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Community 2020 Forum on
Jobs and Economic Properity

Monday, June 9, 1997


TRANSCRIPT OF PROCEEDINGS

Speakers:

Vice President Al Gore
Secretary Andrew Cuomo
John Smith, Jr., Chairman and CEO, General Motors
William Julius Wilson, Harvard University
Raymond Smith, Chairman and CEO, Bell Atlantic


Department of Housing and Urban Development
Office of the Assistant Secretary for Public Affairs
451 7th Street, Southwest, Room 10130
Washington, DC 20410-4000


FORUM ON THE ECONOMIC FUTURE OF AMERICAN CITIES

Welcome: Secretary Cuomo

It's my pleasure to welcome Jack Smith, Ray Smith, Professor William Julius Wilson. I want to give a special welcome to our honorary chairman, Vice President Al Gore. And welcome all of you to the Department of Housing and Urban Development and our first Community 2020 Forum, the first seminar about the future of urban America.

I'm told that there are over 700 people here tonight which is a number that has exceeded our wildest dreams. It's really a heartening expression of interest and concern for our nation's cities, so thank you all very, very much for being here.

The purpose of these seminars is to spur analysis and awareness about some of the most pressing issues facing our cities today. There are questions about how well we're educating our children. How are we going to link our cities to our suburbs? What is working in crime reduction and public safety? Where are the real success stories in community empowerment and sustainable development? What will our cities look like in the year 2020? What will their future be like? Those are the kinds of issues that we're going to be exploring in this seminar series over the next twelve months.

Tonight's topic -- and the best place to start this discussion -- is about jobs and economic prosperity. The economy is going great guns, creating over 12 million new jobs. We have the highest home ownership rate in 15 years, the lowest unemployment rate in 23 years, and all with no inflation. The economic tide continues to rise, but the question is this: Is it lifting all boats? How are cities faring in the transition to the new global economy? How are those at the bottom rung on the economic ladder faring? Can they still reach the American dream?

The specific inquiry for tonight's panel is this: What must industry, government, and our communities do to link cities and their residents to the new economy? That's the question posed to the panel. And the real challenge for the panel -- just to show how really talented they are -- is to answer that question on the new economy in 15 minutes or less. On behalf of all the dedicated women and men of HUD, let me say that it's truly our pleasure to host this seminar series.

When President John F. Kennedy first envisioned this department, it was called the Department of Urban Development, D-U-D, which would have been known as DUD; thankfully, the name was changed. But for some of our critics I fear the original name seems more representative. And we're working very, very hard here at HUD to build a new HUD for a new century.

Our first priority is making Government work, fixing the programs, concentrating on management, proving Government a competent means to a worthwhile goal. We must silence the criticism so often levied that, while Government's intent was right, its implementation was wrong; that housing the poor is the right intent, but our public housing is a failure; that the intent to end poverty was right, but welfare was wrong. Our challenge must be to match good intentions with good implementation, to couple compassion with competence, to prove that, yes, we can make a difference.

That's our first goal. But just as important as HUD's competence crusade is the bully pulpit of dialogue and debate. Indeed, it is our founding mission. When President Lyndon Johnson actually proposed the Department of Housing and Urban Development in legislation on March 2, 1965, he said this: "This new department will provide a focal point for thought and innovation and imagination about the problems of our cities." Tonight, the Vice President returns us to that vision.

HUD's watchwords in 1997 will be reinvention and imagination. We want a HUD with a head and a heart. By your presence here tonight, you are proving your commitment to American cities, and we thank you. Yet we all know that words alone are not going to be enough. When we leave here tonight, we must turn those good words into good deeds. We at HUD are looking forward to working with all of you in the days to come to turn our hopes into reality.

It is now my pleasure to introduce tonight's speakers who will be introduced after the Vice President makes his comments.

John Smith, Jr. has been Chief Executive Officer and President of General Motors since 1992 and became Chairman in January of 1996. He is a member of the Board at Electronic Data Systems, Hughes Electronics Corporation, General Motors Acceptance Corporation, and Proctor and Gamble. He is a member of the Board of Directors and Executive Committee of Detroit Renaissance, the Economic Club of Detroit, and a member of the Business Round Table Policy Committee where he chairs its Government Regulation Task Force. He has been awarded many, many degrees, among them honorary doctoral degrees from the University of Massachusetts, Boston University, and Providence College.

Dr. William Julius Wilson is professor of Social Policy at the John F. Kennedy School of Government at Harvard University. He has been elected to the National Academy of Sciences, the American Academy of Arts and Science, and the American Philosophical Society. He is also past President of the American Sociological Association, and is MacArthur Prize fellow. In June 1996, he was selected by Time Magazine as one of America's most influential people. He is author of numerous publications including an outstanding work entitled, The Truly Disadvantaged. His latest book is When Work Disappears, The World of the New Urban Poor.

Ray Smith is Chief Executive Officer of Bell-Atlantic. Ray Smith has fashioned Bell-Atlantic into a leading worldwide telecommunications company. He joined the Bell system in Pennsylvania and, over the years, developed expertise in finance, operations, engineering, and external affairs. He was named Chairman and Chief Executive Officer of Bell-Atlantic in 1989. Mr. Smith is also a founding member of the Corporate Committee for Educational Technology established by President Clinton, and is on the Business Round Table Advisory Board. He also serves on the Board of Directors of Core States Financial Corporation, US Airways, and Westinghouse Electric Corporation.

The Vice President of the United States, who obviously needs no introduction, is the Chair of this seminar series. He is truly the impetus for this series. The Vice President has worked for years on these policies, first as a Congressman, then as a U.S. Senator, and now as head of the President's Community Empowerment Board which grapples with these issues on a day-to-day basis for the entire Federal Government. He's the innovator of the Empowerment Zones program, so he is truly no stranger to the arena.

A few months ago, the Vice President hosted a policy discussion in his home: three sessions exploring the future of urban America. The Vice President knows the reality of urban policy, whether it's opening a Community Development Bank in South Central Los Angeles, a new business center in Baltimore, or an auto parts plant in Detroit. He knows it because he has done it. Not only does the Vice President understand the issues intellectually, but he feels them personally. Apropos of this evening, the Vice President not only talks the talk, but walks the walk. Ladies and gentlemen, it's my pleasure to introduce Vice President Al Gore.

Introductory Remarks: Vice President Gore

It's a wonderful pleasure to be able to kick off this series with Secretary Cuomo and to be on the dais here with these three distinguished speakers whom I'll present to you sequentially in just a moment. Jack Smith, Ray Smith, and Bill Wilson each bring a unique perspective to this first discussion in the seminar series, and we're very grateful to all three for being here.

I want to thank Secretary Andrew Cuomo for his kind words, his friendship, his wonderful leadership of HUD, and his idea of having this series. Both the Secretary and Kerry Kennedy Cuomo were present at the dinner series that Tipper and I had on the future of urban America about the need to develop a metropolitan strategy weaving together our urban and suburban communities. At the two-day Empowerment Zone Conference or Community Empowerment Conference in Detroit several months ago, I presented the results of what we had worked on; I appreciated the Secretary's participation in that conference. I want to thank Bill Wilson for also being an integral part of the dinner series that we had, and thanks to Jack Smith who was with us in Detroit. I've worked with Ray Smith for many years and I look forward to all three of these presentations.

Even without my glasses I can recognize that this is quite a distinguished group. I see Mayor Ron Kirk of Dallas who is here. We're very glad you're here. I'm told that Mayor Donald Plusquellic of Akron is here. Among the many civil and public interest group leaders who are here include Hugh Price, President of the National Urban League; Betty Bean, President of United Way; Tom Jones, President of Habitat for Humanity; Eleanor Josaitis, Director of Focus: Hope; former Senator Charles Percy. This turnout is tremendous.

What you're doing, Secretary Cuomo, with this series of seminars, is adding to the intellectual capital of the team you have here at HUD and the community of concerned citizens all across America who are a part of the effort to come to grips with these issues. These are subjects that Americans are ready to grapple with. Of course, a lot of people here have been grappling with them for a lifetime. But at a time when we have economic progress, it's especially important to focus in on the future of your communities and the future of our cities. Your theme -- Community 2020 -- has just the right focal point, because too often in the past, when we have had periods of economic upturn, the distressed inner city areas and impoverished rural areas have been left behind.

We're determined to take a different approach in the Clinton-Gore administration. That's why we have the Empowerment Zone and Enterprise Community Program. That's why we have the Earned Income Tax Credit. That's why have a focused effort to create jobs for those who are moving from welfare to work. That's why we have the jobs tax credit proposal. That's why we have a whole series of initiatives aimed at not just a collection of individual problems, but also an approach that's aimed at improving the ability of each community to heal itself and to bring solutions to the table right in the community.

There has been a big shift in our way of approaching issues over the last few decades -- it's kind of a philosophical shift. For a long time, we've had too much of an emphasis on single causes and single effects of isolated problems that are approached without reference to the context in which those problems arise. Those who work with troubled children are quite familiar with this shift in thinking. For a long time, there were efforts to deal with troubled children, and there would be a program for drug abuse, a program for child abuse, a program for violence, a program for dropouts, and a program for teen pregnancy. All of those things are very important. But gradually, an awareness grew that a child acting out, to use the terminology, is often reflecting problems in the family. In order to bring that child to a healthier state of being and give that child a better chance to heal himself or herself, a responsible approach is to look at all the things that are going on in that family. To look at the problem holistically, if you will.

In much the same way, in the past there was frequently an approach to problems found in cities that would focus on particular issues, particular problems, and separate programs created for each problem. All those problems are real and the efforts to solve them are greatly needed. But just as in the earlier example, all too frequently what became visible was a manifestation of a much more complicated underlying reality, and efforts to solve it just by focusing on the most prominent symptom didn't work that well.

And so the Clinton-Gore approach that Secretary Cuomo has been so instrumental in pursuing is to look at all of the factors together. The most important issue is this: Where are the jobs? That's why this first of twelve seminars focuses on jobs, because if you have a growing economy with more jobs, you're going to find that some of the other problems are easier to solve.

As we pursue this session this evening let's keep in mind the context, the other factors that have to be addressed at the same time. What is the availability of shelter and housing? What about the poor? What about the environment? What about crime? What about the education system? What about the availability of drugs? What about the availability of guns? What about the availability of positive alternatives for young people in the community so they are not tempted to get into mischief? What about a dozen other factors that the community itself needs to take into account? So each of these sessions is going to have a particular theme, related to these other issues or concerns.

Jobs and economic prosperity is the first topic -- and it's timely, not only for the reason I mentioned, but also because of the news that we have just recently heard: the lowest unemployment rate in 24 years with inflation continuing at historic low levels; consumer confidence at the highest that it has been in 28 years; rising income across the board. We're seeing a closing of the gap between rich and poor. We're seeing rising standards of living and, for many, rising levels of hope.

But that doesn't have much meaning for someone who is unemployed in an inner city and doesn't personally feel connected to that progress or that hope. How can we make sure that that person is not left behind? As we enter the new global economy of the 21st century, there is no better time or more crucial time then now for us to come together. We have been accomplishing some good things together. We're moving forward, not by sitting still, but by embracing the future.

The President and I asked the country to adopt a bold new economic strategy four years ago with three parts, cutting the deficit, establishing a firm foundation of economic policy. That's because we're not on the gold standard, we're on the information standard. Every one of the decisions made by the United States of America instantly reverberates in markets throughout the world. If it looks like we're basing some policy on an illusion then no longer do we have to wait several years before the illusion catches up to us.

When you're on the information standard you've got thousands of people analyzing the future implications of every decision just like that. There are a billion and half dollars floating around the world economy every day, that are going to flow toward those who do well, according to the information standard. And the fact that we've reduced the budget deficit by 77 percent in the last four years, are on the way to a balanced budget, and are doing it in a way that allows us to increase investments in education, health care, the environment, infrastructure, science and technology, and capital for the future -- that impresses the world community. Investment dollars will flow toward the United States. Interest rates will stay down even when economic growth goes up. That has been the first key part of our new policy.

The second has been opening new markets for our products overseas so that we can sell into this rapidly growing world marketplace, so that we have that a so-called level playing field. The simple fact is that tariffs overseas are almost always much higher than the ones we have. When we bring them down to as far as we possibly can, it's better for us than it is for the other side, almost always; it's good for them, too. It's a win-win outcome. We're seeing a rapid increase in our exports because we've had 200 new trade agreements opening up new markets all over the world.

One of the reasons why we shifted the terms of debate over growth and inflation is that, when we have growth and 12.3 million new jobs and rising incomes, there is not as much freedom on the part of businesses to raise prices because there is more competition. The old relationship is not the same. You can have more dynamic and robust growth without the same inflationary pressures that used to accompany it. So that's the second part of our new plan.

The third part of our policy for economic growth is an insistence on investing in our people. That's why we have, in this balanced budget agreement, the biggest increase in education spending in more than a generation. More spending for science and technology, infrastructure, investments in our future, and protecting the environment. This will enable us to continue progress into the future.

It's always why finally we insist upon extra efforts to focus on community empowerment and focus especially on those cities and other communities that need extra attention so that we can bring the resources of the community together. A lot of people have been pointing out that some of the problems of our older inner cities are connected to the growing problems in the suburbs. The fact that property taxes go up in farm areas is partly because we subsidize with tax dollars the replication of expensive infrastructure out in what use to be corn fields. That hurts the farming areas. At the same time it drains critical mass away from the core of our cities. The centrifugal forces that are subsidized in this way also spread problems that used to be associated with inner cities out into the suburbs. When we focus more on the coherent center of the cities, that's good, not only for the cities but also for the suburbs, and also for the surrounding farm land. But in order to focus, we have to approach the problem in its wholeness and complexity.

Keep in mind the need for bringing the crime rate down, and that's why we've put a lot of the savings into the 100,000 new police officers on the streets. That's one of the main reasons why we just had the largest one year drop in crime rates in 35 years. That's why we've seen a drop in crime rates across the board all over the United States of America. We've got to complete the 100,000 extra police officers, and we've got to focus on the other problems that make up this overall community wide approach.

It's also why the President's new national dialogue on race and ethnicity is so critical. Until we do a better job of coming to grips with the divisive power of race and ethnicity in America, we are not going to get the kind of solutions we need for cities and communities. The good news is that we can do it. With the kind of leadership President Clinton is providing we will do it.

Now, one other thing before I introduce tonight's speakers. I'd like to pay tribute to one man whose entire life embodied this vision I have just described: Father William Cunningham. Father Cunningham who passed away two weeks ago worked for decades to heal divisions in Detroit and to create tangible opportunity; he never gave up hope. The path-breaking group that he started, called Focus Hope, became a national model providing practical, high-tech training and jobs for thousands of disadvantaged youths. Tonight, we're joined in the audience by the woman who is carrying on the work of Father Cunningham, carrying that torch, Eleanor Josaitis, the Executive Director of Focus Hope. Thank you so much for what you're doing.

Now to the main event. The first speaker is Jack Smith. As you all are well aware, Jack is the CEO and President of General Motors. He will speak about the automobile industry which he has helped to revolutionize. Jack will talk about the role of the automobile industry and the economy in the Detroit region and what he has learned from his experience about the role of jobs and economic prosperity in communities in America. He is also one of the many, by the way, who has worked closely with Focus Hope.

We will then hear from Professor William Julius Wilson, the acclaimed Harvard sociologist and urban scholar whose books include When Work Disappears, and The Truly Disadvantaged. He will discuss his work and his ideas for connecting inner-city residents to the regional economy and perhaps focus a little bit on that metropolitan strategy that I referred to a moment ago.

Finally, we will hear from Ray Smith, the CEO of Bell Atlantic. Since assuming his position in 1989, Ray Smith has turned Bell-Atlantic into a leading worldwide telecommunications company and has also played a leading role in promoting education technology efforts in the classroom.

Jack Smith, Chairman and CEO
General Motors

Thank you, Mr. Vice President, Mr. Secretary. It's a pleasure to be here. Most of you would agree that there is a rising economic tide in the nation and in the world right now. If we're going to make serious progress towards reviving our cities, now is the time to push. This is our window of opportunity, and this is what I'd like to discuss with you this evening.

I would like to begin by looking at what some call the smokestack industries of the Midwest, the rust belt. It is a comeback story with lessons for our cities. As you recall, back in the 1980s the economy of the Midwest was going through some very difficult times. Night after night, we saw network correspondents solemnly standing in front of padlocked factory gates. How could jobs ever return when labor overseas was so cheap? How could America ever compete with Japan's lean production and advanced manufacturing techniques?

But the predicted demise of manufacturing in the Midwest never occurred. The Great Lakes region remains the most manufacturing-intensive in the country. For the last three years the unemployment rate in the region has been below the national average. Our growth rate is above the national average. The Michigan Jobs Commission and the Michigan Employment Security Agency are even taking out newspaper ads in other states to attract skilled workers. All of this is not simply due to an upswing in the business cycle; something basic was transformed.

What happened is that the manufacturing companies of the mid-West underwent a near death experience, and they came out changed. The Federal Reserve Bank of Chicago held a series of workshops recently to analyze the recovery of the mid-West economy. The automotive companies, of course, played a major role in the region's recovery. But more generally, guess what the economists believe has been the most important element in the mid-West revival? Increased productivity in the factories. It's ironic that we became strongest in our weakest place.

In addition to productivity improvements, a couple of other major developments gave the domestic auto industry momentum during the turnaround in the early 1990's. The customer began to realize and see the progress we were making in closing the quality gap with foreign competitors, a very important effort by the domestic industry. And the market itself changed, more heavily weighted towards trucks than to cars. This was a big benefit to domestic auto makers because the foreign importers do not play very heavily in the truck market. Taking these together, these were the primary factors where the impetus occurred for the automotive industry to change.

What I'm leading up to is that our cities are like the old smoke stack industry in this way. They can continue to wither and weaken, or they can change. As the Vice President can attest after his recent visit, after many years, we in Detroit are regaining a sense of hope for our city. We have felt a growing momentum, even before the Red Wings won the Stanley Cup. Detroit's brick and mortar programs are coming along nicely. We have plans for new stadiums and many renovations. GM has big plans for its new global headquarters at the Renaissance Center that we believe will open up the downtown.

The Detroit News recently ran a headline that said, GM's plan for Rennnaisance Center could transform the city. And I believe that collectively we can give Detroit a revived, energetic downtown with a focus and a center. This is not a singular effort, of course. All of these plans for Detroit are part of a larger integrated plan. A lot of people are involved, in particular, Mayor Archer, who is a true leader with a vision for the city.

I'm proud to say that Detroit's Federal Empowerment Zone is the most successful one in the nation. It has generated 2,750 new jobs in about two years. Twenty-nine companies have announced plans to invest over 3.8 billion dollars in the Empowerment Zone. And in terms of lending commitments, 50 percent of the ten- year goal has been attained in the first two years. I'm also proud to say that the real force behind the Zone success has been the big three auto makers and their suppliers.

In the case of General Motors, we decided in 1994 to redevelop the former Cadillac Clark Street plant. We sold one of the buildings to the Piston Packaging which was created by Piston basketball stars, Bill Laimbeer and Vinnie Johnson. They currently employ about 200 people, many of those were from the welfare rolls. Other buildings on the site were sold to Ford GM suppliers. The result is what's known as the Hispanic manufacturing center, which is expected to generate 700 jobs over the next few years. General Motors has also signed a billion dollars worth of minority supplier contracts in the Empowerment Zone.

In addition we're building the Clark Street Technology Park which is situated on 53 nearby acres and will consist of approximately 12 new buildings. More than 50 companies are actively vying to be included in the park, where our goal is to maximize skilled job creation. We expect that over 1,000 jobs will be created there.

The ultimate key to revitalizing Detroit's inner city is the jobs that the big three and the suppliers can provide. With a tight labor market, we will be able to make even more progress because there continues to be a surplus of unskilled labor in the city. The unemployment rate in the surrounding counties is now down to three percent. This April the rate was 7.8 percent in the city itself, down from 17.9 percent in April of 1991. And for the first time in a quarter of a century Michigan's welfare case load fell below 150,000.

But business alone cannot solve our city's problems. Bringing true economic health back to our cities will not happen without some new thinking on the part of all of us, including the cities themselves. John Pepper of the Detroit News wrote an excellent article recently in which he outlined some of the problems in the city and the prescriptions needed for Detroit's renaissance. The descriptions he outlined apply to almost any major city. I've used some of his categories and a few of his facts and put my own spin on this.

Let me give you a quick rundown of the kinds of things that cities should be considering, like benchmarking. Businesses benchmark all the time. At General Motors we measure ourselves against the best of global competition in our industry, and in other industries. We measure such work efforts as quality, safety, product development cycle times, cost, and customer satisfaction. Our aim is to know how the best do it and to adopt it in our company. Cities need to do the same thing; some do, but many don't seem to care.

A second category is competitive contracting of city services and civil service reform. Cities have a fiduciary responsibility to the local taxpayers to be efficient and to be responsive. In countless cities across the nation, this fiduciary duty is not being upheld. Sometimes the most competitive bid is from a private firm. That scares some people, but the customer is the taxpayer. Clearly, areas like tax collection, transportation, road repairs, and lighting need to be looked at from a competitive position, especially at a time when resources are so tight. Every inefficiency, every wasted dollar, is a dollar that cannot go to those children whose future are most at risk and whose futures should be our absolute first priority.

Reduce regulation and taxes. There is a clear disincentive to do business in many cities: the paperwork, the bureaucracy, the high taxes, the manual systems, or obsolete computer systems, or in some cases no systems at all. We often joke about these things or roll our eyes, but they are serious barriers to the healthy growth of our cities. It is often simply the cities' old encrusted ways of operating versus the suburbs� newer systems that haven't been around very long and haven't had a chance to become encrusted. Imagine for a moment if cities were easier to do business with than the suburbs. Imagine how that that one thing alone would change the dynamics and prospects of cities.

We need an expedited process for assembling land. Ziona Austrian and Thomas Byer of Cleveland State University's Urban Center make this argument, with which I totally agree: "Cities must recycle the land they have or face inevitable decline." The property tax base is bound to decline if depreciated structures are not replaced by new structures, but cities have no green field land left. So to promote growth, policy makers need to focus on reclaiming brown fields, which is often tied up in an environmental, financial, legal, and political tangle. Mr. Vice President, the Federal Government could help here tremendously by establishing clear liability standards for both lenders and property owners.

In Detroit, another problem we have is that there are not enough large contiguous parcels owned by the cities. I believe there needs to be a new partnership between Government and the private sector for acquisition and remediation of contaminated land in our cities. Clearly the delay in putting large parcels of land for industrial and technology parks is hurting the cities and competing against the suburbs.

Next, educational reform. I don't want to plow old ground, so just let me say this. In a pure business sense, the inner city is a terrible waste of human capital. This country needs that human capital because we are already facing acute shortages in the skills area. Because of this demand for skilled labor and because of general unhappiness with the educational system, I am convinced that in 10 to 15 years public education in this country will look radically different from what it does today. Competition and choice produce a better product, even in education, and such ideas are gaining strength.

General Motors is quite active in the school-to-work movement, which is in the process of creating the American equivalent of the German apprenticeship system. We have created an automotive service training program. The program is in its early stages and it involves a number of the auto makers, 31 vocational schools, 247 dealers in 11 states, all working together to get young people trained for the future.

We are preparing these young people for good jobs. The country puts really perhaps too much emphasis on college. There are great jobs out there for people with technical skills. This program is working in the auto industry, but the scope could be greatly expanded to other industries and services. Not a lot of money is involved, but it needs leadership from the Federal and State governments as well as the business community. There is a shortage of people with this kind of training. What if our cities could become the centers for this training excellence? Think what a draw this would be.

The final area I would like to cover is housing and retail activity, I will use Detroit as an example. New housing is a serious problem in Detroit. Only 86 permits for new residence construction were issued last year and that is up from previous years since there were a few single family permits issued in many of the past 20 years. Last year there were 8,432 housing demolitions. There is also no real retail activity of any size to speak of in Detroit. In fact Detroit ranks last among the 80 largest metropolitan areas in retail shopping. The continued decline in housing makes a retail comeback very difficult.

Housing is an area where the Federal Government could play a major role with an innovative homeownership program for low-income families in the inner city. I know there are a few small programs that are operating in this area, but when you consider the size of the problem that I have just described, it requires a major effort.

There is so much to be done and there is no reason why we cannot take big gulps of progress if cities accept the fact that the rules have changed. General Motors learned the lesson the hard way; things cannot be done as they have always been done in the past. Cities have to remove the barriers to urban economic health that they themselves have sometimes put up over the years. I know a lot of it comes down to city politics, but the traditional concepts of turf and power are meaningless in the new world in which we live. The question is whether the old power structures of our cities will adapt to the new realities of the modern age. Political power cannot exempt cities from change any more than General Motors could exempt itself from changes in the marketplace. I am hopeful that the enlightened desired for economic well-being will overcome the old ways of thinking.

In closing, ladies and gentlemen, let me just say that things can change for the better. History has cycles. The state of our cities is not permanent. There is no reason our cities cannot overcome their problems. There is no reason our cities cannot be healthy, vibrant places once again. There remains tremendous energy in our cities and now it's time to unleash it. Thank you very much.

Professor William Julius Wilson

Thank you very much, Mr. Vice President, Mr. Secretary, ladies and gentlemen. I appreciate having the opportunity to talk to you today about work, the state of work in the inner city, and connecting the inner city worker to regional job prosperity.

In my new book, When Work Disappears, I pointed out that in 1950 a substantial portion of the urban black population was poor but they were working. Urban poverty was quite extensive, but people held jobs. However, I noted that in many inner city neighborhoods -- inner city ghetto neighborhoods -- most adults are not working in a typical week. The disappearance of work has adversely affected, not only individuals and families, but the social life of neighborhoods as well. Inner city joblessness is a severe problem that is often overlooked or obscured when the focus is mainly on poverty and its consequences. Despite increases in the concentration of poverty since 1970, inner cities have always featured high levels of poverty. But the current levels of inner city joblessness are unprecedented.

Now it should be noted that when I speak of joblessness I am not solely referring to a official unemployment. The unemployment rate represents only the percentages of workers in the official labor force. That is those who are actively looking for work, it does not include those who are outside of or have dropped out of the labor market including the nearly six million males 25 to 60 who appear in the census statistics but are not recorded in the labor market statistics. These uncounted males in the labor market are disproportionately represented in the inner city ghettos.

Accordingly, in my book, When Work Disappears, I use a more appropriate measurement of joblessness. It takes into account both official unemployment and non-labor force participation, and that measure is an employment-to-population ratio which corresponds with the percentage of adults 16 and over who are working. Using the employment to population ratio, we find, for example, that in 1990 only one in three adults 16 and older held a job in the ghetto poverty areas of Chicago, areas with poverty rates of at least 40 percent. That represents 425,000 men, women, and children. In the ghetto areas of the nation�s 100 largest cities, for every 10 adults who did not hold a job in a typical week in 1990, there were only six employed persons.

The consequences of high neighborhood joblessness are more devastating than those of high neighborhood poverty. A neighborhood in which people are poor but employed is much different from a neighborhood in which people are poor and jobless. I would argue that many of today's problems in the inner city ghettos -- crime, family disillusion, welfare, low-levels of social organization, and so on -- are fundamentally a consequence of the disappearance of work.

What accounts for the growing proportion of jobless adults in inner city communities, the disappearance of work in many inner city neighborhoods, is in part related to the nationwide decline in the fortunes of low skilled workers. Over the past two decades, wage inequality has increased sharply, and gaps in labor market outcomes between the less and more skilled workers have risen substantially. As Harvard economist Michael Katz has pointed out, these changes are the result of "a substantial decline in the relative demand for less educated and those doing more routinized tasks compared to the relative supply of such workers."

Two factors appear to have shifted the relative demand against the less skilled workers: the computer revolution-- skill-based technological change -- and the growing internationalization of economic activity. Inner city workers face an additional problem -- the growing suburbanization of jobs. Most ghetto residents cannot afford an automobile and therefore have to rely on public transit systems that make the connection between inner city neighborhoods and suburban job locations difficult and time consuming. As the relative importance of the different underlying causes in the growing jobs problem of the less skilled, including those in the inner city, continue to be debated, there is little disagreement about the underlying trends. They are unlikely to reverse themselves.

In short, over a sustained period the labor market has twisted against disadvantaged workers, those with limited skills or education and from poor families and neighborhoods, therefore greatly diminishing their actual or potential earnings. Indeed, with the transition from manufacturing to services, cognitive and interpersonal skills have become prerequisites even for many low paying jobs.

Surveying 3,000 employers in Atlanta, Boston, and Los Angeles, the economist Harry Holzer of Michigan State University found that only five to ten percent of the jobs in central city areas for workers who are non-college graduates require very few work credentials or cognitive skills. This means that most inner city workers today not only need to have the basic skills of reading, writing, and performing arithmetic calculations, but need to know how to operate a computer as well. Also, Holzer found that most employers require a high school degree, particular kinds of previous work experience and job references. Because of the large oversupply of low skilled workers relative to the number of low skilled jobs, many low educated and poorly trained individuals have difficulty finding jobs even when the labor market is strong.

The problem is that in recent years tight labor markets have been of relatively short duration, frequently followed by a recession which either wiped out previous gains for many workers or did not allow others to fully recover from a previous period of economic stagnation. It would take sustained tight labor markets over many years to draw back those discouraged inner city workers who have dropped out of the labor market altogether, some for very long periods of time.

We are currently in one of the longest economic recoveries in the last half century, a recovery that has last more than six years. And as you point out, Mr. Vice President, that is beginning to have some positive effect on the hard core unemployed. The ranks of those out of work for more than six months declined by almost 150,000 during a two month period in early 1997. How long this current period of economic recovery will last is anybody's guess. We can only hope that it continues. A prolonged strong economy is powerful medicine for the low skilled.

However, increasing the skills of inner city workers is not the only problem. Many central city job applicants are physically isolated from places of employment, socially isolated from the informal job networks that have become a major source of job placement. Unlike previous years, labor markets today are mainly regional; a disproportionate number of metropolitan jobs are in the suburbs. Many inner city residents lack information or knowledge about suburban job opportunities and/or have difficulty commuting to them. In the segregated inner city ghettos, that breakdown of the informal job information network aggravates the problems of job-spatial mismatch.

In neighborhoods in which a substantial number of adults are working, people are more likely to learn about job openings or to be recommended for jobs by working kin, relatives, friends, and acquaintances. Job referrals from current employees are important in the American labor market. Individuals in jobless ghettos are less likely to gain employment through this process.

Our research in Chicago revealed that even employers from the inner city neighborhoods rely very heavily on the informal job networks and are hence unlikely to place ads in local newspapers or recruit from schools. For example, one inner city hospital decided against the use of newspaper ads and recruited workers from community jobs programs and through informal employee networks. As a representative from the hospital put it, "If you are just a cold applicant, chances of you getting in are almost nil."

It is ironic that inequality in the labor market is growing at the same time that new constraints on the use of Federal resources to address social inequities have emerged. Pressures on tax and spending decisions will increase over the next 20 to 30 years as the baby boomers retire and spending on programs such as Medicare and Social Security increase. Programs that serve the poor could face even sharper cuts and elimination. Many states have already implemented programs to terminate welfare benefits even sooner than the five year Federal mandate to end assistance. Public housing and food stamp programs have been cut. With eroding public support for the poor, pressures on the bottom of the labor market will grow. The working poor will compete with millions of new labor market entrants for available jobs.

As Federal support for the poor declines, calls for local solutions to local problems have mushroomed across the country. Indeed, the political right, center, and left all share a paradigm that emphasizes local community involvement including business involvement and programs for urban regeneration. Many local community efforts across the country focus heavily on workforce development which ranges from job readiness to skill development programs.

One of the main purposes of job readiness programs is to make persons who have been persistently unemployed or out of the labor force "job ready" -- in other words, to enhance their "soft skills" (personalities now suitable to the work environment, good grooming, group-oriented work behavior, and so on) so that a prospective employer can be assured that a worker understands and appreciates the norms of the workplace, including employer expectations such as showing up for work on time and on a regular basis, accepting the orders of supervisors, and so on. When the program is satisfied that a worker is job ready, then and only then would the worker be referred to an employer who has a job vacancy.

Skill development programs, on the other hand, are designed to enhance "hard skills", including numeracy, literacy, basic mechanical ability, and other testable attributes. While hard skills are the products of education and training, soft skills are strongly tied to culture and are therefore shaped by the social environment, including the harsh environment of the inner city ghetto.

As suggested in a recent internal report by Public/Private Ventures, a non-profit research organization, strong community workforce development programs do exist. Unfortunately, as the report points out, "effective strategies and practices remain largely unknown outside a small circle of academic foundation staff and practitioners. In addition, because staff in these organizations are focused on their own programs, they do not have the capacity to pass their experiences on to others in anything but episodic fashion." We need to identify these programs, understand why they are effective, widely disseminate information that documents and explains their success, and address the question of how to make their achievements the rule rather than the exception.

Workforce development is not the only major local community initiative. In a regional economy, some localities are attempting to address the mismatch between residents and location of jobs. This is a special problem for some workers in America. Unlike in Europe, the public transit system is weak and expensive. For example, inner city blacks have little access to private automobiles and, unlike Mexicans, do not have a network system that supports organized car pools. Accordingly, they depend heavily on public transportation and therefore have difficulty getting to the suburbs where jobs are more plentiful and employment growth is greater. Until the public transit systems are improved in metropolitan areas, the creation of for-profit or not-for-profit carpool and vanpool networks to carry inner city residents to regional areas of employment, particularly suburban areas, would be a relatively inexpensive way of increasing work opportunities.

I have in mind a program such as the Housing and Urban Development-funded Bridges To Work Initiative. Public/Private Ventures is conducting a four year research demonstration in five cities -- Chicago, Milwaukee, Baltimore, Denver, and St. Louis -- to test a transportation strategy that links work ready poor inner city residents to job opportunities outside central cities.

This demonstration is called Bridges To Work. The program includes transportation, public and private or regional alliances of employment service providers to connect trained workers with available suburban jobs. It also includes special support services provided by community agencies. The Bridges to Work demonstration is based on calculated efforts to identify and implement best practices from local initiatives. Again, the results from this demonstration should be widely circulated and discussed.

Let me end by reminding us that the level of unemployment at a given time is partly determined by national policy. Monetary policies that lower inflation but result in higher levels of unemployment ultimately undermine local initiatives to enhance employment opportunities. When that occurs, program models based on proven efforts to strengthen the match between jobless individuals and job vacancies through programs of workforce development and those that connect the inner city poor to regional prosperity become essential.

Raymond Smith, Chairman and CEO
Bell Atlantic

Thank you, Mr. Vice President, Secretary. I'm pleased to have this opportunity. I run what is the largest local telephone company in the country, so I have a vested interest in the health of urban economies. Bell Atlantic employs thousands of people in metropolitan areas like Boston, New York City, Philadelphia, Richmond, Baltimore, and Washington DC, just to name a few. Our future, that is Bell Atlantic's future, is tied to the viability of the regional economy and to the availability of a literate, technically proficient workforce. We will not succeed unless that workforce is developed in these cities.

America in the year 2020 is going to be a very different society, as Bill Wilson just said. It's going to be a society transformed by the passage of information. It will be an information economy, and if we do our jobs right today, in just these next few years cities and their residents will have access to extraordinary job- and wealth-creating opportunities.

The good news for urban America is that the same technologies that are transforming the economy and making us so much more efficient, as compared to the rest of the world, can also make economic opportunity available to everyone, everywhere, irrespective of geography or race or social divisions. This will only happen if we take steps to see that inner city residents not only have the access to the technologies of the future, but also the skills and the education to take advantage of those.

With the advancement of fiber optic cables and digital communications, the economy now operates at the speed of light. Geography, size, natural resources have been eclipsed by innovation and speed, intelligence, swiftness to market. As key competitive advantages, these are the things that are going to make communities and companies and individuals successful. And the market for people who can move those 1's and 0s' isn't just local anymore, though -- it's worldwide.

Information technology fundamentally challenges, at the same time as it empowers. It challenges the historic advantage that cities have had and enjoyed as the physical center of commerce. In order to continue to attract investment in cities, we've got to reverse the job loss that Professor Wilson described, so that can compete on a worldwide basis for the jobs that will be becoming available.

The only thing that matter in an investment economy and information economy are three things: talent, expertise, and brain power. It doesn't matter where you are or where you work, value-added work is the key competitive advantage in the information economy. It derives in part from the intellectual assets that are centered in metropolitan areas. A stupendous advantage for the urban core are the universities, medical centers, cultural institutions, and businesses that are there and still dedicated to staying there. However, it also grows from adding value to the products of more traditional service and manufacturing businesses, whether the specialties are chemicals or information services or customized retailing or targeted marketing of services. These are the kinds of businesses that are going to grow in the urban area if we do our job.

In the year 2020 every business will be part of the knowledge industry. This means that all jobs, from the most sophisticated software development to entry level service jobs, will depend on the manipulation and transport of information. Intellectual capital and the ability to export it will be the prescription of jobs and prosperity in the future of the American city.

The question before us today then is this: What must industry and government and communities do to make this happen? The solution begins with investment, investment in a modern communications infrastructure that is so important in the inner cities. It will be the magnet for jobs in the 21st century. Vice President Gore has been instrumental in seeing that incentives are provided to build a national information infrastructure that will be the basis, when it's built, for a new telecommunication policy for the next century.

In my company alone, Bell Atlantic, we will spend six billion dollars next year creating a high speed broadband network with millions and millions of miles of fiber optic cable; it will be the most modern in the world. High speed two-way fiber optic networks are the deep water ports and the railroad exchanges of the 21st century. They will help cities attract and retain information the information industries that are at the center of today's economy and will be in the 21st century. They leverage the cultural and intellectual resources that, if we're successful, will be centered in urban areas. And they provide skilled workers everywhere with a way to market and export their expertise.

So the first requirement, at least from my point of view, for a healthy urban economy is a regulatory and government structure that provides incentives for companies like ours to invest in that information infrastructure. The second solution is insuring that access to these technologies is spread equitably across the population. Long term competition is the best way to insure that information technologies are widely disseminated and affordable to all.

All new technologies -- TVs, VCRs, cable television and even telephones -- began as high-end luxury items which spread to the mass market as competition and technical innovation drove down prices. The same thing can happen in this broadband revolution if we let market forces drive down the cost of technology and provide the appropriate incentives for investment. In the long run, competition and open markts are the best way to bridge the gap between the information haves and have nots.

But in the short run, we need a combination of targeted subsidies and creative public/private partnerships to speed delivery of the information superhighway to disadvantaged citizens. If not, they will be the people who are left out. If we can't get it to every home then we've got to get it to every institution, to every school, to every library, to every community center. Every single opportunity we have to reach inner city residents must be taken.

This policy objective has been explicitly stated by the Congress in the Telecom Act of 1996. The FCC in its formulation of what's called the Universal Service Fund stated that subsidies to schools and libraries in low income areas is a top priority. My company, Bell Atlantic, supports these policy initiatives even though we are paying for them. We would like it the other way, but we think that they are great and that this will be a good first step. They are just the start.

Let me give you just a little bit of texture about what else is required other than that first important start. What I'll do is talk about some things that are going on in my company, and I'll give you a little perspective of what I think they're worth. Bell Atlantic has participated from the very first in something called Net Day, where we wire inner city schools. Thousands of volunteers went out and we wired the schools. That was a good effort, but a wired school is not a wired classroom, so, again, it's just a start.

We've invested more than $50 million in the last two years in educational partnerships and investments. That's a great contribution, but it's a drop in the bucket compared to what is needed even in the cities that we serve.

We've worked with the Free Library of Philadelphia to transform every one its 53 branches into a cyberspace community center. It's an astonishing transformation if you have an opportunity to see it. It's in only one community, but it's a beginning. We're also building distance learning networks in several states that will connect every public high school, community college, and public university with a fiber optic video conferencing network. That's a great tool and it will help, but it's only step one.

And as I will discuss in just a second, we've helped create a revolution in places like Baltimore and Union City, New Jersey. We've transformed the relationship between technology and improvements in basic education, including teacher training and curriculum design and holistic approaches to integrating technology into the classroom. This is an innovative and dedicated approach with marvelous results, but it's a bump on the log when it comes to the needs of the total solution.

Yet even with these first hesitant steps, and admitting and recognizing that there is a great deal to be done, America in these public/private partnerships has made a good deal of progress. In the last two years, the number of schools with access to the Internet has risen 30 percent; 65 percent of the public schools will have access by the end of this year; and I know that the Vice President and a number of people in this room are determined to get all schools, 100 percent of them, connected by the year 2000.

Despite the fact that we feel that what we've done is inadequate today, and we have a lot more to do, let�s assume that we can figure out a way to get the rest of it done -- the classrooms connected, the kids connected at home, the hardware and budgets taken care of. Then the real question is this: How do we make sure that all those connections and all that hardware will be used efficiently and effectively to provide economic opportunity for the kids who need it? How can we make sure that we prepare our students with the skills that they will need, not just to be minimally educated, not just to be able to read and write and to be "literate", but to be the knowledge workers of the 21st century?

As we've seen at Bell Atlantic, and as Professor Wilson just pointed out, the technical content of even entry level jobs is rising exponentially. We are in competition with information industries of all sorts for skilled, literate, knowledge workers. The distinction between those prepared to do this kind of knowledge work and those who are not will become worse, not better, as we approach the 21st century unless action is taken very quickly.

I believe that information technology used intelligently can help American cities improve the quality of education and create those knowledge workers. Over the last few years I've been a part of a number of groups designed to study the issue: President Clinton's Advisory Council on the National Information Infrastructure, the Corporate Commission on Education Technology, the new CEO Private Sector Forum, all of which were designed to study and figure out what are the best ways were to improve the knowledge worker group in the 21st century. We've examined hundreds of programs throughout the country to figure out what works, what doesn't, what we can afford, what we can't, and what will happen when we integrate technology and education.

We have found that the most successful programs reinforce the fundamentals of a sound educational culture, parental involvement, teacher training, community based solutions, and high standards of achievement.

I'll give you one example which is maybe the example that's dearest to my heart. We've been working with one inner city school now for six years, going into our seventh year in Union City, New Jersey. This is a school where the kids have been told for years that they can't and they can't write and they can't learn. And for years these kids lived down to those expectations. The dropout rates were terrible, the test scores were abysmal and the aspirations were low. Not one of the kids in the groups we're going to talk about said, "I will go beyond high school." We decided to see what these kids would do when we gave them the resources that already existed, the solutions that were already out there.

What we did, with others, was wire the schools and classrooms, and we provided Internet access to the kids. We conducted teacher workshops, trained the parents, and watched them reform the curriculum. We gave the parents e-mail so that they could talk to their kids� teachers.

The results have been astonishing. Self-esteem has soared, test scores have risen, the kids who never wrote more than a paragraph in their entire lives were writers and publishers and researchers and learners. The average number of sentences they wrote per week started out at one-half of a sentence. Afterwards, they were writing hundreds and hundreds a week. Some of them we don't want to read aloud necessarily, but they are sentences and they are in standard English.

Students who were prey to destructive peer pressures not to learn, not even to look like you're learning, not even to look like you're interested in learning, found the ability to talk to the most patient tutor on the other side of the screen, that dark intelligence that didn't make fun of them when they learned how to do things. In that period of time, despair gave way to hope, and the school that was on life support came back on its feet. The school has gone from turning out future dropouts to producing skilled, literate citizens that any company would be proud to employ. Virtually every one of the students has now decided that he or she is going beyond high school.

We're involved in other programs in Baltimore and other places that are very similar to this. It seems very clear that these projects show that, with the right training and the support system, networked computers can be a very powerful anecdote to the anti-academic, anti-achievement climate that plagues impoverished neighborhoods. That alone may be technology�s biggest contribution to the future of the American city.

To sum up, information technologies have fundamentally changed the rules of the game for urban economies -- these are the facts. As we think about the future it does no good to bewail the forces of globalization and decentralization and capital mobility that are challenging the historical dominance of cities in economic life. Rather, it is much more useful to harness the power of technology to ensure that the city isn't left in the dust as we approach the 21st century.

And that means providing incentives for investment in a modern communications infrastructure, promoting open markets and competition to reduce prices, and accelerating the speed and spread of the technologies. It involves investing in communities, in skills and ideas and innovation, and promoting public/private partnerships as seeds to get things going. It requires using technologically intelligent, non-bureaucratic methods to upgrade the quality of education, strengthen inner city communities, and create a skilled, knowledgeable workforce.

If we are really truly responsible and somehow found the will, in 1998, to equip all 4.4 million third graders and then one grade every year after with technology and training, we could reverse the drift that has taken us where we are today. I am convinced, personally, of course, that information technologies can be used in this way to heal and not widen the schisms in our society. Societies can continue to be the nexus of innovation, and expertise, and ideas, and communications. Those are the most precious commodities of the information economy.

Questions and Answers

Ray Grabinski: My name is Ray Grabinski. I'm from the City of Long Beach, which will be closing the finest federal facility in the United States in September of this year. I'd like to direct my question to Mr. Wilson and Mr. Smith. I was struck by the contrast between the two gentlemen: I want to know about economic cannibalism that seems to be going on in the inner cities, where it extends to the suburbs and actually goes throughout the country. When are we going to find a way to stop the shifting of jobs?

Mr. Wilson is absolutely right. We turned over our transportation system 35 years ago in Los Angeles to three major businesses. They went to court and they lost in court because they weren't doing a good job with the public�s money. I know there is a contrast, and I know there is a balance that has to happen, but if we're going to be training people in the inner city to get them productive and ready to go, how in a social sense do we finally get to the point where we put our jobs where our mouth is? How do we put people in those jobs that develop a personal future for people -- not just a job, but a future?

Jack Smith: I'll start. I think we're seeing job creation in Michigan, in the midwest, that many people didn't think would be possible. Job creation is now taking place in the inner city, and it's being driven by the fact that the economy is so strong. If anything, there is a shortage of skilled workers in this country, so job creation is taking place. Is it getting to the inner cities? It's getting there right now because the labor market is so tight. What is happening is jobs are moving in the inner city in unskilled areas.

The challenge for us is to get the training programs really aligned and Focus:Hope would be a good example of that. The vocational schools in Detroit are very good, and what we need to do is have a partnership between business, the schools, and government to make those vocational schools work so that there is a job at the end of the line when they are trained. This can be done, and it is being done in the auto industry. It can also be done elsewhere, in partnership.

I think that if we put the effort on training with a job attached to it, we will be very, very successful. The apprenticeship system in Europe works very well because there is an obligation on the part of businesses to provide jobs at the end of the training program. You don't see that in this country, yet; we're just starting to put that effort in place and hopefully it will spread. But the opportunity is great because the economy is so strong and there is such shortage of workers available. We can make real progress right now.

Professor Wilson: The question really also was addressing the issue of capital on mobility and effects of industry relocation on certain neighborhoods, particularly when industries pull up stakes and relocate to areas overseas. I think that this is a very, very difficult problem that we should be talking about more as a nation. And I would like to see us have national dialogues, national discussion, national discourse on this issue to talk about the effects of globalization of the economy on neighborhoods. The problem is not unique to the United States; it's happening in other parts of the world as well.

In fact, there was recently a Jobs Conference in Washington, D.C. where the G-7 nations talked about the jobs problem and the problem of industry relocation. This is something that has to be discussed. I don't have any particular recommendations to make, but I do think it's something that ought to be part of a national, ongoing dialogue.

Vice President Gore: I think it's also fair to note that there are some special circumstances in Long Beach that are unusual and are deserving of special attention. I want you to know we're keenly aware of that.

Mary Nelson: I'm Mary Nelson. I'm from a Community Development Corporation in Chicago, and chair of the National Congress of Community Economic Development. Many of us live and work in neighborhoods which have a lot of brown field sites with their devastation in the midst of everything. Yet these could be places where there would be jobs and opportunity. What suggestions do any of you or all of you have in terms of both making that an asset, these brown field sites, both for creating jobs for our neighborhoods, for folks who lived there in the neighborhood, as well as balancing it carefully with the environmental concerns so that we don't end up with other kinds of polluting things coming into our neighborhood?

Vice President Gore: Let me make a brief comment on that and invite Jack or our other two speakers to say what they will on it. The Brownfields Program has been a priority for President Clinton and me. In fact, Mayor Ron Kirk joined me in the White House about two weeks ago to announce the latest round of grants for brown fields development. Mayor Kirk, tell us how you were able to leverage the grant money received by Dallas in the first round.

Mayor Ron Kirk: Briefly, we were able to leverage a $200,000 grant into $50 million worth of investment. Now, grant you, one of those was because the tract of land was in one of the most attractive parts of our community, close to downtown, close to an entertainment center, but it was still contaminated for 22 years and that accounted for $35 million of that. But separately we were going into one of our poorest parts of town to bring in an activity that created 75 jobs. It's now worked so well that they're now adding a retail component that will add another 25 jobs.

Vice President Gore: Mayor Kirk is doing a fantastic job. In many communities we have seen a similar result. We see a relatively small investment in the recapture of brown fields coupled with the establishment of some certainty where the regulatory barriers are concerned. In other words, the EPA is cutting through the red tape and saying, "Here is the standard...it's reasonable, not perfect, not zero, but it's a standard where there are not any practical problems." So you're not going to be held liable, Mr. Future Property Owner, if you come in and clean this site up and then start developing it. That regulatory certainty, coupled with the small grant, results in a very large multiple of private investment coming back into the inner city.

We have a third element, which is a tax incentive for the development and redevelopment of brown fields. Since just today we found out some of the details of the House Ways and Means Committee draft of the tax bill, we're very disappointed that they did not include the kind of brown fields provision that we think is necessary. We're going to be continuing our discussions with the majority in Congress to try to get recognition of the value to communities of redeveloping these brown fields because it's absolutely crucial. It's a very big priority for President Clinton and Clinton/Gore administration. We're going to be pushing it very hard. Do any of you all want to comment on this?

Jack Smith: The only point I'd make is the urgency for speed because the city is competing against the suburb that has green fields. A businessman can't wait too long to make his decision on where to put that plant in and whatever can be done to help the cities free up that land, the title to that land, I'd urge to do it. I think the cities can compete with the suburbs if they have large enough tracts of land to offer to potential manufacturers.

Vice President Gore: It's one of our very highest priorities. We're pushing it very hard. The Secretary advises me this is going to have to be the last question, because he wants to leave a little bait in the bucket for the next seminar. Please, go ahead.

Erica Wilson: My name is Erica Wilson and I'm with the Local Initiatives Suppport Corporation, a community development financial intermediary. I noticed with Mr. Wilson and Mr. John Smith that you both mentioned community development organizations and the importance that they have had in the movement in revitalizing urban areas. My question is this: What kinds of partnerships or roles do you envision for community based organization and community development corporations?

Jack Smith: I think community based efforts are really important; we're seeing that in Detroit. I mentioned our ability to establish the Hispanic manufacturing center. The fact that a lot of the business that those companies will be doing with contracts from the big three is kind of how that partnership goes together. When they have the contracts, then they can build the plant and hire the workforce. So, you know, it's working well in Detroit, it can work in other areas as well.

Professor Wilson: Yes, there are many examples of public/private partnerships that involve community organizations who are into workforce development, community organizations working with corporate leaders, civic leaders, government officials. There are just any number of partnerships that I think could be developed. It's important for community organizations to be connected to the broader metropolitan institutions. It's really important that the lines of communication be open to the corporate sector, to educational institutions.

I do think that one thing I want to emphasize is that we should know more about what these organizations are doing. We should know more about the effective ones and how they are connected to the broader community. I would hope, Mr. Vice President and Mr. Secretary, that one of the things that will come out of these series of seminars will be more information about these effective programs that will be widely disseminated across the country.

Gloria Jeff: I'm Gloria Jeff with the U.S. Department of Transportation and we have a program that's been put in place called Livable Communities. Within that program we have found ways to effectively form partnerships between government, the private sector, and community based organizations. One example that we like to talk about a great deal is the Los Angeles Neighborhood Initiatives or LANI. It is an example of where a number of communities in the Los Angeles area have been identified. The community-based organizations have come together and established a vision of what those communities needed to look like. They then had the professionals come in and help them facilitate the creation of that, including what the role of transportation should be and how to utilize transportation programs to create it. That's the kind of partnership that makes it work.

The Department of Transportation has produced a document called Livable Communities, which provides examples of over a dozen and half programs and projects throughout the U.S. where, indeed, you can see where they have worked with community based organizations. If you want to access that information go to www.dot.gov and you can find information on those programs, either within the Federal Highway Administration web site or the Federal Transit Administration.

Vice President Gore: Thank you very much. Let me say that I wish we could hear from everyone who had a hand up. I wanted to briefly respond to Erica Wilson's question which she said was also directed to me. And the Local Initiative Support Corporation or LISC is an excellent example of a real success story. The the example you cited just now is another. In the Empowerment Zone and Enterprise Communities Program, we have found that the role played by community based organizations, and also development corporations and foundations, have been playing an important role in supporting a lot of these groups. The role of these groups is crucial because it provides a center of expertise in the neighborhood and an entry way into the process for people block-by-block who might not otherwise be able to play a role.

The revolutionary idea on which our whole country was based is the idea that the individual citizen is most knowledgeable and best able to chart the destiny of the nation. Representative democracy is based on that principle. When we approach urban policy and metropolitan policy, we have got to once again base it on the ideas of the individuals who are closest to the problem. Community based organizations working in partnership with cities, counties, states, the Federal government, private corporations, universities and schools play absolutely critical roles in each of the successful stories.

You can go all over the United States and wherever there is a success story in the revitalization of a community, you will find a community based organization at the heart of that success story. So that's the short answer to your question. We believe they are critical.

Now with that I'm going to turn it over once again to Secretary Cuomo to close it out. I'd just like to thank you, Mr. Secretary again, for inviting me to participate in this kick-off of your series. For those who are here and those who have participated by the television hook-up, like you I look forward to the next eleven of these seminars. I know that they are going to make a huge difference in our country's understanding of where we need to go for communities in America as we approach the next century.

Concluding Remarks: Secretary Cuomo

When we started out to plan this session, we went to find the three best individuals in the nation to speak to this topic and having heard Mr. Ray Smith and Mr. Jack Smith and Dr. Wilson we found the best three in the nation. Thank you very much.

And Mr. Vice President, you've been a consistently good friend to this department. You've been a consistent champion for the cities, and your leadership in chairing this seminar series is another illustration of that. We want to thank you, Mr. Vice President.

And this is just the beginning -- a good thing -- but it's only the very beginning of the first of twelve. The next session is going to be on "The New Melting Pot: Immigration in the Nineties." That's going to be at the end of July. The topic after that will be workforce development and going from welfare to work. And, Dr. Wilson, that touches on a lot of the topics that you raised this evening, as well as Mr. Ray Smith. That's going to be in August. I commend all of you for staying involved. Stay interested, come to the next sessions, and they'll build. You'll see how these pieces fit together as we go through these 12 seminars.

Let me leave you with the words of John F. Kennedy, who first envisioned this department. He didn't get to complete the task. It was President Johnson who sent up the legislation. But it was the vision, the dream, the hope, the aspiration of President John F. Kennedy that created this department. In that letter to Congress speaking about what became the Department of Housing and Urban Development, he said, "Our communities are what we make them. We as a nation have the opportunity to remold our cities and, indeed, the responsibility. Working together, I know we're going to do it."

 

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