The circus in Washington, D.C., has made it painfully clear that cities and regions can’t count on the federal government to play the supportive role it has in the past.
“The federal government has left the building,” says Bruce Katz, co-author of The Metropolitan Revolution: How Cities and Metros Are Fixing Our Broken Politics and Fragile Economy. The vice president of the Washington-based Brookings Institution, Katz joined San Francisco Mayor Ed Lee and Lennar Corporation executive Kofi Bonner for a discussion of the future of American cities recently at Climate One, the sustainability project of the Commonwealth Club.
Gone are the days when the federal government did big things and showered funds onto states and cities. Today, cities are realizing they need to come up with creative funding models and take their futures into their own hands. Metropolitan areas are “stepping up and doing the hard work to grow jobs, make their economies more prosperous, and respond to climate and environmental challenges,” says Katz.
The caricature of Silicon Valley is that it is Google and Facebook and other companies that write code and don’t really build anything. In fact, Katz says that about about 17 percent of the economy in Silicon Valley is manufacturing. Much of that production is actually in-state, not shipped off to China.
One national problem is that America has focused too heavily on consumption. Katz argues that a “misguided growth model” caused the Great Recession, and he contends there is a big structural shift underway in how we think about who runs America. It is the cities and regions that are really driving exports and innovation. And that’s a good thing. There has been much talk in recent years about the necessity of manufacturing to a robust economy that cannot thrive on services alone.
As for San Francisco’s own manufacturing, Mayor Lee said the “SF Made” nonprofit has started a successful movement to create locally made products. “People from China come over and they ask me, ‘What is made in San Francisco?’ because they will buy it,” Lee said. “It’s good quality.”
BUILDING THE NEWER ECONOMY
With so many businesses focusing on labor costs, America’s manufacturing industry makes up only 11 percent of the economy, Katz said. In comparison, 70 percent of Germany’s economy is production. It’s not just about wages, it’s about quality and reliability of your energy supply, he said.
“Technology is going to play a big role in advanced manufacturing, and I think it’s going to happen right here in San Francisco,” Lee said.
In addition to driving economies and exports, Katz contended that cities are also on the cutting edge of reducing carbon pollution and preparing for the climate impacts already baked into the Earth’s operating system. Climate change is an existential threat, and delinking carbon pollution from the economy is an imperative, Katz said. “We need to get beyond labels that mostly come out of Washington, D.C., … about what the clean economy is.”
Lennar’s Bonner pointed out that the Hunters Point developments are LEED certified and are taking measures to prepare for sea level rise and uncertainties that scientists say we can expect in coming decades. Buildings are being raised, for example, more than three feet above base flood elevation and are being set back from the water’s edge to facilitate flood control. The neighborhood also plans to have an automated waste recovery system that conjures images of the Jetsons. Trash will be collected via tubes and sent to a central processing center.
If the project gets built and comes in on budget, that would be an example of a resilient community poised for the uncertain times coming our way.
“America is the most resilient society and the most innovative economy,” says Katz. “This time around it will come from the communities.”
