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The lesson from the US

Government alone is not enough

By Bruce Katz  

Chicago, US. We have lessons to learn from this city, argues Katz

Read more from Prospect’s “The Future of Cities” supplement

As the importance of cities within Europe rises, it’s wise to look across the pond for advice.

In the United States, the utter dysfunction of federal and state governments due to partisan gridlock and structural fiscal pressures has radically shifted responsibility downwards to cities and larger conurbations. Under what Jennifer Bradley and I termed “The Metropolitan Revolution,” US cities are leading the nation’s response to challenges around climate change, economic competitiveness, and social cohesion while federal and state governments either watch from the sidelines or actively stifle progress.

Europe is undergoing its own city-led transition. Copenhagen and Amsterdam are recognised as global leaders in sustainable urbanisation; Hamburg and Berlin are on the front lines of addressing the refugee crises. More broadly, national governments are pursuing reforms that both decentralise power and emphasise metropolitan solutions—whether it’s Whitehall leaders in England negotiating City Deals with Manchester and Sheffield or national governments in France and Italy empowering metropolitan structures in Paris, Torino and beyond.

As European city efforts proceed, there is one overriding lesson from the US revolution: complement these largely public sector efforts with private and civic sector intelligence, initiative and investment.

Cities, unlike federal and state governments, are networks of cross-sectoral institutions and leaders which thrive on collaboration between multiple stakeholders. US cities recognise that the ability to solve problems does not sit within government alone, but rather within a system of public, private and civic governance.

Networked governance rather than traditional public government is well-suited for this moment. No longer does any one sector—let alone government itself—have the capacity or expertise to design, finance, execute, and sustain initiatives with the potential to set a city or metropolis on a more innovative, inclusive and sustainable trajectory.

Business leaders provide real-world perspectives on both workforce needs and barriers to entrepreneurialism, and are critical to devising new forms of innovative finance. Philanthropists have convening power, the ability to take the long view and the risk capital necessary to experiment with new solutions to challenges that are long standing and inordinately complex.

Academic institutions have the ability if not the obligation to use their role as centres of innovative ideas and talent to leverage the distinctive assets and advantages of their communities.

“Many European cities would benefit from integrating the ‘US model’ of private philanthropy with the traditional dominance of government and the public sector”

And smart municipal governments set important rules and, given strong leadership, can set the agenda. While mayors rarely get things done on their own, transformative change rarely gets done without political buy-in.

In cities across the US, a critical set of institutions and intermediaries is bridging the sectoral divide and helping disparate players work together and govern collaboratively. In New York City and Chicago, civic organisations such as the Regional Plan Association and Metropolitan Planning Council respectively help set agendas around transportation and housing at the metro scale while private sector organisations like the Partnership for New York and World Business Chicago help design and deliver economic development strategies at the city level. In medium-sized cities like Buffalo, Fort Worth, and St Louis, civic and business leaders create organisations to catalyse innovative growth at the district level, particularly around universities and medical centers.

Networked governance can yield real benefits. It can be more effective than traditional government responses since it favours solutions that are multi-sectoral and integrated rather than compartmentalised and rule driven. It can drive a more efficient use of public, private and civic resources since it is more aligned with the distinctive needs of different places—say the demolition of blighted housing in a struggling city versus the building of new housing in a prosperous one. It can be even more democratic since it provides ample opportunities for the active, participatory engagement of local stakeholders rather than the passive act of periodic voting.

Still, even in the US, governance by cities alone can only go so far. Inequality across and within different cities, and the unrest and anxiety it generates, is a major national challenge. This “great divergence,” as a recent Economist article highlighted, means growth in the 50 richest US cities over the past four years has been three times that of the rest of the country. There is also undoubtedly rising inequality, with incomes of the poor and middle class falling further behind the highest earners. Simply put, the US is becoming more Darwinian and it will ultimately fall to functional federal and state governments to lessen the disparities between and within communities.

With those caveats firmly in mind, the fact is that many European cities would benefit from integrating the “US model” of private philanthropy and business leadership with the traditional dominance of government and the public sector. The question is not whether the US metropolitan revolution is coming to Europe, but which set of cities will be the first to embrace it.

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