"It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is the most adaptable to change" - Charles Darwin
Six years ago, Living Cities, a philanthropic collaborative composed of the nation's leading foundations and financial institutions, set out on a new course. Long committed to helping revitalize neighborhoods, the organization's board realized that these strategies alone would not address the nation's growing economic disparities. Systems that we always thought were going to produce more opportunities for the next generation than they did for the last, no longer were doing so. Once-in-a-lifetime developments, such as the internet and globalization, had fundamentally transformed the way people live, work and play. Living Cities began working in new ways so it could nimbly help urban leaders to ride these trends of change and help re-engineer interconnected, but broken systems to ensure that low-income people are prepared for 21st century employment, that cities enable and connect them to opportunity and that opportunities to grow income and reduce income inequality exist.
To pressure test the organization's own strategies and better understand issues facing cities across the globe, the Living Cities board worked with McKinsey & Company to conduct an environmental scan of key trends likely to disproportionately impact U.S. cities, especially the low-income people who live in them. The scan found that municipal fiscal strain, inadequate infrastructure, poor educational outcomes, a skills/job mismatch and a struggling housing market, will be defining urban issues for years to come. And that rapidly changing demographics, transforming the country into a majority - minority nation by 2040, and technology had to be given great weight in any solution built to address these challenges.
We've used these findings to help us ensure that our agenda is adapting to the country's changing conditions. We also thought it was important to share them broadly so everyone committed to America's cities can take advantage of what we've learned. Our newly issued report, State of the City: 5 Trends Impacting US Cities, provides an in-depth look at the scan.
As I read the report again from beginning to end, I was struck by the fact that it not only provides guidance about what issues are trending but also how cities need to act so they can successfully adapt to these trends. With a tip of the hat to Charles Darwin, I thought it would be helpful to highlight the four key ways that cities need to adapt to these powerful trends:
1. Identifying solutions to these complex problems will require the letting go of old ways of working. For example, the report cites the fact that despite many efforts to address racial disparities, only 52 percent of African-American students graduate from high school on time, compared to 76 percent of whites. Clearly, existing strategies aren't on a trajectory to close the gap. Without disrupting the status quo, given population changes, we will have a majority of Americans who fail to meet this key developmental milestone in less than twenty years.
2. Understanding the interdependent nature of these trends is critical to addressing them successfully. The interconnectivity of housing, municipal fiscal health and jobs is a great example. As the report notes, the foreclosure crisis has reduced the value of homes dramatically, putting millions of homeowners underwater (mortgages in excess of the property's value) and reducing municipal property tax revenues dramatically. This not only has exacerbated already strained municipal finances, but has made it even more difficult for cities to commit future revenues too much needed, long-term infrastructure development. Moreover, with people's mortgages underwater, they are unable to move to where the jobs are, further aggravating the jobs/skills mismatch in many places around the country.
3. Recognizing that no institution or sector alone can reverse the direction of these trends is an imperative. Because these issues are so multi-faceted and interdependent, it is simply impossible for any one institution, whether it be public, private or nonprofit, to drive a needle-moving solution. Emerging responses highlighted in the report show how innovative collaborations can make a real difference, regardless of the issue. For example, in many cities, the government is turning to its citizens to identify and co-produce solutions that they historically did only on their own: from pothole identification by thousands of Bostonians via a smartphone app to citizen identification and planting of trees to address storm water runoff in New York. The report also highlights the Strive cradle-to-career partnerships in cities across the country that are driving dramatically better educational outcomes through data-driven partnerships of local government, business, philanthropy and social sector leaders.
4. Taking full advantage of innovations in financing and technology will accelerate change. In almost every focus area, creative financing and uses of technology are part of promising solutions to problems. For example, the increasing use of social impact bonds or pay for success models are helping to get more out of shrinking municipal resources in areas like juvenile and criminal justice. In many jurisdictions, 'blended delivery models' of services combine in-person and online options are showing early, significant results. New York's comprehensive 311 platform, for example, has become the nerve center for a new relationship between government and citizen, enabling residents to efficiently connect with city agencies, receive information, file complaints and resolve issues.
Our State of the City Report confirms once again what Charles Darwin found 130 years ago: strength and intelligence matter but its adaptation that probably matters most. In order for cities, and our nation, to adapt to this changing world, our leaders must find new ways to develop solutions that are grounded in present conditions but with an eye toward the rapidly approaching future.