Urban Prospects in the Age of Obama

By Dick Platkin

American cities are entering a perfect storm of deepening urban crises despite—and in some cases because of—the hopes that many community activists hold for the Obama administration. Activists fully expect the new administration to effectively address a wide range of urban problems, but that is unlikely. What is likely is that over the next four years and beyond, working and living conditions in large American cities will severely deteriorate. While this is certainly not the urban agenda of the Obama administration, nor the intention of the administration’s progressive supporters and critics, external events will combine with a range of poorly conceived public-sector initiatives to produce this dismal outcome.

What are the storm clouds visible on the horizon and, in some cases, already raining down on American cities? How will they combine to produce a perfect storm? More importantly, how will people react to these developments and potentially alter them?

There are five storm clouds that add up to a perfect storm: 1) high hopes combined with the myth of “shared sacrifice;” 2) the neoliberal legacy; 3) infrastructure deficit; 4) the bailout imbalance; and 5) climate change/peak oil.

Storm Cloud #1: High Hopes and “Shared Sacrifice”

High hopes for the Obama administration are to date tranquilizing many community activists, non-profits and well-intentioned local officials into passivity at a time when the political energies of these groups are desperately needed to press for a progressive urban agenda in Washington. Some of these potential advocates view the president’s policies and programs through the lens of personal biography. They see a young, articulate Barack Obama who lived in Los Angeles, New York and Boston before moving to Chicago and entering politics. They welcomed Obama and his new White House Office of Urban Policy, since renamed and downgraded to the White House Office of Urban Affairs. Headed by former Bronx Borough President Adolfo Carrión Jr. of New York, this new office is, according to the New York Times, charged with “job creation, housing and ensuring that federal money for urban America is effectively spent”—or more broadly, focusing federal investment into urban areas.

While community support for the Obama administration in understandable, many potential advocates are reluctant to pressure the White House and its Office of Urban Affairs even though many urban programs continue to be slighted. Because of their personal allegiances to the new president, his party and his administration’s policies, few community activists and local officials are connecting the obvious dots accounting for the long-term, declining level of federal support for urban programs. Lyndon Johnson discovered over forty years ago that the U.S. could not have both the guns of the Vietnam War and the butter to meet urban needs. The same holds true today. The overall cost of the U.S. military budget, including current wars, is now conservatively estimated at over $1.1 trillion by historian Chalmers Johnson in Going Bankrupt: Why the Debt Crisis is Now the Greatest Threat to the American Republic(www.tomdispatch.com/post/174884). Military spending at these levels ensures that critical urban programs such as housing and transportation will be perpetually underfunded.

Many local officials are not just oblivious to the costs of empire, they actively bless them each time they invoke the administration’s vaguely patriotic claim of “shared sacrifice” to promote local budget cuts. This is the slogan developed by David Axelrod, Obama’s senior advisor, to justify selective federal belt-tightening. And just as their Washington mentors exclude corporate bailouts and military and spy budgets from their version of shared sacrifice, local officials exempt subsidized sports stadiums, jails and cops.

Storm Cloud #2: The Neoliberal Legacy. The new administration and local governments have inherited three decades of neoliberal governance. The dumbfounding logic of neoliberalism—that social and economic problems created by the market can also be solved by the market—is still alive and well.

At the federal level, neoliberalism has meant the elimination or downsizing of many New Deal and Great Society social programs. At the local level, it has meant replacing “rational” city planning with “business-friendly” planning departments dedicated to the expeditious approval of permits for private real estate development. In combination, these neoliberal changes at all levels of government have led to such futile neoliberal urban programs as:

  1. Congestion management through highway pricing instead of mass transit to address traffic problems; and
  2. Inclusionary zoning to legitimize luxury development instead of public housing.

This movement from liberalism to neoliberalism has crept up so slowly on planners and other public employees that they have lost site of the profoundly different governance ethic which now guides their work. For example, after the 1965 Watts Rebellion, Los Angeles was flooded with federal initiatives such as Model Cities, along with new state- and locally-funded parks, schools and colleges. Even the local planning department pitched in, preparing the city’s first modern general plan with several dozen specialized elements, most focused on infrastructure. But three decades later, by the time of the city’s 1992 urban insurrection, the neoliberal worldview had firmly taken hold. This time the federal government’s role was limited to sending in media advisors who finessed the transformation of a multi-racial insurrection into a race riot. The State of California sent in the National Guard to help enforce three days of martial law. City government reassigned planners to review conditional use permits for alcohol sales in the riot zone while the Police Department gradually hired 3,000 more cops. As for the infrastructure proposals prepared shortly after 1965, they have not been touched in over forty years.

What does this neoliberal storm cloud portend for American cities over the next decade? First, if and when more aid comes from the federal government, its focus will be the private sector. It will go to private contractors to build projects quickly for the benefit of the local business community. The big-ticket items desperately needed by city residents, in particular housing programs and mass transit, will go wanting. Second, depending on the length and severity of the recession, civil disturbances will again be harshly dealt with instead of being prevented or responded to by federally-supported employment, education and recreation programs.

Storm Cloud #3: The Infrastructure Deficit

According to the American Society of Civil Engineers (ASCE) in its 2009 Report Card for America’s Infrastructure (http://www.infrastructurereportcard.org/), the U.S. has a cumulative infrastructure deficit of $2.2 trillion. Much of this deteriorating and underfunded infrastructure is in cities and results from long-term public underinvestment. Because of the recession and despite the many recommendations of the ACSE, there is no end in sight to the infrastructure deficit crisis. Since the previous ASCE report card in 2005, there has been no improvement with regard to roads, bridges, drinking water, hazardous waste, public parks and recreation, schools, solid waste and wastewater. Furthermore, aviation, roads and transit received worse grades today than they did four years ago. Together, these are critical components of the perfect storm.

The ASCE argues that there are both immediate and long-term dangers resulting from poorly maintained infrastructure. While New Orleans’ devastation from Hurricane Katrina and Minneapolis’s I-35 freeway bridge collapse demonstrate that large-scale, immediate loss of life ensues when infrastructure systems fail, substandard infrastructure also takes its steady toll. One report claims that 14,000 annual traffic fatalities result from poorly maintained roads and highways. Inadequate infrastructure is also a drag on the economy. If goods and employees cannot easily or reliably move within or between cities, then time and money—estimated at $80 billion per year—is lost to traffic congestion.

Richard Little, director of the Keston Institute for Public Finance and Infrastructure Policy at the University of Southern California, has pointed out that there are no longer enough trained engineers and skilled workers to take on the projects proposed by the administration. A generation of underinvestment has left this “humanware” in short supply and stimulus money cannot by itself make a workforce suddenly reappear.

Storm Cloud #4: The Bailout Imbalance

According to Bloomberg News, by the end of March 2009 the Bush and Obama administrations had cumulatively committed a total of $12.8 trillion to rescue packages for banks, auto manufacturers, insurance companies and mortgage lenders. Embedded within this truly gargantuan figure is the Obama administration’s $785 billion American Recovery and Reinvestment Act (Recovery Act), also known as the stimulus package. Though it amounts to a mere 6 percent of the total rescue package, it has nonetheless been presented as a revival of the Roosevelt administration’s New Deal.

The stimulus package is imagined to be an antidote to recession and an opportunity for cash-strapped states and cities to cover their budget deficits, meet public needs and stimulate local economies through capital projects. But very little of the small amount of money in the Recovery Act is devoted to state and local government. According to the ASCE, infrastructure investment only amounts to about $100 billion of the stimulus package’s $785 billion. The State of California’s plight reveals how much more federal help is needed. California’s $24 billion budget deficit already factors in federal stimulus funds, including those allocated to infrastructure. Even with this helping hand, as well as other stimulus funds trickling down to California’s counties, cities, school and community college districts and transit authorities, the state’s public sector has been battered by widespread work furloughs, hiring freezes, layoffs, program cutbacks and canceled capital projects. California is even paying people and vendors with IOUs.

According to the National League of Cities, 83 percent of American cities have responded to the recession by selectively cutting expenditures and services, and 80 percent anticipate making further cuts in the coming fiscal years. Meanwhile, the overwhelming bulk of federal resources are going to rescue banks and reckless corporate giants. This is a political choice made by the Obama administration and Congress, yet the impression remains that the major rescue effort is the stimulus package.

Storm Cloud #5: Climate Change and Peak Oil

Broad global changes related to oil, in particular accelerated climate change ushered in by heavy petroleum use over the past century, buttressed by declining oil supplies that cause prices to rise (i.e., peak oil), are impacting cities in two detrimental ways. The first impact, from climate change, is causing local dislocations that require more, not less, public expenditures. Many parts of the country have experienced more severe storms and floods than in the past, requiring new flood control investments and other repairs to cities and the lives of residents after the storms have lifted. Other impacts, such as droughts and heat waves, force up the price of air conditioning and water. In response to these issues, the U.S. Conference of Mayors has established a Climate Protection Agreement to which more than 500 cities have sign on. Most local municipal climate protection activities consist of low-cost educational campaigns to modify resident lifestyles, such as promoting bicycling or drought-tolerant gardening. Other climate protection programs, however, are not low cost and cities will be forced to spend large sums of money. Such programs, like designing and constructing mass transit, planting and maintaining urban forests, building solid waste recycling centers, constructing LEED-certified municipal buildings and investing in alternative energy sources for municipal power companies, require major financial resources. If there was little money for these projects before the recession, there is even less now.

Peak oil poses other, more insidious problems. While mass transit—were it funded—could ameliorate the related effects of climate change and peak oil, the broad approach of the federal government is entirely different. According to Michael Klare, The Nation’smilitary correspondent, there is a new Washington consensus to use U.S. military force to maintain control over natural resources and access routes, in particular the oil reserves and pipeline routes of the Persian Gulf and the greater Middle East. He describes this consensus in an October 2007 article in The Nation:
We have entered into a new era of intensified energy competition and growing reliance on the use of force to protect overseas sources of petroleum…
The need for a vigorous U.S. military role in protecting energy assets abroad has been a major theme in American foreign policy since 1945, when President Roosevelt met with King Abdul Aziz of Saudi Arabia and promised to protect the kingdom in return for privileged access to Saudi oil….The use of military force to protect the flow of imported petroleum has generally enjoyed broad bipartisan support in Washington….Perhaps the most explicit expression of this elite consensus is an independent task force report,National Security Consequences of U.S. Oil Dependency, backed by many prominent Democrats and Republicans. …The report warns of mounting perils to the safe flow of foreign oil. Concluding that the United States alone has the capacity to protect the global oil trade against the threat of violent obstruction, it argues the need for a strong U.S. military presence in key producing areas and in the sea lanes that carry foreign oil to American shores.
This Washington consensus has resulted in bloated war budgets with an adverse impact on federal programs benefiting cities. If Klare’s analysis continues to be accurate, the U.S. government’s primary response to peak oil will not be energy conservation or new technology, but rather expanded energy wars. The modest energy efficiencies resulting from municipal educational campaigns, such as switching from incandescent to fluorescent light bulbs, will be dwarfed by the enormous loss of public resources siphoned off for energy wars in Iraq, Afghanistan and elsewhere.

The Perfect Urban Storm

As these five smaller storms converge to create the perfect urban storm, we can expect to see the following developments. Urban infrastructure and non-police municipal services, especially education, will further deteriorate, despite the Recovery Act. Given unprecedented annual federal deficits of $2 trillion for the current and coming fiscal years, we have probably seen the high point of local spending. While the deterioration of cities and towns will be gradual, building on trends that originated in the early 1970s, it will rapidly accelerate during natural disasters and political upheavals.

There will be less funding for non-military, non-corrections and non-police services. Many human needs, now greater because of unemployment and slashed public programs, will not be addressed. The real federal jobs program will be an expanded poverty draft, most likely followed by that stalking horse for conscription, a program of national service.

Harder to predict are the public reactions to declining living conditions, especially when the bloom is off the rose of the new administration. In other countries such as France, Iceland and Greece, the response to economic contraction and efforts to shift the costs to the middle and working classes have been met with stiff resistance, including general strikes. So far there has been little resistance in the U.S., but this may not last. This country has experienced periods of mobilization and mass movements in the past, such as in the 1930s, the 1960s and the build-up to the current Iraq War. As storm conditions get worse, the prospects for cities in the age of Obama will depend on how people organize and respond to both the rhetoric and heavy hand of the Washington establishment.

The Fiscal Crisis of the States

The fifty states are facing one of the worst fiscal periods in decades. Fiscal conditions deteriorated for nearly every state during fiscal year 2009, and weak fiscal conditions are expected to continue in fiscal 2010, and possibly into fiscal year 2011 and 2012. . . Almost half the states experienced negative budget growth in fiscal 2009, and nearly three-quarters of states recommended fiscal 2010 budgets with negative growth. As the severe national recession continued, tax revenues from sales, personal income and corporate income taxes continued to come in lower than expected during fiscal 2009. Substantial job losses and significant reductions in corporate profits resulted in declines in capital gains and other investment income, an important source of revenue for states.

Expenditure pressures continue as demand for additional funding of programs such as Medicaid increase during the tough economic periods and states deal with looming long-term issues such as funding pensions, demographic shifts and maintenance and repair of infrastructure. Unfortunately, when revenue growth declines as a result of a weakened economy, spending pressures for social programs and health care increase.

National Association of State Budget Officers, Fiscal Survey of States, June 2009.

Dick Platkin (rhplatkin(at)yahoo(dot)com), a former member of the Planners Network Steering Committee, recently retired from the Los Angeles City Planning Department. He is now teaching and engaged in advocacy planning for community groups in Los Angeles.

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