Deregulate the Inner City to Bring Businesses and People Back

All of the above factors pose formidable barriers to the redevelopment and revitalization of central cities such as Detroit. Some obstacles to urban development may be beyond the reach of big city policy makers. For example, "brownfield" redevelopment is complicated by the fact that federal environmental legislation creates substantial legal and financial risks for businesses and developers interested in redeveloping these abandoned industrial properties. Since central cities tend to contain more brownfields than do suburbs[87], legislative reform at the federal level will be necessary before serious redevelopment of some cities can occur.[88]

However, many other push factors can be alleviated by local policy, including tax and spending policy, regulation, permitting, and local planning policy. Indianapolis Mayor Stephen Goldsmith notes that the natural advantages of the big city — its diversity, culture, amenities, and architecture — are outweighed by "enormous artificial costs that have been placed on urban economies by bad government policy."[89] Decades of poor policy making have led to "high taxes, crumbling infrastructure, and stifling regulations" that create very real and significant barriers to investment.[90]

Today’s mayors need courage and creativity to overcome these barriers and work for long-term, structural reforms to revitalize their cities. For example, Goldsmith used competitive bidding for more than 70 government services to generate $200 million in savings over ten years, help reduce the city’s budget by 7%, and reduce the non-public safety city workforce by 40%.[91] "Cities must resolve their own structural problems," wrote Goldsmith in response to other mayors who have complained about citizen migration to the suburbs. "Simply enlarging the circle of wealth redistribution through annexation does not do that."[92]

Cities, then, need to carefully assess and restructure their own policies to provide a more investor-, family-, and entrepreneur-friendly business climate. Deregulating central cities and lowering overall taxes can help to mitigate the push factors that contribute to "urban sprawl."