As America’s big “superstar” cities pull away from the rest of the country, the former industrial hubs and rural towns left behind in today’s tech-driven economy are doing whatever they can to compete—and it isn’t always healthy. The contest to host Amazon’s second headquarters epitomized their problem. Desperate for tech cachet and tens of thousands of jobs, cities from Albany to Fresno stepped forward, in many cases by offering subsidies and tax breaks they could barely afford. Even then, Amazon anointed the thriving Washington, D.C., suburbs and (initially) New York City as its winners.
As I and my Brookings Institution colleagues Mark Muro and Bill Galston noted in a recent report, the U.S. economy suffers from a stark geographic divide. America’s largest cities—places such as New York, Seattle, and San Francisco—have accounted for 75 percent of the nation’s employment growth since 2015. Geographic inequality warps our politics. The counties that voted for Donald Trump in 2016 account for barely more than a third of the nation’s GDP.
Past presidents and Congresses weren’t shy about singling out the most troubled communities and directing federal help toward them. During the Great Depression, Franklin D. Roosevelt identified the entire South as “the Nation’s No. 1 economic problem” and created agencies such as the Tennessee Valley Authority and the Rural Electrification Administration to address the needs of its most isolated communities. In the 1960s and ’70s, when central cities were seen as the locus of economic distress, successive administrations tried to arrest the decline of urban centers.