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President’s Message

Building the Cities We Need
By George W. McCarthy, Abril 9, 2019


By 2050, the planet will be 70 percent urban, as we add some two billion residents to the world’s cities. As we consider the history and future of these areas, our biggest challenge may be redeveloping land that is already used or occupied. Maintaining, managing, and growing a city where buildings and people already are rooted is much harder than creating one from scratch. Where and how we accommodate new populations will set the stage for human habitation for the rest of this millennium. In this century of the city, we must find ways to build the cities we need.

Future urban growth will not take place in megacities. All indications suggest that popula­tion growth is plateauing in the 30 or so places with more than 10 million residents. The fastest-growing cities are the ones with current populations between 100,000 and one million. These cities do not and will not have the capacity to manage growth. How will they pay for the infrastructure—highways, bridges, gas lines, and the like—to double or treble their size? Will they be choked with unplanned development, adding to the one billion people already living without public services?

Beyond the logistical and financial challenges, a separate concern relates to the identity of cities. How much do we care about the relation­ship between people and their places? Are we prepared to protect the integrity of cities and the people who live in them by preserving their “character”? Will we have the luxury of forgoing expedience for individuality? If we accept that most of the world’s cities do not have the resources to plan and manage their own future growth, then we concede the design and form of future cities to market forces. This portends a future of urban sameness, a dystopia straight from Le Corbusier: all cities looking like forests of “towers in the park,” expedient and soulless.

If recent and historic efforts to redevelop urban neighborhoods are any indication, urban residents might not be so quick to accept expedient solutions. In Dharavi, a Mumbai neighborhood made famous in the movie Slumdog Millionaire, 700,000 people live on less than one square mile of land. In 2006, an advocacy group decided to “improve” the living conditions of thousands of people who lived in the slum by building high-rises and trying to persuade people to move. Despite offering indoor plumbing, secure roofs, and the like, this group was stunned to have few takers. They were mystified that no one wanted to leave for modern accommodations. But they hadn’t done their homework: Dharavi produces an estimated 25 percent of the gross domestic product of Mumbai. The residents didn’t just live there, they worked there. They weren’t willing to trade their livelihoods and shelter for better shelter, no matter how much better.

Plans are still afoot to develop Dharavi, which sits on the most valuable real estate in Mumbai. It will be difficult for its poor residents to protect themselves from the inexorable power of the market. But if we were committed to defending the rights and interests of the residents, could we imagine a future centered not on high-rises, but on more creative land use providing shelter and promoting livelihoods? What would that take? Where can we look for good examples of respon­sive redevelopment?

In the United States, our history is not replete with successful examples of urban redevelopment. Early attempts at slum clearance through the construction of public housing are eerily similar to the efforts in Mumbai. Ironically, building public housing was not a housing strategy. Congress passed it as a livelihood strategy, designed to reemploy idle construction labor during the Great Depression.

In the postwar era, the federal government devolved redevelopment to local authorities through Urban Renewal. A famous case involved the redevelopment of Boston’s West End in the mid-1950s. Using (or misusing) eminent domain, the city obtained hundreds of homes that were owned by middle-class white families, citing their poor condition and the need for “higher and better use.” Neighborhood residents tried to stop the process through local organizing, protest, and the courts. They failed. The neighborhood was replaced by market-driven development. By 1964, more than 18,000 historic buildings in the United States were lost to urban renewal, says the Trust for Historic Preservation.

Informed by the Boston experience and the demolition of New York’s original Penn Station, an “improvement” against which she had protested, activist and author Jane Jacobs organized others to prevent the wholesale destruction of the urban fabric of New York City when developer Robert Moses proposed a crosstown highway through Greenwich Village. Jacobs ushered in a multipronged approach to oppose abusive, top-down, centralized planning. Organized resistance was the first prong; coalition-building was the second; but it was land use policy that created the framework for hundreds of others to defend their cities.

Jacobs’ coalitions enlisted New York house­wives and powerful allies such as Eleanor Roosevelt and Lady Bird Johnson, who not only found the human toll of urban renewal intolerable, but also mourned the loss of culture and history. Mobilizing others can help us protect urban history and culture. Including powerful allies helps even more. But to scale up one’s efforts requires more powerful tools—policies that prevent what one wants to prevent and promote what one wants to promote. It requires carrots and sticks.

The National Historic Preservation Act (NHPA), signed into law by President Johnson in 1966, was the stick, requiring review of historic structures before demolishing them to redevelop neighborhoods. The Historic Tax Credit, enacted in 1978, provided the carrot. Because it might be costlier to redevelop historic buildings and adapt them for new uses, the tax credit sweetened the pot—paying for the public good that was preserved in the historic structures and making redevelopment financially feasible. Thirty-five states have followed suit with their own historic tax credit programs to supplement federal funding. Thus began the rebound of American cities. More than $120 billion was invested in adaptive reuse of buildings from 1981 to 2015, says the Trust for Historic Preservation.

What are the challenges of urban redevelop­ment today? One is the persistence of “highest and best use” planning. In a talk I gave last year in Guangzhou, China, planners could not conceive of why Jacobs’ prevention of a highway across lower Manhattan was considered a success. They argued that achieving highest and best use was the planner’s job. Keeping old buildings and neighborhoods intact was not. Top-down planning predicated on narrow objectives is almost guaranteed to reproduce the results of urban renewal, at the expense of culture and history.

Urban communities everywhere are at risk of displacement from a second, bigger challenge and a faceless new villain: global capital capturing real estate in cities across the globe, making them less livable and less affordable. In spite of the global financial crisis of 2008, urban real estate is considered a safe harbor for capital, especially in places with stable curren­cies like the United States. In the 12-month period ending in March 2017, foreign investors purchased 284,455 U.S. homes, spending more than $150 billion, according to CNBC. According to Statistica, 52 percent of foreign real estate purchases are in the suburbs, while 27 percent are in central cities. In some cities, more than 20 percent of all real estate investment comes from outside the country. Global investment includes domestic capital as well, and it flows not only to U.S. destinations, but also to growing cities around the world. This capital distorts housing markets and makes urban areas, from California to China, unaffordable for the people who live there. It also distorts supply markets, dictating what will be built based on the tastes of part-time residents and speculators.

What can be done? What would Jacobs do? I am sure she would mobilize local residents to reclaim power over land control and teach about the consequences of treating housing as a tradable commodity. Part of mobilizing is to get more stakeholders to the table. She would no doubt use new tools to engage citizens in urban planning, like the tools that helped build the Detroit Future City plan. By using everything from online games to data visualizations, Detroit planners secured input from more than 100,000 residents.

To scale this effort, she would need new land policy tools, sticks and carrots, to motivate developers to build the cities residents need, not the real estate investors want. Sticks might include surcharges on outside investment, like those recently enacted in Vancouver and Toronto. They might include significantly higher property tax rates combined with very high homestead exemptions to increase holding costs for properties owned by nonresidents. Buildings might be protected from speculation using devices like community land trusts. Carrots might include approval for additional develop­ment through density bonuses for developments that preserve urban character, offering residents the opportunity to live and work in closer proximity. And the carrots should also include subsidies to motivate developers to build the right developments—those that preserve the character of the city by supporting residents and their livelihoods.

As a society, we have made, and continue to make, lots of mistakes. But those of us who want to help create more sustainable and equitable cities must do two things: find more effective ways to engage and mobilize people and find the policies to work at scale. This is a time to ask, “What would Jane Jacobs do?” While she did not get it all just right every time, she did compel us to find creative ways to make cities work while preserving their culture and history. Cities that were more welcoming, that could provide both shelter and work. Cities that facilitated social interaction, not just commerce. That is a tall agenda, but it’s one that we should aspire to achieve. It is critical if we are going to survive beyond this century of the city.



George W. McCarthy is the President and CEO of the Lincoln Institute of Land Policy.

Photograph: In Dharavi, a one-square-mile neighborhood in Mumbai, India, that’s home to 700,000 people, tensions have existed between externally designed “improvements” and the actual needs of residents. Credit: Flickr/Adam Cohn