Chatting with Rachel Maddow last night (see below), as Matt Yglesias just pointed out, Obama explained the critical role that national governments play in stimulating urban growth in the developing world and wondered why the United States isn't, in this period of economic decline, taking the hint:
I think we have to rebuild our infrastructure. Look at what China's doing right now. Their trains are faster than us, their ports are better than us. They are preparing for a very competitive 21st-century economy and we're not...if you're gonna run deficit spending, then it better be in rebuilding our roads, our bridges, sewer lines, our water systems, laying broadband lines.
What's China doing that we're not? Oh, just spending 9% of GDP on infrastructure while the U.S. spends 2.4%. Indeed, the Chinese spent $72.5 trillion on infrastructure projects between 1995 and 2005 and will invest $3.8 trillion in road and railroad projects alone over the next three decades.
Obama is onto something here when he argues for investment in transportation, communication, and information infrastructure -- this is what could drive American competitiveness going forward while ensuring economic and social fairness in our cities.
He surely heard the UN's "international alert" about U.S. cities. No, not a terrorist attack, or rising sea levels- instead, startling income inequality. The UN's State of the World's Cities report puts Beijing's Gini coefficient (a key measure of inequality), at 0.22, which is significantly lower than that of major American metros like Atlanta, Miami, and New York (with coefficients greater than 0.5). But it's not just that Beijing is beating us: the international alert line falls at 0.4!
Of course, this doesn't mean that people should pack their bags for Beijing, or for Freetown for that matter (Gini coefficient = 0.32). Poverty levels and standards of living are doubtless higher and lower, respectively, in those cities.
The real take-away from the report is that lower inequality results not from economic performance alone, but from "the regulatory, distributive and redistributive capacity of the national and local welfare states". Redistribution? Welfare? Uh-oh. Don't tell the McCain campaign, whose strategists only have time these days for abstract talk of "fixing crumbling infrastructure" without offering much in the way of specific proposals.
Infrastructure and inequality are clearly linked. Progressive infrastructure investment = progressive investment in cities = a more level economic playing field.
The UN report definitively shows that the main drivers of growth in cities in the developing world are policy decisions made at the national level. This is a global trend that makes our cities look woefully underdeveloped in comparison. Our mayors cannot go it alone, as they have been telling DMI's MayorTV throughout this presidential campaign.
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