Economic restructuring success and failure: Detroit compared to Bilbao, Liverpool, and Pittsburgh

Note that I have been meaning to write a piece comparing revitalization planning in Detroit, Pittsburgh, Bilbao, and Liverpool.

All of these cities have experienced a great deal of economic dislocation in response to deindustrialization, globalization, consolidation of power in other cities within the nation, and/or changes in the organization of the shipping industry.

Liverpool is most like Detroit in the level of poverty that persists, even after the city's 30 years of regeneration programming (on many blocks in Liverpool, every household is on social welfare).  And it's not like there isn't still significant poverty and unemployment in Bilbao and Pittsburgh.

But Bilbao, Liverpool, and Pittsburgh have come a long way forward from the depths of the 1980s, while Detroit continues to deteriorate significantly.

While I would be the first to argue that one element that separates Detroit from the other cities is the race question and racism, the other element that separates Detroit from Bilbao, Liverpool, and Pittsburgh is visionary planning--and Pittsburgh is not quite as comprehensive planning oriented as Bilbao and Liverpool, but has done some amazing things nonetheless, even if not at the scale of those cities, what they have accomplished is quite remarkable, helped by some great local nonprofits that are pretty gutsy (such as the Pittsburgh History and Landmarks Foundation, Heinz Charities and their support of local organizations) and real leadership.

In the sum up piece on the European cities, I wrote this:

The six components of a successful broad ranging revitalization program.  In writing about the various efforts, I drew the conclusion that successful revitalization programs, especially in those cities that were working to overturn serious disadvantages, were comprised of these elements:

• A commitment to the development and production of a broad, comprehensive, visionary, and detailed revitalization plan/s (Bilbao, Hamburg, Liverpool);
• the creation of innovative and successful implementation organizations, with representatives from the public sector and private firms, to carry out the program.  Typically, the organizations have some distance from the local government so that the plan and program aren't subject to the vicissitudes of changing political administrations, parties and representatives (Bilbao, Hamburg, Liverpool, Helsinki);
• strong accountability mechanisms that ensure that the critical distance provided by semi-independent implementation organizations isn't taken advantage of in terms of deleterious actions (for example Dublin's Temple Bar Cultural Trust was amazingly successful but over time became somewhat disconnected from local government and spent money somewhat injudiciously, even though they generated their own revenues--this came to a head during the economic downturn and the organization was widely criticized; in response the City Council decided to fold the TBCT and incorporate it into the city government structure, which may have negative ramifications for continued program effectiveness as its revenues get siphoned off and political priorities of elected officials shift elsewhere);
• funding to realize the plan, usually a combination of local, regional, state, and national sources, and in Europe, "structural adjustment" and other programmatic funding from the European Regional Development Fund and related programs is also available (Hamburg, as a city-state, has extra-normal access to funds beyond what may normally be available to the average city);
• integrated branding and marketing programs to support the realization of the plan (Hamburg, Vienna, Liverpool, Bilbao, Dublin);
• flexibility and a willingness to take advantage of serendipitous events and opportunities and integrate new projects into the overall planning and implementation framework (examples include Bilbao's "acquisition" of a branch of the Guggenheim Museum and the creation of a light rail system to complement its new subway system, Liverpool City Council's agreement with a developer to create the Liverpool One mixed use retail, office, and residential development in parallel to the regeneration plan and the hosting of the Capital of Culture program in 2008, and how multifaceted arts centers were developed in otherwise vacated properties rented out cheaply by their owners in Dublin, Helsinki, and Marseille).

Another big difference in most European cities is that there isn't the same anti-government fervor there that there is here.  In other words, people expect that their local government will take on and address such problems and they don't look to the private sector to lead the change.

Europe's "nonprofit" organizations don't work the same way either.  In the US, once an organization is created, it is run by a board of directors and staff, but isn't "owned" by anybody.  There, there are designated "shareholders" that "own" the organization.  Revitalization nonprofits are usually owned by "the government."  For example, the revitalization organizations in Bilbao are owned by the local, regional, Basque, and national governments. The group in Liverpool is owned by the City of Liverpool.  Dublin's Temple Bar Cultural Trust or the group that runs the Cable Factory in Helsinki are both owned by the local government.  Etc.

Provided there is a commitment to success, that means that there are strong accountability systems in place to focus the effort on outcomes and militate against problems and corruption.

Ultimately, this is what separates Detroit from those other cities.  It's not like there weren't indicators that things weren't working--Detroit has looked like hell for decades as residents and business left the city with blocks and blocks and blocks of the city ultimately combining into the equivalent of many square miles of abandoned land.

Sure, the events that precipitated the outmigration were mostly exogenous and out of the control of elected officials, stakeholders, and the citizens.  Regardless they still had to deal with the consequences, and not planning, not addressing the consequences left the city more at risk and ill-prepared for the time when structural conditions changed significantly, as they always do during a serious economic recession or depression, and the problems could no longer be ignored.

It is tragic that just as GM had to pushed into bankruptcy to transform its business model and practices for the 21st century, rather than continue to work off the model that Alfred Sloan developed in the 1920s and 1930s, Detroit has to be pushed into bankruptcy to change.

Not that Detroit isn't screwed by all kinds of other actors (e.g., "The rise of Oakland County is built upon Detroit's fall").

If you don't plan, your fate is fully out of your control.