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Contrary to modern political assumptions, the dense city, not the quiet office suburb, is the facilitator of market capitalism.
Throughout history, cities have been the creator of wealth, the breeder of genius, and the market for art, technology, and science. In fact, the words "city" and "civilization" have the same root. To socialist reformers like Eugene Debs, the city is what had to be dispersed for a revolution to take hold. Debs said "regeneration will only come with depopulation-when socialism has relieved the congestion and released the people and they spread out over the country and live close to the grass."(1)
Capitalism needs the city as much as the city needs capitalism. The city cannot thrive without capitalism, and capitalism cannot be prevented in a city. Capitalism, trade, and commerce created and shaped cities as dense environments where everything is within reach. Being together allows for an efficient distribution of goods, and services, ready access to labor and capital, and an easy exchange of ideas and knowledge.
The suburb and the congested highway is a manner of development in-between civilized and nomadic life just as today's economy is in-between flee-markets and welfare state. While markets have adapted to the suburban form, it is none-the-less the creation of the government.
The form of the city did not change from urban to suburban because of new products competing in a flee-market; it changed because people, companies, and interest groups used the government and the public interest to favor an industry and subsidize private homes, commercial establishments, and developments.
The highways have been successful and popular because they have introduced technology to the economy, even if it's not the technology which would have prevailed if the market were flee. Unlike urban development subsidies which exert control over every economic aspect contained within a given area, highway subsidies only stimulate and entice developers, and the market, to act in a certain way. But they are no less harmful.
Rather than suffering from a case of out-dated technology and outmoded environments, cities have been the victim of government steering and stabilization efforts pulling at them in any number of directions. It could strangely be argued that the cities that work today have received huge government subsidies to counteract the effect of other huge government subsidies which perhaps restored them to some mirror image of the state they could have been in if the market had provided it's own course for urban growth. In other words, in urban America, highway subsidies created a need for transit subsidies and subsidized suburban investment created a need for urban development grants and programs.
It was an exercise in planning for the future and in harnessing the power of big government to support private enterprise. The method of getting Uncle Sam to finance the infrastructure needed to allow one technology to supplant another was strategic and operated on a number of fronts.
Visitors to the 1939 New York World's Fair(2) were presented with a vision of the future which showed a new city which looked clean, uniform, and organized. Following an era of new government programs that made attempts to organize and regulate the economy, regulating and overseeing the physical shape of the American landscape wasn't that hard to swallow. Journalist Walter Lippman wrote about the General Motors Futurama exhibit at the fair and noted the company had spent a small fortune to convince Americans that if they wanted to enjoy the automobile, they would have to rebuild cities and highways at public expense.
At this point, American cities were at an unprecedented size in world history. Structures like the Empire State Building, Woolworth Building, San Francisco Bay Bridge and the "L" in Chicago represented structures of unequaled magnitude. Reshaping American cities to accommodate the automobile would be no easy or inexpensive task--in fact, the Interstate Highway System would be bigger than the Erie Canal, Panama Canal, Transcontinental Railroad, Hoover Dam, or even the Great Wall in China. It would grow to be the largest and most expensive public works project ever. While auto, rubber, steel, and oil companies were busy painting pretty pictures for Americans of life with the automobile, others were busy putting it together with concrete and thinking of ways to rebuild cities.
"The skyscrapers of New York are too small and there are too many of them," architect LeCorbusier wrote envisioning a city for tomorrow. The city he and other planners had in mind was far from the organic, busy, crowded, and disorganized city that had existed before World War II. The city of the future was to be built of block style glass and granite skyscrapers, spread apart by grassy green backdrops for building monikers, with white concrete highways covered with shiny, tail-finned multi-colored automobiles gliding between buildings on freeways from a home in the suburbs to an underground parking garage.
The grass wasn't for a picnic, a ball-game, or a leisurely stroll. In fact, the new city was pleasantly void of crowds and people. But as we discovered a half-century later, the crowds weren't gone: they were on the highways. And since no one would be on the street to look at the buildings, they had to look different too. The steel and glass buildings of this future city were designed to be attractive from a highway at 50 miles per hour.
In order to create changes of this magnitude, to erase an environment that had grown out of the closest thing to a flee-market economy that had ever existed, resources had to be pulled. General Motors could not rebuild the city alone. The government had to take on the task. As Benjamin Kleinberg noted in his book Urban America in Transformation,(3) the costs are paid for out of government tax revenues, distributing the cost widely by redefining once private responsibilities as public ones. Kleinberg also notes that to Marxists, this era, known as the corporate city, coincides with the monopoly stage of capitalist development. When companies, like individual voters, discover they can vote themselves rich, projects like the highway program inevitably favor an industry able to use the government to gain an advantage over another.
Making of the Mess
Before 1920 most cities in the United States had a transit system and most of the vehicles on the streets were electric streetcars. In 1910, there were only 458,300 automobiles registered in the U.S. By 1920 there were more than sixteen times as many. By the time Congress was discussing a national highway system in the 1940s, there were 27,465,800 automobiles registered.(4)
It is clear there was some market for the automobile. People often felt at the mercy of the street car lines and railroads and felt trapped in the crowded city. The idea of having private transportation accessible to almost anyone was an attractive one. But without a place to park and with everything nearby and few places to go, city residents didn't rush to buy them.
People had private transportation before with the horse and buggy, but without market interference it gave way to the efficient and inexpensive streetcar. Like the horse and buggy, the wide-spread use of the automobile would also remain prohibitively expensive without a massive public investment in roadways, highways, and parking facilities. City residents had no use for the automobile as long as there were street cars and thus the auto-makers' market was limited.
By 1920, the majority of Americans lived in cities. The majority of people in cities used streetcars to get around. Some automakers claimed that the auto market was saturated unless entire cities were reordered and rebuilt to accommodate the car. Eventually this meant bulldozing large sections of the urban landscape for parking garages and highways, but initially it meant buying streetcar lines and replacing them with busses which were also dependent on government-built roadways to operate. The busses served as a transition from a streetcar to an automobile.(10) With the investment in roadways, the number of automobiles more than doubled. By 1970 there were nearly ninety million cars registered.
Of particular interest is the growth rate in the pre-highway building era and in its aftermath. In the period between 1920 and 1945, ten million automobiles were added to the nation's streets. In the period after 1945 up until 1970, at least sixty-five million automobiles were put on the nation's new roadways.
While the popularity of the automobile has played a part in its success, road building initiatives, i.e., the federal government, played an equal or greater role in making it available to the masses, changing development patterns in both urban and rural areas.
David St. Clair wrote …