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Why the Economic Fates of America’s Cities Diverged - The Atlantic
"What accounts for these anomalous and unpredicted trends? The first explanation many people cite is the decline of the Rust Belt, and certainly that played a role."



"Another conventional explanation is that the decline of Heartland cities reflects the growing importance of high-end services and rarified consumption."



"Another explanation for the increase in regional inequality is that it reflects the growing demand for “innovation.” A prominent example of this line of thinking comes from the Berkeley economist Enrico Moretti, whose 2012 book, The New Geography of Jobs, explains the increase in regional inequality as the result of two new supposed mega-trends: markets offering far higher rewards to “innovation,” and innovative people increasingly needing and preferring each other’s company."



"What, then, is the missing piece? A major factor that has not received sufficient attention is the role of public policy. Throughout most of the country’s history, American government at all levels has pursued policies designed to preserve local control of businesses and to check the tendency of a few dominant cities to monopolize power over the rest of the country. These efforts moved to the federal level beginning in the late 19th century and reached a climax of enforcement in the 1960s and ’70s. Yet starting shortly thereafter, each of these policy levers were flipped, one after the other, in the opposite direction, usually in the guise of “deregulation.” Understanding this history, largely forgotten today, is essential to turning the problem of inequality around.

Starting with the country’s founding, government policy worked to ensure that specific towns, cities, and regions would not gain an unwarranted competitive advantage. The very structure of the U.S. Senate reflects a compromise among the Founders meant to balance the power of densely and sparsely populated states. Similarly, the Founders, understanding that private enterprise would not by itself provide broadly distributed postal service (because of the high cost of delivering mail to smaller towns and far-flung cities), wrote into the Constitution that a government monopoly would take on the challenge of providing the necessary cross-subsidization.

Throughout most of the 19th century and much of the 20th, generations of Americans similarly struggled with how to keep railroads from engaging in price discrimination against specific areas or otherwise favoring one town or region over another. Many states set up their own bureaucracies to regulate railroad fares—“to the end,” as the head of the Texas Railroad Commission put it, “that our producers, manufacturers, and merchants may be placed on an equal footing with their rivals in other states.” In 1887, the federal government took over the task of regulating railroad rates with the creation of the Interstate Commerce Commission. Railroads came to be regulated much as telegraph, telephone, and power companies would be—as natural monopolies that were allowed to remain in private hands and earn a profit, but only if they did not engage in pricing or service patterns that would add significantly to the competitive advantage of some regions over others.

Passage of the Sherman Antitrust Act in 1890 was another watershed moment in the use of public policy to limit regional inequality. The antitrust movement that sprung up during the Populist and Progressive era was very much about checking regional concentrations of wealth and power. Across the Midwest, hard-pressed farmers formed the “Granger” movement and demanded protection from eastern monopolists controlling railroads, wholesale-grain distribution, and the country’s manufacturing base. The South in this era was also, in the words of the historian C. Vann Woodward, in a “revolt against the East” and its attempts to impose a “colonial economy.”"



"By the 1960s, antitrust enforcement grew to proportions never seen before, while at the same time the broad middle class grew and prospered, overall levels of inequality fell dramatically, and midsize metro areas across the South, the Midwest, and the West Coast achieved a standard of living that converged with that of America’s historically richest cites in the East. Of course, antitrust was not the only cause of the increase in regional equality, but it played a much larger role than most people realize today.

To get a flavor of how thoroughly the federal government managed competition throughout the economy in the 1960s, consider the case of Brown Shoe Co., Inc. v. United States, in which the Supreme Court blocked a merger that would have given a single distributor a mere 2 percent share of the national shoe market.

Writing for the majority, Supreme Court Chief Justice Earl Warren explained that the Court was following a clear and long-established desire by Congress to keep many forms of business small and local: “We cannot fail to recognize Congress’ desire to promote competition through the protection of viable, small, locally owned business. Congress appreciated that occasional higher costs and prices might result from the maintenance of fragmented industries and markets. It resolved these competing considerations in favor of decentralization. We must give effect to that decision.”

In 1964, the historian and public intellectual Richard Hofstadter would observe that an “antitrust movement” no longer existed, but only because regulators were managing competition with such effectiveness that monopoly no longer appeared to be a realistic threat. “Today, anybody who knows anything about the conduct of American business,” Hofstadter observed, “knows that the managers of the large corporations do their business with one eye constantly cast over their shoulders at the antitrust division.”

In 1966, the Supreme Court blocked a merger of two supermarket chains in Los Angeles that, had they been allowed to combine, would have controlled just 7.5 percent of the local market. (Today, by contrast there are nearly 40 metro areas in the U.S where Walmart controls half or more of all grocery sales.) Writing for the majority, Justice Harry Blackmun noted the long opposition of Congress and the Court to business combinations that restrained competition “by driving out of business the small dealers and worthy men.”

During this era, other policy levers, large and small, were also pulled in the same direction—such as bank regulation, for example. Since the Great Recession, America has relearned the history of how New Deal legislation such as the Glass-Steagall Act served to contain the risks of financial contagion. Less well remembered is how New Deal-era and subsequent banking regulation long served to contain the growth of banks that were “too big to fail” by pushing power in the banking system out to the hinterland. Into the early 1990s, federal laws severely limited banks headquartered in one state from setting up branches in any other state. State and federal law fostered a dense web of small-scale community banks and locally operated thrifts and credit unions.

Meanwhile, bank mergers, along with mergers of all kinds, faced tough regulatory barriers that included close scrutiny of their effects on the social fabric and political economy of local communities. Lawmakers realized that levels of civic engagement and community trust tended to decline in towns that came under the control of outside ownership, and they resolved not to let that happen in their time.

In other realms, too, federal policy during the New Deal and for several decades afterward pushed strongly to spread regional equality. For example, New Deal programs such as the Tennessee Valley Authority, the Bonneville Power Administration, and the Rural Electrification Administration dramatically improved the infrastructure of the South and West. During and after World War II, federal spending on the military and the space program also tilted heavily in the Sunbelt’s favor.

The government’s role in regulating prices and levels of service in transportation was also a huge factor in promoting regional equality. In 1952, the Interstate Commerce Commission ordered a 10-percent reduction in railroad freight rates for southern shippers, a political decision that played a substantial role in enabling the South’s economic ascent after the war. The ICC and state governments also ordered railroads to run money-losing long-distance and commuter passenger trains to ensure that far-flung towns and villages remained connected to the national economy.

Into the 1970s, the ICC also closely regulated trucking routes and prices so they did not tilt in favor of any one region. Similarly, the Civil Aeronautics Board made sure that passengers flying to and from small and midsize cities paid roughly the same price per mile as those flying to and from the largest cities. It also required airlines to offer service to less populous areas even when such routes were unprofitable.

Meanwhile, massive public investments in the interstate-highway system and other arterial roads added enormously to regional equality. First, it vastly increased the connectivity of rural areas to major population centers. Second, it facilitated the growth of reasonably priced suburban housing around high-wage metro areas such as New York and Los Angeles, thus making it much more possible than it is now for working-class people to move to or remain in those areas.

Beginning in the late 1970s, however, nearly all the policy levers that had been used to push for greater regional income equality suddenly reversed direction. The first major changes came during Jimmy Carter’s administration. Fearful of inflation, and under the spell of policy entrepreneurs such as Alfred Kahn, Carter signed the Airline Deregulation Act in 1978. This abolished the Civil Aeronautics Board, which had worked to offer rough regional parity in airfares and levels of service since 1938… [more]
us  cities  policy  economics  history  inequality  via:robinsonmeyer  2016  philliplongman  regulation  deregulation  capitalism  trusts  antitrustlaw  mergers  competition  markets  banks  finance  ronaldreagan  corporatization  intellectualproperty  patents  law  legal  equality  politics  government  rentseeking  innovation  acquisitions  antitrustenforcement  income  detroit  nyc  siliconvalley  technology  banking  peterganong  danielshoag  1950s  1960s  1970s  1980s  1990s  greatdepression  horacegreely  chicago  denver  cleveland  seattle  atlanta  houston  saltlakecity  stlouis  enricomoretti  shermanantitrustact  1890  cvannwoodward  woodrowwilson  1912  claytonantitrustact  louisbrandeis  federalreserve  minneapolis  kansascity  robinson-patmanact  1920s  1930s  miller-tydingsact  fdr  celler-kefauveract  emanuelceller  huberhumphrey  earlwarren  richardhofstadter  harryblackmun  newdeal  interstatecommercecommission  jimmycarter  alfredkahn  airlinederegulationact  1978  memphis  cincinnati  losangeles  airlines  transportation  rail  railroads  1980  texas  florida  1976  amazon  walmart  r 
march 2016 by robertogreco
Local Projects: Change by Us
"This project is an evolution of Local Projects’ successful Give A Minute (giveaminute.info) initiative, already underway in Chicago and Memphis. Change by Us aims to invite ideas for civic solutions, intelligently form project groups, and effectively connect groups with resources to bring their ideas to life. Change By Us functions as "a social network for civic activity." Using both text messaging and the site itself, New Yorkers can submit ideas for a more sustainable city. Based on those ideas, the site then connects visitors, and invites them into project groups. Project groups can then easily form connections to existing city resources and community organizations that can help them achieve their goal. Change By Us launches in limited beta form on April 21, 2011—the eve of Earth Day—with the question, “Hey NYC, How can we make our city a greener, better place to live?”"
change  crowdsourcing  placemaking  social  socialnetworking  ceosforcities  local  nyc  grassroots  activism  community  civics  civicengagement  chicago  memphis  changebyus  localprojects  sustainability  urban  urbanism  cities  urbanplanning 
may 2011 by robertogreco
Give a Minute!
"Give a Minute is a new kind of public dialogue. It only takes a minute to think about improving your city, but your ideas can make a world of difference. "Give a Minute" is an opportunity for you to think out loud; address old problems with fresh thinking; and to enter into dialogue with change-making community leaders. Soon, you’ll also be able to link up with others who have similar ideas and work on making your city an even better place. This initiative is happening in multiple cities: Chicago Memphis, New York, San Jose"
civicengagement  change  crowdsourcing  creativity  giveaminute  classideas  civics  community  collaboration  activism  behavior  environment  agency  technology  government  society  public  mobile  localism  local  csl  texting  chicago  ideas  memphis  nyc  sanjose 
november 2010 by robertogreco
The Public Square Goes Mobile - NYTimes.com
"Give a Minute launched with the question, “Hey Chicago, what would encourage you to walk, bike or take CTA more often?” Citizens, who are learning about it from billboards, ads on the L and in the local paper, are texting their ideas and posting them to the Give a Minute Web site. You can look here to find the responses texted so far (1,000 in the first two weeks), which range from “lower CTA fares” to “organized walking groups going roughly the same route with similar interests” to “play classical music on train system” to “I need to bring my daughter with me, so the streets need to be kid-safe.”

“We’re just culling through all the different ideas that run from the specific to the hilarious to the utopian,” says Barton. “But one thing that does seem clear is that they are far more diverse and often smaller scale, and actionable on different scales including individual, neighborhood and government.”"
civicengagement  change  crowdsourcing  creativity  giveaminute  classideas  civics  community  collaboration  activism  behavior  environment  agency  technology  government  society  public  mobile  localism  local  csl  texting  chicago  sanjose  nyc  memphis 
november 2010 by robertogreco
The Snailr Project
"One journey of almost 7000 miles, six new cities, eight trains, fifteen days, and every vignette, observation and fractured bitty-bit of the travelogue broken up and sent as status messages the old way. By postcard. To a bunch of random people who asked for one. Because travelling slowly is nice. And so is leaving a trail to see where we have been."
papernet  travel  snailr  slow  slowtravel  postcards  glvo  amtrak  trains  us  sanfrancisco  losangeles  seattle  memphis  neworleans  chicago  portland  nola 
november 2010 by robertogreco
Marginal Revolution: How to travel in the U.S.
A reader asks: "I was wondering whether you have similar advice for traveling in the US? If someone who has never previously visited the US asked you for five places they should visit in the US, what would be your advice? Or perhaps more generally, what should they look for in their destinations? Assume they're driving, and budget isn't an issue, and that it's not a requirement to see the most popular tourist spots. What's the best advice to properly see and experience the US, in all its diversity?" Tyler Cowen responds: "Most of all, drive as much as possible and do not shy away from a few days in the "boring" (yet wondrous) suburbs. After that, here is my list of five: 1. Manhattan 2. Detroit and the Ford Rouge plant in Dearborn 3. Memphis and the Mississippi Delta 4. San Francisco 5. Grand Canyon and southern Utah"

[... follows with discussion of possible swaps & top ten cities. I'm guessing Kottke will point to this/ask on his own blog, comments will get even more interesting.]
us  travel  tylercowen  advice  foreuropeans  nyc  manhattan  detroit  memphis  texas  sanfrancisco  boston  miami  neworleans  chicago  nola 
february 2009 by robertogreco
David Byrne Journal: 09.17.2007: On The Road
"I seriously doubt that architectural scholars and critics will agree with me here — they might prefer the more austere, minimal church of Tadao Ando or Corbusier’s wacky asymmetrical church in France. I’ll take this one, and Gaudi’s Sagrada Famil
davidbyrne  roadtrip  travel  american  dollywood  graceland  elpaso  losangeles  architecture  design  mormon  churches  memphis  culture  religion  place  context  us  americana 
september 2007 by robertogreco

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