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Struggling Cities Don’t Need Creative Class Leadership

Any unbiased observer of our cities can see that mediocrity is the salient characteristic of the typical local American politician. Another important problem in small and mid-sized cities is that they are poor and in need of revitalization, especially in Rust Belt areas. A natural conclusion to draw from the coincidence of inept leadership and socioeconomic decay is that better leaders are needed. But in the poorest, most troubled cities, talented leadership is not much of an asset, and it can be a liability. Talent does real harm by raising false expectations of a revival—distracting from mundane yet essential operational matters, and forestalling state intervention at critical junctures.

To assess the value of talented urban leadership, it’s best to start by looking at exceptions to the rule: places where it does exist. Hartford, Connecticut’s capital and home to 123,000 people, is one such exception. Mayor Luke Bronin is a former Rhodes Scholar and intelligence officer in the Naval Reserve. He investigated terrorist financing at the Obama Treasury Department, and served as the state of Connecticut’s general counsel before being elected mayor in 2015. An amateur musician, he wrote a song that was featured on Dawson’s Creek. He is 38. This is not a typical resume for a mayor of a small, deeply impoverished city. Decades of economic decline and imprudent budgeting have brought Hartford to the brink of bankruptcy.

Yet it remains unclear if Bronin’s talents will do anything to stabilize Hartford’s budget, and they may even constitute an impediment. Hartford can only regain solvency through the involvement of the state government. The most sensible solution would be a financial assistance package accompanied by a state takeover. Were Hartford now led by a long-serving mayor under indictment for corruption, a state takeover would be a foregone conclusion. But since it is being led by a brilliant up-and-comer, the case for state oversight is weaker—as helpful as that option may be for the city.

When public-spirited reformers call for better leadership for cities, they typically have in mind a collection of qualities that are more likely to be possessed by an outsider. They are not sounding the call for everyone to get behind this or that city councilmember, someone who got his start as a campaign worker to some local hack and has patiently waited his turn. Instead, they want someone with experience and/or education that most of the local crowd does not have, derived perhaps from service in the private sector or government at the federal or state level. This is likely to be someone who did not come up through the ranks and can thus apply a novel approach to longstanding challenges; who admires innovation; who can envision a solution to every problem, instead of a problem with every solution.

That was how many once viewed former New York City mayor John Lindsay. When Lindsay, a Republican congressman from the Upper East Side, first ran in 1965, New York Post columnist Murray Kempton famously opined “He is fresh and everyone else is tired.” Handsome, standing 6’4’’, and articulate, Lindsay was celebrated by the city’s elites. He emphasized youth and intelligence over government experience in his staffing decisions, and used the phrase “Fun City” to describe his vision for a revitalized New York. Now, however, historians mostly use “Fun City” in an ironic way, with reference to how lousy things got under Lindsay. Crime skyrocketed. Jobs and residents exited at a galloping rate. Though Lindsay was not mayor when New York almost went bankrupt in 1975, he was arguably more responsible than any other figure for the fiscal crisis because of his tolerance for budget gimmicks that papered over the widening gap between revenues and spending. Lindsay’s responsibility for the “bad old days” has caused many to forget what a dashing figure he first cut on the scene when he arrived.

The Progressive Turn to Experts

One of President Franklin D. Roosevelt’s major legacies was to make the public feel entitled to hold politicians directly responsible for the health of the economy. As a result, elected officials at all levels of government are now held to totally unrealistic standards. This is nowhere more clearly so than in the case of struggling cities.

Here’s how Edward McClelland, in his 2013 book Nothin’ But Blue Skies: The Heyday, Hard Times, and Hopes of America’s Industrial Heartland [1]puts it: “Running Flint [Mich.] requires the financial acumen of William Pitt the Younger, the law-and-order bullying to Benito Mussolini, the city-building vision of Romulus, the labor negotiating skills of Franklin D. Roosevelt, and the industrial efficiency of Otto von Bismarck. Obviously, no politician has all these qualities. Any politician who had even one probably wouldn’t settle for mayor of a bankrupt city of one hundred thousand and counting backward. Flint is ungovernable, yet Flintstones continually punish mayors who can’t govern it.”

In order to compete in a mayoral election, all candidates must promise better days are ahead. But not every city has mayoral elections, or not consequential ones. So called “council-manager” cities do not. Under the council-manager form of government, the head of the city administration is an unelected appointee of the city council. The mayor is a ceremonial figurehead. Also known as the “weak mayor” model, the council-manager system was a Progressive-era innovation whose premise was that, by separating politics and administration, the former will become less corrupt and the latter more effective. Slightly more than half of all small and mid-sized cities have council-manager, according to the International City/County Management Association [2].

The council-manager system has not achieved its ideal. A century of experience with the form of government—Dayton, Ohio was the first major city to adopt council-manager, in 1913—has produced numerous examples of waste and corruption. It appears that politicians will always want to meddle in administrative matters, and top city administrators, if they want to survive in their position, must cultivate and use political skills to some degree. But you can say this for council-manager: At least it has the right ideal, and everyone has a right to expect competent delivery of basic municipal services.

But there’s no such thing as a right to revitalization. City reformers call for inspired leadership because they see it as a condition of revitalization, but what if that’s impossible? Our conception of urban renaissance is unduly influenced by the experience of a small handful of large cities. If you look past New York, San Francisco and Boston, and survey their dozens of small and mid-sized Rust Belt peers, it is very difficult to find an example of true revitalization. In a forthcoming research report, I survey 96 major poor cities in the Rust Belt and find that every single one has seen its poverty rate increase since 1970.

The Problem With Public-Sector Unions

The best argument for the benefits of talented urban leadership its ability to question the power of public-sector unions. Someone from outside city politics is more likely to grasp the many bizarre pathologies that result from having allowed teachers, police officers, and other public servants to assert formal influence over their own compensation and terms of employment, regardless of what’s in the public interest. Government unions are able to do this via their sway over the electoral process, selecting the “management” with whom they will be negotiating their contracts.

In the contemporary urban era, the threat of municipal bankruptcy looms large. Due to the steady corrosion of their tax bases, and the escalating costs of bonded debt and retirement-benefit liabilities, poor cities have a thin margin of error, fiscally speaking. Cities that have seen no substantive economic growth for decades should not be making retirement-benefit promises that stretch sixty years out into the future. And yet this practice is routine for all cities that still compensate their workforces through defined-benefit pensions.

If fiscal policy is one of the most important issues in urban politics today, and government unions are the greatest barrier to a more responsible fiscal policy, then bringing in more talented outsiders to mayor’s offices across the nation may be one of most important things we could do to help cities. But those who came up through a city’s political system are likely to view government unions’ stranglehold on city finances and operations with a “twas always thus” attitude. Examples of outsiders who grasped the lunacy of municipal compensation structures are Hartford’s Bronin and New York’s Michael Bloomberg [3].

But there’s a limit to how much any American mayor wants to be identified as a union-buster. Republicans revere Gov. Scott Walker of Wisconsin as a happy warrior who “sit[s] upon a throne made out of the skulls of his enemies [4].” But Democrats must take pains to avoid the Scott Walker tag. And only a Democrat can get elected in most cities. Long ago, it was possible for an American politician to be against public-sector unions while supporting private unions—FDR is the obvious example [5]. But such a political brand is not possible now because the decline of unionization in the private sector is so far advanced. Local Democrats who go too far in their battles with teachers unions risk being seen as anti-worker, even though going “too far” is what needs to be done to stabilize municipal budgets. So they have to counterbalance their union fighting with all manner of very liberal policies, some of which are will mean more spending.

A 2016 analysis by the Citizens Budget Commission [6] found that Bloomberg, the centrist who frequently tussled with the unions, increased spending in New York City during times of economic growth at an even greater rate than his openly labor-friendly successor Bill de Blasio has. In the end, it is almost impossible not to succumb to the lure of “labor harmony.” No Democratic mayor relishes the thought of fighting government unions across two or three terms in office, even though that may be how long it takes to effect genuine fiscal reform.

Big Ideas or Sound Management?

Perhaps the biggest problem with the talented-outsider mayor is that he is apt to get ideas. He may be more educated than the local doofuses, but that does not mean he is fully enlightened. It’s a case where a little knowledge can become a dangerous thing. State and local politicians who are known as big thinkers will always be strong candidates for a “public official of the year” award from Governing magazine or singled out as one of “America’s 11 Most Interesting Mayors [7]” by Politico. New York and DC-based reporters from national publications are naturally attracted to mayors who can speak the language of urbanism.

But too much of urbanists’ advice for small and mid-sized cities consists of trying to impose lessons from successful top tier cities such as New York, Washington, San Francisco and Boston. Poor small and mid-sized cities should spend more time comparing themselves to other poor, small, and mid-sized cities. If you’ve lost half your population since 1950, you probably don’t have an affordable housing crisis; you’re not grappling with the challenges of density but rather a lack of density. If you have no wealth to redistribute in the first place, then Bill de Blasio can teach you little about the joys of redistribution.

In public budgeting, which is the area of greatest concern for many cities today, getting ideas is especially dangerous. John Lindsay’s innovative fiscal maneuvers were noted earlier. Detroit lit the fuse for its 2013-14 bankruptcy with a complicated $1.4 billion debt issuance that former Mayor Kwame Kilpatrick and his advisers dreamed up in 2005 in order to evade both the city’s legally-imposed debt limit and a pension contribution it could not afford. The Bond Buyer, the preeminent trade publication for state and local finance, gave Kilpatrick—now in federal prison for convictions on separate corruption charges—its 2005 “Midwest Regional Deal of the Year” award for so cleverly arranging “future flexibility” for his city’s budget. But all Kilpatrick’s deal really did was pile on more debt and make a bad fiscal situation worse.

“Flexibility,” like “innovation,” may be a core value in Silicon Valley, but it’s frequently a bad thing in the world of municipal finance. Remember all the encomiums to “boring banking” in the wake of the 2008 financial crisis? Often enough, the same principle applies for how to run a city.

Stephen Eide is a senior fellow at the Manhattan Institute

11 Comments (Open | Close)

11 Comments To "Struggling Cities Don’t Need Creative Class Leadership"

#1 Comment By Clyde Schechter On October 12, 2017 @ 11:50 pm

I understand the concern about the effects of public unions on municipal finances. But why do you not express a similar concern about corporate interests whose money drives campaigns to elect, and lobbyists to suborn, the officials with whom they, too, negotiate contracts and finance deals? Why is labor corruption bad but corporate corruption warrants no mention? They’re ripping off the cities to the same extent, if not more.

#2 Comment By polistra On October 13, 2017 @ 2:32 am

The love of outsiders also applies to lower-level officials. Here in Spokane the police dept was ruined by a “talented” NYC monster brought in by Mayor Condon. Condon himself was a partial outsider; grew up here, then spent his career in DC and NYC before returning with carpetbag in hand. After two years of ruination the police union applied enough pressure to get the NYC monster kicked out, but the mayor and self-elected council fought it all the way.

#3 Comment By DGJ On October 13, 2017 @ 1:59 pm

If the right has no answers Leftists like Jeremy Corbyn will, we won’t like those answers. He’s coming to America soon.

[8]

#4 Comment By Kent On October 13, 2017 @ 4:37 pm

Struggling cities don’t have a problem with public sector unions, they have a problem with a lack of effective private sector unions.

Ineffective private sector unions left the local population unemployed when they were unable to keep local factories from being off-shored.

Once vibrant cities with well-paid citizens end up as Flint. And after the detritus settles, the only folks who look like they are making it somehow are the public sector employees who never exposed their necks to the free market noose.

#5 Comment By Winston On October 13, 2017 @ 8:14 pm

State takeover does not help struggling cities. Just look at Camden NJ. The problem is states not proactive, very reactive. NC system far away the best in US, when it comes to local finance monitoring. It also keeps watchful eye over debt.

Talented outsiders worked in Colombia and Curitiba (Brazil), so how come less so in US? Maybe the suburbanization of US has something to do with it? Also US local governments have less electoral turnover. Term limits is permitted in very few US cities.

#6 Comment By Winston On October 13, 2017 @ 8:31 pm

The real problem is structure and limited autonomy. Consider what Mechelen mayor able to do. Mechelen population 80,000. But he has more power than US mayor.
In US, still held back by 2 British legacies:segregation and limited local autonomy. These weaknesses made worse by lack of regional collaboration.

#7 Comment By Winston On October 13, 2017 @ 8:59 pm

The real problem is structure and limited autonomy. Capacity matters and small cities can have capable mayors.

Consider what Mechelen mayor able to do. Mechelen population 80,000. Or what mayor of la Rochelle, France did La Rochelle’s innovation followed by bigger cities afterwards both inside and outside France! They have more power than US mayor.

In US, still held back by 2 British legacies:segregation and limited local autonomy. These weaknesses made worse by lack of regional collaboration.
Contrast also what Widodo did in Indonesia in a small city.

#8 Comment By Winston On October 13, 2017 @ 9:07 pm

@Kent,
The main problem is now that population is aging, the pensions of public sector workers have become an issue. I think actually state and federal government should handle pensions of public sector workers.

In fact, there is going to be a problem of having sufficient public sector workers. I think collaboration and outright consolidation may take place because of this problem.

Private sector unions cannot help economy because real problem is Shareholder value. It is weakening corporations and their assets- labor and R&D. In fact there has been R&D decline over same period US innovation has declined!
See:
[9]

How the U.S. New Economy Business Model has devalued science & engineering PhDs

[10]

Is R&D Getting Harder, or Are Companies Just Getting Worse At It?

#9 Comment By Pitchfork economist On October 14, 2017 @ 7:54 pm

The big cities aren’t doing so great either if you don’t work in one of the privileged industries. Rents are so high in San Francisco that people are cramming into fewer and fewer rooms, sharing apartments with people they don’t know and don’t necessarily get along with. The fact that there’s plenty of money flowing into these cities doesn’t mean a whole lot for the majority of people living there.

The real problem is capital flight. This prevents city, or even national governments from democratically improving the lives of people in society. The fact that a small oligarchy owns everything means that when they don’t get their way, or if there is even a hint of agenda that disfavors them, they can take their ball and go home, literally leaving a community, or in some cases even a whole country, bankrupt. There’s always somewhere else they can ram their money where government is more malleable to their interests.

The “threat” of unions not backing your reelection is nothing compared to the idle rich sucking the whole city dry. Free market backers like to talk about the freedom to start a business or whatever, but this is the end result, hyper-concentrated wealth that holds the rest of society hostage, not by running businesses, but by trading and accumulating financial paper assets that are of no value to anybody. Their speculations bankrupt small business owners as well as public finances, however they see fit. A great deal of bureaucracy exists only to mitigate the effects of these parasites. So if you want to talk about getting rid of the public sector unions, you should be willing to talk about the investor class that creates them. The economy serves no function but to make people’s lives better, and that includes people who live in small to medium sized cities. We don’t owe the rich anything.

#10 Comment By Red State Red Flag On October 14, 2017 @ 10:48 pm

Cities need mediocre leadership lest the rabble believes there’s hope for the future.

#11 Comment By Bill On October 17, 2017 @ 8:13 pm

Okay, so we think that talented leadership is not the answer but what type of mayor is needed for these rust-belt cities? It’s stated that a takeover by state government would help but what kind of takeover would that be and who in his right mind after winning a mayoral election, talented or not would hand over control of his city to the state? Especially if you’re in Illinois! So I go back to my original question. What kind of mayor do we need for rust-belt cities with populations of 50-100,000?