Brookings: Topics - Chicago

Chicago’s Promise as a Manufacturing Policy Leader

Howard Wial — Tue, 26 Feb 2013 00:00:00 -0500

Editor's Note: In tandem with his newly released paper, "Locating Chicago Manufacturing: The Geography of Production in Metropolitan Chicago", Howard Wial examines Chicago's manufacturing economy, specifically its strengths, weaknesses, and distribution. Wial also discusses Chicago's past and current manufacturing strategies, which lead the nation.

A handful of states and major metropolitan areas have become seedbeds for local and regional public and public-private strategies to strengthen American manufacturing. Initiatives are planned or underway in Massachusetts (at the state level), Baltimore, northeast Ohio, Louisville and Lexington (KY), and Newark (NJ). The public-private National Additive Manufacturing Innovation Institute, run by a regional consortium and based in Youngstown, OH, is the first member of President Obama’s proposed National Network for Manufacturing Innovation.

The national leader of the current generation of manufacturing strategies, though, is metropolitan Chicago. Chicago is home to the Austin Polytechnical Academy (one of the nation’s leading manufacturing-focused public high schools), the Chicago Manufacturing Renaissance Council (a public-private partnership that has been influential in shaping city policy on manufacturing), the advanced manufacturing component of the Plan for Economic Growth and Jobs (an initiative of World Business Chicago, the city’s nonprofit economic development arm), and the University of Illinois’ proposed Illinois Manufacturing Lab (intended to give local manufacturers access to computer simulation, workforce training, and faculty resources to help them become more productive and competitive).

As I note in the Center for Urban Economic Development’s new briefing paper “Locating Chicago Manufacturing: The Geography of Production in Metropolitan Chicago,” Chicago’s leading position in the current generation of regional manufacturing strategies makes eminent sense.

In 2011, metropolitan Chicago had about 411,000 manufacturing jobs, more than any other U.S. metropolitan area except Los Angeles.
Manufacturing is an economic specialization of the Chicago area. About 9.5 percent of the area’s jobs are in manufacturing, compared to 8.5 percent nationwide.
The Chicago area specializes in 11 different major manufacturing industries, ranging from printing to fabricated metals to machinery to pharmaceuticals.
Even though Chicago lost 32 percent of its manufacturing jobs between 2001 and 2010, it is more specialized in manufacturing now than it was a decade ago. The percentage of its jobs that are in manufacturing was 1.11 times the national percentage in 2011, up from 1.08 in 2001.
From early 2010 through the fall of 2012, Chicago manufacturing employment grew by 5 percent, compared with 4 percent nationwide.
In 2011, average annual earnings were 16 percent higher in manufacturing jobs than in all jobs in the metropolitan area.

In its report on Chicago manufacturing, released this morning, the Chicago Metropolitan Agency for Planning underscored the metropolitan area’s advantages as a manufacturing hub.

Yet with all these advantages in manufacturing, why does Chicago need manufacturing strategies at all? One obvious reason is that, as in other parts of the country that have experienced manufacturing job growth since early 2010, that growth is just a drop in the bucket compared to the previous decade’s losses. Other important issues that Chicago manufacturing strategy needs to address include:

Technology. Chicago specializes in pharmaceutical manufacturing and in a range of moderately high technology industries (non-pharmaceutical chemicals, electrical equipment and appliances, machinery, and petroleum and coal products). Yet the region lost jobs in very high technology industries (a category that includes pharmaceuticals) during the last two years, while the nation as a whole gained them. The Chicago area gained jobs in moderately high technology industries, but not as rapidly as the entire United States. The most promising routes forward for Chicago are to strengthen existing industry specializations with new technologies, build new industries out of those specializations, and support high-wage, high-skill production in all industries.
Decentralization. During the last decade, the city of Chicago and Cook County lost manufacturing jobs more rapidly than most outlying counties in the metropolitan area. Yet Cook, the metropolitan area’s central county, still has nearly half of all Chicago-area manufacturing jobs. In manufacturing, as in many other industries, density means higher productivity. Numerous executives and analysts have underscored the importance of the many benefits that flow from the presence of a dense and regional industrial commons. Therefore, Chicago-area manufacturing policy should preserve and promote dense agglomerations of manufacturing jobs and try, if possible, to offset the incentives that led manufacturing to decentralize.

In the 1980s, the city of Chicago pioneered local manufacturing strategy by creating planned manufacturing districts, a zoning tool subsequently copied by other cities seeking to preserve manufacturing jobs. Thirty years later, metropolitan Chicago is once again poised to lead in addressing today’s regional manufacturing challenge: to spur a more productive, more innovative, and growing manufacturing sector as a contributor to a strong metropolitan economy.

Authors

Howard Wial

Locating Chicago Manufacturing: The Geography of Production in Metropolitan Chicago

Howard Wial — Mon, 25 Feb 2013 00:00:00 -0500

Editor's Note: Howard Wial examines Chicago's manufacturing economy, specifically its strengths, weaknesses, and distribution. Wial also discusses Chicago's past and current manufacturing strategies, which lead the nation. This paper was originally published on February 25, 2013 for the Center of Urban Economic Development, University of Illinois at Chicago.

Recent small gains in manufacturing employment nationwide have led to a resurgence of interest in public policies to strengthen America’s manufacturing base. In his 2013 State of The Union Address, for example, President Obama pledged to create three new Manufacturing Innovation Institutes to complement the one that currently exists in Youngstown, Ohio, and urged Congress to fund a network of 15 such institutes. At the metropolitan level, Chicago is a leader in developing creative manufacturing policies and policy proposals. The city’s Austin Polytechnical Academy, founded in 2007 by the Chicago Manufacturing Renaissance Council, is among the nation’s leading public high schools focused on manufacturing and engineering.

The Chicago Manufacturing Renaissance Council itself is a unique public-private partnership that has had considerable influence in shaping city policy on manufacturing and in initiating key reforms in secondary and post secondary education for manufacturing. Making Chicago a leading hub of advanced manufacturing is the first of 10 strategies included in the Plan for Economic Growth and Jobs released last year by World Business Chicago, the city's nonprofit economic development organization. This year the University of Illinois announced plans for a privately funded manufacturing-oriented R&D center to be located in Chicago. The university's proposed Illinois Manufacturing Lab would give local manufacturers access to computer simulation, workforce training, and faculty resources to help them become more innovative and competitive.

The paper's findings include:

The Chicago metropolitan area is one of the nation's major manufacturing centers, and manufacturing has become a more important specialization of the area over the last decade despite large manufacturing job losses.
The Chicago metropolitan area specialized strongly in 11 manufacturing industries, with moderately high technology industries more important in the region than very high technology industries.
Almost half of all manufacturing jobs in the Chicago metropolitan area are in Cook County.
In metropolitan Chicago, manufacturing offers higher wages than other industries.
During the last two years, metropolitan Chicago gained manufacturing jobs more rapidly than the nation as a whole.

Read the paper » (PDF)

Authors

Howard Wial

Publication: Center for Urban Economic Development, University of Illinois at Chicago

Poor Students Can’t Afford Teacher Strike

Beth Akers and Matthew M. Chingos — Mon, 10 Sep 2012 11:51:00 -0400

Ninety-three years ago yesterday, the Boston police force went on strike, leaving the city unprotected while the state scrambled to find replacements. Governor Calvin Coolidge’s declaration of support for the city—he said that “There is no right to strike against the public safety, anywhere, anytime”—established his national reputation that ultimately led to the presidency.

Public outrage at labor actions that compromise public safety has historically been a bipartisan affair. Coolidge was a Republican but his actions earned the respect of Democratic President Woodrow Wilson, who hailed his re-election as Massachusetts governor as “a victory for law and order.” Nearly 20 years later, President Franklin Roosevelt shared his view that a strike by public employees of any sort is “unthinkable and intolerable.”

The impacts of the Chicago teacher strike that began today may not be as immediately obvious as the looting and vandalism that descended on Boston in 1919, but they are just as serious. Research from a large, urban school district found that teacher absenteeism has a negative impact on student learning in math.

But a strike doesn't leave students with substitute teachers—it leaves them without any school at all. Research on summer learning loss shows that being out of school has a disproportionate effect on low-income students. One recent study found that “while all students lose some ground in mathematics over the summer, low-income students lose more ground in reading, while their higher-income peers may even gain.” In other words, the consequence of being out of school is to increase the already unacceptably large achievement gap between low-income students and their affluent peers.

The American labor movement has made important contributions in areas ranging from workplace safety to child labor to employment discrimination. There are good reasons to believe that the public ought to accept higher coal prices resulting from a strike to protect the lives of miners. But the public should not tolerate damage to the education of disadvantaged students resulting from a strike over disagreements about teachers’ salaries, benefits, job security, and method of evaluation.

The Chicago Teachers Union’s differences with the city over how the public schools ought to be run may well be legitimate. But those battles should be fought in the court of public opinion and ultimately at the ballot box, not through strikes that come largely at the expense of poor children.

Authors

Image Source: © Stringer . / Reuters

What Would an Infrastructure Bank Really Do?

Robert Puentes — Mon, 16 Jul 2012 15:00:00 -0400

Last week, the Congressional Budget Office released an important analysis on the potential efficacy, need, and impact of a national infrastructure bank (NIB.) While the idea remains stuck in political and policy limbo, the report is still highly relevant. Interest in the idea remains high, helping to inform the policy innovation happening in states like New York and cities like Chicago.

The CBO report is, as usual, careful and thorough. The analysts over there are super sharp and know what they're talking about especially--and obviously--when it comes to the impacts on the federal budget. (In fact, the section in the report about the budgetary cost of credit support is an important read.)

While the report raises some legitimate concerns let me make five quick points and provide a somewhat different perspective in order to make a stronger case for the NIB.

First, the CBO report focuses just on transportation infrastructure and even then just on the limited field of highway and transit projects. Of course, the revenue streams coming from ratepayers do make energy and water projects unique. But that's precisely the point and why those projects may be more appropriate for an NIB than traditional road projects that should be funded in the traditional way.

It remains that the greatest potential for an NIB is for a different set of complex investments such as ports (sea, air, intermodal) and rail (freight and passenger), renewable energy, dams, levies, water treatment facilities, and probably large-scale urban redevelopment projects.

The related second point is that an NIB would ideally focus on projects that are truly national in scope. Not that they're giant mega projects traversing the continent but that they connect to larger national goals. If we truly had a multi-modal freight plan, one could envision the NIB supporting projects necessary to fulfill its goals. Or else projects that are part of a national renewable energy strategy. Then because the projects have national purpose and intent, they should be granted priority and expedited through the federal review process. The point here is that a NIB shouldn't be established to enable us to keep doing what we've always done.

Third is that the establishment of an NIB would be a strong signal to the private sector that the national government is committed and open to private involvement in infrastructure financing and delivery. Today private sector financiers and investors are understandably frustrated by the lack of clarity about the rules of engagement that is--as in many states--a real hindrance to the development of the public-private partnership market.

The fourth point is that an NIB would provide technical assistance and expertise to states and other public entities that cannot develop internal capacity to deal with the projects themselves. Some of the most potentially transformative investments are inherently complex and require a mix of investors from all levels of government, across different federal programs, combined with the private sector, and even from other nations' sovereign wealth funds. Expertise to consider such deals and fully protect the public interest is paramount.

Last is the skepticism expressed by the CBO about the market for projects that fit the criteria I've described. A fair point, though there's probably a bit of chicken and egg thing happening. The establishment of an NIB with clear scope and criteria would undoubtedly result in a range of new and innovative projects. In fact, we're already seeing it here at the Brookings Metro Program.

Last year we challenged public and private leaders to send us their ideas for innovative, transformative investments. And the response was tremendous. We got transportation projects like the New International Trade Crossing in Detroit. We got energy projects like the Plains & Eastern clean energy transmission line in the Southeast. We got projects for education and research institutions like the Applied Sciences NYC. And we got redevelopment and placemaking projects to build out a new vision of the next American metropolis in San Francisco and Chicago. Whether or not these projects would all be supported by an NIB is hard to say, but the point is that these projects are out there and are likely just the tip of the iceberg.

I'm not naïve about this. Prickly issues around congressional jurisdiction, project selection, capitalization levels, and financing mechanisms are still unresolved and why the NIB remains as it has been for decades: the next greatest idea. In the meantime, Washington should pay attention to how states and metro areas are getting projects done in this challenging fiscal and policy environment.

Authors

Robert Puentes

Publication: The Avenue, The New Republic

Image Source: © Molly Riley / Reuters

Transformative Investments in Infrastructure, Chicago Style

Robert Puentes — Thu, 01 Mar 2012 00:00:00 -0500

Sometimes if you want something done right, you’ve got to do it yourself.

During his time as White House chief of staff, Rahm Emanuel was unable to push through President Obama’s proposal to establish a National Infrastructure Bank. The NIB would be a merit-driven approach for advancing a range of infrastructure projects that have the highest return on investment and support economic growth. However, prickly issues around congressional jurisdiction, project selection, capitalization levels, and financing mechanisms were left unresolved, and the NIB remains as it has been for decades: the next greatest idea.

So it’s important that now Mayor Emanuel announced the creation of the Chicago Infrastructure Trust (CIT) as the initial policy strategy designed to support the region’s bold new plan for economic growth and job creation. That plan, developed by World Business Chicago (with advice from Brookings, McKinsey and others) focuses on the region’s core economic strengths in areas such as advanced manufacturing, exports, and innovation, as well as putting workers back on the job through energy retrofit projects. Like similar plans and ambitions, the new Chicago plan cites infrastructure as a key economic driver and describes infrastructure-related challenges such as deterioration and lack of reach into low-income neighborhoods as barriers to economic growth.

The CIT hits on most of the important elements of past infrastructure bank proposals. It’s a market-oriented institution that attracts private capital interested in steady returns and makes investment decisions based on merit and evidence rather than politics. Like California’s I-Bank it cuts across different types of infrastructure such as transportation and telecommunications, and like Connecticut’s Green Bank it emphasizes the generation, transmission, and adoption of alternative energy. The CIT also embraces advanced technologies to support next generation place-making by wiring low-income neighborhoods with broadband and developing high-tech research campuses.

The CIT will be capitalized through direct investments from private financing organizations. Those investments will go to supporting specific projects through customized financing (some combination of debt and equity) for specific projects. The initiative will be kicked off with a $200 million effort to reduce energy consumption in municipal buildings, lighting projects, and other energy efficiency projects. The idea is to provide a home for private investors looking for low-risk investments while supporting economy-boosting projects the city wants. Citibank, JP Morgan, Macquarie and others have already expressed interest that could reach $1 billion or more in total investment capacity. So while the energy retrofit project comes first, other projects like bus rapid transit or water could follow next. Stay tuned.

Chicago’s plan is noteworthy because it is the first-of-its-kind established on the local level and it should profoundly inform the new thinking and ideas coming from the states. Virginia recently established a Transportation Infrastructure Bank (TIB) that acts as a revolving loan fund, capitalized with money appropriated from the legislature. Alaska is considering an infrastructure fund that would be treated like an endowment and expected to earn a 6 percent rate of return. A $25 billion fund is taking shape in New York state with details still to come.

The bottom line is that, in the absence of progress in Washington, cities like Chicago are showing the way forward. They are stepping up to devise new ways to conceive and finance a range of infrastructure projects as the physical means to an economy-shaping end, rather than end in itself.

Authors

Robert Puentes

Publication: The Avenue, The New Republic

Image Source: Â© John Gress / Reuters

Seizing the Metropolitan Moment

Bruce Katz — Fri, 07 May 2010 00:00:00 -0400

Editor's Note: Bruce Katz gave a commencement speech before the graduating class at the College of Urban Planning and Public Affairs at the University of Illinois, Chicago. He urged the graduates to tackle pressing issues facing metropolitan areas.

Thank you, Dean Pagano for that introduction.

And congratulations to all of the graduates here, and the family and friends who have supported you along the way, for a job well done.

I know these are difficult times to enter the job market. The Great Recession has left an indelible imprint on tens of millions of Americans.

But I want to assure you that the profession you have chosen has a bright future because cities and metropolitan areas have a bright future.

You begin your professional career at what can only be described as a Metro Moment, in the United States and throughout the world.

Metropolitan areas, cities and their surrounding suburbs, exurbs and rural communities, are the world’s essential communities.

These places are the engines of national prosperity.

They are on the front lines of demographic transformation.

They are the vehicles for environmental sustainability.

They are the vanguards of innovation … in technology, in business, in government policy, and practice.

If this is a Metro Moment, then it is also a time for individuals who are engaged in building strong cities and suburbs.

Professionals who plan, design, finance, develop, retrofit, manage, implement in ways that affect the lives of metro citizens every day.

Like metros, your profession is on the front lines, of a revolution in thinking and practice.

The traditional ways of specialized disciplines and siloed bureaucracies are giving way to holistic thinking and integrated solutions. This, in turn, is fuelling a burst of creativity and imagination.

These are not your parents’ metros and this is not your parents’ urban planning profession.

So let me situate your work in the complex dynamics of metropolitan America.

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Authors

Bruce Katz

Publication: The University of Illinois at Chicago

A Chicago-Area Retrofit Strategy: Coordinating Energy Efficiency Region-Wide

Mark Muro and Sarah Rahman — Tue, 28 Jul 2009 00:00:00 -0400

The Center for Neighborhood Technology, a Chicago-area nonprofit promoting urban sustainability, has a long-run vision of a Chicagoland building energy-efficiency system, which, if started up quickly, would help to effectively deploy relevant stimulus dollars in the near-term. Its activities focus on ramping up existing weatherization and retrofit programs in the short-term to take best advantage of current stimulus dollars while at the same time building the institutional capacity to launch and sustain a new regional initiative aimed at coordinating energy efficiency information, financing, and service delivery for the seven-county region over the long-term.

The Center for Neighborhood Technology (CNT) is using ARRA and other resources to work toward a long-run vision of a sustainable regional energy efficiency system. CNT envisions a centrally-coordinated initiative— either through a new stand-alone entity or a formalized network—to manage the financing, marketing, performance monitoring and certification, information provision, supply chain development, and customer assistance required to efficiently scale up the delivery of retrofit services for all types of buildings across the Chicago region.

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Chicago’s Multi-Family Energy Retrofit Program: Expanding Retrofits With Private Financing

Mark Muro and Sarah Rahman — Sat, 25 Jul 2009 00:00:00 -0400

The city of Chicago is increasing retrofits by using stimulus dollars to expand the opportunity for energy efficient living to low-income residents of large multi-family rental buildings. To aid this target demographic, often left underserved by existing programs, the city’s new Multi-Family Energy Retrofit Program introduces an innovative model for retrofit delivery that relies on private sector financing and energy service companies.

Chicago’s new Multi-Family Energy Retrofit Program draws on multi-sector collaboration, with an emphasis on private sector involvement supported by public and nonprofit resources. Essentially, the program applies the model of private energy service companies (ESCOs), long-used in the public sector, to the affordable, multi-family housing market. In this framework, ESCOs conduct assessments of building energy performance, identify and oversee implementation of cost-effective retrofit measures, and guarantee energy savings to use as a source of loan repayment.

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Chicago’s Southern Suburbs Focus on ARRA: Coordinating Inter-Suburban Recovery

Mark Muro and Sarah Rahman — Wed, 22 Jul 2009 00:00:00 -0400

To leverage limited ARRA resources, Chicago’s Metropolitan Planning Council is working with local leaders and key partners to build on efforts already underway to promote inter-jurisdictional cooperation in the city’s south suburbs around the first round of the Neighborhood Stabilization Program (NSP1). By layering new stimulus dollars for energy efficiency, workforce development, transit improvements and neighborhood stabilization into the same focused areas for investment identified by the south suburbs’ joint NSP1 application, these partners intend to enhance the benefits generated by any single program.

The Metropolitan Planning Council (MPC) and key partners, the Metropolitan Mayors Caucus (MMC) and the South Suburban Mayors and Managers Association (SSMMA), support inter-jurisdictional cooperation over competition in generating effective ARRA implementation and have brought together a group of south Cook County suburbs to advance joint recovery initiatives. Many of these southern Chicago suburbs have been hit hard by the recession, particularly by foreclosures. As MPC notes, while the Chicago metro area as a whole in 2008 suffered 25.4 foreclosure filings per 1,000 mortgageable properties, the rate was 80 percent higher for just the south suburbs at 45.8 filings per 1,000 properties.

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Metro Areas Need to Use Power of Their Votes

MarySue Barrett and Bruce Katz — Tue, 22 Jan 2008 00:00:00 -0500

Presidential hopefuls have been stumping for such a long time now that it's hard to believe the "Super Duper Tuesday" primary contests are less than three weeks away. Candidates have time to capture the hearts and minds of voters, not in Iowa and New Hampshire, but in a record 24 other states (thus the "Duper"), including -- for the first time -- Illinois. They would do well by starting to address what's eating at voters in greater Chicago and other top metropolitan regions.

Collectively, the top 100 metros take up only 12 percent of the land in the United States, but account for an astounding 65 percent of our population, 68 percent of jobs and 75 percent of the U.S. Gross Domestic Product. If talented people, quality jobs, innovative firms, advanced universities, planes, trains and, of course, money make the world go round -- well, then metro regions are the axis.

Yet, voters in these areas are losing sleep over the state of the economy, and the federal government -- and, so far, most presidential candidates -- are doing little to address their worries.

That's why the Brookings Institution has launched the Blueprint for American Prosperity. Together with regional groups such as the Metropolitan Planning Council, Brookings will spend this election year making the case that we are a Metro Nation and need to start acting like one. To that end, Brookings and its regional friends are reimagining the partnership between the federal government and metro regions, one that strengthens economies, promotes sustainability and ensures a strong and diverse middle class. There is much work to do.

In Chicagoland, as in many other areas across the country, a two-income household no longer guarantees an affordable home in a desirable community. In fact, a fire- fighter and a kindergarten teacher together can only afford to purchase a typical home in 40 percent of Chicagoland's villages and cities.

Many affordable communities are miles from the nearest job center, which prompts an urgent question for employers, "How long will my employees be willing to drive -- 20, 30, even 40 miles to get to the office?" Meanwhile, the typical commuter in this region spends nearly two full days each year stuck in traffic, time they could have spent with family or friends, catching up on sleep, working out or volunteering.

Shrinking homeownership rates and lengthening commutes are as unsustainable as crumbling bridges, overtaxed airports and outdated freight infrastructure. At the heart of the nation and on the shores of Lake Michigan, Chicago's location makes it the third largest intermodal port in the world, after Hong Kong and Singapore. Almost $1 trillion of our nation's freight moves through this region annually, and freight volumes are expected to increase 80 percent or so in the next 20 years.

Yet trains often must slow to a crawl through northeastern Illinois and northwestern Indiana because technological and physical updates to tracks and rail yards are long overdue. Businesses are losing money due to delayed deliveries, and drivers are experiencing more traffic jams on local roads. The federal government's response has been to spread surface transportation funding around like peanut butter, rather than investing strategically in major national rail hubs, ports and gateways, like Chicago.

The increasing demand for an educated work force, the need to weave new immigrants and their families into our communities, a growing energy crisis -- these are just some of the other issues Chicagoland and all other metropolitan regions must address to remain competitive.

Chicagoland simply does not have the power or resources to achieve meaningful reforms to metro-scale problems such as crushing traffic gridlock and inadequate work force housing on its own. Whether we appreciate it or not, the federal government has a powerful role to play in helping metros address these and other issues -- through smart investments, market-shaping information and environment-strengthening regulation. This potential is not being realized since for too long the federal government has been strangely adrift and unresponsive to the dynamic forces at play in our country.

The first wide-open election since 1952, when no incumbent president or vice president is in the race, creates a historic moment to totally rethink the compact between metro areas and the federal government. The first candidate to seize this opportunity will score points with metropolitan voters on Feb. 5 in key metros such as Phoenix, Los Angeles, Denver, Atlanta, Boston, New York, the Twin Cities, Santa Fe and Chicago. Metro thinking and action is the only path to secure and sustain prosperity for all Americans.

MarySue Barrett is president of the Metropolitan Planning Council in Chicago and Bruce Katz is director of metropolitan policy program for the Brookings Institution.

Authors

MarySue Barrett
Bruce Katz

Publication: Chicago Sun Times

Cashing in on the BP Beltway

Robert Puentes — Thu, 01 Mar 2007 00:00:00 -0500

Back in the 1970s the humor magazine National Lampoon wrote a commentary on corporate influence in America entitled: "We're Changing the Name of the Country to Exxon."

It doesn't seem like such a stretch today. From naming rights to professional sports venues, to companies offering financial support to cash strapped public schools in exchange for marketing their brands and products, corporate influence in America today is pervasive.

Now, commercial interests and smart investors are turning their eyes toward some of our nation's most prominent roadways. We need to slow down.

Certainly states and cities across the country face massive transportation challenges. Roads and bridges are crumbling, traffic congestion has become intolerable, air quality is deteriorating, working families are having difficulty reaching many jobs, and several transit systems are either constrained or seriously overcrowded.

So politicians are looking for a quick fix.

Two specific deals at the south end of Lake Michigan have sparked this movement.

Earlier this year, Indiana Governor Mitch Daniels leased his state's toll road for 75 years to a private consortium for $4 billion which he then spent on other roadway projects around the state. In 2004 Mayor Richard Daley reprogrammed the $1.8 billion from his 99-year lease of the Chicago Skyway back into city coffers to be spent largely in unspecified ways. New Jersey is considering the selling or leasing of the Jersey Turnpike, Garden State Parkway, and the Atlantic City Expressway to private companies.

The payoff for private companies, syndicates, and their advisors also is huge. They're putting up billions of dollars banking on steady, ever increasing toll revenues from generations of captive motorists.

This scheme sounds much better than it is. These deals have set off a frenzy prompting Standard & Poors to warn of a dotcom-like pricing bubble.

Governments lose more than they gain. All that up-front cash looks sweet, but the long term revenue stream is lost since all the toll receipts flow directly to the private operators. Governments also lose the option to borrow against those future revenues.

Far worse, policymakers lose the ability to connect transportation to other emerging metropolitan trends. Transportation planning is inherently a metropolitan issue—people and goods travel in and out of cities and between suburbs—and removing a piece of the puzzle hampers the ability to deal strategically with the system in an integrated manner.

Also, governments are taking steps to manage the demand for car trips due to concern over how traffic congestion effects climate change. These important policy objectives are in conflict with the commercial interests of private companies running toll roads. They want more traffic not less.

Some thoughtful politicians are having second thoughts. Houston turned down $20 billion to lease the region's toll roads. Officials believe they'll be better stewards of an enormous public asset and the fast money didn't outweigh the long term costs of doing the deal. Illinois Governor Rod Blagojevich expressed similar concerns over the specifics of a proposal for his state's Tollway system.

Selling off toll roads is not a silver bullet solving all transportation problems. It allows politicians to demonstrate action and provides a lot of cash-in-hand for pork projects. But it's not the right conversation we should be having about transportation in America today.

All the focus on this latest hot idea comes at the expense of a more comprehensive and inclusive discussion about transportation—a discussion that includes accountability, overall intent, and connection to broader goals of economic growth and personal mobility.

We're letting politicians and policymakers off the hook. We should all roll up our sleeves, define, design and embrace a new, unified, competitive vision for transportation policy and not be seduced by the easy money.

What's next the "SUBWAY" subway?

Authors

Robert Puentes

Publication: Hartford Courant

Racial Division and Concentrated Poverty in U.S. Cities

Bruce Katz — Fri, 07 Jul 2006 00:00:00 -0400

In this presentation, Bruce Katz provides an overview of current patterns of racial and ethnic separation in the United States, using the Chicago, Washington DC, and New Orleans metros as case studies. He shows how racial segregation relates to the problem of concentrated poverty and describes the broader effects on job access, educational attainment, and other social outcomes. He identifies past public policies that have served to exacerbate these problems, and concludes by discussing some current policies that aim to reverse the trends of racial and socioeconomic separation.

The metro program hosts and participates in a variety of public forums. To view a complete list of these events, please visit the metro program's Speeches and Events page which provides copies of major speeches, PowerPoint presentations, event transcripts, and event summaries.

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Bruce Katz

Publication: Urban Age Conference

New Realities for Chicagoland

Bruce Katz — Fri, 09 Sep 2005 00:00:00 -0400

In this presentation at the Chicago Metropolitan Mayors Caucus, Bruce Katz discussed the new realities facing the Chicago region, their consequences, and what policies should the region focus on to address the new realities.

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Bruce Katz

Publication: Chicago Metropolitan Mayors Caucus

The City/Region of the Future

Bruce Katz — Mon, 15 Nov 2004 00:00:00 -0500

In this presentation to the British-American Project's 2004 Conference in Chicago, Bruce Katz discusses demographic and economic trends occuring in Chicago, the U.S., and the U.K. Using specific examples, Katz suggests how the U.S. and U.K. can learn from each country's unique perspectives and approaches to regional planning.

The metro program hosts and participates in a variety of public forums. To view a complete list of these events, please visit the metro program's Speeches and Events page which provides copies of major speeches, powerpoint presentations, event transcripts, and event summaries.

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Authors

Bruce Katz

Publication: British-American Project

Access to Social Services: The Changing Urban Geography of Poverty and Service Provision

Scott W. Allard — Sun, 01 Aug 2004 00:00:00 -0400

Findings

An examination of neighborhood variation in access to social services in three metropolitan areas—Chicago, Los Angeles, and Washington, D.C.—finds that:

On average, poor populations in urban centers have greater spatial access to social services than poor populations living in suburban areas. In all three metropolitan areas, tracts with higher poverty rates are located in closer proximity to social service providers than tracts with lower poverty rates. On average, tracts with low poverty rates are within 1.5 miles of one-third, one-fifth, and one-quarter as many providers in metropolitan Chicago, Washington, D.C., and Los Angeles respectively, as tracts with high poverty rates.
While spatial access to social service providers is greatest in central city areas, potential demand for services is also much greater in central city areas than in suburban areas. Service providers in the city of Chicago are in proximity to ten times as many poor households as providers in suburban Chicago. Social service providers located in the District of Columbia are proximate to about six times more poor households than service providers in suburban Washington, depending on the particular service area. Because poverty is less centralized in Los Angeles, however, potential demand facing social service providers in central city is only about twice that of the potential demand in suburban areas.
The location of social service providers does not always match well to the changing demographic compositions of cities. Central city tracts that transitioned to a higher poverty status between 1990 and 2000 generally have less access to providers than tracts where poverty rates remained high over the past decade. In all three cities, suburban tracts experiencing significant increases in poverty rates between 1990 and 2000 were proximate to far fewer service providers than central city tracts experiencing such increases in the poverty rate.
High poverty central city tracts with large percentages of Hispanics are located within the greatest proximity to service providers. Access disparities also exist between whites and African-Americans in Los Angeles and Washington. These findings appear in large part to be a product of the patterns and degree of racial and ethnic segregation in each city.

Governmental and non-governmental social service providers offering assistance to low-income populations locate in urban centers, near where disadvantaged populations are most concentrated and where services can be delivered most efficiently. However, the shifting geography of concentrated poverty, and the transformation of governmental assistance from cash to services, increases the importance of the location of these facilities, requiring greater attention from policymakers and service providers.

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Scott W. Allard

The Calculus of Coalitions: Cities and States and the Metropolitan Agenda

Thu, 01 Apr 2004 00:00:00 -0500

Executive Summary

Cities are creations of their states. Their boundaries, their powers, and their responsibilities are all substantially prescribed by state law. With the advent of the new federalism—beginning in the 1970s and resurgent today—the devolution of power from Washington to state capitals has increased the importance of state decision making for cities.

Yet, this shift occurred precisely as cities were losing political clout in state legislatures due to population decline within city limits and rampant growth in suburban jurisdictions.

This paper argues that in response to shifting population distributions within states, cities need to build new coalitions to effectively achieve their legislative goals within state legislatures. Case studies—New York City, Chicago, Detroit, and the three largest cities in Ohio (Cincinnati, Cleveland, and Columbus)—are used to more closely examine coalition-building methods.

Overall, the authors find:

Cities' dependence on state government has increased as the federal government has ceded more power to the states. As cities' populations have declined, they have become weaker in state legislatures that have grown more powerful due to federal policy. In the peak year of 1978, about 15 percent of city revenues came from the federal government. By 1999 that had decreased to 3 percent. Concurrently, the federal government has shifted a number of programs to the states, which control the rules and revenue mechanisms cities operate under.

Traditional political coalitions cities have used to achieve their state legislative goals are no longer as effective. Partisan (usually Democratic) coalitions are less reliable as focus has shifted to suburban swing districts. Moreover, as their power has decreased, cities' agendas have become more reactive, aiming to preserve the status quo in funding, infrastructure projects, and autonomy.

Older, inner-ring suburbs are a logical new partner for cities in state legislatures. Increasingly, these suburbs, and some outer ones, have common interests with central cities as they address immigration, fiscal stress, and infrastructure woes. Such alliances would also better address metropolitan-wide issues on a metropolitan basis.

There remain many obstacles to forging such coalitions, however, including longtime distrust among big cities and their neighbors, racial disparities, and in some cases, growing investment in central cities while surrounding suburbs languish. Nonetheless, for cities to effectively influence their state governments more creative approaches to coalition building must be found.

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Authors

Hal Wolman, The George Washington University
Margaret Weir, University of California, Berkeley
Nicholas Lyon, The George Washington University
Todd Swanstrom, Saint Louis University

Financial Education and Asset Building Programs for Welfare Recipients and Low Income Workers: The Illinois Experience

Dory Rand — Thu, 01 Apr 2004 00:00:00 -0500

There's more to leaving poverty than finding a job. Aside from a regular paycheck, a whole set of skills are needed to make sound financial decisions, build savings, establish good credit, and achieve the American dream of owning a home, car, or small business, or pursuing higher education. Many welfare recipients entering the workforce for the first time, as well as low-income workers at risk of dependence upon public assistance, lack these skills. Additionally, confusing and administratively burdensome resource-counting rules in public benefit programs discourage savings and asset building and exacerbate asset poverty among welfare recipients and the working poor.

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Dory Rand

Chicago in Focus: A Profile from Census 2000

Sat, 01 Nov 2003 00:00:00 -0500

Executive Summary

Chicago rebounded from four decades of population loss in the 1990s, and Census 2000 provides a snapshot of that recovery.

Chicago's rebound derives in large part from significant immigration flows, which have made the city one of the nation's most racially and ethnically diverse. Immigrants from Mexico now account for nearly half the city's foreign-born population, for example, yet Chicago also remains one of the foremost U.S. gateways for workers and families from Eastern Europe. Such inflows have made Chicago more youthful, and they are responsible for the residential and commercial revitalization of many of the city's neighborhoods. However, most new foreign-born residents are settling in the suburbs rather than the city, as they are in a number of other U.S. metropolitan areas.

Chicago made progress on income and poverty during the last decade, and all racial/ethnic groups experienced gains in homeownership. Yet in many respects the city still exemplifies our nation's residential and economic separation by race. Blacks, Hispanics, and whites live in largely segregated neighborhoods. Annual household incomes for blacks trail those for whites by more than $20,000. And families with children face particular challenges—more than a third live below or near the poverty line, and more than one in five Chicago children live in a family with no adult workers. In the time since Census 2000 was conducted, moreover, unemployment in the city has risen, and economic differences by race and class are likely magnified today.

Along these lines and others, then, Chicago in Focus: A Profile from Census 2000 concludes that:

Chicago's population "rebounded" during the 1990s, but the region's outer suburbs are booming. Census 2000 reports the story: For the first decade since the 1950s, the City of Chicago saw its population increase, by 112,000 residents. Neighborhoods on the city's southwest and northwest sides grew rapidly with the addition of immigrant populations. At the same time, though, Chicago's suburbs added roughly seven residents for every net new resident in the city. Most of the growth was in the outer suburbs; wide areas of suburban Cook County and inner DuPage County lost population over the decade. As a result, the economic center of the region is shifting outward. Fewer than half of the region's workers commute to the city for their jobs, and a growing number of Chicago residents drive alone to work in the suburbs.

The city owes much of its population growth and unrivaled diversity to new arrivals from abroad. While most Midwestern cities are home to a predominantly black/white population, Chicago boasts high racial and ethnic diversity. Whites, blacks, and Hispanics each make up at least a quarter of the city's population. This unique mix reflects Chicago's continued status as one of the nation's important immigrant gateways. The city added 160,000 new residents from abroad in the 1990s. Nearly half came from Mexico, and significant numbers also came from Eastern Europe and Asia. This diversity is not uniformly dispersed, however. Chicago's blacks and Hispanics, and blacks and whites, often live in very separate sections of the city.

The city's residents are relatively young, but most have lived in Chicago for several years. Baby Boomers aged 35 to 54 are by far the nation's largest age cohorts, but people in their late 20s represent Chicago's largest age group. But Chicago is not a transient place. The city's youth belies the fact that nearly 85 percent of its residents have lived there for more than five years, one of the highest rates among the Living Cities. Despite a slight decline in the number of married couples with children living in the city during the 1990s, Chicago still has a higher share of these "nuclear" families than most other large cities. Whether these families remain in the city will influence Chicago's population trajectory in the current decade.

Chicago's families made broad economic gains in the 1990s, though some residents—African Americans, in particular—still face hardships. Unlike many other U.S. cities in the 1990s, Chicago managed to retain its middle class, and the ranks of lower-income households declined modestly. Median household income in Chicago grew at a rate twice the national average. Poverty, especially for children, declined. Yet Chicago's black community faces continued economic challenges. Median household income for blacks was just $29,000 in 2000, versus $37,000 for Hispanics and $49,000 for whites. Chicago has the sixth highest black poverty rate among the 23 Living Cities. The ranks of the "working poor"—families with incomes below 150 percent of poverty—are significant. Behind these economic differences lies a racial education gap; only 13 percent of black adults in Chicago hold bachelor's degrees, compared to 42 percent of whites.

Chicago maintains a unique mix of homeowners and renters. Forty-four percent of households in Chicago own their own homes, a rate lower than that for most large cities. Differences in homeownership between minorities and whites, however, are less stark here than in many other cities. Nearly 40 percent of racial and ethnic minority households are homeowners, and all groups—especially Hispanics—made significant gains in the 1990s. Rents rose during the decade, and median prices are similar to those in growing cities like Dallas, Phoenix, and Portland. But because Chicago's households tend to be larger, and more likely to rent, cost burdens remain a significant issue in Chicago. To be precise, roughly 225,000 households in Chicago devote at least 30 percent of their incomes to rent.

By presenting the indicators on the following pages, Chicago in Focus: A Profile from Census 2000 seeks to give readers a better sense of where Chicago and its residents stand in relation to their peers, and how the 1990s shaped the city, its neighborhoods, and the entire Chicago region. Living Cities and the Brookings Institution Center on Urban and Metropolitan Policy hope that this information will prompt a fruitful dialogue among city and community leaders about the direction Chicago should take in the coming decade.

Chicago Data Book Series 1
Chicago Data Book Series 2