The twenties: not so calm before the storm

INTRODUCTION

Looking back over Part I, the chapters have been about growth—of industrial Big Cities, southern cities (despite its “divided mind”) and city-building western cities. No matter the region, the bottom line has been growth: what kind, how much, how to do it, who is and who isn’t. Even community developers of the period strive to assimilate the disadvantaged to enjoy the benefits of growth (while staving off civil disruption).

Despite being centered on growth, at this critical junction of the 1920s, the three regions were in very “different spaces”. They didn’t start growing at the same time, and they didn’t develop identical jurisdictional economic bases. They didn’t approach growth in the same way; political culture mattered in how cities in different regions sought growth. So did the impact of the urban competitive hierarchy on policy-making. Growth, like Baskin-Robbins ice cream, comes in several flavors.

During the twenties, growth was in style. Going with the flow, cities/regions enjoyed the fruits of growth: prosperity and good times. Of all the decades researched in this history, the 1920s were one of the quietest in our ED policy history. Life couldn’t be better. Yes, these were Prohibition years, yet persistent rumors of rum-runners, speakeasies and something called the Roaring Twenties suggest otherwise. Economic development as a policy area faded into the background, suggesting that affluence and prosperity lowers ED on the municipal policy agenda. GNP nearly doubled over the decade.

There was a construction boom, new skyscrapers went up downtown; suburban home-building in style, telephones, cellophane plastics, cigarette lighters, Pyrex glass, and modern bathrooms were hot consumer items. The hottest innovation, the smartphone of the day—the radio—blared from every house. Sports were what people listened to. The finishing touches for urban electrification were installed, allowing all sorts of household labor-saving devices to work their wonders (toasters, vacuums, sewing machines). Unemployment started off in 1920 at 5.2 percent, and by 1928 it was down to 4.2 percent. ED’s importance paled when you can go to the movies or foxtrot.

As far as ED went, while off to the side, second wave chamber-style ED was in its golden years, the tail-end projects of the City Beautiful era were finishing up. Port authorities were introduced to airports (and buses). Indeed, economic development itself founded a national professional association. Federal legislation effectively ended immigration by mid-decade, but the Southern Diaspora gathered steam during the twenties Mostly black migrants, however, continued to pour into Big City neighborhoods in everincreasing numbers. The 1919 Chicago race riot was among the worst ever, but in the twenties the Lost Generation and the Harlem Renaissance also raged—mostly unnoticed. But even in Harlem one could see there was a whole lot of shaking going on.Over the decade an estimated 117,000 whites moved out of Harlem and 87,000 blacks moved in. Not that it was mentioned in F. Scott Fitzgerald’s The Great Gatsby (1925).

In 1920 the Census Bureau reported for the first time that a slight majority of the nation lived in “urban areas”. Most people thought Big Cities would grow forever— until the 1930 census came out and “decentralization” became the buzzword of the Policy World. By the end of the decade some Big Cities were effectively stagnant, and a few had actually declined. The Census Bureau detailed “metropolitan areas” and planners talked about “regional plans”. Suburbanization, excuse me decentralization, was the talk of the town—and decentralization had evolved from an optimistic opportunity to a worrisome concern. By the end of the 1930s, decentralization had become the principal concern of Big City economic development for the next 30 years—or more. Still, the competitive urban hierarchy was about to acquire an “intra” metropolitan competitive dimension on top of the usual inter-urban one.

Reflection and the Pivot to Part II

There were “ED things” going on, of course, and several will be discussed in this chapter. But municipal policy systems were digesting their new-found structural capacity, and voters had moved on to other concerns. This allows us the opportunity to look back a bit and reflect, and to prepare ourselves for Part II. Four topic areas will be discussed in this chapter. First, the formation of the American Industrial Development Council must be discussed, and the appearance of states (state-level EDOs and state ED strategy) is a notable feature of the decade. The focus on ED structures allows us the opportunity to reflect on two aspects of our Chapter 1 framework: onionization and siloization.

A second subject, the jurisdictional economic base, opens up discussion on the profit life cycle. Over the previous 50 years or so certain sectors will reach the critical late Stage 3 and 4, and several important new sectors (automobile) leaped from Stage 1 to early Stage 3—and oligopoly. Oligopoly affects economic developers’ ability to manage their jurisdictional economic base, and oligopolistic decision-making calls attention to the “mobility of capital”. Using the Lehigh Valley in Pennsylvania as an example, we will also veer away from Big Cities and review how regional centers handled ED. Finally, we return to our textile industry case study, looking deeply at how agglomeration decline is defined by ED actors and how they choose to manage it. In the process the reader will sense that textile agglomeration decline escalates into an undeclared regional war—a forerunner of things to come. Throughout the entire discussion of the jurisdictional economic base, the reader might also sense that, aside from New England, nobody is paying much attention to its needs, or its evolution. The profit life-cycle is ticking away, but if anything ED is focused more on urban competition, with retention viewed more as preventing firms from moving than addressing their competitive needs. Sitting off to the side of ED’s agenda, the economic base of Big Cities is beginning to look like a time bomb.

Community development is next. There’s a lot going on in this decade that will consume our attention. Still we will find opportunity to take note how CD differs from ED. In particular we call attention to various “wings” within a community development “movement”: wings that will be important in Part II; wings that reveal the considerable “fragmentation” within the movement. Finally, we will segue into decentralization (suburbanization). Unlike much contemporary thought which focuses on post-World War II (fifties and sixties) as the pivotal period of suburbanization, our history strongly argues that the 1920s is when suburbanization entered the ED/CD agenda—and quickly became the hottest topic in Big City economic development. In the twenties most were unsure if decentralization was an opportunity or a threat. In Part II it will eventually be defined as a threat; slum clearance, public housing and urban renewal will revolutionize Big City economic development—and profoundly affect the course this history will take.

The chapter will conclude by returning to growth as the central goal of Part I economic development, arguably the central goal of ED through its history thus far. Parts II and III (and a separate volume currently under way) also center on growth, and its absence—that is, decline—and on redefining growth to accommodate new values and technological change. This conclusion introduces growth and prepares the reader for Parts II and III.