By John Macomber
A student wrote to me offline with the observation I’ve paraphrased below. My email reply follows below that. I’d be interested in thoughts on how to expand an infrastructure finance course from “develop property” into “develop human beings” while continuing to exercise a finance, investment, entrepreneurship, and big business toolkit.
This passionate pain point (sorry about the PPP again ) is a good angle for final essays on the blog (should you be looking for a topic later today).
To me this conversation also underscores the potential learning value of this experimental blog in drawing out points of view or lines of reasoning that didn’t get expressed in class (for any number of reasons). Other recent posts expanding on what was not said in class include but are not limited to:
And the counterpoint “cities = cash flow for services” view is in this comment:
I deeply appreciated a late comment in our class on Masdar and KAEC. The observation came up that in the previous 115 minutes of discussion, we hadn’t focused on the people necessary to populate two of the world’s newest cities. This was spot-on. Perhaps my biggest takeaway from this semester is that when we talk about cities, our gaze is often misdirected. We focus on the hard infrastructure—roads, water pipes, power plants, houses, hospitals, malls, high-rises, etc.—all of which are important components of cities. But cities are literally nothing without people to inhabit them.
I was struck by the difference between KAEC and the Kumbh Mela. To me, KAEC is nothing more than a cautionary tale—how not to construct a “city.” KAEC was all about the infrastructure—big, important, expensive projects, spread over a huge area, that now lie half-completed and empty, with no people and no path forward. The failure to plan for workforce housing epitomizes the hubris of KAEC’s top-down, central planning—the infrastructure and buildings, it seems, were to appear magically, with no people even necessary to construct them.
The Kumbh Mela, on the other hand, is all about the people—100 million people flowing to one spot in a condensed period of time. The infrastructure is barebones at best—roads, bridges, lights, some toilets, some tents. But once the people arrive, a flourishing place arises. People eat, drink, sleep, buy, sell, worship, and celebrate—the people themselves create commerce and culture.
Cities are largely self-generating. This is true even in the world’s richest country in the 21st century. As Joe Nocera noted recently in the New York Times, the recovery of New Orleans’ Ninth Ward is largely happening in spite of, rather than because of, top-down official action. The returning residents are doing it themselves.
Masdar, KAEC, and South Saigon —a rich suburban satellite—are not the answer to the urbanization challenge the world now faces. The millions of people migrating to cities worldwide are not rich, and, the cities where they are settling are not rich either, and often not well-governed. The result, of course, is massive, unorganized slums.
Kumbh Mela, however, may be the solution. The Indian government successfully housed 100 million migrants for $200 million. That is an astounding return on capital. There is no reason Kumbh Mela can’t happen ten times, or a hundred times, the world over. The demand is there—the people are coming. [See my comment post here – John M]. Governments can lay down roads and provide basic utilities—requiring neither great expense nor great expertise—and get out of the way. Once the people arrive, they will erect shelters, raise families, open businesses, and spend and earn money. Land values will increase. A virtuous cycle takes hold. The government can then grant title to the migrants, formalize their businesses, and begin to collect taxes. A portion of the new revenue can fund schools, hospitals, police stations, permanent utilities, and other more expensive infrastructure projects.
Government, big business, small entrepreneurs, and NGOs all have a role to play in urbanization. But ultimately, people—not government, not business—build cities. When we talk about cities, we need to talk about people.
This argument is well taken. I wonder how we could structure that conversation with a beginning, a middle, and end, and some takeaways?
One factor is to consider scope of the material. This course is framed as infrastructure finance course (that’s what the IF is for in SC:UIF), but exercising finance and construction tools alone is no more working on the whole system than the orthopedics course alone addresses the whole body in med school. Ideally the material provides students with a piece of the toolkit, as do FIN and TOM and LCA, then you use the tools as you see fit.
A number of other students also wrote about Kumbh Mela. I was very moved to be at the Mela and that’s why I showed the KM slides (and why I went). Check out Deepa’s post here in which she challenges me and the class with respect to Ho Chi Minh City and the role of government.
Another theme for a post would be to develop what to talk about when we talk about people. What would we cover? As you know my particular focus is on water, transit, and electricity so that people can then make their own opportunities. Many other scholars and investors and agencies emphasize soft infrastructure like schools, hospitals, social safety net, fire department and police, or courts and banking infrastructure. Others emphasize the basic elements of employment and urban development – feeling that jobs will follow. I’m out of my element if we are going to “talk about people” other than on the above indirect criteria. What would the ideal course module be? I’d love to be able to add something that was more than Oprah.
Anyway I think your essay is excellent and I will look forward to seeing if you develop this idea further with respect to PlaNYC (also light on “human beings” in 202 pages) or blog responses.