owned and managed by federal bureaucracies, i.e. the federal government. Whatever history and tradition characterized economic development east of the Mississippi, it was likely to be a quite different story in the West for that reason alone. The federal role started during the nineteenth century.
The 1891 Forest Reserve Act/Land Revision Act authorized the President (Benjamin Harrison) to set aside and reserve land and forest areas from the public domain. Added to by both the Cleveland and McKinley administrations, the land/forest aggregation was turned over to the newly formed (1905) Forest Service, the creation of Gifford Pinchot and Theodore Roosevelt. By the 1990s over 740 million acres—one-third of the nation—was still directly administered by the federal government. The feds were many western states’ largest landowner, and they controlled economic recreational/ tourist activities conducted on these lands.
In 1919 the National Park Organic Service Act established a nationwide set of national parks, and, intentionally or not, put Uncle Sam into the local/regional tourism business. Federal ownership of so much land and the involvement of the federal government in regulating/conducting what, in other states, would be local/state economic development activities/business climate created a complexity, if not a constant source of tension in western state economic development. This tension did not take long to manifest itself. In 1922, after leasing federal petroleum reserves to a private firm, a massive scandal, the Teapot Dome, erupted. The tension persists and will be discussed in Chapter 19; but suffice it to say, the federal government will be an EDO as far as western tourism goes.
As a starting point in regard to the federal role in western economic development, I make three observations:
- The West as described by its famous explorer, John Wesley Powell, is “an arid region”;
- Anyone who has survived a car trip across the West will know—it is BIG. Getting from place to place and providing services over such a dispersed, loosely populated area is a different matter; and
- The Pacific Ocean required the federal government to construct a defense/military presence in the Pacific coastal states.
These observations require certain infrastructures that will be discussed in this section: water, energy and highways. First and foremost, the federal government had to deliver infrastructure if the West was ever to develop. Several of these infrastructures will be discussed, albeit briefly, in Chapter 13. This brief entry into the world of federal infrastructure in western states mostly provides a time line for critical infrastructure developed in these years by the federal government. Frank Wiggins could not have grown oranges, and Mulholland stolen his water without earlier federal intervention.
Agriculture, the gray area of economic development, prompted early western state action to advance wide-scale household farming, then Frank Wiggin’s infamous orange groves and, in fairly short order, large-scale commercial agriculture. By the time John Steinbeck’s heroes were making their way from the Dust Bowl to employment on southern Californian farms, a second book, Carey McWilliams’s Factories in the Field (1939) provided vivid testimony of the existence and weaknesses of California’s highly developed commercial agriculture complex. Donald Worster (1992) argues that, over 40 years, California and other western states developed into a hydraulic economy similar to that of the ancient Egyptians and Mesopotamians—an economy based on farming made possible by irrigation accomplished through concerted, large-scale government public works.
The government–irrigation nexus grew out of an 1871 private firm, the San Joaquin and King’s River Canal and Irrigation Company, headquartered in San Francisco. This corporation opened up the San Joaquin Valley, and within two years irrigated over 16,000 acres. Rich and poor, big and small farmers flooded into California, and by the 1880s new migrants had consumed nearly every drop of water in sight. The 1895 formation of the Fruit Growers Exchange prompted yet more marketing cooperatives that fed the grocery stores of the nation—and drained more water. Deeper wells were required. In order to accommodate further growth, eventually large-scale irrigation was required.
In 1887 the Wright Act (California) authorized farmers to organize a quasigovernment entity that could own land, build irrigation complexes and tax the landowners: the agricultural district was born. “By 1920 there were 71 irrigation districts in the state, most of them put together in the boom years of 1915 to 1920. The largest, covering over a half million acres, was in the Imperial Valley” (Worster, 1992, p. 60). It was only a question of time, and in the late 1930s the New Deal federal government commenced the Central Valley Project. The quest for water for a thirsty population and growing economy had drawn the federal government into the provision of infrastructure necessary for western states’ economic expansion. It didn’t come willingly (Hundley, 2009).
In 1917 seven states formed the League of the Southwest to promote development (irrigation) from the Colorado River. Congress in 1921 authorized the states to enter into an agreement to allocate the flow and resources of the Colorado. So in 1922 the Colorado River Compact, a controversial agreement, was signed and the river’s water rights were allocated to each member state.12 The federal government played a major role in the politics and negotiation of the Compact; indeed, Worster asserts that much pressure for the first federally constructed dam program came from the Bureau of Land Reclamation as well as the City of Los Angeles.13 Worster’s take was that without the Frank Wiggins—Los Angeles Chamber entrepreneurial drive to encourage migration and commercial agriculture, there would have been little reason to construct the dam system. He cities Mulholland, who had earlier declared (1907): “If we don’t get the water, we won’t need it. We have to get the water or quit growing” (Worster, 1992, p. 69). In any case, the Colorado River Compact made dam construction and electrification of the inland West possible.
A confirmed Privatist, Calvin Coolidge, signed the Boulder Canyon Act in 1928 and set in motion federal dam construction. President Hoover in 1930 dedicated the dam and started construction (that’s why they call it the Hoover Dam, stupid). In any case, the Hoover Dam was completed and generating power by 1937. At that time, however, Harold Ickes, FDR’s Secretary of the Interior, changed the name to the Boulder Dam.
Hoover Dam was followed in 1938 by Parker Dam, located 150 miles downstream and furnishing water for the California Aqueduct which supplied the City of Los Angeles. Then came the building of the Imperial Dam and the All-American Canal to supply the agri-business interests farther south on the Mexican border. Then Davis Dam began to go up in 1946, and soon after the Morelos Dam in Mexico … the names proliferated endlessly … Blocked, trapped, stilled and siphoned off, the Colorado finally ceased in normal seasons to reach the sea. (Worster, 1992, pp. 70–71)
Somebody somewhere might be thinking about highways, so let’s switch from dams and water to a happier note—Route 66. The Will Rogers Highway began construction in 1926 and crossed over 2400 miles from Chicago to Santa Monica.14 Although not completely paved until 1938, Route 66 served the function performed by the National Road (opening up the Southwest)—but without the controversy the latter engendered. In short order, Route 66 became part of the American fabric and legend: the highway traveled by Grapes of Wrath Dust Bowlers; the route of wartime industrial decentralization and population migration; and an early 1960s’ television series my wife loved. Federal aid to highways increased from $216 million in 1932 to $805 million by 1936. Much of these federal highway monies, however, were spent in urban areas such as Triborough Bridge in NYC and the Arroyo Seco Freeway in Los Angeles (Altshuler and Luberoff, 2003, p. 78).
Accordingly, by the New Deal, the federal government had four decades of deep involvement in western infrastructure. FDR, however, faced other more complex issues than infrastructure in confronting the Great Depression: rural poverty, marginal farmers/livestock, a Dust Bowl and a large rural population in a nation that, in 1920, had on aggregate just achieved a bare majority of urban residents. That is a story for Chapter 13.
THE CROWN JEWEL OF THE PACIFIC URBAN HIERARCHY: THE US NAVY
We started this chapter off with city-building. That discussion asserted, among other observations, that cities in the city-building “phase” highly prioritize economic development and that, by its nature, city-building is closely associated with our third driver, the competitive (regional/national) hierarchy. Left unsaid in that discussion, but now abundantly apparent, city-building generally involves ED strategies that tap into either/both building the industry/sector jurisdictional economic base or some form of citizen-attraction to increase city size, markets and so forth. The latter strategy is, of course, complicated by the reality that some cities “enjoy” heavy population inflows due to factors over which they have little control.
After 1900 Pacific western cities were in “growth mode” and the Pacific/West regional hierarchy was emerging. San Francisco (population 417,000 in 1910) was king of the mountain, followed by LA (319,000), Seattle (237,000) and Portland (207,000). In that decade events conspired to offer a “crown jewel” from the federal government to a Pacific port city. The jewel was the headquarters for a brand-spanking new Pacific fleet. Competition for naval facilities and bases, triggered by the prospective opening of the Panama Canal (August 1914), also overlapped with World War I. The canal was a game-changer. Each Pacific Coast city considered it an opportunity to diversify their economy and to grow their economic base. The race was on!
In the competition that emerged a sophisticated ED strategy was pursued by the above port cities. Labeled “Fortress California,” a landmark work by R. Lotchin, the strategy was already a time-honored one to positively affect federal decision-making to land some federal resource, facility or grant/ investment. More than 25 years would pass (1937) before the crown jewel was awarded—to San Francisco. In the interim the port cities of California competed to attract the jewel and the associated facilities that came with the Pacific Fleet. The ultimate winner in that competition was a city not on the above list, a city less than one-tenth the size of San Francisco—a city that forged a “fortress” strategy with which the other cities could not, or would not, effectively compete. If the Goliath was San Francisco, the David was San Diego (population less than 40,000). Given the prominent role of the federal government in western development, the fortress strategy could potentially be applied to the quest for any number of federal or state resources. Although not yet in its “activist” period, the federal government offered sub-state economic developers a viable approach to achieve ED jurisdictional goals. The lessons learned from San Diego therefore are just as valuable now as they were then.
San Diego’s Fortress Strategy
The fleet’s commanding officer, Admiral George Dewey, initially rejected a southern California location for his new fleet; Seattle’s excellent harbor was the apple of his eye. One could not discount the meteoric rise of Los Angeles—although its harbor politics were convoluted at best. Competition for fleet headquarters, however, proved to be a major league “head-fake.” The real plums were the various facilities and naval bases associated with the fleet (that’s where the jobs and contracts were). Most of those facilities had nothing to do with the fleet headquarters.
The initial competition seemed to be between San Francisco, Seattle and upstart Los Angeles—but the ultimate victor was none of the above. The first Pacific naval base was built in San Diego. Considerably smaller and less well known, its natural advantages were substantial: “The Border City enjoyed proximity to the Panama Canal, a mild climate, and the whole population was united to convince the Secretary (of War) that San Diego was by far the best site for Naval Bases on the Pacific” (Lotchin, 1992, p. 30). San Diego got its economic development big boy pants on, and outhustled its major league competition. Outhustling meant developing a sophisticated fortress California naval attraction strategy that had the audacity to bypass the navy and the fleet commander, going directly to their boss.
Central to San Diego’s success was the election of former chamber director William Kettner, a Democrat, to Congress in 1911.
During his tenure in the House of Representatives … the greatest available naval prize was the main home base of the Pacific fleet … Kettner did not openly aim for this trophy … Instead [he] concentrated publicly on smaller, less dramatic and newsworthy projects. As any Navy man knew, enough of these modest installations could eventually become a major one. (Lotchin, 1992, p. 28)
Kettner, relying on the chamber for local leadership, worked the House, the Senate, the Naval Department and the Corps of Engineers—which would be responsible for the harbor itself. When Democrat Woodrow Wilson became President in 1913, Kettner appealed directly to both Secretary of the Navy Josephus Daniels and Assistant Secretary Franklin D. Roosevelt. With materials and research prepared by the chamber, Kettner countered San Francisco’s initial advantage, isolated Los Angeles Republicanled advances and opposed the navy’s preference for a northwest location.
The key first step was to secure approval and funding for the Corps to dredge the harbor—making it competitive with other Pacific coast harbors. Shortly after, a coaling station, a fuel oil station and a radio station were approved for San Diego. The chamber played a critical role in identifying and securing sites for several of these facilities. Land was donated to the navy in each instance. A marine base (the nucleus for present-day Camp Pendleton), a naval air station, a naval training station and a naval hospital were subsequently built (all by 1917)—then the big boy announcement in 1919: San Diego’s designation as a “Naval Operating Base,” followed by, in 1921, a naval supply depot, a submarine repair base and designation as “Eleventh Naval District Headquarters.” With success in each small project, Kettner reduced the cost of establishing the main facility in San Diego. San Diego, its economic development and congressional leadership in close alliance, had sustained a decade-long, single-minded target of acquiring naval facilities. In so doing it pioneered how to implement a “fortress-defense industry economic development strategy.”
In this single-minded pursuit the community, its business community and political leaderships were consistently supportive: “The press, city government, Harbor Commission, civic clubs, labor unions, political parties and the public stood solidly behind the courting of the Navy” (Lotchin, 1992, p. 35). The Harbor Commission (formed in 1928) was the culmination and physical expression of a united community effort to remove politics from economic development and concentrate upon clear, defined and specific objectives by doing whatever seemed necessary to “close the deal.”
The Harbor Commission possessed tremendous power. It could plan and to an extent regulate development of the heart of the city and thereby extract concessions in return for privileges granted, especially to the military … The multiplication of navy piers, anchorage grounds, base sites and turning basins in one part of the harbor was echoed in the proliferation of parks, yacht harbors, industrial sites, harbor drives and airport runways in another. (Lotchin, 1992, p. 36)
If Portland and Seattle developed port authorities to establish public control over harbor development, San Diego did so to achieve its Privatist economic development strategy.
The most important reason for the placement of what became the main home base in San Diego was that the city let [the Navy] put it there. For the most part the city held veto power … simply by virtue of its control over its own waterfront, which was almost entirely municipal property … Almost everything the services got in San Diego came from enthusiastic city offers and much local brokerage of critical matters. (Lotchin, 1992, pp. 40–41)
The city added its own related capital investment and monies; dredged on its own dime, using the fill for its airport; and then built piers and facilities to attract commercial uses while facilitating access by rail to the various facilities. In the years before the bombing of Pearl Harbor, San Diego continued its focused economic development strategy, even more tightly weaving the city into the Naval and War Department’s decision-making fabric, adding still more naval and air facilities by relocating facilities in competing cities. It culminated in the 1935 San Diego World’s Fair, which promoted the accumulated assets in which the city sheltered the entire Pacific Battle Fleet.
In 2015 San Diego was the eighth largest city in the US, and California’s second largest.
Fortress Strategy and Competitive Urban Hierarchy
As described by Lotchin, early twentieth-century Pacific Coast cities (especially California) focused their city-building and chamber-style boosterism to forge a distinctive multi-decade ED–growth strategy based upon close ties between the city and the military. By linking municipal/state ED efforts to national defense policy (and war) these cities developed a sizeable economic agglomeration for their jurisdiction by acquiring military/governmental spending, facilities and personnel. In each of these pre-World War II Pacific cities, within its booster–competitive–chamber policy nexus, a network of business, political and national bureaucratic alliances were established, sufficient to obtain the desired military-related facilities/spending.
The core of these initiatives was an early military-industrial complex, an “Iron Triangle” of military/governmental bureaucracies, congressional delegations/ committees and municipal EDOs. Bureaucratically, chambers provided leadership, liaison and staff coordination with municipal/county/state, general business community, key private actors, the media and the Washington political/bureaucratic establishment. They arranged for incentives and developed formal programs support/implementation of the various projects.
San Diego was not the only Pacific city to do this. San Francisco competed intensely, and intelligently as well. The San Francisco Chamber actually received a municipal subsidy for its normal expenses and an extra one for its promotional activities. Elsewhere, chamber–government ties were especially close and their collaboration in military matters quite thick. The chambers’ courtship of the soldiers and sailors was institutionalized rather than improvisational. Although the chambers featured military affairs committees, by World War II the Los Angeles Chamber of Commerce had a committee for both military and naval affairs and, in addition, published a weekly newsletter devoted solely to civil and military aviation (Lotchin, 1992, pp. 13–15).
Despite its initial lead and genuine desire, San Francisco was unable to leverage its size and legacy to develop its harbor. The city diffused its focus, simultaneously trying to satisfy its Progressive business through comprehensive planning, neighborhoods, arts and commerce encompassed an expanded City Beautiful initiative. Harbor and naval base attraction, a more Privatist-style economic development, failed to connect to Progressive business elites and ethnic voters. Decentralization of political life to wards and civic improvement neighborhoods diffused city hall’s ability to develop a sustained, focused effort on naval base attraction. Los Angeles, on the other hand, could not muster the sustained intensity of a community-supported commitment to the Naval Department made by San Diego: “The Navy certainly did not occupy the central place in the City of the Angels that it did in San Francisco, San Diego or Vallejo” (Lotchin, 1992, p. 38). Against this backdrop, the reader may be amazed to learn that San Francisco achieved formal designation of Pacific Fleet home port (1937)—only to lose that to Hawaii’s Pearl Harbor in 1940.
Fortress California has become so deeply impressed in our understanding of the early rise of California’s cities that one might think these cities invented the strategy—they didn’t. San Antonio,15 unequivocally, engaged in a defense-based economic development strategy essentially similar to Lotchin’s California cities—but in the 1880s (Charleston around 1900 as well, among others). What distinguishes the Pacific states’ use of this strategy is that it truly was a decentralized region-wide strategy used by municipalities to compete for position in the Pacific urban hierarchy. World War I unleashed a period of great prosperity as war production demanded western resources (fishing, mining, lumber, agriculture) and prompted shipbuilding for the newly established (1919) Pacific Fleet and a new, but struggling, aircraft industry as well. The insecurity of each city’s business elites increased, as did their perceived need for growth and regional dominance by acquiring facilities associated with the Pacific Fleet/military for their metropolitan area: “This naval/air realignment triggered economic war up and down the West Coast” (Lotchin, 1992, p. 6).
By the time of the bombing of Pearl Harbor, California cities had created a well-entrenched pattern of pursuing military wealth in order to create urban greatness … Each city had become a metropolitan-military complex by the time the Japanese attacked Pearl Harbor. Each had long-standing political ties between civilian and military sectors as well as a huge military or potentially military economic investment to protect. Each had institutionalized its union with the military through political institutions like the naval and military affairs committees of the chambers of commerce, city governments and educational devices and had invented pageants [events] to link the emotional life of the metropolis to the fate of the military … and [these cities] competed with each other impetuously for the spoils of war. (Lotchin, 1992, pp. 1–2)
Ron W. Coan 