Cities are back. For the first time in decades, and, for three consecutive years, cities in the United States are growing faster than their surrounding suburbs. The innovation occurring in cities is critical to the ongoing economic recovery. Nonetheless, legacy problems stemming from the historical decline of America’s cities in the second half of the 20th century, coupled with obsolete governance, persist. Cities will likely continue on their new path and prosper in the coming years, but the failure to address the legacy issues as well as the new challenges of affordability in today’s prosperous cities will be costly in the long run for cities, their surrounding suburbs, and the U.S. economy overall.
From the 1960s to the turn of the 21st century, the U.S. urban landscape was plagued by decline, with former city residents moving to surrounding communities and creating new suburbs. Declines in transportation costs stemming from automotive and later telecommunication and internet technology, along with the availability of single-family housing that was accessible and affordable to middle income households (although not lower income households), made suburbs an appealing option for those who could afford it. At the same time, the prospect of declining asset values, racial strife, and social disarray fueled further urban decline. Individuals with higher income were able to move into high amenity suburbs, resulting in the concentration of lower income residents in central cities. Jobs followed people out of the city. Through 2000, two out of three of the largest cities were losing population. The Great Recession reinforced these trends hitting lower income areas of cities hard.