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Power structures at the city level are different from the national power structure. They are not junior editions of the national corporate community.
That's because local power structures are land-based growth coalitions. They seek to intensify land use. They are opposed by the neighborhoods they invade or pollute, and by environmentalists.
To the shock and dismay of land-based elites, the workers who poured into the cities between 1870 and 1920 challenged elite rule through Democratic Party machines and the Socialist Party. So the growth elites created a "good government" ideology and a set of "reforms" that literally changed the nature of local governments and took them out of the reach of the upstarts.
The theory presented here explains all the key case studies of the past, including the most important ones, such as Atlanta and San Francisco, and the one that had the most impact, political scientist Robert A. Dahl's study of New Haven, which turns out to be wrong on almost every key point.
The city-level pluralists (who have now morphed into public-choice theorists in some cases) have an inadequate theory of city power because they rely on classical free-market economics, ignore the fact that growth does not benefit everyone in the city, and downplay or ignore the genuine conflicts that exist between growth elites and neighborhoods. There is little or no concern with power in their theory.
Marxist theory fails at the local level because it does not take its own distinction between "exchange value" and "use value" seriously, focuses almost entirely on finance and industrial capital, treats neighborhood as a residual category (merely a place to reproduce the working class), and interprets every conflict as a "class conflict" even though the primary battle in cities is between land-based growth coalitions trying to increase "rents" and neighborhoods that are trying to defend their use values.
A local power structure is at its core an aggregate of land-based interests that profit from increasingly intensive use of land. It is a set of property owners who see their futures as linked together because of a common desire to increase the value of their individual parcels. Wishing to avoid any land uses on adjacent parcels that might decrease the value of their properties, they come to believe that working together is to the benefit of each and everyone of them. Starting from the level of individual ownership of pieces of land, a "growth coalition" arises that develops a "we" feeling among its members even if they differ on other kinds of political and social issues.
This "we" feeling is reinforced by the fact that the pro-growth landed interests soon attract a set of staunch opponents--if not immediately, then soon after they are successful. These opponents are most often neighborhoods and environmentalists, which are sometimes aided by university students and left activists. The inevitable tensions between the growth coalition and its opponents led to increased suburbanization, urban renewal, ghettoization, and many of the other problems that plague American cities of the 21st century.
In economic terms, the "place entrepreneurs" at the center of the growth coalitions are trying to maximize "rents" from land and buildings, which is a little different than the goal of the corporate community -- maximizing profits from the sale of goods and services. As sociologists Jonathan Logan and Harvey Molotch explain:
Unlike the capitalist, the place entrepreneur's goal is not profit from production, but rent from trapping human activity in place. Besides sale prices and regular payments made by tenants to landlords, we take rent to include, more broadly, outlays made to realtors, mortgage lenders, title companies, and so forth. The people who are involved in generating rent are the investors in land and buildings and the professionals who serve them. We think of them as a special class among the privileged, analogous to the classic "rentiers" of a former age in a modern urban form. Not merely a residue of a disappearing social group, rentiers persist as a dynamic social force. (Logan & Molotch, 1987.)
The most typical way of intensifying land use is growth, and this growth usually expresses itself in a constantly rising population. A successful local elite is one that is able to attract the corporate plants and offices, the defense contracts, the federal and state agencies, and/or the educational and research establishments that lead to an expanded work force. An expanded work force and its attendant purchasing power in turn lead to an expansion of retail and other commercial activity, extensive land and housing development, and increased financial activity. It is because this chain of events is at the core of any developed locality that the city is for all intents and purposes a "growth machine," and those who dominate it are a "growth coalition."
Local growth coalitions and the corporate community, as owners of income-producing properties, have much in common and often work together, but their somewhat different ways of making money means that there are some political tensions and conflicts between them. They are different "segments" of the ownership class. That is, as owners and as employers of wage labor, they are in the same general economic category and share more in common than with non-owners. But they nonetheless are to some extent rivals because their interests in business dealings are not always exactly the same.
In particular, there is tension between growth coalitions and corporations because corporations have the ability to move if they think that local regulations are becoming too stringent or taxes and wages too high. A move by a major corporation can have a devastating impact on a local growth coalition. Thus, growth coalitions can fail. Cities can die, or even become ghost towns.
Moreover, this ability to move on the part of corporate capital contributes to the constant competition among rival cities for new capital investments, creating tensions among growth coalitions as well as between individual growth coalitions and the corporate community. The net result is often a "race to the bottom" as rival cities offer tax breaks, less environmental regulation, and other benefits to corporations in order to tempt them to relocate. Ironically, most studies of plant location suggest that environmental laws and local taxes are of minor importance in corporate decisions concerning the location or relocation of production facilities. A union-free environment and low-cost raw materials are the major factors.
Rather obviously, then, the most important activity of a local growth coalition is to provide the right conditions for outside investment. However, this preparation involves far more than providing level and plentiful acreage with a stream running through it. It also involves all those factors that make up what is called a "good business climate," such as low business taxes, a good infrastructure of municipal services, vigorous law enforcement, an eager and docile labor force, and a minimum of business regulations.
Place entrepreneurs expend considerable effort in keeping up with the changing locational needs of corporate capital. They take business school courses, read relevant trade journals, talk with local capitalists, go to business conferences, encourage real estate studies at local universities, and keep a close eye on what is happening in planning and governmental circles. In a word, they are constantly alert to the needs of big outside capital. They also engage in incessant boosterism, extolling the virtues of their local area to anyone who will listen.
Only in the largest cities, where major corporations and a few extremely rich families are wealthy enough to capture the profits of both land use and production, does the distinction between land-based local growth coalitions and a capital-based national power elite rooted in the corporate community tend to disappear. It may even be that the corporatization of real estate profits is the wave of the future. Huge real estate and development syndicates now move from city to city, and even country to country. But for now, and for understanding the history of local power for much of the 19th and 20th century, the distinction between two types of economic elites is an essential one.
Although the growth coalition is based in land ownership, it includes all those interests that profit from the intensification of land use. Thus, executives from the local bank, the savings and loan, the telephone company, the gas and electric company, and the local department store are often quite prominent as well. As in the case of the corporate community, the underlying unity within the growth coalition is most visibly expressed in the intertwining boards of directors among local companies. And, as with the corporate community, the central meeting points are most often the banks, where executives from the utilities companies and the department stores meet with the largest landlords and developers.
There is one other important component of the local growth coalition: the daily newspaper. The newspaper is deeply committed to local growth so that its circulation and, even more important, its pages of advertising, will continue to rise. No better expression of this commitment can be found than a statement by the publisher of the San Jose Mercury News in the 1950s. When asked why he had consistently favored development on beautiful orchard lands that turned San Jose into one of the largest cities in California within a period of two decades, he replied, "Trees do not read newspapers" (Downie, 1970, p. 112). However, the unique feature of the newspaper is that it is not committed to growth on any particular piece of land or in any one area of the city, so it often attains the role of "growth statesman" among any competing interests within the growth coalition.
The newspaper's publisher or editor is deferred to as a voice of reason. Competing interests often regard newspaper executives as general community leaders, as ombudsmen and arbiters of internal bickering, and at times, as enlightened third parties who can restrain the short-term profiteers in the interest of a more stable, long-term, and properly planned growth. The newspaper becomes the reformist influence, the "voice of the community," restraining the competing subunits, especially the small-scale arriviste "fast-buck artists" among them.
The growth coalitions also have a well-crafted set of rationales, created over the course of many decades, to justify their actions to the general public. Most of all, this ideology is based in the idea that growth is about jobs, not about profits:
Perhaps the key ideological prop for the growth machine, especially in terms of sustaining support from the working-class majority, is the claim that growth "makes jobs." This claim is aggressively promulgated by developers, builders, and local chambers of commerce. It becomes part of the statesman talk of editorialists and political officials. Such people do not speak of growth as useful to profits--rather, they speak of it as necessary for making jobs. (Molotch, 1976, p. 320.)
Thanks in part to this rhetoric about being responsible citizens who just want to help everyone by creating jobs, the local growth coalition sometimes includes a useful junior partner--the building trade unions. They often are highly visible on the side of the growth coalition in battles against environmentalists and neighborhood groups. In reality, local growth does not create new jobs in the economy as a whole, which is a function of corporate and governmental decisions beyond the province of any single community. However, local growth does determine where the new jobs will be located, which is what matters from the point of view of the building trades unions. For that reason, it is in their interest to help their local growth coalition in its competition with other localities.
Due to the separation of local, state, and national government in the United States, the wily members of the local growth coalition are able to have it both ways. At the state and national levels they support those politicians who oppose, in the name of fiscal and monetary responsibility, the kinds of government policies that might create more jobs, whereas at the local level they talk in terms of their attempts to create more jobs. Their goal is never profits, but only jobs.
Although a concern with growth is at the basis of each local power structure, every city enters into the competition with a different set of priorities and strategies for achieving it. Calculations have to be made about what investment possibilities are the most desirable and possible based upon such factors as the availability of natural resources; the nature of the climate; the proximity of oceans, lakes, and rivers; the skills of the work force; and the past history of successes and failure in growth competition. Rather obviously, there is a clear preference for clean industries that require highly paid skilled workers over dirty industries that use unskilled workers, but dirty industries will be accepted if other locales win the clean ones. Attractive beach-front towns are not as likely as inland cities to seek out just any type of industry; their property can bring in more money as sites for tourist resorts and convention centers. When an area has little or nothing to offer, as in the case of most of Nevada, it settles for gambling and prostitution to create a Las Vegas. Then, too, growth strategies can change over time; when Atlantic City lost out as a "nice" resort, it adopted the Nevada strategy and turned to legalized gambling.
Historical factors also enter into growth strategies. If one locale gets there first with a once-in-a-generation opportunity, such as a stockyard or a railroad, over which competition was very fierce in the 19th century, then nearby communities have to settle for lesser opportunities even though they have very similar natural conditions. On the other hand, earlier successes may lock an area into relationships and obligations that make it very difficult for it to take advantage of new opportunities.
Successful unionization by workers in one city can lead to new opportunities for another. In fact, that is the basic reason for the movement of many industries from the North to the South in the course of the 20th century. The fiercely racist, paternalistic, and anti-union Southern city elites were able to provide manufacturers with cheap and docile labor forces. They had their police and sheriffs run union organizers out of town the minute they arrived. This union-free strategy was working for cities in South Carolina, Tennessee, and Mississippi as recently as the 1990s, when lower transportation costs and free trade agreements made it possible for manufacturers to seek even higher profits by moving to Mexico and China.
The growth-coalition hypothesis leads to certain expectations about the relationship between power structures and local government. Rather obviously, the primary role of government is to promote growth according to this view. It is not the only function, but it is the central one, and the one most often ignored by those who write about city government. Local government promotes growth in several ways, the most visible of which are the construction of the necessary streets, sewers, and other public improvements and the provision of the proper municipal services. But zoning, building standards, and many other government regulations also matter greatly in keeping property valuable, as home builders also realized very early in the 20th century (Gotham, 2002, Chapter 2). While all of this is going on, the city departments of planning and public works, among several, become allies of the growth coalition with the hope that their departments will grow and prosper (Mollenkopf, 1983).
In addition, government often provides the funds for the boosterism that gives the city name recognition and an image of togetherness, which are considered important by the growth coalitions in attracting industry. Sometimes the money for boosterism is given directly to the government by the local Chamber of Commerce. In some places, it is given to an Industrial Development Commission or a Convention and Visitors Bureau that is jointly funded by government and private enterprise.
Then, too, government officials are expected to be the growth coalition's ambassadors to outside investors, traveling to meet with them in their home cities or showing them the local community and answering their questions when they come to inspect it for possible investment.
Since a great many specific government decisions can affect land values and growth potentialities, leaders of the growth coalition are prime participants in local government. Their involvement is even greater than that of corporate capitalists at the national level, where the power elite can rely to some extent on such "signals" as stock prices, interest rates, and the level of new investments to tell government officials what they think of current policies. The growth coalition is the most over-represented group on local city councils, as numerous studies show (Logan & Molotch, 1987). It also is well represented on planning commissions, zoning boards, water boards, and parking authorities, which are the decision-making bodies of greatest importance to it. However, this direct involvement in government is usually not the first or only contact with government for members of the growth coalition. They often have previous service on the local Chamber of Commerce's committees and commissions concerned with growth, planning, roadways, and off-street parking.
The idea that the heart of a local power structure is provided by those businesses concerned with local real estate values explains what had been considered a perplexing issue in what was once called the "community power literature:" the relative absence of industrial executives as top leaders within the city. Industrial corporations provide financial support and leadership that are often important within the Chamber of Commerce. Their executives are active in community service organizations if the company is one in which such activity is considered part of good citizenship. But in most cases such corporations and their executives are not central figures at the local level. Why would this be the case if capitalists rule America?
A theory that distinguishes between land-based growth elites and national-level corporate capitalists explains this finding by the fact that manufacturers usually are not concerned with land values unless they are also big landowners as well. Their focus is on making profits through the sale of products in regional, national, and international markets. For an industrialist, any given locality is merely a site for production that can be abandoned with a fair amount of ease if it becomes too costly, as the great concern with plant closings attests. Their power is not in their involvement in local government but in their ability to move, which makes the local growth coalition eager to satisfy their requests and at the same time creates an underlying tension between the two sets of interests. Manufacturers provide money for boosterism, urban planning, and political campaigns, but it is land-based elites that run the show.
Growth coalitions are relatively unique to the United States because land has been commodified to a degree that is found in no European industrialized democracy. Capitalists and corporations are everywhere, but not place entrepreneurs. Right from the start, many of the richest Americans were landowners and land speculators, including George Washington, who was eager to spread his holdings through involvement in land companies. This difference can be seen most dramatically in the percentage of housing that is publicly owned, which was 46% in England, 37% in France, and less than 1% in the United States in 1980 (Jackson, 1985, p. 224).
Moreover, because the governmental system has national, state and local levels, local growth coalitions were able to take advantage of new land markets as the country conquered the Native Americans. The federal system of government made it possible to resist control of land from the top by national-level landowners who could work through the government in Washington (Logan & Molotch, 1987; Molotch, 1999). In addition, the commodification of land and the decentralized nature of American government go a long way in explaining why there is no decent housing for low-income people in the United States; it is the pressure of the local growth coalitions that create both concentrated areas of low-income housing and resistance to decent public housing (c.f. Sites, 2003, Chapter 5).
The distinction between a national-level power elite based in the corporate community and local-level growth coalitions based in land and buildings shows once again why it is necessary to study power structures anew in each country.
The growth coalition faces considerable opposition when it impacts neighborhoods or the environment through highrises, new freeways, industrial pollution, noise, dirty air, and many other factors. People in neighborhoods want to preserve the amenities that they have. They do not like the congestion that comes with growth. They often organize to fight new growth or any other intrusions on their way of life. But this does not mean neighborhood resistance is inherently progressive. To the contrary, it sometimes involves racial, religious, or ethnic exclusion.
In abstract terms, the basic conflict at the local level between growth coalitions and neighborhoods is one of "exchange value" versus "use value." Growth coalitions want to make more money off their land and buildings, which can lead to major changes in neighborhoods if developers want to construct highrise apartments, office buildings, or strip malls. The people in the neighborhoods, on the other hand, see their homes as a place of safety and comfort, and as a place to raise children and mingle with people of their own kind. Even in the fast-paced modern world, neighborhoods are imbued with deep sentiments and inspire strong attachments. True, people want their homes to retain their resale value, and in this day and age, to rise in value, but their primary concern remains their "quality of life." They are therefore NIMBYs--Not In My Back Yard.
Moreover, the residents of a city want the local government to spend a greater share of its budget on municipal services, social services, parks, and other amenities. But the growth coalitions want the lion's share of the money to go to physical infrastructure and anything else that aids growth. Once people are in the city, the growth coalitions do not worry much about them. Its members are very shortsighted if spans of decades are taken into consideration.
In the short run, growth coalitions usually win out over people who are protesting intrusions into their neighborhoods or asking that tax monies be used for use values like parks. The residents who can afford to leave grow tired of the battle or are bought off by the developers. They move to land outside the city, and they join with other recent arrivals to the new scene to insure that this living space remains inviolate. They incorporate the area as a new city, a "suburb," which is primarily focused on neighborhood use values, or was until huge malls and office complexes came along.
However, victories for the pro-growth forces in battles with neighborhoods are by no means guaranteed. When growth coalitions are weakened by the departure of large corporations, or by an inability to cope with racial tensions, they can fragment and lose control to coalitions of neighborhoods, environmentalists, and left activists.
It is also true that not all members of the growth coalitions are completely crass in their dealings with local citizens. Some of them believe in a few use values for residents, as long as their own taxes can be kept to a minimum. Furthermore, there are middle-class "reformers" who want to save the city from itself. In the Progressive Era, the moderate elements within growth coalitions sometimes joined with reformers to work for the amenities sought by neighborhoods. These reformist urges were especially strong where the growth coalitions faced serious political challenges from Democratic Party political machines and the Socialist Party, as they did between 1880 and 1920. These challenges are discussed in a minute, after a summary statement on the dynamics behind suburbanization.
Suburbs have been part of the American scene since the early 19th century, when the steamboat and regular stagecoach lines ("omnibuses") were the mode of urban escape. They increased in size and popularity as soon as there were railroad and trolley lines, sometimes as early as the 1830s, as in the case of Brookline, a Boston suburb. Thus, the dream of living in the quiet countryside in an idyllic little town is deeply imbedded in American culture (Jackson, 1985).
The urge toward suburbs accelerated in the late-19th century as industrialization and further railroadization impacted the cities in negative ways. First of all, factories and railroads became a huge source of environmental pollution. The air was terrible in many large cities, such as Chicago. The local growth coalitions tried to do something about this problem, but the railroad and manufacturing magnates had the upper hand, and rejected efforts at amelioration (Gonzalez, 2005). Second, the large manufacturing plants in the cities had to have workers, and the result was an increase in low-income immigrant populations from Eastern and Southern Europe, who were looked down upon by the established middle class--and craft workers--of Northern European origins. Thus, ethnocentrism and class snobbery contributed to the movement of the middle-class to the suburbs.
When American cities were small and relatively homogeneous, and not everyone could vote, they were easily dominated by the local landed elites and their allies. But in the last quarter of the 19th century, as the country urbanized and new immigrants poured into the cities to become industrial workers, the situation changed dramatically. Ethnic-based political machines, usually affiliated with the Democratic Party, came to electoral power in many city governments. In the early 20th century, these machine Democrats were sometimes joined by members of the Socialist Party that formed in 1901. In 1912, the high point of socialist electoral success, the party elected 1200 members in 340 cities across the country, including 79 mayors in 24 different states. There were also 20 socialists in nine different state legislatures, with Wisconsin (7), Kansas (3), and Illinois (3) heading the list (Weinstein, 1967, pp. 83-118).
The local growth coalitions were deeply upset by this turn of events. They claimed that ethnic machines were raising taxes, appointing their supporters to government jobs, and giving lucrative government contracts to their friends. In other words, they were cutting themselves in on the action, and using government to move into land speculation and urban development for themselves. In their desperation, some of the old guard openly questioned the right of ordinary citizens to vote at the local level, claiming that those who did not own property should not be able to raise taxes on property holders. As the noted historian and reform advocate Francis Parkman put it in 1878, "indiscriminate suffrage" was putting an "ignorant proletariat" in seats of power (Schiesl, 1977, p. 6).
Even when the established growth coalitions could reach an accommodation with the machines by joining them as financial supporters, as they very frequently did, they also worked to undercut them through a series of "reforms" and strategies that gradually took shape over a 30-year period. Although the reforms were presented as efforts to eliminate corruption, reduce costs, and improve efficiency in the face of growing infrastructure needs, they also had the purpose of making it more difficult for Democrats and Socialists to hold on to elected positions. This strategy was carried out by an urban policy-planning network that foreshadowed the national-level policy planning network that developed two or three decades later.
The urban policy-planning network began with a meeting in 1894 of local reformers from 21 cities in 13 states. This National Conference for Good City Government brought together about 150 delegates and invited guests, many of whom were leading businessmen, lawyers, journalists, and academics from their respective locales.
The conference led to the formation of a permanent National Municipal League three months later. This organization carried the general ideology and formulated the specific policies for the local growth coalitions for the next five decades, as well as encouraging other organizations--for research, for professionalization, for advocacy--that soon developed (Stewart, 1950). Three years after its formation, the National Municipal League, through a special committee made up businessmen, lawyers, and university professors, began work on a municipal program which would put into practice what its leaders saw as the essential principles that must underlie successful local government. The committee report eventually became a model city charter for possible adoption around the country.
The reforms were put forth as part of the ideology of "good government," which meant "efficient," "businesslike" government by experts and technicians, as opposed to the "corrupt," "machine-dominated," and "political" government alleged to exist in a growing number of cities. The new movement claimed to make government more democratic and less boss-dominated, although the actual effect of the reforms was to increase the centralization of decision making, remove more governmental functions from electoral control, and decrease the percentage of workers and socialists elected to city councils.
These reforms and their effects are as follows:
The reformers did not have many successes at first, except for civil-service protection for municipal employees and competitive bidding on government contracts. They faced determined opposition from machine Democrats and the Socialist Party, especially in the large Eastern and Midwestern cities They did not begin to taste victory until the second decade of the 20th century. Riding a call for unity between the two major parties in the face of large gains by Socialists in 1908 and 1912, the movement then capitalized on the fear and patriotism created by World War I. It branded the Socialists as anti-war traitors, disrupted their meetings, and removed their newspapers from the U.S. mail. By 1919, the reformers had been able to implement their model charter in 130 cities, and could claim partial successes in many more. (Hays, 1964; Schiesl, 1977; Weinstein, 1962). By 1965, over half the cities between 25,000 and 250,000 in population were functioning under council-manager government, and the plan was especially popular in the suburbs, a wonderful way for the well-to-do to protect neighborhood use values (Goodall, 1968, pp. 60-61).
At the same time, the home-building component of the growth coalition was organizing to insure that property values could be maintained in the new residential communities they were developing, both within the city limits and in suburbs. Organized as the National Association of Real Estate Boards in 1908, the home builders and real estate salespeople realized that they now needed "public regulation of all land-use, including public provisions of infrastructure and services (e.g., building use, size, land coverage, and zoning), to ensure a stable and long lasting residential environment" (Gotham, 2002, p. 41).
As the home builders organized to use government to ensure land values, the government reform movement continued to make gains in the next several decades. A large-scale survey conducted in 1991 revealed that 75 percent of American cities have non-partisan elections, making that reform the most successful in the entire array. Over 90% of cities west of the Rocky Mountains use non-partisan elections, although only 12% of cities in the states of New York, New Jersey, and Pennsylvania do so, reflecting the entrenched nature of machine politics in areas with a long political history. In addition, 59% of cities use citywide ("at-large") elections, compared to only 12% that rely exclusively on the old district system ("wards"). The other 29% use a combination of citywide and ward representation. Finally, 52% of cities had adopted either the council-manager or commission form of government recommended by the reformers, abandoning the election of a "strong" mayor who presided over the city council and had responsibility for city employees. Most of the resistance to council-manager government continued to come from large cities with strong Democratic Party organizations. (Renner & DeSantis, 1994)
Despite the partial failures in big cities, the larger goals of the good-government movement were achieved. The direct connections between local and national government were obscured, making it possible for leaders of the growth coalition to sound plausible when they claim their goal at the local level is to create jobs, while at the same time opposing any legislation at the national level that actually might help create more jobs. Then, too, the local branches of the two major parties were eliminated in half of all American cities, removing city councils as a training ground for liberal-labor candidates and making it harder to create a comprehensive liberal-labor program.
The electoral results tell the same story. A quantitative study comparing cities that had adopted from one to five of the basic reforms showed that each of the reforms reduced voter turnout. (Alford & Lee, 1968). From a point before World War I where thousands of blue-collar and lower white-collar workers were serving on city councils, by the 1940s there were very few such people being elected.
As the basic plans of the reform movement were being implemented, the urban policy-planning network was adding new organizations to complement the National Municipal League. First, municipal research bureaus sprang up in the first ten years of the 20th century, reaching into dozens of cities by 1940. Funded by a handful of large foundations, they provided the facts and figures that city governments needed, along with advice to city officials on drafting legislation and creating administrative structures.
The first of these bureaus was founded in New York with the help of prominent local citizens of great wealth, such as John D. Rockefeller and Andrew Carnegie: "By 1914 the New York Bureau had spent $950,000, of which $125,000 was contributed by John D. Rockefeller, $117,000 by R. Fulton Cutting, $55,000 by Andrew Carnegie, and $52,000 from Mrs. Edward H. Harriman." (Gill, 1944, p. 16). Within a short time the New York Bureau was working closely with New York City government. The historian of the movement claims that "for several city administrations the Bureau became virtually an official agency" (Gill, 1944, p. 16). In 1911 it developed a Training School for Public Service to train personnel for other cities. The training school eventually evolved into the Institute for Public Administration, still a major force in its field today.
By 1916 the good-government forces were working through several organizations, which some leaders wanted to merge into one large organization. According to this idea, the National Municipal League, the National Civil Service Reform League, the National Voters League, and the Short Ballot Organization would be merged into a single unit.
One of the people arguing against the merger plan was Raymond B. Fosdick of the Rockefeller Foundation, a personal advisor to John D. Rockefeller, Jr. Fosdick's comments are of special interest because Rockefeller money was coming to have considerable influence on political science and public administration, and was to have an even greater impact over the next 30 years. Fosdick argued that
Progress is not achieved in the fashion that is here implied. Reform is never accepted wholesale. Civic ideals never advance in a uniform line. A little progress in this direction is followed by a little progress in another direction, or from another angle. (Stewart, 1950, p. 165.)
Fosdick then suggested the organizational form which was later adopted, in good part because of Rockefeller funding:
Our many organizations should club together to support a common selling agency or clearinghouse, whose business it would be to take the well established results of study and investigations, and by temperate, sure-footed, and dignified publicity put them before the entire country. (Stewart, 1950, p. 165.)
This strategy took many years until it reached fruition, but it was carried out to the letter by another Rockefeller employee, Beardsley Ruml, working through another Rockefeller foundation, the Laura Spelman Rockefeller Memorial Fund. (This Memorial Fund was soon transformed into the smaller and more city-focused Spelman Fund, with its other programs folded into the very large Rockefeller Foundation, the dominant foundation by far in its era.) In conjunction with political scientist Charles Merriam of the University of Chicago (which was created with Rockefeller money), Ruml encouraged the creation of the Public Administration Clearing House (usually called the Clearing House for short) at the University of Chicago. Founded in 1930, its organizers were Richard S. Childs, president of the National Municipal League; Luther Gulick, head of the Institute of Public Administration in New York; and Louis M. Brownlow, a former city manager who had come to know Ruml and Merriam.
The Clearing House was only the first step in the overall organization of the urban policy network. As Brownlow recalls it, this organization was to be at the center of a large array of organizations. Ruml and one of his assistants, Guy Moffett, who headed the newly formed Spelman Fund, drew up a chart that outlined the projected urban policy-planning network in straightforward terms:
That chart consisted essentially of a circle in the middle of a page labeled "Central Clearing of Information." From it radiated lines which led to circles at the top of the page labeled with the names of organizations such as the Assembly of Civil Service Commissions, the City Managers' Association, the Governors' Conference, the Legislators' Association, and one other labeled "other organizations of public officials." Under these was the note: "Secretariats of the above organizations to be located as far as possible at the same place as the central clearing house of information." At the right of the center circle, one line ran to a circle labeled "Coordination of Publication Activities." On the lower part of the page the lines ran from the center to circles designating existing research organizations, such as the Institute of Public Administration, the Brookings Institution, private consulting organizations, universities, and other technical groups. Underneath these was a note: "Activities correlated to some extent to Social Science Research Council." (Brownlow, 1958, p. 249.)
Let's face it: this is a breathtaking overall vision. And it was all carried out by a relative handful of Rockefeller employees with huge grants from various Rockefeller philanthropies.
Only now are historians able to provide us with a sense of the full scope of these efforts (Roberts, 1994). I am always amazed that political scientists, whether pluralists or regime theorists, do not seem to realize that these organizations and their purposes are very difficult for their theories to explain.
Among the organizations brought to Chicago by the Clearing House was the Municipal Administration Service, a research department of the National Municipal League. It was created in 1926 with an ongoing grant from the Spelman Fund. Renamed the Public Administration Service, it became one of the most important members of the group. Also brought to Chicago in the late 1920s and early 1930s were such groups as the American Public Welfare Association, the American Municipal League (now called the National League of Cities), the United States Conference of Mayors, the Municipal Finance Officers' Association, and the International City Managers Association.
The International City Managers Association (ICMA) was typical of these organizations in its development and functioning. The organization was founded in 1914, three years after the first council-manager government was adopted. Although it received considerable help from the U.S. Chamber of Commerce in its early years, ICMA did not become an organization of any significance until it came under the financial wing of the Spelman Fund in 1928. Naturally, Merriam, Ruml, and Brownlow were the central figures in arranging this new funding relationship. The association was then moved to Chicago. By 1935 it was receiving two-thirds of its operating revenue from the Rockefeller Foundation, which by then had absorbed the Spelman Fund within its general structure. This financial tie did not end until 1947, when the organization was solidly on its own two feet (Stillman, 1974).
The ICMA served several functions which insure the smooth functioning of urban power structures once they are in place. Most importantly, it created national standards and guidelines for the new city manager profession, and promoted the implementation of these guidelines in the training of young city managers. Many universities, encouraged by the grants that foundations close to ICMA were willing to provide, developed courses or programs to carry out the training. ICMA also became a placement center for aspiring city managers, creating a national job market in the field. This further encouraged managers towards a national and professional orientation. Finally, it provided policy suggestions, research, and a forum for the exchange of ideas among practicing city managers. Taken together, these functions have led to the structuring of a profession which does not always have to take specific directions from growth-coalition leaders on each and every issue. ICMA has "institutionalized" the efficiency-minded and business-oriented mentality which the growth coalition is happy to see in city administrators.
These and other urban organizations came to be known as the "1313" group in academic circles because of their common address at 1313 East 60th Street in Chicago. They have shaped thinking about local government since they were brought together in the early 1930s to form an urban policy-planning network and create nationwide professional standards and policy guidelines. As Brownlow candidly said, by the 1950s all of these organizations were "integral and important parts of the American governmental (albeit not official) structure" (Brownlow, 1958, p. 466). You can't say it any better than that. Local governments are semi-private in the United States, and therefore funded in part by foundations.
However, there have been some changes since Brownlow wrote. Many of the organizations have moved to Washington because the federal government is now so essential to local governments. Now they are an "urban lobby" as well as a policy-planning network. In addition, they have been joined by the Urban Institute, created in 1968 as a "RAND Corporation" to help the federal government solve urban problems. It has a five-star corporate board of directors and receives major-major funding from large foundations.
In addition, the nationally oriented Committee for Economic Development has come to focus more of its attention on local government through specific subcommittees, providing a direct link between the corporate community and the urban policy network. CED committees, which bring together business leaders with experts and administrators from the urban policy-planning groups, have issued numerous reports on improving and modernizing local government. They usually call for consolidation of government units, greater centralization of administrative authority, the creation of super-agencies, and the creation of "public-private partnerships." These public-private partners have become all the rage since the 1980s because local governments lost financial support from Washington and have no choice but to join with private businesses on whatever terms they can get.
But that's getting a little ahead of the story. It is time to go back to the 1930s, when the combination of ongoing suburbanization and the Great Depression flattened the growth coalitions and forced them to join with the New Deal to create new programs to restore urban growth.
No sooner did the local growth coalitions regain full control of most city governments than they faced a new set of problems. The suburbanization that accelerated in the 1920s, made possible by the automobile, was gradually taking its toll on them. So, too, the first malls and suburban shopping centers, which came about at the same time, started to draw shoppers away from downtown stores, thereby threatening land values.
Then the Great Depression put an end to just about any kind of development. Property values went down, tax revenue declined, housing starts dropped to near zero, mortgage foreclosures zoomed upwards, and the need for social services increased in the face of rising unemployment. Despite their general aversion to the federal government, growth coalitions soon had to go, hat in hand, to Washington for help, and thus was created the context within which the growth coalitions functioned until the 1980s, when the Reagan Administration forced many changes by cutting federal funding for cities.
The most immediate problem created by the Great Depression was providing for impoverished local citizens, which had traditionally been the function of private charities and local governments. It was here that the urban policy-planning network at 1313 East 60th Street in Chicago came to the rescue: it became the cities' liaison to the federal government. Brownlow and the Clearing House were soon helping the federal government set up its Public Works Administration to give grants and loans to cities for construction projects. The Clearing House not only suggested the administrative structure through which the program functioned, but provided many of the experts who ran the program (Brownlow, 1958, pp. 282-285).
The relationship between the Clearing House and the New Deal was initiated by Guy Moffett of the Spelman Fund. Moffett made the contact rather than one of the other members of the policy network at 1313 because he was a very close friend of Louis Howe, President Franklin D. Roosevelt's most trusted White House aide:
Mr. Moffett took to Mr. Howe a proposal from Public Administration Clearing House which suggested the President might possibly decide to make certain specific studies and inquiries for which no existing appropriation was available and that, in such event, upon the written request of a member of the Cabinet, the Clearing House would make available, within limits, a sufficient amount of money to finance these studies. (Brownlow, 1958, p. 280).
Roosevelt accepted the offer, the Cabinet was notified, and, as Brownlow (1958, p. 280) recounts, "immediately requests began to come in." Now the Rockefeller foundations were funding government programs. This is "state-building" by the capitalist class, which isn't supposed to happen according to state autonomy theory.
But social services for the unemployed were the least of it from the point of view of the growth coalitions. Their land values and property-tax bases were already declining as the well-off residents moved to the suburbs, leaving only downtown land owners and low-income people to pay for the routine city services that were needed. The growth coalitions did not like the idea of raising their own taxes, which might have been self-defeating anyhow--because higher taxes might discourage new investment in office buildings and industrial factories. They needed a way to clear out slums that were encroaching on the central business districts. These low-income neighbors not only lowered land values, but they stood in the way of possible downtown expansion.
These general problems were made even more difficult and pressing by another factor--the dramatic growth in the number of African-Americans in large cities, leading to racial tensions, riots, and white flight. It is usually thought that African-Americans moved into big cities, especially in the North, between 1940 and 1970, but in fact a "Great Migration" first occurred between World War I and 1930; see Table 1.
Table 1: African-American Populations of Selected U.S. Cities, 1910-1930
|Source: Gotham (2002) p. 34.|
This rapid increase in the African-American population had not gone unnoticed by the builders within the growth coalition who specialized in constructing residential homes, especially those who built whole communities. As early as World War I, real estate boards in many cities had endorsed measures to keep neighborhoods racially homogeneous. These measures included racially restrictive clauses in deeds of ownership, a legal strategy that was endorsed between 1918 and 1930 by state supreme courts in California, Colorado, Kansas, Michigan, and Missouri as well as nine Southern states (Gotham, 2002, p. 38).
The first step by the growth coalitions to involve the federal government in reviving land values at the local level was a December, 1931, conference on home building and home ownership called by President Herbert Hoover. This conference led to the establishment of a Federal Home Loan Bank Board in 1932. Well before the dreaded New Deal that would eventually be blamed for becoming involved in local matters, Hoover's loan board "recommended a new direction in federal housing policy that included the creation of long-term amortized mortgages, encouragement of low-interest rates, federal housing subsidies to aid private home-building efforts, and reduction of housing construction costs" (Gotham, 2002, p. 53).
All of these recommendations were built into law in the first years of the New Deal. First, the Home Ownership Loan Corporation created in 1933 provided low-interest loans to home owners who no longer could pay on their current mortgages. Between July, 1933, and June, 1935, this program refinanced 10% of all owner-occupied, non-farm housing in the United States. Not coincidentally, these new loans from the federal government also bailed out the banks holding the mortgages.
Then the Housing Act of 1934 established a program of government insurance to banks for their mortgage loans through an agency called the Federal Housing Administration (FHA). This agency made possible longer term mortgages with lower down payments and lower interest rates, which of course stimulated the housing market. In the process, it created a secondary market for mortgages, which was a boon to insurance companies.
For the most part, the bill was written and advocated by the National Association of Real Estate Boards, the National Association of Building Owners and Managers, the Mortgage Bankers Association of America, and the U.S. Building & Loan League. Key lobbyists in favor of the bill included the president of the General Motors Holding Company and the president of the U.S. Chamber of Commerce, who was very close to President Franklin D. Roosevelt and the New Dealers. However, there was not unanimous support among land investors: minor players in the growth coalitions, such as small builders and local savings and loans, opposed the legislation because they feared (rightly, as it turned out) that it would soon crowd them out.
Once the bill was passed, the leaders within the growth coalitions played the key role in shaping and staffing the agency. In addition, the president of the General Motors Holding Company and vice presidents from two large New York banks became deputy administrators. A vice president from Standard Oil of New Jersey, a personal friend of President Franklin D. Roosevelt, became head of the agency.
The Federal Housing Administration then used longstanding real estate industry guidelines in shaping its loan program. In particular, it would not provide mortgage insurance for housing in mixed-race or black neighborhoods, or even in white neighborhoods near black neighborhoods. The program thus promoted both suburbanization and segregation. When liberals resisted these guidelines, they met with enormous resistance (Dreier, Mollenkopf, & Swanstrom, 2004, p. 120).
As the comment about resistance to the racist guidelines implies, the growth coalitions now began to face opposition from a new liberal-labor coalition that advocated a program for subsidized rental housing for both the middle class and low-income people. The coalition was lead by reformers from the 1920s who admired the public housing projects in some European cities. They also called for the rehabilitation, not removal, of slum housing.
In 1933 the "public housers," as they called themselves, had been able to convince the Public Works Administration, headed by the Progressive Republican Harold Ickes, to include two small demonstration projects in its long list of construction efforts. One involved seven housing developments, sponsored for the most part by unions. The other involved 49 housing developments with over 21,000 units, built by the Public Works Administration itself between 1934 and 1937 (Radford, 1996). Flush with success, the reformers joined with unions to create the Housing Labor Conference in 1934 to lobby for more such programs.
The pro-housing group saw the growth coalitions as "the reactionary real estate lobby," which was embodied in the aforementioned National Association of Real Estate Boards, the National Association of Building Owners and Managers, the Mortgage Bankers Association of America, and the U.S. Building & Loan League, along with the real estate committees of the U. S. Chamber of Commerce. On the other hand, those in the growth-coalition lobby called the public housing advocates "the housers," and often claimed their programs were socialistic or communistic.
The public housers joined with organized labor, civil rights activists, and consumer activists to oppose the Housing Act of 1934. The American Federation of Labor called it the "anti-housing bill." However, they were unable to have any impact on the bill (Gotham, 2000, p. 303).
With the Housing Act of 1934 as a starting point, the growth coalitions next turned their attention to ways to halt the decline in their downtown land values. It might be thought that the slum land could just be purchased, but it was usually not that simple, as later explained by an expert on American housing legislation:
Problems of land assembly and costs, however, stood in the way of any slum clearance program based on private redevelopment. Inner-city industrial and lower-income residential areas, however unsightly, were generally profitable. Located near city centers and major transportation routes, these sites were in demand for factories, stories, and low-rent residences. Hence, slum landowners were reluctant to sell their properties at low prices or sometimes at all. After assembling tracts of land, private developers faced the expense of demolishing existing structures and building new ones. As a result, few private developers undertook the redevelopment of slum tracts. (von Hoffman, 2000, p. 304.)
Downtown growth-coalition leaders, usually with the National Association of Real Estate Boards as their spokesperson, began complaining about these problems very frankly in their publications. As early as 1935, the National Association of Real Estate Boards called on the government for help through clearing "blighted" neighborhoods and providing loans to developers so they could buy and build on the cleared land (Gotham, 2002).
The battle between the growth coalitions and the liberal-labor coalition over these issues was fully joined in the Housing Act of 1937. This act started out as a liberal initiative sponsored by Senator Robert Wagner of New York, a champion of organized labor and one of the first "urban liberals." It embodied the public housers' desire for subsidized rental housing sponsored by unions and other nonprofit organizations. Moreover, they wanted this public housing to be built on vacant land in order to deflate what they saw as irrational land values in the city. The founding director of the United States Housing Authority (USHA), a wealthy real estate-owner from New York who was wise to his conservative brethren, explained the issue as follows:
It would indeed have been a betrayal of a public trust to allow the USHA program to become a means of bailing out owners of slums at "values" of three, five, or ten dollars a square foot when such fictitious values arose out of use of property in a manner which was dangerous to the health of tenants and detrimental to the well-being of the community. The USHA program accordingly was planned to enable local authorities to build some of their projects on low-cost land outside of slum areas. (Straus, 1944, p. 59.)
Needless to say, the growth coalitions saw this program as a dire threat. Not only did they want the middle-class people as their customers, but they wanted the vacant land for new private developments. And they certainly did not want to see a further decline in their downtown land values. They also saw the program as a thin entering wedge into "socialized housing," a not unreasonable supposition.
So, with the hearty backing of the Southern Democrats, the real estate lobby then gutted the plans of the public housers by:
Still, some housing was built. By 1941, there were 130,000 units in 300 different projects (Jackson, 1985, p. 224). With the onset of World War II, however, Congress finished off the program by eliminating its funding in 1942.
Although the growth coalitions were able to cripple the housing program, they had not solved the problem of declining downtown land values because they could not win provisions that would aid them in their program for "urban renewal." As urban renewal apologist Jeanne Lowe, who worked for downtown real estate boosters, wrote in her colorful history of urban renewal:
Business interests, particularly downtown property owners and realtors, wanted a clearance and rebuilding program that would be on a more "economic" basis--that would allow private entrepreneurs to participate as developers; permit reuses other than public housing, especially in centrally located slum areas; and let cities reap the higher tax returns which private developers promised. Equally important, these interests had come to accept the fact that in order to assemble land for feasible rebuilding, local government's power of eminent domain would be required to eliminate hold-out prices. (Lowe, 1967, p. 28.)
Even with the power of eminent domain, however, it was likely that the high cost of slum land in many cities would make it too expensive for those who wanted to renew and expand downtown areas. In 1941 the National Association of Real Estate Boards therefore put forth a plan developed by its research arm, the Urban Land Institute. The plan called for metropolitan land commissions that would have the power of eminent domain to clear slums. They were to receive loans from the federal government to pay for the "write-down" on the land that was purchased, i.e., on the difference between what they had to pay the slumlords and the price that developers could pay and still make a profit on their new buildings. However, it was not clear that cities would be able to pay back these federal loans.
A better answer to this financial problem was provided in the early 1940s by two economists, Alvin Hansen and Guy Greer (1941). Their work was part of the large-scale postwar planning already underway in 1940-1942 under the auspices of three national-level policy-planning organizations, the Council on Foreign Relations, the Committee for Economic Development, and the smaller and more liberal National Planning Association. From the point of view of these organizations, urban renewal was one of several spending programs that might be utilized if economic depression returned after the war (Domhoff, 1990, Chapter 5).
The general Greer-Hansen proposal for redeveloping the cities was very similar to one developed by the planners at the Urban Land Institute. But there were two major differences. First, Hansen and Greer suggested that the federal government might have to pay much of the cost for buying and clearing the land instead of merely granting long-term loans, as in the Urban Land Institute plan. Local government was to pay the remainder of the cost, which was set at one-third when the act was passed several years later. Second, the land would then be leased under the Hansen-Greer plan to private developers at a lower price than the government had paid, a lower price that supposedly reflected the true earning power of the land when redeveloped.
In other words, small property holders, mortgage holders, and slumlords would be bought out at a handsome price by the government. Then the bigger real estate interests would be able to obtain the land at a reduced price that supposedly was necessary if they were to make a reasonable profit with non-slum structures. The difference was to be absorbed by the ordinary taxpayer. However, at least the taxpayers and the city government would realize some of the long-term profits if the land was leased to the developers, which made the Hansen-Greer plan a little more palatable to liberals.
Greer and Hansen realized that their new plan might be viewed in the way I have just characterized it, as "a bail-out of the owners of slum properties and the lending institutions that held the mortgages;" they therefore argued that "the social and economic mess" that had been left by "past generations" was something for which "society as a whole can be held mainly to blame" (Hansen & Greer, 1941, p. 7). This rather general argument, which may have had the wisdom of making the program more acceptable to both the public housers and the growth coalitions, was not appreciated by many liberals, such as the U.S. Housing Authority administrator already quoted. He later retorted:
The high profits obtained from slum properties, the dogged insistence of slum-owners on their right to maintain housing which flagrantly violates human decencies, the high returns derived from this method of operation, and the high capitalized value placed on the properties--these are typical conditions throughout the country. In view of the facts, the thesis that society is to blame for slum conditions and that there is moral justification for using the taxpayer's funds to bail out owners of the slums is hardly tenable. (Straus, 1944, p. 81.)
The growth coalition lobby had different reservations about the program than the public housers did, but they were tempted by it. Involving the federal government in the bail-out was a difficult idea for it to accept ideologically, given its general wariness toward the federal government. It was made even more difficult by the fact that New Dealers had great power within the Democratic Party on these kinds of issues. The real estate interests also strongly opposed the idea that they could not own the land that the city had cleared for them. In addition, they feared the guidelines that might be tied to any federal handouts. In the end, however, they decided they could live with the basic proposal if the lease-only provision was eliminated and the emphasis on housing kept to a minimum.
The Hansen-Greer proposal was included in new legislation introduced into the Senate in 1943, and a slightly different bill was introduced later in the same year by the Urban Land Institute. Hearings on the ideas contained in the two bills were first held in 1944-1945 before the Special Subcommittee on Post-War Economic Policy and Planning.
The stage was now set for a postwar battle that pitted the liberal-labor coalition against the growth coalitions over issues of housing and urban renewal.
After the Second World War, top corporate leaders joined with the biggest land owners and developers in local growth coalitions to form highly visible committees to prepare ambitious plans for the redevelopment of central business districts. They did so in the context of genuine concern that the Great Depression might return now that there was no war spending to stimulate demand. The Central Area Committee of Chicago, Civic Progress in St. Louis, the Allegheny Conference in Pittsburgh, the Civic Conference in Boston, the Greater Philadelphia Movement--these and many more organizations were formed on the same template. The business elites of the city met privately, agreed upon more or less comprehensive plans for the redevelopment of the central city, and presented the plans to the press, the politicians, and the public as their contribution to civic welfare.
However, the task they faced was now even more daunting because of the massive migration of African Americans to the cities to find work in factories and escape the oppressive conditions they faced in the rural South. Arriving with great hopes, they found themselves crowded into low-income housing near downtown areas due to the virulent racism of most whites. Moreover, this migration happened precisely at a time when downtowns made their plans to expand. In addition, downtowns often wanted this close-in land for freeways because they held the vain hope that suburbanites could be induced to shop at the fine department stories and other up-scale places still lingering in the downtown. They also needed a way for their white-collar employees and executives to speed out to the suburbs after work.
In the process of expanding the downtown, the urban growth coalitions also hoped to defend and hold on to existing white urban neighborhoods. This intensified the squeeze of African-Americans into ghettos, and then to the disruption that followed from racism and ghettoization in a context of disappointed expectations and high rates of unemployment. In the end, many growth coalitions were able to save downtown property values, thanks to their new powers of eminent domain, along with the guidelines and justifications provided by urban renewal legislation, and the huge subsidies that allowed them to build skyscrapers, high-rises, stadiums and convention centers. But they were not able to "save" the white neighborhoods, although there were some rear-guard actions by "ethnic" neighborhoods. Urban renewal accelerated suburbanization and left the growth coalitions (and their universities, cultural institutions, and stadiums) surrounded by potentially volatile, low-income, non-white neighborhoods.
In 1945-1946, as the growth coalition polished its plans for urban renewal, the public housers saw a chance to revive their own program. They suddenly offered to support urban renewal if it included public housing for those who were displaced. They spoke in terms of "rehousing" and said that such a policy would avoid many potential problems for the developers (von Hoffman, 2000). They were able to introduce the requirement that residential areas that were cleared of slum housing had to be returned to "predominantly residential uses," with "predominantly" eventually defined as over 50%. This requirement was vehemently opposed by the growth-coalition lobby, but it was unable to have it removed. The public housers also insisted that the bill contain provisions for the construction of public housing, which the growth coalitions continued to oppose. The growth-coalition forces thus worked to block passage of the bill and were successful in doing so until 1949.
The bill as finally passed had four main provisions, only the last of which was opposed by the growth coalitions:
In an attempt to make the bill more acceptable to the growth coalitions, it contained three important concessions to them, which served as thin entering wedges in this long-term battle. They were introduced as amendments early in 1948 by a moderate Republican, Senator Ralph Flanders of Vermont, an industrialist who was also one of the top leaders in the Committee for Economic Development.
The first concession mandated that federal money be given to the local community in one lump sum, which made it more difficult for federal agencies to monitor the local program in any detail. A second concession stated that a unit of slum housing had to be torn down for each unit of public housing that was built. This would clear land for the developers and keep the housing supply tight.
A third concession allowed city-cleared land to be sold as well as leased to private developers. This concession, which had been part of the original Urban Land Institute proposal, was essential to leaders of the growth coalitions because it made it possible for private entrepreneurs, rather than the city, to realize the gains from long-term increases in land values. Liberals and moderates, fearing fiscal crisis for the cities, wanted to give them a more secure financial basis by letting them share in the profits of ownership. The short-sighted, anti-government place entrepreneurs wanted no part of such a plan. They wanted all the profits, and they wanted city officials to be dependent on them.
The act also included a backdoor acceptance of racially segregated housing by liberal Democrats. When clever--and diabolical--Northern Republicans proposed an amendment to mandate the integration of public housing, with the hope that Southern Democrats would then kill the whole bill, the liberal Democrats sided with the Southern Democrats to defeat the amendment. They reasoned that segregated housing was better than no housing at all. This vote was later used again and again by urban renewal administrators to insist to civil rights advocates that the legislative history of the Housing Act of 1949 gave them no mandate to force housing integration (von Hoffman, 2000).
Even with these major concessions, however, the growth coalitions tried to block the final bill because it still contained the strong emphasis on housing in redevelopment areas and the provision for new public housing. Once the bill was enacted, the growth coalitions attempted to limit its funding through their strong influence with the Appropriations Committee in the House. They also suggested to local leaders that they lobby for passage of state legislation that would allow them to set up local redevelopment agencies that could compete with local housing authorities for federal grants. This plan, created in the mid-1940s by the Urban Land Institute, had been developed in anticipation of a possible defeat at the hands of the liberals and labor at the national level.
The outbreak of the Korean War then contributed to the delay in starting the program, diverting money and attention away from it. In addition, developers were soon very leery that protests might flare up over programs that were going to tear down people's houses with no guarantee of where and when new ones would be completed. The result, as Lowe recounts in her pro-real estate hagiography, is that very few urban renewal programs of any consequences were in process by 1954:
Redevelopment proved doggedly slow in getting started in spite of the apparently attractive opportunity that Title I (of the Housing Act) presented to private enterprise and the cities themselves.... The pertinent fact here is that by 1954, few municipalities had been able to take a redevelopment project beyond its initial planning stage. (Lowe, 1967, p. 34).
The advent of the Eisenhower administration in 1952, along with unexpected victories in the House and Senate, which gave Republicans control of Congress for the first time since the Great Depression, raised the possibility that the real estate interests could change the law to their liking. So, naturally, their opposition to the program began to soften, a fact that is not understood by the pluralists who write about urban renewal (Dahl, 1961; Wolfinger, 1973). The first step in this process was the creation of a presidential commission in 1953 that was dominated by bankers, savings and loan officials, and real estate and development leaders. When their suggestions, in the form of a commission report, were brought to Congress, there was little or no protest from any business groups, although conservative southern congressmen registered their disagreement on some points.
The key change suggested by the presidential commission, which basically served to legitimate the growth coalitions' fondest hopes, was to create an exception to the rule that residential areas had to be restored to predominantly residential usages. The new provision allowed another 10% of urban renewal grant monies for a given project to be used for nonresidential uses, taking the housing percentage down to 40%. The commission also proposed that the program should encompass slum prevention as well as slum clearance. In practical terms, this made it possible for a plan to encompass areas that were not run down--by claiming they would become slums if they were not part of the redevelopment program. In reality, this was a license to create much-needed self-fulfilling prophecies by badmouthing neighborhoods into decline with negative stories about them, not to mention benign neglect by city officials.
The combination of these two provisions freed local growth coalitions to move ahead with their plans. Requests for money burgeoned, and numerous programs got under way. Then the gradual enlargement of the exception rule made the program even more attractive. It was increased to 20% in 1959, to 30% in 1961, and to 35% in 1967. The growth coalitions, functioning as what political scientists call the real estate lobby, had won a complete victory over the liberal-labor coalition even though it took them a long time to do so. As urban sociologist Scott Greer (1965, p. 32) succinctly summarized the legislative struggle between 1937 and the early 1960s, "the slum clearance provisions of the Housing Act of 1937 have been slowly transformed into a large-scale program to redevelop the central city."
In other words, the growth coalitions used the federal urban renewal program to clear downtown land of low-income housing and small buildings so that central business districts and such major institutions as universities, hospitals, museums, theaters, and stadiums could be expanded and enhanced. That is the brutal power trip that university administrators, cultural aficionados, and urban boosters cannot face. They claim that the urban renewal forces had good intentions, but miscalculated. Sometimes they even point to the Housing Act of 1937 as evidence for their argument, as if that act had not been eviscerated by the growth coalitions.
Between 1954 and 1975 urban renewal programs changed the face of many downtown areas and displaced tens of thousands of low-income citizens. The programs led to lawsuits, demonstrations, and sit-ins by angry African-Americans, white liberals, university students, and senior citizens who were attempting to protect their neighborhoods. As the protests mounted, extreme right-wingers like Martin Anderson (1964) conveniently blamed the federal government for a program insisted upon by local growth coalitions, saying it was all the result of what he wrongly called "the federal bulldozer." More housing was torn down than was built. And out of 810,000 public housing units that were mandated by the Housing Act of 1949, only 332,000 were completed by 1961. But since replacement housing was often necessary, some cities put up highrise apartments that soon became overwhelmingly black.
As stated by one expert on the way in which the urban renewal program quite purposefully displaced and ghettoized African-Americans:
The Eisenhower Administration and Housing and Home Finance Administrator Albert Cole offered to supply a modicum of new African-American housing as long as it facilitated the economic development of the central city and did not challenge existing residential patterns. Family public housing increasingly became a minority relocation program locked in the urban core, while government subsidies brought home ownership and suburban mobility within the reach of the white middle class (. (Hirsch, 2000, p. 431.)
This process was even more harsh and blatant in Southern cities, which previously had been less residentially segregated in a context of complete physical control of the African-American population through school segregation, intimidation, and violence. Thirteen Southern states contained almost half of all public housing authorities and one-third of all public housing units. Soon Southern cities were as segregated as Northern ones.
But it was not just urban renewal that cleared land for downtown land interests. The huge federal highway program set up in 1954 (with the justification that highways were needed for national defense in a time of potential nuclear attack by the Soviet Union) spent a large portion of its money creating super highways into large cities for the convenience of shoppers and commuters. Whole neighborhoods were blitzed by this process, and sometimes the highways were sited so that they would provide concrete barriers between low-income white or black neighborhoods and the rest of the city. The combination of the automobile-oil-highway lobby and the growth coalitions remade the urban landscape and greatly intensified the move to the suburbs.
Although every local growth coalition relied on the highway program to create gateways to the suburbs, not all cities used federal dollars to bring about urban renewal. Many large cities in the Southwest, such as Dallas and Houston, were able to accomplish their goals without federal revenues, as were some cities in the West. In the case of St. Louis, its huge Gateway Arch on the city's waterfront was built without urban renewal money, but it did have a special grant from Congress as an addition to the National Park Service. Whatever methods were used to clear the inner cities, the general conclusion is that most large cities ended up looking just about the same (Teaford, 2000).
On the chance that the disruptive urban renewal and highway programs contemplated in 1955 might not be accepted by everyone, corporate and growth-coalition leaders prepared a massive public relations campaign. As one part of its report to President Eisenhower, the Commission on Urban Renewal and Housing suggested that implementation of the urban renewal program should be aided by "the formation outside of government of a broadly representative national organization to help promote and lead this dynamic program for renewal of the towns and cities in America" (President's Advisory Commission, December, 1953, p. 2). This new group was formed in November, 1954, as ACTION, the American Council to Improve Our Neighborhoods. It included bankers, corporate executives, and real estate developers as well as urban planners and housing experts from major cities across the country. Its ambitious program included a research division that would amass all available information on how to carry out a good program, a national advertising campaign that would "arouse individual action against the threat of home and neighborhood decay," and a technical assistance program that would provide trained personnel to both citizens and governmental groups."
A mere four days after the founding of ACTION, the Advertising Council, another propaganda arm of the corporate community, announced a new national campaign to be called "Action on Slums." The aim of the campaign was to "stimulate the rehabilitation or rebuilding of depressed areas." At the same time, various real estate and homebuilding associations were conducting their own campaigns under such slogans as "Build America Better," "New Face for America," and "Better America, Inc."
As one small aspect of the ACTION program, in an attempt to give people the feeling that something was happening and that they should become involved, the organization hired writer Jeanne Lowe in 1957 to be its public information officer. This work took her to various cities. It was not long before she visited New Haven, the scene of the early urban renewal program studied by pluralist Robert A. Dahl and made famous in Who Governs? (1961). After being shown around the city with breathless enthusiasm by Mayor Richard E. Lee and his aides, Lowe wrote an article for the October 1957 Harper's Magazine entitled "Lee of New Haven and His Political Jackpot."
As might be expected, it was an enthusiastic endorsement of what was happening in New Haven, proof that there was no political danger in creating an urban renewal program. The article had been vetted and edited by Lee's staff, which is not exactly an example of independent journalism. Harper's was pimping a puff piece for ACTION. There was great emphasis on Mayor Richard C. Lee's leadership qualities. It began:
Richard C. Lee of New Haven is the first city Mayor in the country to make urban renewal the cornerstone of his political career. Today, as a result, this twice-defeated candidate for a once semi-ceremonial job in a second-rate city is apparently assured of re-election next month for his third term.... Mayor Lee has struck political paydirt in an unpromising issue. (Lowe, 1957, p.36.)
Five paragraphs later, Lowe noted that "what redevelopment needed was an example like New Haven's, which other cities have watched with envy and which Housing Administrator Cole has called 'spectacular, imaginative, exciting, comprehensive--a model for urban renewal in the cities of America.'" ACTION adopted the city as its ideal example of an urban renewal program.
As the creation of ACTION and the hype about New Haven show, the legislative successes and image-building efforts of local growth coalitions had a great deal of outside help from members of the corporate community. Leaders from the largest corporations in the United States gave their considerable support through the opinion-forming process. If their interest in the minor city of New Haven as a model seems to be something of a mystery, the answer is that it is the home of Yale University, the revered alma mater of key people within ACTION, including its chairman. (Yale is also the reason why New Haven received so much urban renewal money, but that is a separate story.)
As might be expected from the way in which the legislative battles of 1937, 1949, and 1954 unfolded, several different studies of urban renewal programs in specific cities reveal the predominant role of local business interests. For example, social scientists Timothy K. Barnekov and Daniel Rich (1977), using questionnaires and interviews in 33 cities, found that downtown associations, chambers of commerce, and small committees of top business leaders were highly active in the urban renewal programs in most of these cities. They concluded that "these data suggest that it is inaccurate to conclude that businessmen have been hostile or indifferent to urban renewal, or that they lack the sustained organization to promote redevelopment" (Barnekov and Rich, 1977, p. 434). In other words, they are contradicting the received wisdom of the pluralists, in fair measure based on what Dahl (1961) claimed about New Haven.
Case studies of urban renewal programs in such major cities as Pittsburgh, Philadelphia, Chicago, San Francisco, and Atlanta also shed light on how growth coalitions dominated local programs even though there were wide differences in how this was accomplished. In Pittsburgh, one of the first cities to undertake urban renewal, it was one family, the Mellons, that spearheaded the program through a coalition known as the Allegheny Conference. Founded in 1943, the Allegheny Conference developed a close working relationship with local government and the Democratic Party that was considered the basis for its success. Because of the great wealth and influence of the Mellons, urban renewal was possible in Pittsburgh even without federal money. Although few cities could emulate Pittsburgh in this regard, the Allegheny Conference nevertheless became the model for Philadelphia, Baltimore, Syracuse, St. Louis, and other cities in the formation of "public-private partnerships."
Philadelphia became a case worthy of study because it created a strong urban renewal program despite the absence of a super-wealthy family. It therefore had to develop a deeper and more broad-based leadership coalition that spent most of the 1940s drawing up plans and changing the structure of local government. One of the key steps in this process was the formation in 1948 of an organization called the Greater Philadelphia Movement. It was composed primarily of downtown business leaders, but there were minority group representatives and a labor official among its 35 members who were considered essential symbolic representatives. Not least among its efforts was support for the election of a reform Democratic mayor who was more responsive to the program than his conservative Republican predecessor had been. The Philadelphia model was one that other cities, including Dahl's New Haven, tried to emulate in their own efforts.
A detailed study of Chicago's first urban renewal project is of interest because it showed the central role that can be played by a major university--in this case, the University of Chicago. A university can be especially potent, this case suggests, when it has direct ties to both the downtown business community and the Democratic political machine. In Chicago, the university provided aid to various planning and citizens' groups in the formative years between 1949 and 1953 and became even more open in its participation after that time. Utilizing its trustees' connections to city government, it lobbied vigorously for the first city project to be located in the area surrounding the university (Rossi & Dentler, 1961).
In 1959, trustees and administrators from the University of Chicago convinced the Eisenhower Administration to amend the urban renewal legislation so that new university construction could be counted as part of the city's one-third contribution to the project costs. This was one of those little add-ons that turned out to be a bonanza for both universities with expansionary plans and city officials who needed more "local" credits for their overall urban renewal programs. City officials were able to piggyback their programs into university deals by gerrymandering renewal areas.
Urban renewal in San Francisco also showed strong downtown business involvement, but there was a different relationship with government. The process began with a group of business leaders who started meeting regularly in 1945 to plan the revitalization of the city and then formalized themselves as the Bay Area Council and the San Francisco Program for Urban Renewal in 1948. The idea was to remake San Francisco as the "Manhattan" of the West, a financial and communication hub that reached out to China and Japan. By the early 1980s, the downtown business sector had been transformed (Hartman, 1984; Mollenkopf, 1983).
With some delays due to neighborhood protests, the plans for the downtown in San Francisco were carried out almost to the letter by a strong redevelopment administrator who was often at odds with the board of supervisors and received minimal support from the mayor's office. Instead of a coalition between downtown business and the mayor, as in many cities, there was a coalition between business and the Redevelopment Agency (Hartman, 1974; Wirt, 1974). This and other examples like it are important because they show, contrary to Dahl (1961) and later pluralists, that a strong mayor was not essential to the success of an urban renewal program.
One of the best and most detailed case studies of an urban renewal program concerns the Southern city of Atlanta between 1950 and 1970. Written by political scientist Clarence Stone (1976), it is of special interest because it was designed with the controversy in the community power structure literature between sociologist Floyd Hunter and political scientist Robert Dahl clearly in mind. It completely vindicates all of Hunter's claims.
More generally, landed elites dominated urban renewal in virtually every city that was studied. But what about New Haven? After all, according to Dahl (1961), business leaders were relatively powerless in New Haven on all issues, including urban renewal. He claimed the program there was almost entirely due to Mayor Richard E. Lee and his highly competent aides. Not even Yale University, which was in need of land for expansion plans developed as early as 1948, showed any real interest in urban renewal. But is this a correct analysis? My later research, based on newly opened archives and new interviews, along with transcripts of Dahl's key interviews, shows that his analysis is mostly wrong.
Local growth coalitions, backed by the major corporations in their respective cities, dominated most American cities with relative ease from the 1920s well into the 1960s. Then they were severely challenged due to a combination of factors (Mollenkopf, 1983). Pluralist political scientists and hopeful political activists predicted the beginning of the end for the growth coalitions. There was soon talk of "hyper-pluralism," "street-fighting pluralism," the "ungovernable city," and even "the wild city."
What were the factors that led to this potential unraveling for the growth coalitions?
Several of these factors are an inherent part of growth-coalition theory, which predicts that neighborhoods will organize and fight to protect their use values whenever they can. The theory even allows for the fact that growth coalitions can lose, although that is not the usual expected outcome.
In response to these diverse challenges, three kinds of urban political administrations developed--liberal, progressive, and conservative (Dreier et al., 2004).
Boston, a combination of a university and high-tech city, had both urban liberal (1968-1983) and urban progressive (1984-1993) administrations after the upheavals of the early 1960s. Urban liberal Kevin White won the support of rent control advocates in 1968 with the slogan, "When landlords raise rents, Kevin White raises hell" (Dreier et al., 2004, p. 177). However, once he was elected mayor he dropped the issue in the face of strong growth-coalition opposition. In the 1970s he used government development grants, supposedly intended to help low-income neighborhoods, to support a downtown mall that included up-scale housing (Dreier et al., 2004, p. 138).
During the building boom in Boston in the 1980s, when nearly $1 billion per year was being invested downtown, the progressive mayor Ray Flynn used linkage programs tied to specific projects to finance the Boston Housing Partnership, which supported the Community Development Corporations that built the housing (Dreier et al., 2004, pp. 205-206). The Flynn Administration was able to obtain $50 million from developers for affordable housing and job training (Dreier, 1993; Molotch, 1998, p. 66). Measured against the past, the liberal and progressive mayors of Boston were impressive, but they did not do anything that stymied the local growth coalition.
Progressive regimes most often developed in university towns, where neighborhood-activist/
However, progressive regimes also developed in some primarily residential cities as well. The classic example here is Santa Monica, California, where activists rode to electoral power on an initiative for rent control in the face of rapid rent increases by the large apartment building owners who provided a very large percentage of the rental housing. The activists then used their governmental authority to extract concessions from developers in exchange for permission to build--which in good part meant social services and a walking mall, which turned out to be a bonanza for both the growth coalition and the city treasury (Gilderbloom & Capek, 1992; Shearer, 1982).
San Francisco was the biggest city to face a major challenge from a progressive coalition (Mollenkopf, 1983). The devolution of power to neighborhoods there was extensive enough that one political scientist who analyzed these changes, Richard DeLeon, called his book Left Coast City (1992). Up-scale neighborhoods stopped a multi-lane federal highway through the city in the mid-1950s, and by the 1970s most neighborhoods were reasonably well protected from noxious growth through strict zoning laws. Then a slow-growth initiative was passed by the citizens in 1986, the strongest such measure anywhere in the country up until that time.
DeLeon thought that San Francisco had become a "wild city" in the sense that no one group was strong enough to carry out its plans. He called the coalition of progressive forces--traditional liberals, neighborhood populists, left-wing activists, and environmentalists--an "anti-regime" because they could stop the growth coalition, but could not as yet pass their own agenda. He thought that these progressive forces were on the verge of becoming a true regime. The distribution of power in San Francisco deserves separate treatment in the light of events since 1992.
In Los Angeles, a long-running urban liberal regime, led by a black mayor, was replaced in 1993 by a Republican corporate lawyer who worked to slash city services. This change did not make a great deal of difference from the point of view of the growth coalition, however, because both regimes focused on downtown development (Dreier et al., 2004, p. 189). In Cleveland, though, the replacement of the progressive mayor in the late 1970s did make a big difference, dashing the hopes for major challenges to a tightly knit downtown elite (Swanstrom, 1985).
In Detroit, the long-time progressive regime of leftist Coleman Young (1973-1992), which constantly criticized business, had little or no success despite many years of effort. The city declined while businesses moved to the suburbs and prospered. Young was replaced in 1993 by a black corporate lawyer, Dennis Archer, who openly courted business and urged it to move back to the city from the booming suburbs, which were now becoming an expensive place to do business. He was replaced in 2001 by another black lawyer, Kwame Kilpatrick, who continued the process of winning back business:
Computerware, a software company, spent $400 million to move its headquarters and 4,000 workers from a Detroit suburb, buying its five-acre site from the city for $1. In recent years, Detroit has seen nearly $4 billion in investments downtown and midtown including two stadiums, corporate construction, hotels, and housing. (Dreier et al., 2004, p. 200.)
As these examples show, growth coalitions continued to be the dominant political force in most large cities in the late 30 years of the 20th century, or recently returned to that role through conservative regimes. However, they are often more fragmented and compromised than their predecessors. Most of them have resigned themselves to the fact that linkages, affordable housing projects, environmentally sensitive designs, and other concessions are a cost of doing business. On the other hand, the progressive forces have not been able to make as much headway as they had expected to for a variety of reasons, including the decline in federal monies since Nixon's second term as president began in 1972:
A good many urban analyses, along with the present study [of housing on the lower east side of New York City], also suggest that U.S. policies and politics are partly to blame for the limits experienced by cities. For several decades, scholars and planners have labored to develop notions of the "progressive city," and to puts these notions in practice in a number of cities. Yet the harsh reality remains that in the intervening years it has been difficult to sustain departures from elite-oriented strategies of urban growth, and this brute fact underscores the limits of a progressive localism. (Sites, 2003, p. 142.)
Within the current urban context, where "market forces" and "elite-oriented strategies of urban growth" shape the city, the growth coalitions and their opponents engage in a new set of battles. First, most growth coalitions now focus on increased hotel and motel space for tourists who come to partake of events that occur in the growth coalitions' new stadiums and convention centers. They also push for up-scale housing for adults without children, who will frequent the city's cultural centers and eat in its five-star restaurants. While these goals may seem reasonable, even these narrow and focused development struggles once again involve rousting low-income people out of their homes because the land under them now can be put to "higher and better uses." There is still no inclination on the part of the growth coalitions and city officials to deal with the twin evils of poverty and racism. Nor is there any willingness to pay people adequate compensation for their losses and provide them with enough money for decent re-housing.
Still, even though large-scale liberal and progressives successes were relatively few, or short-lived, with the exception of a few cities, they are important because they show what is possible by rejecting noxious projects and insisting on linkages in exchange for the right to create new developments. As Molotch (1998, p. 67) argues:
It is a mistake to minimize the significance of these linkages on the grounds that these are privileged places with special bargaining resources. The bargains they strike set the outer limit of standards. The higher those standards and the more projects they turn down, the stronger the negotiating position of places lower in the hierarchy.
Growth-coalition theory, which grew out of Molotch's (1976; 1979; 1998; 1999) critical reading of the urban sociology and the community power structure literatures, provides a new perspective on local power that is compatible with what power structure researchers found for the national level. It preserves the pluralists' emphasis on markets, which is an essential starting point in a capitalist society, but it shows how markets are sociologically constructed and explains how land markets differ in important ways from commodity markets. It explains the very real conflicts between landowners and neighborhoods that are ignored by pluralists, and it takes the federalist nature of American government seriously.
The theory resurrects Marx's distinction between capitalists and landlords that has been ignored by latter-day Marxists. It also uses the Marxist distinction between exchange value and use value to understand the conflict between growth coalitions and neighborhoods. At the same time it stresses that these conflicts are analytically distinct from struggles between capitalists and workers, noting further that labor unions often join the developers as part of the pro-growth coalition. Thus it is a new theory because it is a creative synthesis of the best available ideas from earlier schools of thought. And it is a good theory because it encompasses existing empirical findings.
However, it would be wrong to imply that this theory has carried the day. Pluralism, Marxism, and regime theory are still the favorites for the many social scientists who theorize about any aspect of urban and suburban settings. I think they are very mistaken for reasons provided in a separate detailed critique of these rival urban theories.
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