Severe Wealth Inequality Is Destroying The World's Great Cities

Last weekend we noted in, post about the galloping inequality inherent in urbanization that Richard Florida was warning that "Young, affluent, highly educated people have flowed back to downtown cores in cities like London, New York, San Francisco and Vancouver. Good jobs, better restaurants, higher tax revenues and even high-tech startups have followed. But this dramatic back-to-the-city movement also has its dark side, giving rise to what I call the new urban crisis, which registers itself in increasingly unaffordable housing and a growing divide between rich and poor." Since then, Florida was on NPR with Steve Innskeep (above), discussing his new book, The New Urban Crisis. He explained to the NPR listeners that "the middle-class neighborhoods, those platforms for the American dream, have been decimated" and that blue-collar service workers "are being pushed out of these metropolitan areas entirely." He blames Democratic politicians in the big cities and says flatly that they have "abandoned progressive policies" and he blames how power (and taxes) have flowed to the federal government and away from local governments.

We have to make a commitment to building affordable housing because what's getting built in New York and in Los Angeles and San Francisco and what is causing the backlash is luxury towers and luxury lofts for the wealthy. Number two, we've got to build more transit. We've got to build transit that connects parts of our cities and parts of our communities-- and actually those lagging areas-- that connects them to employment centers near the urban core, which is where the best jobs are being created. But the third thing we have to do that's absolutely critical and that very few people are talking about-- we have nearly 70 million jobs now in the blue-collar service economy-- food preparation, food service, office work, personal care services-- the fastest growing jobs in our country.

So I talk in the book about the need to massively increase the minimum wage to take into account the cost of living. So that minimum wage would be higher in New York and San Francisco than it would be in Buffalo or Pittsburgh, of course. As a country, we really spend time and money making manufacturing jobs good jobs. We increase the wages so that people who work in factories could buy the cars and consumer durables coming off the assembly lines. The only way we're going to build a middle class today is to make sure the service workers-- 70 million strong, more than roughly half of our workforce-- that they have jobs that are middle class jobs. And right now, they're sinking further and further behind.

...I had hoped that our federal government would lead here. But now with the Trump election and Republicans in control of both houses, that's impossible. So I think the default for the United States is this progressive group of cities and mayors and urban leaders and philanthropy. And let's hope progressive businesses-- the tech companies, the knowledge companies, progressive real estate developers-- will get on board with this because we are in such deep trouble with this overblown nation-state and really out of sync with the times. Dysfunctional, imperial presidency-- we see that with Trump in office, but it's been there all along. I really do see cities and local empowerment as probably the only way out of this new urban crisis.

There's an excerpt from his book in the new issue of The Atlantic, The Roots of the New Uran Crisis. In his 2002 book, The Rise of the Creative Class, he laid out the basis for urban success-- attracting and retaining talent, not just companies. "The knowledge workers, techies, and artists and other cultural creatives who made up the creative class were locating in places that had lots of high-paying jobs-- or a thick labor market. They also had what I called a thick mating market-- other people to meet and date-- and a vibrant quality of place, with great restaurants and cafés, a music scene, and an abundance of things to do."

In time, my work generated a considerable following among mayors, arts and cultural leaders, urbanists, and even some enlightened real estate developers who were looking for a better way to spur urban development in their communities. But my message also generated a backlash on both sides of the ideological spectrum. Some conservatives questioned the connection I drew between diversity and urban economic growth, countering that it was companies and jobs, not the creative class, that moved the economy forward. Others, mainly on the left, blamed the creative class and me personally for everything from rising rents and gentrification to the growing gap between the rich and the poor. Although some of the more personal attacks stung, this criticism provoked my thinking in ways I could never have anticipated, causing me to reframe my ideas about cities and the forces that act on them.

Slowly but surely, my understanding of cities started to evolve. I realized I had been overly optimistic to believe that cities and the creative class could, by themselves, bring forth a better and more inclusive kind of urbanism. Even before the economic crisis of 2008, the gap between rich and poor was surging in the cities that were experiencing the greatest revivals. As techies, professionals, and the rich flowed back into urban cores, the less advantaged members of the working and service classes, as well as some artists and musicians, were being priced out. In New York’s SoHo, the artistic and creative ferment I had observed as a student was giving way to a new kind of homogeneity of wealthy people, high-end restaurants, and luxury shops.

I entered into a period of rethinking and introspection, of personal and intellectual transformation. I began to see the back-to-the-city movement as something that conferred a disproportionate share of its benefits on a small group of places and people. I found myself confronting the dark side of the urban revival I had once championed and celebrated.

As I pored over the data, I could see that only a limited number of cities and metro areas, maybe a couple of dozen, were really making it in the knowledge economy; many more were failing to keep pace or falling further behind. Tens of millions of Americans remain locked in persistent poverty. And virtually all our cities suffer from growing economic divides. As the middle class and its neighborhoods fade, our geography is splintering into small areas of affluence and concentrated advantage, and much larger areas of poverty and concentrated disadvantage.

It became increasingly clear to me that the same clustering of talent and economic assets generates a lopsided, unequal urbanism in which a relative handful of superstar cities, and a few elite neighborhoods within them, benefit while many other places stagnate or fall behind. Ultimately, the very same force that drives the growth of our cities and economy broadly also generates the divides that separate us and the contradictions that hold us back.

My perspective on cities and urbanism was also deeply affected by what I saw happening in my adopted hometown of Toronto. I had moved there in 2007 to head up a new institute on urban prosperity at the University of Toronto. For me, the city was a bastion of the very best of progressive urbanism. Toronto had as diverse a population as can be found anywhere in North America; a thriving economy that was barely dented by the economic crisis of 2008; safe streets, great public schools, and a cohesive social fabric. Yet, somehow, this progressive, diverse city chose Rob Ford as its mayor.

While his personal foibles and dysfunctions may have endeared him to his Ford Nation of supporters, he was, to me, perhaps the most anti-urban mayor ever to preside over a major city. Once elected, Ford went about tearing down just about everything that urbanists believe make for great cities. He ripped out bike lanes, and developed plans to turn a prime stretch of the city’s downtown lakefront into a garish mall, complete with a giant Ferris wheel.

Ford’s rise was the product of the city’s burgeoning class divide. As Toronto’s once sizable middle class declined and its old middle-class neighborhoods faded, the city was splitting into a small set of affluent, educated areas packed in and around the urban core and along the major subway and transit lines and a much larger expanse of disadvantaged neighborhoods located far from the city center and transit. Ford’s message resonated powerfully with his constituency of working people and new immigrants, who felt that the benefits of the city’s revitalization were being captured by a downtown elite and passing them by.

I came to see this mounting class divide as a ticking time bomb. If a city as progressive, diverse, and prosperous as Toronto could fall prey to such a populist backlash, then it could happen anywhere.

At the time, I said Ford was just the first signal of this brewing backlash: more and worse would follow. It did. In short order came England’s stunning and wholly unexpected decision to leave the European Union with the Brexit. Vehemently opposed by affluent, cosmopolitan London, it was backed by the struggling residents of working-class cities, suburbs, and rural areas who were being left behind by the twin forces of globalization and re-urbanization.

But what came next was even more unanticipated-- and even more frightening: the election of Donald Trump to the presidency of the most powerful country on the planet. Trump rose to power by mobilizing anxious, angry voters in the left-behind places of America. Hillary Clinton took the dense, affluent, knowledge- based cities and close-in suburbs that are the epicenters of the new economy, winning the popular vote by a substantial margin. But Trump took everywhere else-- the farther-out exurbs and rural areas-- which provided his decisive victory in the Electoral College. All three-- Trump, Ford, and Brexit—reflect the deepening fault lines of class and location that define and divide us today.

These political cleavages ultimately stem from the far deeper economic and geographic structures of the New Urban Crisis. They are the product of our new age of winner-take-all urbanism, in which the talented and the advantaged cluster and colonize a small, select group of superstar cities, leaving everybody and everywhere else behind. Much more than a crisis of cities, the New Urban Crisis is the central crisis of our time.

The stakes could not be higher. How we come to grips with the New Urban Crisis will determine whether we become more divided and slide backward into economic stagnation, or forge ahead to a new era of more sustainable and inclusive prosperity.