Cities are Changing, But Urban Living Remains Optional


Starting with the first oil crisis in 1973, it’s become de rigueur for the press to accompany every spike in energy prices with a spate of stories explaining how the higher costs will inevitably lead to the revival of the long declining industrial cities of the Northeast and Midwest. But don’t count on a boom in Baltimore or Cleveland anytime soon.

This iteration’s model might be the June 25 New York Times article entitled “Fuel Prices Shift Math for Life in Far Suburbs,” neatly encapsulated in the photo caption, “As gas prices climb, people who once considered an exurban commute are now considering center-city living.”

Such wishful thinking from news reporters, who live in cities, and urban planners, who have an even more direct stake in them, enhanced by the mortgage crisis and the presidential election, has obscured the fundamentals that will continue to determine where people choose to live and, by extension, which cities thrive. Job demand, tax levels, well-provided services — especially garbage, police, transportation infrastructure and schools — and a resilient and diversified job base remain key.

In New York, for example, even as the economy has grown since 9/11, it still has less jobs than it did on September 10, 2001, meaning the city now depends on a relative handful of high-paying positions, and is at the mercy of a relative handful of large employers and very well-paid employees.

As job growth continues to occur mostly on the periphery, where space is cheaper and taxes tend to be lower and the inclination is to fight to attract businesses, not see how much tax and fee money can be extracted from them without inspiring them to leave, people still have options. And despite the cries of the New Urbanists, it’s not always the easiest thing to go from, say, one part of Chicago to another. To the extent that job growth occurs mostly on the periphery, people still have options, and clustering in the exurbs seems more likely than a mass return to the center.

While white flight seems to have stabilized, city life remains most appealing to the youngest and oldest members of the middle class — meaning those without children or whose children have left the home. In short, urban living remains an appealing, but optional mode of existence most appealing to the very poor, the very rich, young singles and older empty nesters.

There are, though, a few new and relatively little-noticed developments in play that will have dramatic and unpredictable effects on the urban experience over the next several decades. Here are three worth tracking:

  • Telecommuting. High gas plays into it, but more generally there’s little reason to have many workers sharing a physical space, purchased or rented by their employers, for 40 hours a week. Expect a new model that compels many information workers, in the broadest definition, to show up for a day or two a week for face time, but otherwise to rent shared work spaces or to work from their homes. While this trend may have begun with freelancers bringing laptops and surge protectors into Starbucks, much more is coming, even if the trend has been retarded by the reluctance of managers to serve as early adaptors to the trend.

    The upshot will be a retrofitting of office space to residential use, which will serve as a countervailing pressure to sky-high residential rents in high-demand cities like New York and Chicago, while adding to the excess unoccupied inventory in shrinking cities. Purchasers will benefit from lower prices, but the repurposing of hundreds of millions of square feet should be a serious damper on the new construction industry and market.

  • Intelligent pricing (sunk costs raised). Bloomberg’s slap-dash congestion pricing plan may have happily gone down, but other more serious ones with elements like congestion parking and variable fees will emerge. The danger here can be seen in one early, if clumsy, example of this trend—smoking taxes, which were pushed through, as were smoking bans, through arguments about the sunk health costs smokers incur.

    The trouble, of course, is that any time fees are used both to influence behavior and to generate revenue, the need for money eventually trumps all other goals.

  • Continued reductions in privacy. London is again the model city here, but really this is a national and international trend. As governments are able to collect and store more information, they will, and information that can translate into imperative and immediate actions naturally consolidates in the executive branch. DNA databases, fingerprinting, security camera footage, phone record and even metrocards and EZ passes, along with storage and sifting of publicly accessible information, will redefine privacy downward, even as civil rights-and-liberties types fight a rear-guard battle against a technological fait accompli. Much as governments will always spend all of the monies available to them, they will collect and use such information.

Working out safeguards — and reporting on already accomplished abuses — will be a major sport in years to come, and will likely bring down at least one national-profile big city mayor in the next decade.

Harry Siegel is an editor for Politico.