Housing Democrats

Why Democratic mayors must build America's cities by establishing an urban real estate cartel

Seeking refuge from cold, damp Market Street last Wednesday, I pushed open an unlocked door near the corner of Second Street, stepped onto an escalator, and found myself amid a couple of hundred environmentalists eagerly waiting to be declared extinct.

"With fond memories, a heavy heart, and a desire for progress, I say to you tonight that environmentalism is dead," declared former Sierra Club President Adam Werbach to a crowd that included current leaders of top enviro groups such as the Sierra Club, Rainforest Action Network, and Earth Island Institute.

As it loses basic battles such as curbing pollution, environmentalism has shown it's as good as dead. The movement's members should therefore stop focusing on a single cause and instead advocate for broader leftist ideals, Werbach urged.

"Choose your side. Are you a progressive or a conservative? If you're a conservative," Werbach declared, "we wish you well, but we need you to leave this movement."

On Thursday the Commonwealth Club hosted yet another left fretfest, an election postmortem panel moderated by a CNN political analyst, former Stanford Law Review editor, and McKinsey & Co. consultant named Carlos Watson. He employed his superior smarts by toying with the political scientist, think-tank pundit, blogger, and pollster who made up his panel.

"So why not admit George W. Bush is one of history's most brilliant political minds?" Watson insisted several times.

Watson made equal sport of the moping, leftish audience, asking for a show of hands from people who had spoken with an actual Republican during the past month. When some hands crept up, he made a face depicting shock. By the evening's end, Watson had some crowd members beside themselves.

"Why can't people see that Bush is so, so, so ... stupid!" one man said.

I can see the point in Watson's teasing. Post-election Democratic angst has blossomed when it should have waned and, by now, turned into resentment or fence-building. We have environmental leftists urging those who are insufficiently left-leaning to exit the room, while, from the other end of the Democratic spectrum, nostalgists such as New RepublicEditor Peter Beinart recommend a re-enactment of the 1940s purge of Communist sympathizers from the party, with, this time, Michael Moore, George Soros, and other fellow travelers suffering banishment.

These dueling donkey pogroms seem a bit harsh, given that they're aimed at remedying a nonexistent catastrophe: Stiff and discursive John Kerry did fail to unseat a politically deft wartime president, but barely. There was no landslide. The election would have turned out differently if 60,000 Ohioans had voted the other way, or if a total of 64,000 voters in Colorado, Nevada, and New Mexico had polled Democratic instead of Republican.

Rather than angst and pogroms, the Democratic Party needs to broaden its political embrace, wrapping the greenest of its Utopians together with its fiercest capitalists in a strategy that has the potential to do more than any previous U.S. government program to protect the environment, house the homeless, and uplift the values of racial and cultural tolerance. Democrats must build up the population of America's cities by establishing a disciplined, national, urban real estate cartel.

Whether the means be formal or otherwise, mayors of Democratic cities need to find a way to join together to market their unused or underused land in a way that encourages large developers to create dense urban communities, without demanding a king's ransom in taxpayer subsidies in return. Such a strategy would bring new people into the city, improve the environment by reducing sprawl and gasoline use, and -- and here is the novel part of the plan -- create new Democrats through the shared experience of urban living, all without crippling the urban governments financially, as such projects often do now.

Post-election fretting has blamed the Democratic Party's fortunes on losing the South because of the civil rights movement, or on the populist reconnoitering of the Republican Party following Barry Goldwater's 1964 presidential bid. But these trends might have proven inconsequential if Americans had not, for the past 50 years, marched away from one another.

In that procession, suburban areas such as Mesa, Ariz., have grown to outpopulate cities such as St. Louis and Minneapolis. Over time, that suburban march has increased the number of citizens whose daily experience is consistent with Republican values such as self-reliance and suspicion of cultural differences and has reduced the proportion of Americans who appreciate Democrat-espoused urban values such as interconnectedness and tolerance.

To put the argument directly: Density breeds Democrats. The 516 counties that voted Democratic in the last two presidential elections have, on average, four times the number of voters as the 2,374 counties that voted Republican, according to a Cox News Service story citing poll and census data.

A Democratic urban repopulation strategy would serve to redirect the party's ideological purgers on both the left and the right. If Democrats made growing cities priority No. 1, environmentalists would see their party striving to curb the diffusion of America's population into once-natural areas, a trend that qualifies as an environmental catastrophe in its own right. Pro-business Democrats, meanwhile, would see their economic dreams fulfilled, as their party chieftains strove to draw hundreds of thousands of consumers, workers, and entrepreneurs into mixed-use developments on abandoned and underused industrial, military, and urban land.

As I listened to forlorn Democrats express their pain and resentment at the Commonwealth Club, it just so happened that a potential answer to their troubles was erecting a department store 2 1/2 blocks away. Forest City Enterprises Inc. of Cleveland, Ohio -- developer of the new Bloomingdale's-anchored urban mall between Market and Mission streets and a project that will turn the old Public Health Service hospital in the Presidio into apartments -- is leading a national business trend in which niche developers are building closely bunched apartments, stores, and offices in American cities -- and making a healthy profit in so doing.

But it's up to America's Democratic mayors to exploit these companies' opportunistic energies in a way that truly benefits cities, and, indirectly, the Democratic Party. There are a lot of cities that have underdeveloped urban space and are run by Democratic mayors. More than a few of them are in Ohio, Colorado, Nevada, and New Mexico, where a tiny demographic shift in the direction of urbanity could move whole states into the Democratic electoral column.

When it comes to the demographic, political, and business trends I'm addressing, Cleveland is emblematic of America's past (its neighborhoods' populations shrank between 20 and 60 percent from 1970 to 1990), its present (Ohio voters just decided America's political course for the coming four years), and its future (Cleveland is the corporate headquarters of Forest City Enterprises Inc., whose business plan imagines reurbanizing America).

This $5 billion real estate company has bet its stock on urban projects, many of them mixed-use infill developments designed to bring population back into old cities, a strategy "where the opportunity for growth extends far into the future," according to an analyst quoted recently in Forbes.

A company subsidiary plans to develop a $2 billion urban-infill project in Brooklyn. Forest City is developing America's largest urban-infill project on the 4,700-acre site of a former airport in Denver. It's creating a mixed-use development on 55 acres in Kansas City. And it's building a $290 million apartment project in Oakland that will house 2,500 residents in nearly 1,000 apartments, which the company ultimately hopes to expand to 2,000 units.

But as with other firms focusing on urban redevelopment, Forest City has achieved financial success by putting urban taxpayers in a headlock. The company's Brooklyn proposal includes a government-subsidized stadium; its Oakland project, an estimated $61 million in city subsidies.

In its hometown of Cleveland, Forest City spent 14 years attempting to lure the city into a deal by which taxpayers would build a $400 million convention center on Forest City land in exchange for a project that would erect 2,400 homes on vacant land the company owns near downtown. The deal fell through this year after potential costs to taxpayers proved overwhelming. In retaliation, Forest City has indicated it will sit on its fallow land indefinitely.

This is where the Democratic city real estate cartel comes in. If Democratic mayors were to join into such a cartel -- whether formally or otherwise -- America's dense, blue-hued counties could bargain with infill developers from a far better negotiating position.

Since the 1970s, American city fathers have doled out an astonishing number of taxpayer sops to development firms, whether in the form of stadiums, tax breaks, or near-free land, in the apparent belief that such corporate welfare is necessary to lure people back into cities.

This largess is based partly in reality: Building in old cities can be difficult and expensive, thanks to political delays stemming from anti-development battles with neighbors and the costs of removing industrial residues. On the vast stretches of abandoned or underused waterfront land in Cleveland and other northern Ohio cities, for example, "it takes around $200,000 to get the lot going," says Ron Schwachenwald, community relations director for the Building Industry Association of Northern Ohio, when I spoke with him last week.

On the other hand, it costs just $15,000 to prepare and permit an acre of suburban sprawl on rural land in Ohio.

But some cities have overcome the hurdles to urban development without inappropriate subsidies, pointing to similar economic potential nationwide.

Between 1996 and 2001, Vancouver grew its downtown by 155,000 residents, assembling swaths of underused industrial land into a series of large deals with developers of high-rise condominium towers. That population shift represents enough urban-values voters to tip nearly three U.S. elections.

Once land in downtown Vancouver sold out, Canadian high-rise developers descended upon San Diego. And after attempting to lure developers downtown for decades, city leaders struck gold by turning the city's central area into a redevelopment zone. Since 1992, downtown San Diego has grown by 12,500 people, with another 60,000 expected during the next 20 years. Repeat a similar urban population increase in Albuquerque, Denver, and Las Vegas, and you've elected John Kerry three times.

Portland, San Francisco, and Seattle are also undergoing a boom in demand for midtown apartments. This trend could be spread to cities such as Cleveland, which has square miles of available waterfront land but intransigent developers, if big-city mayors were to join together with national Democratic leaders, creating new ways of cooperating to grow America's cities without getting shafted by developers.

Given the vagaries of local, state, and federal law, the extent to which Democratic mayors could horse-trade development rights from one city to the next is unclear. But there's certainly room for better coordination when a single developer can screw over a Democratic city such as Cleveland by holding a potential downtown housing development hostage, yet also cut sweetheart deals with Democrat-controlled cities such as Kansas City, Denver, Oakland, and San Francisco -- without anyone in the national Democratic Party seeming to notice.

Why not launch a new type of top-down urban identity politics, in which Democratic cities as a whole are never taken advantage of by the same developer twice?

Leaders of cities such as San Francisco and Berkeley -- which have long yearned to influence policy nationally -- could make their views known to developers about how it would do wonders for the environment, improve cities, and, coincidentally, boost Democratic chances to redevelop a brownfield in Cleveland. If such a mention occurred in a conversation that also touched on the subject of possibilities for developing large swaths of underused land in eastern San Francisco, or western Berkeley, would that be so wrong?

For this to happen, though, Berkeley -- which voted 90 percent for John Kerry -- might need to abandon the ultra-NIMBY stance that has so far prevented dense, multistory development in its downtown, along University Avenue, on San Pablo Avenue, and in its western, postindustrial bayside. Such national influence would also require removing the local impediments to approving development rights for building high-rise housing in San Francisco's eastern area, along Geary Boulevard, and down the city's other main transit corridors, many of which are now lined by single-story cinder-block buildings of little utility and no architectural significance.

Here's a new arm-twisting role for U.S. Rep. Nancy Pelosi: When career-minded mayors yield to anti-urban-infill neighborhood groups -- as, for instance, Gavin Newsom has yielded -- the national party should punish them politically.

And here's a way for environmental leaders to rise from the dead: When self-styled leftists block the permitting of urban apartment projects -- as Sophie Maxwell and anti-growth progressives have sought to do with legislation up for a Board of Supervisors vote Tuesday, which would prohibit new mixed-use apartment developments in the abandoned and semiabandoned postindustrial space around Potrero Hill -- yank their moral authority with celebrity-studded press conferences, nationwide letter-writing campaigns, and urbanism-themed calendars and postcards.

"To aspire to neutrality is to accept your own death," Werbach said Wednesday, as he urged environmentalists to take left-friendly positions outside their own interest groups. The same could be said for Democratic leaders, environmentalist and otherwise, who must adopt a strong, pragmatic, and unified stance in the struggle to grow America's cities, or risk extinction.

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