Every couple of months, I write the local government column for the print edition of /Carolina Journal. My latest effort is just out, and also ran over at the mothership today. To save you the trouble of following a link to read it, I’ll just repost it in its entirety here.
CHARLOTTE — Over the past decade, the concept pitched by urban studies guru Richard Florida of the “creative class” has driven a lot of economic development decisions by cities across the country and around the world. Charlotte has bought into the theory in a big way.
In fact, Charlotte is now doubling down on Florida’s theory — which says a region’s economic growth depends on its ability to convince artists, intellectuals, and various other bohemian types to live there. Recently, Charlotte has spent hundreds of millions of dollars on a light-rail line and hundreds of millions more on arts buildings to attract the “creative class.”
That hasn’t worked out so well to date as Mecklenburg County’s unemployment rate is well above the national average. Even so, past failures haven’t stopped the Queen City from considering more new projects to attract the cool crowd.
Charlotte city manager Curt Walton is proposing that Charlotte spend $926 million through 2020 on capital projects. Walton has described the need for the projects he’s identified in nothing less than apocalyptic terms.
In Walton’s view, North Carolina’s largest city is on the cusp of becoming like all those old Rust Belt cities, with a very small affluent area paying most of the property taxes while vast portions of the city house uninteresting, noncreative people of modest incomes and abilities — and low property values.
“If we don’t invest now, will we see a markedly declining Charlotte in five years? In my opinion, probably not,” The Charlotte Observer quoted Walton as saying. “However, if we don’t invest soon, and in innovative ways, will we see decline in 10 years? Again, in my opinion, yes.”
Walton’s proposal is hardly surprising. Charlotte is running out of room to increase its tax base through annexation; getting more tax revenue depends upon having existing property become more valuable. And that would be a challenge in any case as much of the city’s housing stock is obsolescent — older, relatively small, and often lacking the amenities like open floor plans that today’s homebuyers value.
Still, Walton’s proposal is far from the answer. Evidence supporting Florida’s notion that attracting the creative class is critical to achieving high growth rates is scant. Indeed, the cities that Florida identifies as the most creative aren’t necessarily the cities with the highest rates of entrepreneurship and business formation.
Even if Florida’s ideas were unassailable, it’s unclear why building additional light-rail and streetcar lines — transit spending accounts for a third of Walton’s plan — would be the solution. The city’s existing light-rail line was built along South Boulevard in large part as a redevelopment scheme.
Then-Charlotte Mayor Pat McCrory famously called the street a “corridor of crap.” Light rail hasn’t improved things much to date, and private developers remain uninterested in building a signature development at the Scaleybark Road station despite large city subsidies.
And it’s not as if Charlotte and Mecklenburg County don’t provide a lot of amenities already. Charlotte’s per capita local government tax and fee collections of $2,290 are the highest of any city in the state with a population of 25,000 or more. Walton’s proposal would increase property taxes in Charlotte by another 8.2 percent.
Perhaps Charlotte’s problem is the opposite of what Walton imagines it to be — people and businesses are finding the cost of living or starting a business in Charlotte is too costly already. Adding to those costs won’t make it more attractive.
If, as the saying goes, the definition of insanity is doing the same thing over and over again and expecting different results, then Charlotte’s existing creative-class-based policies certainly qualify as insane, given the lack of success they have brought to date.
