From London and Berlin to Sydney and San Francisco, civic authorities agree that the key to urban prosperity is appealing to the "hipster set" of gays, twentysomethings and young creatives. But the only evidence for this idea comes from the dot-com boom of the late 1990s—and that time is overby Joel Kotkin / October 22, 2005 / Leave a comment
Published in October 2005 issue of Prospect Magazine
The world’s great cities face serious, even catastrophic problems. Terrorists have planted bombs in London’s Underground and bus systems. Floods have wiped out New Orleans, and fires incinerated scores of impoverished Africans living in crowded, seamy Paris apartments. Everywhere—from New Orleans to London and Paris—the middle classes, whatever their colour, are deserting the core for safer and more affordable suburbs, following in the footsteps of high-tech industries and major corporations. Yet rather than address serious issues like housing, schools, transport, jobs and security, mayors and policy gurus from Berlin and London to Sydney and San Francisco have adopted what can be best be described as the “cool city strategy.” If you can somehow make your city the rage of the hipster set, they insist, all will be well. New Orleans, the most recent victim of catastrophic urban decline, is a case in point. Once a great commercial hub, the city’s economic and political elites have placed all their bets on New Orleans becoming a tourist and culture centre. Indeed, just a month before the disaster, city leaders held a conference that promoted a “cultural economy initiative” strategy for attracting high-end industry. The other big state initiative was not levee improvement but a $450m expansion for the now infamous convention centre. This rush to hipness has its precedents, perhaps even in Roman festivals or medieval fairs. But in the past, most cities did not see entertainment as their main purpose. Rome was an imperial seat; Manchester, Berlin, Chicago and Detroit foundries of the industrial age; London, New York, and later Tokyo, global financial centres. Perhaps even worse, the lure of “coolness” leads cities to ignore the fundamental issues—infrastructure, middle-class flight, terrorism—that have so much more to do with their long-term prospects. Cities once boasted of their thriving middle-class neighbourhoods, churches, warehouses, factories and high-rise office towers. Today they set their value by their inventory of jazz clubs, gay bars, art museums, luxury hotels and condos. The advocates of this approach are a new generation of “hip cool” mayors, including Ken Livingstone, Berlin’s Klaus Wowereit, San Francisco’s Gavin Newsom, Baltimore’s Martim O’Malley, Detroit’s “hip hop” mayor Kwame Kilpatrick and the gay chief executive of Paris, Bertrand Delanoe. Ken Livingstone sees London’s future tied to “the richness, breadth and diversity of its cultural and creative resources.” Theatres, sports stadiums, museums and cinemas are, he notes, “what many of us enjoy most about living here.” Culture, not commerce, is “London’s heartbeat.” For a city “vulnerable to the up and downs of the global political and economic system,” the mayor proclaims, culture and tourism represent an ideal way to counteract “the negative impact of such events.” This refocus of urban policy around culture and tourism has wide appeal, particularly in continental Europe. Expensive—and increasingly economically marginal cities—like Paris, Vienna and post-cold war Berlin have all embraced the notion of a culturally-based lifestyle economy. Berlin epitomises the trend. In the 1990s, massive funds were expended to make the restored German capital into the business capital of Mitteleuropa. These ambitions foundered on the city’s high taxes, red tape, and generally anti-business culture. Over 100,000 jobs have left in recent years, unemployment is nearly 20 per cent and the population is declining, as people flee to the suburbs or more prosperous parts of Germany. Faced with such problems, what does the mayor of the bankrupt city propose? Cut taxes, build new infrastructure, find ways to keep the middle classes and businesses? No, Mayor Wowereit pegs the future to selling Berlin as “the city of glamour.” To him, “the most decisive aspect is to bring creative young people to Berlin.” Somehow, he believes, this will turn the city’s sad economy around. Similar thinking has been picked up by political and business leaders in grittier places like Liverpool and Manchester, Cleveland, Baltimore and Detroit. Faced with population decline of 30 to 40 per cent over the past half century, these cities have all created programmes designed to lure gays, bohemians and young “creatives” to their towns. This ephemeralisation of urbanism derives, in part, from the theories of Richard Florida, an American academic whose theories about the “creative class” have captivated many city leaders. Using research drawn largely from the dot-com era of the late 1990s, Florida insists that the key to urban success lies in attracting such groups of young twentysomething singles, artists and homosexuals. Florida’s favourite hip cities, not surprisingly, are places like Sydney, San Francisco, Portland, Seattle and Boston, areas with lots of students, artists and gays—and the lowest percentages of families. Other less hip locales have been duly forewarned, as a headline in the Washington Monthly put it, that cities “without gays and rock bands are losing the economic race.” There is little evidence that this is really how urban economies work. It turns out that many of the most prized members of the “creative class” are not 25-year-old hip cools, but fortysomething adults who, particularly if they have children, end up gravitating to the suburbs and more economically dynamic cities like Phoenix, Boise, Charlotte or Orlando. The false promise of Florida’s “creative class” has been obvious for the last five years, particularly with the collapse of the dot-com boom. In the late 1990s there did appear to be a new kind of urban economy—driven by black-clad graphic designers, programmers and marketeers—that was bringing new jobs, wealth and residents to old urban areas from San Francisco’s “multimedia gulch” to New York’s ultra-trendy “silicon alley.” Then the dot-com economy fizzled out, leaving whole districts of New York, San Francisco and Boston with huge vacancy rates and declining job rolls. San Francisco has lost roughly 10 per cent of its jobs and 4 per cent of its residents since 1999. Its job growth rate, like most of the “hip” cities heralded by Florida, has lagged behind the national average, not only in overall jobs but in high-wage technology, business and financial service jobs. There have also been social costs. These cities have become the most divided by class in the US, and often suffer large homeless populations. In some, the largely immigrant service class labour to keep the wealthy population properly served, at least until they can afford to move to the suburbs. Perhaps there is no more searing evidence of the limitations of a culture-based economy than New Orleans. Once a great industrial and commercial centre, the city—despite its huge port—has roughly half the US average of jobs in manufacturing and wholesale trade. Other, more business-focused cities, notably Houston, have taken the lead in the high-paid service jobs connected to trade, such as finance, engineering and medical services. The energy industry, once the lynchpin of the local economy, also decamped, primarily to Houston. All this happened despite New Orelans being a city that was heavily gay, very cool and extremely hip. By the time of the flood, tourism and culture, along with a huge social service bureaucracy, was driving the economy. The problem, of course, is that tourism pays poorly; a 2002 study for the AFL-CIO showed that nearly half of all full-time hotel workers could not earn enough to keep a family out of poverty. Lost in the ghastly images of New Orleans’s poor is the fact that the city’s whites, about 27 per cent of the population, are wealthier and more educated than their counterparts nationwide. They, of course, welcomed the new nightclubs, coffee shops and galleries that dotted their grander neighbourhoods. New Orleans epitomised the inequality of the hip cool city. While the national gap between black and white per capita income stands at about $9,000, in New Orleans it is almost $20,000. The prospect for older industrial cities, which lack much of a basis for tourism and culture, are even less encouraging. Detroit, in particular, under its “hip hop” Mayor Kilpatrick, continues to slide. Baltimore, another city that has openly embraced the “creative class” theory has languished. It also experienced a shocking increase in crime, and now suffers one of the highest homicide rates in America. Little recognised amid the creative class craze is the fact that a strong and growing middle class is still the key to well balanced urban life. Without a permanent middle class, cities through history—from ancient Rome and 17th-century Venice to 19th-century Amsterdam—have lost their balast, become ever more divided by class, and ceded their central role. London and other amenity-rich cities like New York, Paris, San Francisco and Boston will not become ruins, any more than Venice and Amsterdam did after they entered their elegant dotages. Even New Orleans, owing to its location and historical significance, and troubled Berlin, by dint of being Germany’s capital and possessor of an enormous cultural legacy, are unlikely to go the way of Detroit. Indeed, as long as the world economy expands, such cities may find their sustenance as amusement parks for adults. But the people will come from other more dynamic rising cities—places like Shanghai, Singapore, Taipei, Perth, Calgary, Los Angeles, Houston or Phoenix—that still retain their “animal spirits” and remain the locus of middle-class aspiration. New Yorkers and Londoners still possess the essentials for a more vital future. But first their political leaders must realise that great cities need schools for families, transport that works, jobs for the middle and the aspiring working classes. And they must acknowledge the continuing need to invest heavily in public safety, particularly in an age of terror. These challenges come with a price, and require public money to pay for them. In contrast, the “coolness” strategy both costs little and offends no one. It is the path of least resistance, but one that offers only poor returns.