Creative Class

The New York Times notes that the crisis is turning design from decoration and frivolity to function.

The pain of layoffs notwithstanding, the design world could stand to come down a notch or two — and might actually find a new sense of relevance in the process. That was the case during the Great Depression, when an early wave of modernism flourished in the United States, partly because it efficiently addressed the middle-class need for a pared-down life without servants and other Victorian trappings.

Patrik Jonsson in The Christian Science Monitor notes that the crisis may be ending the McMansionization of the suburbs and some cities (via Planetizen).

With housing prices off by 18 percent in 20 US cities in the last year and new home starts at a 26-year low, bulldozers have slowed their march across American cities and towns. In Westport, Conn., teardown permits are down in the last year by 33 percent – a figure that experts say can be extrapolated nationwide, though teardown trends do have significant regional variations. Analysts expect the lull to last at least five years, perhaps 10.

My own hunch is that we are witnessing a sharp turn toward quality and functionality. The Great Reset will mean smaller, better, more efficient spaces, and an emphasis on higher quality design from the artifact to the city and regional scales. Call it wishful thinking, but the logic of the economy is at least pushing in the right direction.

Barack Obama won the election by winning cities, according to this analysis by Nate Silver. (h/t: Alison Kemper). While others have pointed to this trend, Silver does a nice job of putting it all together. Plus the graphics are great.

If Bill Clinton was the first black president, then Barack Obama might be the first urban one. He is the only American president in recent history to seem unembarrassed about claiming a personal residence in a major American city. Instead, presidents have tended to hail from homes called ranches or groves or manors or plantations, in places called Kennebunkport or Santa Barbara or Oyster Bay or Northampton …

In 1992, when Bill Clinton won his first term, 35 percent of American voters were identified as rural according to that year’s national exit polls, and 24 percent as urban. This year, however, the percentage of rural voters has dropped to 21 percent, while that of urban voters has climbed to 30. The suburbs, meanwhile, have been booming: 41 percent of America’s electorate in 1992, they represent 49 percent now).

In other words, if you are going to pit big cities against small towns, it is probably a mistake to end up on the rural side of the ledger. Last year, Obama accumulated a margin of victory of approximately 10.5 million votes in urban areas, far bettering John Kerry’s 3.6 million. Obama improved his performance not only among black and Latino voters but also among urban whites, with whom he performed 9 points better than Kerry. Obama also won each of the seventeen most densely populated states, a list that includes such nontraditional battlegrounds as Virginia, North Carolina, and Indiana. (One hidden advantage of urban areas: They’re easier to canvass to get the vote out.)  …

With the votes that he banked in the cities, Obama did not really need to prevail in the suburbs. But he did anyway — as every winning presidential candidate has done since 1980 — bettering McCain by 2 points there …  It may also be that suburban voters are starting to look — and behave — more like their urban brethren. According to a poll by the National Center for Suburban Studies, 20 percent of suburban voters are nonwhite — not much behind the national average of 27 percent — and 44 percent live in a racially mixed neighborhood (versus a national average of 46 percent). Suburban voters are just as likely to be concerned about the economy as other voters are and just as likely to know someone who has lost a job. Moreover, many suburbanites who do not live in cities may nevertheless be thoroughly familiar with them; according to the Census Bureau, at least eight to nine million persons commute into urban areas each day  …

Republicans trail Democrats among essentially every fast-growing demographic except the elderly — the youth vote, the Latino vote; they never had the black vote. It is long past time that they hone their pitch to urban voters, and find their shining city upon a hill.

Luring the latest Hollywood blockbuster is just the latest in a long series of economic development policies based on bribes… er… I mean incentives. Alan Greenblatt of Governing takes a good hard look, and finds lots and lots of waste and opportunity costs (via Planetizen).

Urban designer – and my former Carnegie Mellon colleague – David Lewis has long said that our older suburbs are the greatest urban renewal challenge of modern times. Lacking concentration, density, transit, historic architecture, and highly developed infrastructure like older center cities, he said, the suburbs pose a much greater challenge to redevelop. Over at The New York Times’ By Design blog, Allison Arieff offers some interesting perspective – and possible solutions (h/t: Allison Kemper).

The problem now isn’t really how to better design homes and communities, but rather what are we going to do with all the homes and communities we’re left with …  As I learned in artist Julia Christensen’s new book, “Big Box Reuse,” when a big box store like Wal-mart or Kmart outgrows its space, it is shut down. It is, apparently, cheaper to start from scratch than to close for renovation and expansion … The silver lining in Christensen’s study are the communities she’s discovered that have proactively addressed the massive empty shells they’ve been left with, turning structures of anywhere from 20,000 to 280,000 square feet into something useful: a charter school, a health center, a chapel, a library. (And, in Austin, Minn., a new Spam Museum.) …

But exurban communities are a unique challenge. The houses within them are big, but not generally as big as, say, Victorian mansions in San Francisco that can be subdivided into apartments. So they’re not great candidates for transformation into multi-family rental housing.  I did visit a housing development last year that offered “quartets,” McMansions subdivided into four units with four separate entrances. These promised potential buyers the status of a McMansion with the convenience of a condominium, but the concept felt like it was created more to preserve the property values of larger neighboring homes than to serve the needs of the community’s residents …

I still dream that some major overhaul can occur: that a self-sufficient mixed-use neighborhood can emerge. That three-car-garaged McMansions can be subdivided into rental units with streetfront cafés, shops and other local businesses.

Wondering what others think, and strategies you may have come across in communities around the world?

In this recently ended economic bubble, too many companies isolated the function of risk management to a few select individuals. Meanwhile, a broad spectrum of people had risk-taking, broadly defined, within the scope of their roles. This imbalance is one finding from a recent study of how major corporations are changing tactics in 2009, completed by Ernst & Young and articulated by firm partner, Paul Battista on Business News Network last week.

Battista believes that in 2009 many companies will work toward institutionalizing a culture of risk management, insisting that all employees think about potential threats as well as work toward helping the company be sufficiently flexible to handle the unexpected.

Extrapolating from this information, it suggests at least two major changes to workplace culture during these uncertain times:

• New ideas or new innovations will be more closely scrutinized. What will the implication be for short-term cash preservation? What will it mean for attracting and retaining clients? What will the implication be for long-term goals?
• More human resources will be dedicated toward assessing different short- and medium-term business climate scenarios.
  
• And, I predict, this time around, people at all levels of organizations will be asked to participate. Younger workers likely tune into business news and industry trends in different ways from their baby boomer bosses – using and viewing Twitter, blogs, and RSS feeds with greater regularity as well as tapping into the observations of Facebook friends.

What has changed in your workplace culture since the economic slowdown hit?

I have to ask the question: Is Obama an optimist? I am going to have to answer in the affirmative.

We are seeing this at the macro and microlevel and in foreign and domestic policy.

1) At the microlevel, Obama is defending Timothy Geithner for Secretary of the Treasury when it is clear that Geithner was a conscious tax cheat. While working for the IMF he signed papers certifying that money he was provided to pay his U.S. income taxes would be used for that purpose. Later he was audited by the IRS for two years where he did not pay and he paid the disputed taxes. However, for two earlier years in which he had undertaken similar income tax evasion, he did not declare the income. In other words, he deliberately and consciously evaded paying his income tax even after being caught for other years. Obama is defending this income tax evader. Is this change from the Bush regime? No this is more optimism. Obama’s meme of change from the corrupt Bush years appears simply to be hollow or perhaps cynical.

The Geithner appointment, besides ratifying tax evasion, also ratifies the crony capitalist bailouts in which the New York Federal Reserve was a central player. Obama is appointing one of the key persons in aiding and abetting the current crisis. By this decision, Obama is saying Wall Street and its representatives should be running the U.S. Treasury and personal responsibility is not an issue in this estimation. What a terrible message.

2) At the macrolevel, Obama lobbied Congress for the TARP bank bailout. Even after the first $350 billion was used to bailout banks and ensure that the executives that drove their banks into insolvency would retain their jobs, salaries, and bonuses. In other words, Obama is assuming ownership for the failed Bush response to the economic crisis. This is optimism run wild. The oracle of change rushes to become identified with failures of the past. Obama in his eagerness to please identifies and takes ownership of immoral failed policies.

3) Where Obama seemed to promise that he would get us entirely out of Iraq quickly, now is talking about a presence there for years. But, more foolish than this, is that he wants to massively increase our commitment to the already failed war in Afghanistan. Not only is Afghanistan already lost, but he will be increasing our expenditures there despite a looming bankruptcy of the Federal government due to the bailouts related to #1 and #2.

In my estimation, the Obama regime is already well on its way to failure. Let me outline the issue again, though talking about change, he ratifies individual irresponsibility in his choice of Timothy Geithner, institutional irresponsibility by his support of the TARP, and foreign policy foolishness in increasing our commitment to Afghanistan. These actions epitomize my definition of crackpot ideas AND unfortunately the cost is that, unless he dramatically changes direction toward honesty and realism, his Presidency is already on the road to failure.

Ryan Avent, one of my favorite and one of the very best urban bloggers around, digs into Obama’s urban policy team. As a preface to his longer article which appears in Grist, Avent writes on his blog: “My thinking on the selections has evolved somewhat. Initially, I was fairly disappointed, but I’m more sanguine now.” Money quote: “The urban picks are probably just a bit more explicitly pragmatic and shouldn’t be read as a betrayal by the president.”

The best member of team city, as judged by urbanists and other progressives, is likely to be Shaun Donovan, tapped by Obama as secretary of Housing and Urban Development …A Clinton-era veteran of the agency, he’s familiar with the federal bureaucracy and managed to be effective despite institutional hurdles. More recently, he has demonstrated his knowledge of best practices in affordable housing as a capable head of New York City’s Department of Housing Preservation and Development  … Yet it’s unclear whether Donovan appreciates the scope of the housing challenge facing the nation.

From a visionary perspective, Obama’s Transportation pick is widely seen as the most baffling … Obama used the pick to name his promised Republican cabinet member (Defense secretary holdover Robert Gates excepted). Ray LaHood, a retiring downstate Illinois representative, will be handed the reins of the department at perhaps the most crucial juncture for transportation investment since the Eisenhower years …

Less remarked upon by urbanists but perhaps more disappointing, on the face of things, is Obama’s choice for head of the new Office of Urban Policy… And so the choice of Bronx Borough president Adolfo Carrion was also somewhat underwhelming. Carrion is at least nominally qualified. He’s a trained urban planner and a veteran of the New York political scene. He helped engineer redevelopment of underused portions of the Bronx … Carrion did take a courageous stand in favor of Mayor Michael Bloomberg’s congestion pricing plan … There is little in Carrion’s resume to indicate that the Bronx lifer can explain the necessity of a difficult transition to increased density to residents and leaders of the nation’s great suburban expanses.

The whole piece, here, is required reading for anyone interested in American urbanism and the future of urban and regional policy.

Earlier this week Richard posted on movie production incentives as a development tool. This weekend’s WSJ has an interesting editorial by Jerry Bowyer investigating NFL Conference Championship teams Pittsburgh, Philadelphia, and Baltimore’s use of stadium centric development in recent years. (The Arizona Cardinals, based in the Phoenix-metro, is the fourth team playing this weekend.)

From the Op-Ed, Sports Mania Is a Poor Substitute for Economic Success;

“If there ever was a time to crow about the wonders of rebuilding a city around a professional sports team, this would be it. Three of the four teams remaining in the play-offs hail from cities — Baltimore, Philadelphia and Pittsburgh — that in recent years spent billions rebuilding their downtowns around pro sports facilities and other community “anchors.”

Except that there’s a problem. The teams might be competitive, but the cities definitely are not. All three continue to shrink in population, and have stagnant job markets and crumbling public schools.”

And later,

“When the Steelers were in the Super Bowl in 2006 I was the host of a radio show in Pittsburgh. I argued that the franchise was an exercise in leadership excellence in a city whose politicians were anything but. Numerous callers hammered me. They said there are a lot of “Steelers” bars across the country, and that proved the city still had some national respect. Indeed, there are hundreds of watering holes dispersed across America loaded with fanatical devotes of the Pittsburgh Steelers. “Where are the Seahawks bars?” the callers asked.

In Seattle, of course. That city has gained population while Pittsburgh lost it. Steelers bars are the visible cultural artifact of a kind of economic diaspora.”

I am a huge sports fan and appreciate many of the new stadiums across the country and know the record is mixed – look at the benefits of the privately financed Verizon Center in D.C’s China Town. Clearly the devil is in the financing details and the overall balance of the regional economy as to whether stadiums help or hurt economic success.

This is a big question – for which there are no easy answers. Some cities are quite resilient: places like NY or London seem to be able to remake themselves seamlessly for new economic times. Others falter and never bounce back. But reading stories this weekend on two of my favorite cities -  Pittsburgh, where I lived for nearly two decades, and Detroit, where my wife Rana’s family lives and where we visit often – got me thinking.

The superb article on Detroit by Lawrence Ulrich in the Sunday Times captures the true soul and very real dilemma facing that city. It is a must-read for anyone who cares about cities and Detroit in particular.

The second article, also in the Times, takes a looks at Pittsburgh’s rebirth and, among other things, suggests there may be lessons there for Detroit and places like it.

It’s hard not to compare the two cities and regions, but they are really different places. Pittsburgh for one developed before Detroit. Its core industry was steel which emerged in the late 19th century; and it also had a more diverse industrial base – with leading firms like Westinghouse, Pittsburgh Plate Glass, Alcoa, Heinz, and others across a wide and diverse group of industries. Plus it was a financial powerhouse, with the Mellon interests not only being banking titans but functioning as an early sort of venture capital firm. Its major universities are located in the city. Its downtown core is intact (much of the worst decline was concentrated in mill town along the rivers outside the city’s limits). The city retains several very high-income neighborhoods and several excellent urban public schools. It has perhaps better “material” to work with and certainly a longer time frame to rebuild.

A colleague of mine once speculated that it takes at least two generations to overcome an economic crisis.  And that seems to hold, at least generally, when looking at, say, the crisis of steel in Pittsburgh or the crisis of manufacturing a generation or so earlier in Boston.

Detroit, while it has long faced urban decline, is facing its real economic test today. Yes, it has many assets, as Ulrich mentions. And, yes, it has to imagine and act on a future after auto. Auto has a role in it, particularly in design. But design itself is a bigger part of it, as Ulrich notes, Detroit was – and is – a center of design broadly. But it also must realize that even more so than Pittsburgh or Boston it cannot save itself.  It is home to several good universities, but its major intellectual assets are outside the city – the University of Michigan in Ann Arbor, and Michigan State University in Lansing. It also has to realize that it can benefit from greater connectivity to major metros and mega-region hubs nearby – Chicago and Toronto.

So, what do you think?

The Standard & Poor’s 500 stock index has tumbled 40 percent since the start of February 2007, while home prices in 20 major U.S. cities have fallen 22 percent, according to an S&P-Case Shiller index.

Quite a nugget – and a pretty big differential. The same Bloomberg.com story quotes Joshua Rosner:

“Fixing housing won’t solve the problem … If we’re to actually get out of this, it’s going to come because we correctly diagnose the problem.” The main issue is the packaging of debt into securities, which is creating a credit crunch by leaving lending dependent on capital-constrained bank …  “It’s a great cliche that housing is the root of the problem,” Rosner said. “We can seek to stabilize housing but once unemployment worsens housing will de-stabilize.”

More here. Quite a predicament actually. Credit markets are frozen and assets are depreciating, so who can – or will – buy. How to break this cycle? Seems to me attempts to artificially re-inflate these assets only prolongs the inevitable. You?