This Terrifying Economic Crisis Will Make Cities Better

Amid the pandemic, the rich are fleeing American cities. That’s a good thing.

Hamilton Nolan

WEST NEW YORK, NJ - MAY 20: A goose stands in front of Central Park Tower and the Steinway Tower on Billionaires' Row. Gary Hershorn/Getty Images

Have you heard? The gold­en age of the Amer­i­can big city is over. The pan­dem­ic and the protests are scar­ing peo­ple away. Res­i­dents are flee­ing. Crime is up. Bud­gets are bust­ed. The offices are emp­ty, the rich are mov­ing to the sub­urbs, and the peri­od of unbro­ken pros­per­i­ty has shat­tered forever. 


Well — to be more pre­cise — there is a strong poten­tial for this to be good, if a few things break the right way. The pan­dem­ic is bad, as is the human suf­fer­ing and the eco­nom­ic cat­a­stro­phe — and it’s all like­ly to get worse. But the city? The city is going to be reborn for the better.

To under­stand why this is true, you have to under­stand who cities are for: every­one. Cities are not theme parks for the rich, where every­one who makes less than six fig­ures is sim­ply a cast mem­ber with a ser­vice role. Cities are not archi­tec­tur­al show­rooms for bank branch­es. Cities are not apartheid states that pro­vide the raw mate­r­i­al to the prison-indus­tri­al com­plex. Cities are not just back­drops for Amazon’s new head­quar­ters build­ing. Cities are — or should be — fre­net­ic quilts where every type of per­son lives togeth­er. The mag­ic, and the ben­e­fit, of cities is that they bring togeth­er rich and poor, young and old, artists and busi­ness peo­ple and col­lege kids and retirees and hus­tlers, facil­i­tat­ing unpre­dictable rela­tion­ships and smash­ing (to some degree) the bub­bles that we form to sep­a­rate our­selves from one another. 

That capa­bil­i­ty of cities has bro­ken down in two ways. Some cities have been hol­lowed out by post-indus­tri­al decline, los­ing the pri­ma­ry dri­vers of their economies with noth­ing to replace them. This is the Detroit prob­lem, and its emp­ty down­towns and board­ed-up homes can be seen in once-thriv­ing cities across the coun­try. But oth­er cities have been afflict­ed by the oppo­site prob­lem: death by pros­per­i­ty. From New York to Los Ange­les, San Fran­cis­co and­Seat­tle, a rapid influx of wealth into such cities has raised the cost of liv­ing in gen­er­al, and the cost of hous­ing in par­tic­u­lar. In the most suc­cess­ful cities in Amer­i­ca — the very places where it would make the most sense to encour­age the most peo­ple to live — the rent is too damn high, and, for the aver­age work­ing per­son, buy­ing a home is a math­e­mat­i­cal impossibility. 

This con­di­tion has reached the most absurd pro­por­tions in San Fran­cis­co, where there are vir­tu­al­ly no homes in the entire city that one could pur­chase on a teacher’s salary. The same dynam­ic is true in large swaths of New York and oth­er thriv­ing cities. Unless you believe that cities should come with ready-made slums pop­u­lat­ed by the ser­vant class­es, you have to admit that a city with­out afford­able hous­ing is fun­da­men­tal­ly flawed. 

The most ratio­nal response to this influx of rich peo­ple into cities would have been to build a large amount of new hous­ing, in order to pre­vent the prices of the city’s hous­ing stock from sky­rock­et­ing as it was bid up by wealth­i­er res­i­dents. Of course, that is not what hap­pened. Instead, every city just allowed their hous­ing prices to sky­rock­et until they faced deficits of hun­dreds of thou­sands of units that would need to be built in order to meet demand. In the long term, that hous­ing will indeed have to be built as cities grow; but the past decade is proof that in the short term, it will not hap­pen, due in large part to the intran­si­gence of exist­ing home­own­ers, who make up the most potent force in any city’s local politics. 

For years, it has seemed like many of America’s cities were doomed to become increas­ing­ly unaf­ford­able playpens for the rich, able to be vis­it­ed by nor­mal peo­ple, but not lived in. Unless… there was an exo­dus of the upper class from major cities. Wow — that’s just what the pan­dem­ic has pro­vid­ed! All of the trend sto­ries about New York­ers flee­ing the city in droves” are not about the poor, nor about the mid­dle class. They are about the wealthy, who have the means to go live wher­ev­er they want. And while this dynam­ic is being pre­sent­ed by some media out­lets as a night­mare, the real­i­ty is that a reduc­tion in the demand of upper class peo­ple to live in cities would serve as a release valve on hous­ing mar­kets, mak­ing these cities more afford­able for every­one else. 

Lack of mon­ey can dev­as­tate a city. But mon­ey can dev­as­tate a city as well. Over­whelm­ing pros­per­i­ty dri­ves out the cool peo­ple, prices out the artists and the dive bars, and pro­motes chain stores and lux­u­ry goods. It makes once-inter­est­ing and unique places look like every­where else. This has hap­pened to Man­hat­tan. It has hap­pened to San Fran­cis­co. It has hap­pened to gen­tri­fied neigh­bor­hoods in Atlanta, and in Den­ver, and in Los Ange­les. But it can be reversed. The big chain stores are already shut­ting down in New York. In their place will be some­thing cool­er, because there is noth­ing less cool. 

Of course, there is a steep down­side to what is hap­pen­ing to cities right now. City bud­gets rely on tax rev­enue. When the busi­ness­es and the peo­ple in cities are not mak­ing mon­ey, and when the prop­er­ty val­ues decline, tax rev­enue goes down, and bud­gets get cut. We are liv­ing through that now. New York City is poised to lay off more than 20,000 city work­ers, and they are not all bad cops. They are san­i­ta­tion work­ers and ambu­lance dri­vers and tran­sit work­ers and the oth­er peo­ple who make the city run. Los­ing them will make the city a worse place to live. The city will be dirt­i­er, crime will rise, the sub­ways will break down, and count­less needs will go unmet as ser­vices are slashed. If all of this were inevitable, it would cer­tain­ly be a strong argu­ment against the idea that there is any sil­ver lin­ing to all of this. 

But it is not inevitable. City bud­gets can be res­cued by the fed­er­al gov­ern­ment. Indeed, mon­ey to bail out city and state gov­ern­ments, to pre­vent the cut­ting of ser­vices out­lined above, appears to be one of the main stick­ing points in the cur­rent stalled nego­ti­a­tions between Democ­rats and Repub­li­cans on a new Covid res­cue pack­age. If Repub­li­cans get their way, city bud­gets will have to be cut, and the down­ward spi­ral will com­mence, and any new hous­ing afford­abil­i­ty will come at the cost of a much more bro­ken city that will hurt the most vul­ner­a­ble res­i­dents. But if the fed­er­al gov­ern­ment does the wise thing — most like­ly under a future Pres­i­dent Joe Biden —then we could enjoy the exo­dus of a good num­ber of wealthy peo­ple from our cities and the sub­se­quent relief in hous­ing prices with­out the awful cuts to mass tran­sit and oth­er ser­vices. In that sce­nario, we could legit­i­mate­ly be enter­ing a new gold­en age of cities — afford­able for nor­mal peo­ple, open to art and music and cul­ture once again, and with­out Chase branch­es and tech bros lit­ter­ing the streets. The dream would be realized. 

So keep yelling at the rich to scare them away, but be sure you also yell at Con­gress. If we don’t get that bailout mon­ey, things are gonna suck. But if we do, you may final­ly get a chance to live with­out a roommate.

Hamil­ton Nolan is a labor reporter for In These Times. He has spent the past decade writ­ing about labor and pol­i­tics for Gawk­er, Splin­ter, The Guardian, and else­where. You can reach him at Hamilton@​InTheseTimes.​com.

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