September 19th, 2013


Mayor, San Francisco

Regional Vice President, Lennar Urban

Vice President, Brookings Institute

The Great Recession was caused by a “misguided growth model,” according to Bruce Katz, vice president of the Brookings Institution. With an increasing number of people moving to metropolitan areas, American communities are facing a new economic future – without the aid of the federal government.
"I will attest to the fact that the federal government actually has left the building," said Kofi Bonner, president of Lennar’s Bay Area Urban Division.
During a sold-out program at The Commonwealth Club, San Francisco Mayor Ed Lee, urban planner Kofi Bonner and Katz discussed the future of cities. Mayor Lee agreed that local urban problems must be handled without national assistance and said San Francisco is a model city because of its history of innovation.
“We never really let national or regional problems get to us,” Lee said.
In the past, America has focused too heavily on consumption, according to Katz. Because we weren’t building better jobs, the country is now undergoing a “big structural shift in how we think about who runs America,” he said.
On the other hand, communication between urban and metropolitan areas is lacking, making it difficult for different cities to connect.
“There’s very little regional thinking going on,” said Bonner, who previously worked on urban development in the public and private sectors.
Katz, co-author of The Metropolitan Revolution: How Cities and Metros Are Fixing Our Broken Politics and Fragile Economy, said manufacturing plays an important role in sustaining the economy. According to his research, about 17 percent of the economy in Silicon Valley is coming off of manufacturing.
“It’s really critical that the U.S. go back to fundamentals and realize how productive we really are,” Katz said.
Mayor Lee discussed how San Francisco’s tax incentive in the mid-Market area helped companies like Twitter take off.
“Low and behold, today we have 1,892 technology companies in San Francisco,” he said. “We created the right invitation.”
Regarding manufacturing, Mayor Lee said the “SF Made” nonprofit has started a successful movement to create locally made products.
“People from China come over and they ask me, 'What is made in San Francisco?’ because they will buy it,” Lee said. “It's good quality.”
With so many businesses focusing on labor costs, America’s manufacturing industry makes up only 11 percent of the economy, Katz said. In comparison, 70 percent of Germany’s economy is production. It's not just about wages, it's about quality and reliability of your energy supply.
"Technology is going to play a big role in advanced manufacturing and I think it's going to happen right here in San Francisco," Lee responded.
Meanwhile, climate change needs to be treated as an economic imperative, Katz said.
"We need to get beyond labels that mostly come out of Washington, D.C...about what the clean economy is."
Katz spoke about the rebirth of industry in places like the Cleveland metropolis, where STEM jobs have been created for people with high school and associate degrees. He also discussed the “profound” emergence of a shared economy, where we don’t need to own everything – the millennials are sending signals to the markets.
By putting collaboration over conflict, cities will eventually infect the states and the national government, he said.
“America is the most resilient society and the most innovative economy...this time around it will come from the communities.” 
- Danielle Torrent
Photos by: Rikki Ward
Commonwealth Club of California
Sept. 19, 2013