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Prospect Magazine


The Mill Towns Round Our Neck

August 28, 2008

By Edward Glaeser

We urban policy scholars are usually thrilled when someone, anyone, reads our stuff. Like greying veterans of Woodstock and Haight-Ashbury, many urbanists look back nostalgically at the 1960s, not out of any particular fondness for Janis Joplin, but because in those years, scholars of cities, like Daniel Patrick Moynihan, Jane Jacobs and Edward Banfield, made headlines and influenced policy. I am therefore thrilled at the media carnival unleashed by the think tank Policy Exchange's report "Cities Unlimited."

The report was controversial because it suggested that the urban giants of the industrial age, like Liverpool, will never reclaim their former glory, and that public policy should recognise that fact. Residents of Liverpool have taken this as a personal attack. Tory leader David Cameron, doubtless aware that there are voters in the northern industrial cities, has distanced himself from the report.

I do not agree with everything in the Policy Exchange report, but it does contain important insights. The economic forces that drive the rise and fall of cities are powerful and hard to reverse. Historically, most attempts at urban renewal have been expensive failures. In the US, I was sceptical about the idea of spending up to $200bn to rebuild New Orleans in the wake of Hurricane Katrina. I said that this money could be better used by giving displaced citizens vouchers to pay for housing, food and education.

My work on New Orleans was an (unsuccessful) attempt to make sure that government aid went to suffering people rather than politically connected contractors, but I received plenty of angry responses, similar to those directed at Policy Exchange. This reflects the tendency for people to think of their city like a sports team-go New Orleans, come on Liverpool-and to take pride in its growth and accomplishments. Rooting for your town is fine for individuals in moderation, but it is a bad basis for government policy.

The starting point for any serious urban policy is to recognise that the government's objective should be to enrich and empower the lives of people, no matter where they live. The state should work to improve the lives of poor people, but that does not imply trying to bring economic activity into every poor place. Could it possibly make sense for the government to spend billions trying to bring manufacturing plants to John O'Groats?

Even if the focus of policy should be helping people, not places, there is still plenty of scope for place-based policies. Our quality of life depends on the safety and attractiveness of our neighbourhoods. There is every reason to work to improve schools, streets and safety in Manchester and Liverpool, even if the objective isn't to artificially boost the population of those towns.

The big problem with basing policy-making on urban boosterism is that all sorts of nonsense can be justified as a means for bringing cities back. Within the US, billions of dollars have been spent on foolish housing and infrastructure projects, like monorails and convention centres, which were sold as tools to bring rust-belt cities back. These policies didn't bring back the rust belt, and Americans were foolish to think that they could. The hallmark of declining cities is that they have plenty of infrastructure relative to people. After all, they were built up during an earlier, more prosperous era. It makes no sense to build more structures in places that are losing people.

England's older industrial cities can have a brighter future, but that future can come only by investing in people. Neither infrastructure nor industrial policy offer a way forward. In both the US and Britain, human, not physical, capital has been the source of urban regeneration. Across older, colder American cities, education levels have been the strongest predictor of urban success since 1960. There is a similar pattern in Britain. Highly skilled Edinburgh booms, while less well educated Glasgow suffers. The urban edge comes from the ability of smart people to connect in dense urban areas. The same forces of globalisation and technology that have been so hard on the goods producers in Detroit and Liverpool have been great for the idea-producers in London and Boston. Economic change has increased the returns to being smart, and you become smart by being around smart people.

London's high housing costs offer an opportunity for the rest of Britain. Like the authors of the Policy Exchange report, I believe that London should ease its land use restrictions and permit more high-rise construction. More building will make the city more affordable and allow more people to participate in its dynamic economy. Taller city buildings are also one of the best responses to global warming, since urbanites drive less and use less energy heating and cooling their apartments than people in the suburbs.

But I doubt that London will ever permit enough building to make the city all that affordable-so if the older cities can provide a better quality of life they can attract people and companies priced out of London. Of course, not every city will succeed, and that is all right too. The role of government is not to favour one place over another, but to provide a level playing field for places while investing in people. The important thing is that children in the industrial north are given the skills to succeed, not whether they choose to continue living in former mill towns.

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