An Interstate Urban/Suburban Park System
The Interstate Highway System was a transformational federal government program proposed by President Eisenhower. It was started in the 1950's and now has a total length of over 46,000 miles, making it both the largest highway system in the world and the largest public works project in history. The Interstate Highways received substantial federal funding (90% federal and 10% state) for their construction and complied with federal standards, developed by the American Association of State Highway and Transportation Officials (AASHTO) and the Federal Highway Administration (FHWA). The highways themselves are owned, built, and operated by the states or toll authorities.
That stimulus was a very successful federal investment. States have ownership and control of the asset, and have managed it for local needs. The System provided incomparable mobility to the masses and enabled GDP to grow steadily in the postwar period. The country was transformed. Suburbs bloomed, factories went from being vertical to horizontal, and commercial areas migrated to interstate interchanges. Some would call the result sprawl, but it did remake the country and provided a substantial increase in the country's transportation productivity.
The initial cost estimate for the system was $25 billion over 12 years; it ended up costing $114 billion (adjusted for inflation, $425 billion in 2006 dollars) and taking 35 years to complete. It is noteworthy that the total cost in 2006 dollars of $425 billion is just about half of the current stimulus program.
So, will the current stimulus plan provide the same level of benefits today as the Interstate Highway System did from 1950's until 1970's? Infrastructure spending in the stimulus totals about $80 billion. Approximately $30 billion will go towards highway and bridge construction and maintenance, $20 billion for school projects, $3 billion for airports, $4.5 billion for public transportation and $ 1 billion for Amtrak. These are big numbers, but hardly transformational. The current stimulus is clearly needed to stabilize the economy. However, nothing will change … no one will get anywhere faster or cheaper. The quality of life will not improve.
In addition to the direct stimulus, the Treasury and the Federal Reserve have committed almost $14 trillion to buy "BAD" paper assets. But, the underlying bad physical assets remain - vacant and dilapidated houses and thousands of empty stores. Both are dragging down neighborhoods, good businesses, and responsible homeowners.
Are there any public works available as transformational as the Interstate Highway System? Maybe it's time for vision like the great landscape architect Frederick Olmsted had 130 years ago. During his career, Olmsted and his firm carried out some 500 commissions. They included 100 public parks and recreation grounds, 200 private estates, 50 residential communities and subdivision and campus design for 40 academic institutions. Olmsted's works were transformational, projects like Central, Prospect, Riverside, and Morningside Parks in New York City, Jackson Park in Chicago, Mount Royal Park in Montreal, the Emerald Necklace in Boston, Stanford University, and the U.S. Capitol grounds. Olmsted's vision was replicated later in the 19th century in other great parks like Rock Creek Park in Washington DC and Golden Gate Park in San Francisco. These projects have clearly improved the quality of life for those that use them and made the surrounding areas more attractive places to live.
At this time in our economy, we need to be forward thinking like Olmsted was. As Wiltold Rybczynski wrote in his biography of Olmsted, "A Clearing in the Distance: Frederick Law Olmsted and America in the Nineteenth Century",
Olmsted was one of the first people to recognize the necessity for planning in a large, industrializing country - whether in peace or war. ... It was the future that concerned him, and he had the rare patience to successfully project his plans years ahead. I think that was one of the things that finally attracted him to landscape architecture. It is a field where a long time - sometimes generations - is required for the full realization of the designer's goal.
So what would Olmsted suggest to help stimulate the economy, make the country better for future Americans, and maybe help solve the problem of 19 million vacant houses and growing excess retail space as Americans increasingly shop on-line? I think he would recommend an Urban/Suburban Park Initiative or, for analogy purposes, an Interstate Park System.
Some of the successful features of the Interstate Highway System can be applied to the park initiative. Funding could be split 90-10, 90% by the Federal Government and 10% of the States. The States would be responsible for the design of the parks under federal standards. And, with a 90% financing incentive, the states would be encouraged to find opportunities to spend as much money as possible as soon as possible. Charitable donations would probably be attracted to help the states' local financing efforts.
Besides making the country a nicer place to live, the park initiative would have a major positive, secondary effect. Capital would be available to buy underutilized retail space and vacant homes. Homeowners wishing to "cash out" of their housing investment would have new buyers for their assets. Excess commercial real estate could find alternative uses. Construction jobs would be re-ignited as demolition work and landscape architecture would turn into growth parts of the economy.
If the federal government allocated $200 billion a year to this program for the next ten years, the changes would be significant. In sunbelt cities like Atlanta, Dallas, Miami which have grown dramatically since the 1960's without substantial regard for public spaces, multi-year land-use plans could be developed, and areas could be identified that could make the cities more livable. New great parks designed and built by local citizens for themselves would blossom around the country.
The stimulus would be transformational. Those empty strip malls of the 20th century could become the Central Parks of the 21st century.
Michael G. Messner
Seminole Capital Partners