Speeches

"Downtowns and the 21st Century Economy"
Organization/Conference: Downtown Madison, Inc.
Location: Madison, Wisconsin
Date: July 10, 2003

It is already a cliché, of course, but the world really did change forever on September 11th, 2001? What impact will those events have on downtowns in the 21st Century?

Anyone who says today that they know what’s going to happen has allowed their arrogance to overpower their expertise. Anyone with the least intellectual integrity simply has to say, “I have no idea.”

But there are two important lessons we have learned from these events; or perhaps more accurately that we have relearned. First, buildings can have meanings. Important buildings are symbols. Buildings can reflect values.

Now let’s put aside for the moment what the World Trade Center and the Pentagon symbolize for us and think what they must have represented to the terrorists — American global capitalism and American military power. They attacked the buildings they saw as symbols of those meanings. If their only aim had been to kill people those four planes would have been hijacked on a Sunday and crashed into football stadiums, but that wasn’t done.

Look at what else they didn’t target — a shopping center, often seen as the representation of so-called American consumer decadence. Why didn’t they strike a shopping center? Because the buildings themselves have no meaning. They are pieces of crap. They are exactly what the sociologist E.V. Walter meant when he wrote, “For the first time in human history people are systematically building meaningless places.” So lesson one from September 11th — buildings can be powerful symbols, but most buildings are not.

Lesson two is this: there is something incredibly important about public spaces. Here was this horrendous event. One might have speculated that everyone would want to go home, bolt the doors, and curl up in bed. Instead what did we do, all over America? We gathered together in public spaces. We wanted, we needed to be with other people. And importantly other people not exactly like us. We didn’t gather inside the private space of department stores or hotel lobbies. We gathered on the street, we gathered in parks, we gathered in public squares.

What does this have to do with downtown? Everything! Where are the buildings with meaning in Madison, the buildings that were built to reflect symbolic values? The vast majority of them are downtown.

Where are the public spaces in Madison, the places where people gather to celebrate or mourn or protest? The vast majority of them are downtown.

I don’t think it is overreaching to suggest that if downtown is to be important in the 21st century it must maintain those two roles: the concentration of buildings with symbolic meanings and the locus of public gatherings. What we in this country call “downtown” most of the world calls the “city center.” I think that is a better phrase, actually, because the downtown ought to be the center of the city in a multitude of ways.

My assignment here today was to talk about the role of historic preservation in downtown revitalization. Well, I can do that in 30 seconds. I’m often introduced as an historic preservationist, but what I really am is an economic development consultant who focuses exclusively on downtowns and neighborhood commercial centers, and I’ve been doing that for 20 years.

There are a variety of approaches to downtown revitalization, of course, but I cannot identify a single example of sustained success in downtown revitalization in any sized community in any part of the country that does not have historic preservation as a key component of that effort.

That doesn’t mean, I suppose, that it isn’t theoretically possible to have an example of downtown revitalization without historic preservation, but I haven’t heard about it, I haven’t read about it, I haven’t seen it. It’s as simple as that.

So with my primary assignment out of the way, I can spend the remainder of my time this morning on a broader perspective of downtown. I said earlier that I don’t know the future of downtowns in the 21st century, but I do know two forces that will impact their future, whatever it is — globalization and diversity.

First, globalization. On one side promoting globalization you have virtually all national governments, the World Bank, the IMF, multinational corporations, and the world’s finance ministers, regardless of political system. On the other side opposing globalization there is a growing coalition of social activists, environmentalists, much of the traditional left, a few labor unions, anarchists and some right-wing ideologues.

What few on either side understand is that there is not one globalization but two — economic globalization and cultural globalization. For those few that recognize the difference, there is an unchallenged assumption that the second is an unavoidable outgrowth of the first.

It is not my intention here to argue the merits of economic globalization aside from the following:

economic globalization is inevitable in the 21st century;
there are 1.2 billion people in the world living in poverty — most of them people of color — and the industrial world will never tax itself enough to end that hunger;
the only escape from poverty is the ability to sell goods and services around the world; and
while there will be some places that choose to opt out of the world economy for reasons of provincial ideology, protectionist isolationism, or political I.O.U.s, the citizens of those places will be the losers.

What does economic globalization have to do with downtown? The most significant impacts of the global economy will not be at the national or even the state level. The biggest impacts will be local.

Akito Marito, founder of Sony, called it “global localization.” Local response to globalization will necessitate identifying local assets (human, natural, physical, locational, functional, cultural) that can be utilized to respond to globalization. Those assets need to be first identified, then protected, then enhanced.

In Post-Capitalist Society, business guru Peter Drucker writes, “Tomorrow’s educated person will have to be prepared for life in a global world. He or she must become a ‘citizen of the world’— in vision, horizon, information. But he or she will also have to draw nourishment from their local roots and, in turn, enrich and nourish their own local culture.”

I said earlier that there is not one globalization but two — economic globalization and cultural globalization. If the U.S. economy is going to benefit from globalization it can no longer be through a monolithic Americanization of the world’s economy.

Economic globalization has widespread demonstrable benefits; cultural globalization ultimately diminishes us all. And it is cultural globalization — whether called Disneyfication or McDonaldization or Westernization — that generates the most passionate outrage around the world.

There is a New York Times photograph of the president of General Motors standing in front of the Renaissance Center in Detroit. This phallic symbol building is now GM’s corporate headquarters, but is also the most expensive failed attempt of downtown revitalization in history. His foot is resting on a model globe. Well that may be General Motor’s version of globalization but that kind of hegemony cannot be sustained much longer. The view that in Detroit or in New York or in Washington unilateral decisions can be made about what the world will buy is a myopia that cannot last. A permanent and prosperous economic globalization has to be a diverse globalization.

There’s a reason critics invariably link cultural globalization with economic globalization: many multinational corporations are oblivious to the distinction.

The Golden Arches are frequently the target of cultural globalization protestors. McDonald’s CEO Jack Greenberg vehemently denies his company is trying to McDonaldize the world. But when asked why only one of his board of directors isn’t American (a Canadian) his response is, “I’d love to add somebody from outside the United States, but getting them to meetings six times a year is very complicated.” Wait a minute! McDonalds can figure out how to get special sauce and sesame seed buns to 28,000 restaurants in 120 countries and can’t figure out how to schedule six plane trips a year? No wonder Greenberg is not believed.

But it is not just internationally that this sterility of the corporate imagination is adversely affecting the local culture and the local character. A CVS pharmacy or K-Mart comes to town and says, “We’re building here, like we build everywhere else, take it or leave it” (or more recently, “take it or we’ll sue.”) It wouldn’t be quite so bad if the buildings were structures of quality, but they’re not. They are buildings planned from the beginning not to outlive their 15-year mortgage.

City council members who go home every night and tell their kids “just say no” to drugs, can’t summon the courage to “just say no” to drug store chains. To ignore the reality of a globalized economy, or to allow our local culture to be subsumed to a globalized culture will make cities the victim rather than the beneficiary of globalization.

Perhaps the most articulate advocate for globalization in America is New York Times columnist Thomas Friedman, author of The Lexus and the Olive Tree. But listen to what he says. “There are two ways to make people homeless: One is to take away their home, and the other is to make their home look like everybody else’s home.”

Downtown’s strength is not homogeneity with everywhere else; the strength of downtown is its differentiation from anywhere else. The trip from someplace to any place, and the trip from any place to no place is far shorter than many would like to admit.

There is a Latin phrase — horror vacui — that means the intolerability of no-place-at-all. Many places in America have approached that horror vacui. On a trip to California I picked up a copy of the Sacramento Bee one morning and read a local columnist, Steve Weigand, and here’s what he wrote:

And from the Brave New World of the Internet comes the following new term. Generica: fast food joints, strip malls and subdivisions, as in “we were so lost in Generica, I didn’t know what city it was.”

Generica isn’t just a California phenomenon or just a city or suburban phenomena. Generica is happening everywhere including downtowns and I would suggest it is at the heart of the challenge of economic development, smart growth and downtown competitiveness.

Differentiated downtowns mean diverse downtowns. But that diversity must not only be encouraged between downtowns but celebrated within downtowns. Why do we care to have diversity downtown? In part diversity, too, is related to globalization. We live in a world where there are far more brown, yellow, and black people than white; where there are more Hindus, more Buddhists, and more Muslims, than non-Hispanic Christians. The percentage of the world’s population made up of people who look and in many cases think like most of the people in this room is falling every day.

When John Kennedy was president there were 3 billion people in the world. When my 28-year-old daughter was born the world’s population was 4 billion. The last time a George Bush was president there were 5 billion people in the world. Today there are over 6 billion. Every 143 days there are enough more people in the world to populate a country the size of Canada. Less than 10 percent of those new people look like me. Over the next 50 years, 97 percent of all of the world’s net population growth will be in Asia, Africa and Latin America.

The world entered the 21st Century with incredible diversity and yet: Christian Serbs were killing Muslim Albanians; Protestant and Catholic Irishman killing each other; Ethiopians fighting Eretrians; Hindus burning Sikh temples in India; Iraqis fighting Kurds; Iraqis again threatening Kuwaitis; Iraqis fighting Iranians; Indonesians crushing ethnic minorities in East Timor; French-Canadians trying to disassociate themselves from English-speaking Canadians; Chinese suppressing Tibetans; Russians attacking Chechnians; and on and on and on.

So in most of the world, diversity is not only not deemed desirable — in many places diversity is a death warrant. President Bush has said the Taliban hated our freedom. Maybe, but I would suggest it is a component of our freedom one step removed. The United States likes to argue that its contributions to world civilization are democracy and capitalism. Well, we’ve certainly improved both, but the Greeks invented democracy and the Scotch invented capitalism and the English were the first to implement it.

I think our unique contribution to civilization is our tolerance of diversity. For 60 years in this country we have struggled over our racial and ethnic and gender diversity. That struggle has not been easy nor is it over. But we have confronted diversity issues and we have at least begun to celebrate diversity, and that is nearly unique among the nations of the world.

There is a statistical inevitability of diversity worldwide. But it is true here in the United States as well. One in ten Americans were foreign born. Nearly four in ten is non-white. Much of the white population is Latino. Hispanics have now surpassed African-Americans as the largest minority group in America.

Overall growth rates in the United States over the next 25 years will be less than 19 percent. But the African-American population will grow 20 percent; the Asian population 21 percent, the Hispanic population 39 percent; the non-Hispanic white population will grow less than 15 percent. In California there are already dozens of no-majority communities, and there will be more no-majority states. That is to say no racial or ethnic group will constitute more than 50 percent of the total population.

But it is not just ethnically that we have to figure out ways of working in a context of diversity. The nature of what is a household is changing rapidly as well. Today there are far, far more one-person households than there are households made up of two parents with children at home.

What is a white, middle-aged, well-compensated, heterosexual, Republican-type male doing up here talking about diversity? The point is that businesses and governments and especially downtowns are going to have to learn to figure out ways to operate in this context of diversity not for sociological, political, ethical, or moral reasons, but for economic survival.

Addressing diversity is certainly going to be true in finding workers, but also our suppliers, intermediaries, elected officials, and most importantly customers. When shopping in the local store was the only option, you had no choice but to deal with that local merchant even if he was racist or sexist or homophobic or distrusted teenagers or just provided lousy service.

That is no longer the case. Internet shopping certainly isn’t the answer to everything. And the Internet is in no way a substitute for a downtown. But Internet customers are not judged based on their race or age or sexual preference or religion or dress or country of origin. The Internet will force every business to reconsider how its customers are treated. I don’t believe that old saying that the customer is always right. But it is never, ever the customer’s fault that they don’t shop in our business. It is our fault. And it is the merchant that has to adjust, not the customer.

The customer has far more options to buy a good or service and will quickly abandon the local business when she isn’t treated as she has a right to be.

We can deny, if we choose, these factors — the Internet, globalization, diversity of populations — if we wish, but that means we will be left behind in our business, in our job and in our downtown. There simply is no place that is immune to the rapid changes that are taking place in the world.

We have all long claimed that downtown is the only place in the community where the bank president and the homeless person come into direct contact. That is not only true but is a very important role for downtown to play. In fact I would argue that downtowns are the only place in our society where we are learning diversity first hand.

That used to happen in our public schools, but not anymore. They are more segregated by race, ethnicity and income than before Brown vs. the Board of Education.

It doesn’t happen in our churches. It doesn’t happen in our neighborhoods. Nearly forty years after the passage of the Civil Rights Act and the Fair Housing Act the vast majority of our neighborhoods represent a very narrow slice of humanity, racially, economically, educationally, occupationally. The exception to that, by the way, is historic districts, which, across the country, are almost the only neighborhoods where a range of people across the demographic spectrum live side-by-side.

One might say that there is diversity in a shopping center, but that is a single function place. As Elizabeth Anderson at the University of Michigan has written:

The triumph of malls over downtowns in many U.S. cities thus does not represent a fulfillment of consumer’s sovereignty so much as a disenfranchisement of citizens. Malls provide only a simulacrum of complex genuinely public spaces, for private property owners retain the power to censor citizen speech and activity there.

I think she is right about the shopping mall, but I think she inadequately recognizes what you are doing in your downtown, and that is giving renewed expression to citizen sovereignty. If we are going to learn the value of diversity it is going to be downtown.

But think about the other forms of diversity. Where is there more racial diversity than downtown? Nowhere. Where is there more economic diversity than downtown? Nowhere. But downtown’s diversity goes far beyond those elements. Where is there a greater diversity of goods than in downtown? Notice I didn’t say, quantity. In many places there is a greater quantity of goods at the regional mall. But where is there a greater diversity of goods? Nowhere. Where is there a greater diversity of services? Nowhere else is even close.

Where is there a greater range of rental rates? The spread of rents from top to bottom at the shopping center might be 100 percent, and only then because Sears as the anchor is paying less for space than it costs the building owner to house them. The rent spread at the industrial park? At the so-called office campus? The range from top to bottom is less than 50 percent. In most downtowns of every size, however, it is typical to see both the most expensive rents in the entire city and some of the cheapest. A rent spread of 500 percent downtown isn’t at all unusual. And that results in a wide diversity of economic activities.

The functional diversity of downtown is also vastly greater than anywhere else. A friend of mine, Bill Mosher, used to be president of the Downtown Denver Partnership. Bill identified twelve centers that downtown could be: business center, government center, arts and cultural center, entertainment center, housing center, tourism and convention center, education center, medical center, special events center, sports center, retail center serving those other markets, and heritage center.

I have of course stolen Bill’s list and I use it often. But its significance is how diverse downtown really is; how much the city center downtown is.

Biologists were the first to understand the importance of diversity to a healthy ecological system. But the words “ecology” and “economy” come from the same root, the Greek word oikos which means “house.” Economic development analysts, based on the models of the ecologists, have discovered that what is necessary to keep our economic house in order is the same as it takes to keep our ecological house in order and that, in part, is diversity.

So the concepts of diversity emerged from the environmental sciences but I don’t want to leave the subject of the environment quite yet.

We all diligently recycle our Coke cans. It’s a pain in the neck, but we do it because it’s good for the environment. Now even though a quarter of everything dumped at the landfill is from construction debris, we don’t often think about the environment in relation to the demolition of historic buildings. But let me put it in context for you.

Let’s say that today we tear down one small, two-story, 25- by 100-foot masonry building in downtown Madison. We have now wiped out the entire environmental benefit from the last 1,344,000 aluminum cans that were recycled. We’ve not only wasted an historic building, we’ve wasted months of diligent recycling by the good people of Madison. Now why doesn’t every environmentalist have a bumper sticker saying “Recycle your aluminum cans AND your historic buildings.” Either that or let us off the hook from having to sort those Coke cans every week.

But diversity is not just an economic imperative — it is a civic one as well. The former mayor of Missoula, Montana, Daniel Kemmis, writes:

A good city…depends not only on imaginative people taking risks in pursuit of opportunities they see in particular locations, but also on those risk takers being widely diverse in their dreams and their manner of pursuing them.

Downtown will also need to have a diversity of meanings. Those diverse meanings should include: aspiration, civic pride, prosperity, confidence, responsibility, sustainability, evolution.

Well, twenty-five minutes ago I told you that anyone who says they know the future of downtown is a captive of their own hubris. But the future of downtown and the importance of downtown are two different things. I don’t know what the future of downtown is but here is what I am certain of:

If we are to have an effective environmental policy, downtowns are important.
If we are to have an effective transportation policy, downtowns are important.
If we are to have meaningful historic preservation, downtowns are important.
If we want Smart Growth, downtowns are not only important but irreplaceable.
If a local official wants to claim the treasured mantel of fiscal responsibility, downtown revitalization is imperative.
If we want to avoid Generica downtown is essential to establish differentiation.
If the community is going to compete in economic globalization without being swallowed by cultural globalization, downtown revitalization has to be central to the strategy.
If new businesses, start-up businesses, innovative businesses, and creative businesses are going to be fostered and encouraged, a community will need a downtown for that to take place.
If we are to have buildings with meaning, buildings with value, buildings with values, they will be downtown.
If we are to have public places of public expression we need a downtown.
If a community is going to embrace diversity instead of hide from it, celebrate diversity instead of deny it, then that has to take place downtown. It ain’t gonna happen anywhere else.

Regardless of the size of the community, those working for downtown revitalization and historic preservation represent the Real Urbanism.

They aren’t the cute urbanism with a pleasing pattern of pastel porches; they are the challenging urbanism of complexity, conflict, and compromise.

They aren’t the squeaky clean urbanism; they’re the dirty, gritty, gum-on-the-sidewalk, graffiti-on-the wall urbanism.

They aren’t the idealized urbanism conjured up by experts from elsewhere; they are the urbanism created daily by the barber, the crotchety building owner, the clueless merchant, and the ineffectual public official.

They aren’t the new buildings that respect their context; they are the context.

Sometimes they call themselves the Downtown Partnership or the Preservation Association or the Main Street program. But I’ll tell you what I think they are. I think they are the local chapter of the Congress for Real Urbanism. And I consider myself privileged to work with them and their colleagues around the world. I thank them for that, and thank you for allowing me to be here with you today.

© Donovan D. Rypkema
PlaceEconomics
1785 Massachusetts Avenue, NW
Washington, DC 20036
202-588-6258
DRypkema@PlaceEconomics.com