Still the Promised Land

Poverty, policy and hope in the Rust Belt

Out west in gigantic, thriving Chicago, there's a debate underway between a journalist and an IT consultant over whether regionalism can help the hollowing-out cities of the Rust Belt.

Chicago is the Great Lakes exception. Social thinkers there look west and see the empty Great Plains states that lost their economic mojo a generation ago, and theorize that projects like Buffalo Commons — a proposed 139,000-square-mile nature preserve spanning 10 Plains states — make more economic sense than trying to save all those tiny little towns in states like Nebraska and North Dakota. Looking east, Chicago sees the Rust Belt and observes that "the industrial age needed all these towns. The global era doesn't. Without an economic raison d'etre, no place can keep going forever."

Richard Longworth, who likes regionalism, wrote those words in reference to Cleveland, Dayton, Buffalo and the other rusty towns he discusses on his blog, The Midwesterner. Aaron Renn, the IT guy who runs a blog called The Urbanophile, also writes about the economic challenges of old industrial centers, but Renn prefers localism. Renn finds great quotes from the late urbanist Jane Jacobs to advocate for local rather than regional governance — even when localism in practice gets us the corrupt 50 little fiefdoms of the ward system in Renn's adopted city of Chicago.

Everybody who discusses governance is more or less advocating a solution to concentrated poverty. But, to quote the Chicago preacher and politician Jesse Jackson, where you sit determines where you stand. Chicago is rich: The level of enduring prosperity and philanthropic strength, coupled with never-ending immigration from every corner of the planet, huge institutional strength, and depth and sophistication in ethnic communities — including the black community — make Chicago's poverty problems seem manageable.

In the rest of the Great Lakes, we don't have much glitter to distract us from the concentrated poverty that seems omnipresent. Maybe that's because poverty is spreading so rapidly here: The social workers who help the poor get food stamps enroll folks across the region, not just in Cleveland proper or the inner-ring suburbs. Rust Belt regions as a whole offer mostly low-wage employment. They are metros with poor cores, surrounded by low-wage suburbs, with a few rich enclaves populated by business folks who scream about taxes but who gladly pocket economic "development" subsidies. Our former landscape of general prosperity has become a scene of polarized incomes.

And yet for some folks the Rust Belt still looks like the promised land.

Two Cleveland writers have laid out some compelling stories and statistics about a happy new reality, which is that there are many cases of immigrant success in cities where the great age of metal industrialism left the worst concentrations of poverty, derelict buildings, racial animosity and brownfields. In their book Immigrant Inc., Richard Herman and Robert Smith work hard to tell the story of the immigrant boys who created Google, but they spend most of their efforts following the stories of recent immigrants, several of them refugees from brutal politics, who are doing well in the Great Lakes region precisely because the barriers to starting anything one wants to start are lower here than elsewhere, simply because everything is cheaper here.

The immigrant phenomenon is real. The authors' core assertion — which is that immigrants possess most of the magic ingredients that give them a leg up as entrepreneurs — gets nods from Sue McCartney, who directs Buffalo's Small Business Development Center. She emphatically concurs that the alleged barriers to business — a big public sector, taxes and regulation — are irrelevant to startups. Well-educated English-speaking folks who arrive here from Africa, Europe, East and West Asia, and the Americas regard Buffalo and other Rust Belt cities as the best place in the world to start a business. They don't care about taxes, and they regard the regulations and bureaucracy here as completely manageable. They are delighted not to have guns pointed at them, or shakedown artists showing up from government offices, or protection rackets hassling them.

Internal immigrants like the Rust Belt too. There is a little buzz happening about our broken towns. The idea of the Snow Belt as a destination for the creative and the adventurous got a nice boost a couple of years ago from New York magazine, which profiled some young hipsters who'd smartly slipped their New York City and Toronto confines and shuffled off to cheap, short-commute, liveable Buffalo. It wasn't a government of corporate handout or loan that lured them; it was the scent of opportunity. (But there's the smell of scam in the air too. Richard Florida, the famous proponent of the "creative class," has been criticized for going to broken-down, small, out-of-the-way places in Ohio, Michigan and New York where, for a hefty fee, he provides an assessment of the upsides of coffee shops, gay dual-income-no-children couples and Internet artists.)

And the Census does not lie. There is virtually zero in-migration to Cleveland or any other Rust Belt metro. The authors of Immigration Inc. are surely correct about the entrepreneurial characteristics that energetic immigrants bring. But are there ever going to be enough of them to create enough activity to reshape the economy and bust up concentrated poverty here?

Renn of asks: Are you a producer or a consumer? Are you going to make things happen in the Rust Belt, or are you going to wait for the government to hand you your future? I like that question, especially from apologists for sprawl like Renn. The answer is this: Of course the government is absolutely central to the future of the Rust Belt — but not in the way that government has been.

Government investment in infrastructure created the industrial economy in the first place. A smart government could make immigration to the Rust Belt cities what the smart government in Canada made happen in Toronto, which is such a magnet for immigration that today, 49 percent of the population is foreign-born. It's no accident that the economic region known as the Greater Toronto Area is governed as a whole. It's no accident that policy-makers in Hamilton clamor for more immigration, and that the smart governments there, whatever their other faults, see regional governance, attracting immigration and preventing concentrations of poverty as explicitly linked policies.

Yes, we need immigrants. Yes, we need entrepreneurs. No, our taxes and public services are not burdensome or unduly costly. No, the old monolithic industrial structures of the past, like steel mills, nor the new monolithic structures of today, like banks, will not rejuvenate the Great Lakes metros.

The Small Business & Entrepreneurship Council's (SBEC) 2009 Business Tax Index ranked Ohio 10th best in the nation. The state fared almost as well in SBEC's more comprehensive Small Business Survival Index 11th. Ohio also recently won its fourth consecutive Governor's Cup from Site Selection, a trade magazine focusing on corporate real estate and economic development. Youngstown was recently named the most promising place in America for startups by Entrepreneur magazine. Youngstown is the place that has become the signpost for the new way to manage urban decline — by accepting that some streets and neighborhoods should become, if not the Buffalo Commons of the Great Plains, then at least urban forests, or land banks, ready for the next immigrants, whenever they might come, wherever they might come from.

We know where the poverty is. We know where the vacant land is. We know what immigrants can do. What we don't know is if our governments will ever adjust their policies away from handouts to the already rich.

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Bruce Fisher is a former deputy executive for Erie County, N.Y., and currently visiting professor of economics and finance at Buffalo State College, where he directs the Center for Economic and Policy Studies.

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