Thursday, May 17, 2012

Urban Ouiji

Greg Lindsay, jeopardy champion and author of the book Aerotropolis, has a great post investigating Paul Romer's idea of Charter Cities over at Next American City.  Unfortunately, it's a subscription only piece.  On the other hand, Next American City is smart enough to set their articles up on an itunes-like pay-to-play a la carte basis.  You can get it for 1.99 or join for the year for about 18 bucks.  I'm signed up for the year because they're doing great work.  Blowing away Atlantic Cities for more in depth, research-driven, long form pieces, IMO.  

Charter Cities, if you're unaware, is Romer's idea for bringing markets and therefore opportunity to otherwise backwater, third world locations.  As Lindsay and Romer's critics correctly point out, sometimes reality gets in the way of theory.  And that many of those places are the way they are because of political instability (to say the least) and potentially authoritarian regimes that may not like ceding much control indefinitely to global free trade zones.  Let's just call them unreliable for the kind of investment you actually want.  As we see locally here in Dallas, most of the investment willing to wade into the corrupt waters of south Dallas is the exploitative kind. 

My issue with charter cities is not Romer and his urban planning "consigliere's" basic principle of cities and that they're best governed by simple operating systems, basic rules, rather than top down, directed planning.  But rather that when opening these places up to markets, they have have HAVE to be followed by legitimate institutions.  Simply opening the people up to markets is a recipe for exploitation if they're not given access to the opportunity empowered by education, internet, a legitimate rule of law and court system, ie a fair and level playing field.  And that never happens over night.  Otherwise, the global market, and therefore opportunity, isn't available to them, but they're available to the inevitable next wave of strip mining for the cheapest global labor.

Another major issue is the size and scale of the ports and airports that have to be built upfront to make it work.  The entire idea strikes me as similar to the various forms of Enterprise Zones that cities have enacted on under-utilized pieces of land (usually underdeveloped for a reason), where new businesses would get whatever form of tax breaks and subsidies to locate there.  However, I've yet to see many (any?) that actually achieve a critical mass.  Typically, they're situated for global interconnectivity (on highways), but lack the requisite local interconnectivity with neighborhoods, parks, schools, and everything else necessary.  They're islands.  Similarly, Charter Cities are trying to build islands from scratch without either the global or local interconnectivity.  But who will build the full scale ports/airports and related infrastructure before incrementalism builds to the critical mass to sustain such investment?  It's a massive risk and given the scale they're talking about, likely too large of a risk unless you're literally desperate (note the countries cited: Honduras, Madagascar).

As I told Greg last night, I found a lot of truth in the statements by Romer, his disciples, and critics alike.  But none of them had the market cornered on the reality of cities either.  And therein lies the beauty of cities, civilization.  We're all pulling in our own direction and the total sum of forces determines the ultimate destination.  And like a ouiji board, though we're each exerting some amount of force in disparate or coordinated directions, we assign the result to some mystical forces entirely out of our control.  Whether we want to believe it or not.