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| May 11, 2008 |
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By David Brewster Seattle is coming back to earth, knocked off its perch as the most desirable (well, almost) world city of the future. A year ago, Seattle was the place that fondly thought it was the region everyone in the world would like to emulate: green, globalized, tolerant, artsy, progressive, entrepreneurial, right-sized for livability, and fully wired to the new economy. What does it feel like as this giant hot air balloon slowly loses economic altitude? As usual, the question in Seattle on the down glide is whether it has gained much of permanent value—made real progress—in the previous boom times. Did we build well when the sun shone and the SUVs took over the streets? The question of real progress brings to mind something grandly called "The Progress Project: Rethinking Progress and Human Development" that was launched about a year ago in Seattle. Ambition was written all over this project, as suited Seattle in the millennial year. The Progress Project asked a key question in these turbulent times: what is real progress, as opposed to simple calculations of gross domestic product? The idea for this kind of recalculation of the usual measures of growth—domestic output, economic indicators—underlies the theme of sustainability. Why not create an indicator of progress that has to do with clean air, greater income equality, essential and measurable happiness of large numbers of people? This quest for a comprehensive new metric of genuine human progress is a favorite idea of Rob Glaser, founder and CEO of RealNetworks. Glaser is a leading example of the former Microsoft employee determined to start his own world-changing business (in this case streaming audio and video). Glaser is also a left-leaning billionaire. So one of the first ventures of his Glaser Family Foundation was to fund the Progress Project, teaming up with the University of Washington’s Daniel J. Evans School of Public Affairs to bring in bigfoot speakers (Jane Goodall, Doris Kearns Goodwin, Jimmy Carter) to address large crowds at Town Hall, a new Seattle cultural center, on ways to redefine progress. These lively sessions, in turn, seemed to symbolize the coming-together of Seattle’s twin worlds: the transformative new-technology businesses and the traditional civic order. Such ambitious hopes seemed reasonable as 2000 began. But across that year RealNetworks’ stock tumbled 86 percent. Glaser now presumably has to concentrate on rethinking RealNetworks rather than recasting the world’s notions of progress. (Typical of his high-bandwidth style, however, Glaser is setting his sights even higher for the project, probably linking his crusade with prestigious national economists and downplaying the Seattle connection.) The next day, we venture out to the Forbidden City, Imperial Palace of the Emperors. It is explained to us that these 183 acres housed the Emperor because it was easier to watch, and therefore protect, one Emperor than it was to watch the rest of the country. We hear of the "very smart" Empress who, when threatened by loss of her control over her nephew-Emperor (his favorite concubine had introduced him to her brother's circle of young intellectuals who had traveled abroad, and he was being influenced by them) had the concubine murdered and her nephew poisoned, temporarily burying the influence of foreigners. The treasures of the Forbidden city are long gone--to Taiwan in 1949. Seattle could use a new definition of real progress, given the decline of the older indices. It’s not so much fun now to check the stock-value index of progress, not with these changes is stock value over 2000: Microsoft – down 63 percent; Amazon – down 80 percent; Nordstrom – down 31 percent; Weyerhaeuser – down 29 percent. Still, there is a lot of optimism in the air in Seattle, despite the snowstorm of pink slips in cyberspace. The optimists make a reasonable case. For starters, Seattle loves reinventing itself, and the custom goes way back. The Native Americans of the region loved myths of cataclysmic change, driven by fire, water, wind, and volcanoes. The great hero of the local Indian myths was called The Changer, a reasonable nickname for Bill Gates. Seattle began as a resources town, dependent on external markets accessed by fickle railroads and shipping. That boom was subject to fearsome market gluts, and when the first bust came in 1886, a round of labor riots erupted not unlike the WTO melees in Seattle in late 1999. Seattle then became a manufacturing town, hostage to wartime cycles. Lately it has tapped the high-investment economy, with its own cyclical demon of too much money chasing too many unprofitable ideas. After all this, however, the Puget Sound economy is now well diversified. Venture money, still plentiful, is now flowing from dot-coms to biomedical companies. Boeing is helping to offset the business cycle by having a good year (its stock went up 59 percent) and the aerospace giant diversified itself by buying a space division from Hughes. The high tech sector, with about 100,000 of the 1.6 million jobs in the greater Seattle region, now matches Boeing’s share: the Jet City is no longer a company town. The tech sector is itself fairly well spread, particularly as second-generation Microsoft "graduates" exercise their creativity and their grubstake. The regional high tech breakdown: 46,000 software jobs, 24,000 in electronics, 16,000 in telecommunications, and 11,000 in biotech. The tech sector continues to be the defining component of a strong local economy: non-polluting, high wages ($129,000 a year is the average in software, highest in the nation) that attract a creative and entrepreneurial workforce from around the world. This sector is still growing, despite the stock market slides; Microsoft added 4,000 workers last year, for instance. And it is likely that all the money surging into Internet companies in the past few years has created the computing architecture for the second phase of the Internet boom, the Evernet, with billions of digital devices connected to a broadband Web. But is this revolution bringing real local progress or just enriching 20 percent of the workforce? Is it sustainable? The downside is increasingly obvious: a sector with only slight loyalty to a region, one driven up too fast and down too fast by surges of investment capital, and beset by businesses still searching for sustainable models of profitability. Moreover, in its heedless wake these companies generate sprawl, congestion, income inequality, political apathy, and rapid rises in the costs of living for everyone else. "It makes it very difficult for younger people to live here," economist Douglas Henton told The New York Times recently in toting up the drawbacks of the Silicon Valley economy. "We’re in danger of losing our middle class." Some other cities in the tech belt, notably Austin, Texas, have tried to fashion a political coalition to address these negative impacts and to get the politics-averse new economy engaged in constructive social change. Not much progress in Seattle on this front so far, where a strongly entrenched governmental sector is averse to the kind of fluid, customer-driven business models of the new economy. It didn’t help that government acquired a bad reputation in the year of Microsoft’s antitrust lawsuit, shifting a Democratic-leaning company into the embrace of the Republicans. Seattle is unusual in one other positive way: a disproportionate number of high tech companies are located in the city limits, rather than fleeing to the suburbs. It helps that Seattle has a ring of warehouse zones or underused waterfront areas to absorb these companies as they suddenly need lots more space. The high tech firms also understand that the competitive edge lies with companies that attract the best young employees, and these folks need nightlife, restaurants, and bands as much as they need nearby mountains for recreation. During 1995-98, according to a new Brookings study, Seattle added 6,000 new high-tech jobs, about one-quarter of the region’s growth in that sector. However, the spread of tech companies to sleepy residential neighborhoods threatens to create a new brand of neighborhood political warfare as parking disappears, rents soar, and a generation of three-story, tradition-on-the-cheap apartment complexes transform the sleepy small commercial districts. A similarly upbeat case is made about the arts in Seattle. A billion dollars in new facilities across the 1990s created a much more lively after-work downtown as well as a platform for true excellence in Seattle arts. A dramatically remodeled Opera House (for opera and ballet) will soon start construction, as will the dazzling new downtown library, a zigzaggy stack designed by Rem Koolhaas, and a large sculpture garden for the Seattle Art Museum in a neglected but view-rich area just north of downtown. The year’s biggest splash was the opening of Paul Allen’s Experience Music Project, designed in Bilbao mode by Frank Gehry. Tacoma and Bellevue are now also in the celebrity-architect sweepstakes. Some of the new arts facilities are the result of a convenient panic that set in about 10 years ago, when the downtown Frederick and Nelson store failed and sat vacant. A familiar demon came back to haunt the city leaders: Seattle might lose its downtown retail vitality unless massive public spending takes place to save it. ACT Theater moved downtown. The Symphony built its new Benaroya Hall, to great public acclaim, and moved downtown. The Convention Center executed an awkward mid-air leap over some downtown streets and expanded, bringing downtown another museum, the Museum of History and Industry, as part of the package. The new library and a new city hall complete the package. Mayor Paul Schell, a downtown developer himself, has been an ideal mayor for prosperous times. (Whether he wants to run again in 2001, with diminished tax surpluses, is the big political question of the moment, but the betting is that Schell though still unpopular from his handling of theWTO riots will seek re-election and face a tough campaign.) Schell in his first term found a guns-and-butter political formula to continue the heavy public funding of these downtown projects, doubling the tax levies to spend equally on libraries, parks, and community centers in outlying neighborhoods. Two components of the downtown decade have not yet fallen into place. One is the area north of downtown called the Commons area, where a levy proposal for a Boston-style central park lined with apartments was twice defeated. Paul Allen, the Microsoft co-founder who is the most active in Seattle affairs of all the billionaires (developer of Experience Music Project, owner of Seahawks and builder of their new stadium, arts benefactor), owns a lot of the key property in this area. Allen real estate interests, working with city hall in a quiet way, are turning the Commons area into a home for technology companies, University of Washington biomedical spinoffs, some cultural institutions, and housing. This area may turn out to be a key generator of yet another great economic leap forward. The University of Washington, which is becoming a kind of Cal Tech of the Northwest, is approaching critical mass on several new technologies, such as post-genomic medicine, nanotechnology that can create new materials, photonics to replace electron transmissions with photons, and complex environmental systems modeling for such challenges as salmon movement and climate prediction. Remarkably for research-based cities such as Seattle, the end of the Cold War has not curtailed government research, even though it has concentrated it among winner cities and universities. The UW Medical School may turn out to be as much a growth engine as Microsoft and Boeing, particularly if its massive fundraising campaign (soon to be launched) truly taps the enormous philanthropic potential of the region. The other delayed component downtown is rapid transit, which was supposed to ease traffic and bring still more workers, shoppers, and culture consumers to downtown. Sound Transit, as it is called, has become instead exhibit A of the political decline of the region. Don’t tell the feds, whose $500 million check is urgently desired before the Bush Administration’s sharp pencils take office, but this puppy is very sick. In turn, transit’s malaise is indicative of the state’s political paralysis. Last fall the bills were added up publicly ($3.6 billion for the central spine, $1 billion and three years over budget), heads were chopped off, and the plans almost came off the rails. With opponents unable to agree on an alternative, the likely outcome is a Seattle recipe for disaster: once all the flaws have been exposed and public support is exploded, go ahead and build it anyway, because everyone is too tired of all the debate. Seattle politics currently suffers from a shortage of friends around the more-conservative state and too many novices at City Hall—a rookie mayor and six of nine council members who are first-termers. At the state level, politics is stalemated by the continuing 49-49 tie in the House, the low-risk, survivalist politics of Gov. Gary Locke, and the one-seat Democratic lead in the Senate. All eyes continue to be on the next election, with hopes of breaking the impasse by prevailing in the swing suburbs around Seattle, the real balance of power. Maybe redistricting (which will help the central Puget Sound liberals) and a court-mandated shift of the primary system from a blanket primary will help break up the stalemate. As usual, state politics puts off for two more years the big decisions: how to fund transportation fixes, how to rescue the University of Washington from severely under-market faculty salaries, whether to recommit to an eroding program for growth management, whether to defy the various tax-limit measures that are a legacy of 1990s initiative politics. (K-12 school funding is temporarily alleviated thanks to two initiatives passed in 2000, but these measures in turn ate up the surplus in Olympia.) The Republican Party is in disarray over its leadership, but it really did pretty well in the last election, winning most of the close races for the House by recruiting decent moderates. Republican House co-speaker Clyde Ballard, an amiable but unyielding conservative from Wenatchee, has managed to smother the social-issues conservatives of his party, which keeps the party electable at the local level but still too alarming to suburban women to win statewide. The GOP’s gubernatorial victim of this round, hot-talk radio host John Carlson, did even worse than a religious right candidate, Ellen Craswell, a Bible-based fundamentalist who was destroyed by Gary Locke in 1996. Democrats had a good election, too. Toppling Slade Gorton, as Maria Cantwell narrowly managed to do, destroys the last major stronghold of Republican patronage and statewide organization. Gorton went down defending the old economy of Washington, the resource-dependent sector of the state that resonates to property values, traditional values, Seattle-bashing, and military spending (lots of retired soldiers in the state). Cantwell, an unsteady candidate who got better and spent $10 million of her own wealth from Real Networks, carried only the five central Puget Sound counties and did poorly with working men, who don’t relate to her rapidly acquired wealth and brittle manner. Even so, the state now has six of nine Congressional seats (Republicans had seven seats as recently as 1995), and Al Gore even carried the suburban Bellevue district of GOP Congresswoman Jennifer Dunn. So does this add up to real progress? Has Seattle spent its windfall wisely? I’d give a middling grade. Too much money was spent on quick-burn companies and quick-status buildings. The underlying institutions—research universities, roads and transit, healthy hinterlands—remain undernourished. Fatal political problems remain, such as the lack of urban Republicans, the split of the state into Seattle-area liberals and Gorton-land conservatives, the avoidance of far-sighted planning, an unstable and inequitable tax base, explosive income inequality and populist backlash. Likewise, the promise of integrating the dynamism of the new economy with the idealism of civic Seattle remains on a first-date basis. The new economy, despite its geographic presence in the city, is still a kind of parallel universe. The new-tech set tends to spend all day at work together and then go off on the weekends to ski at remote places and connect up with a national network of friends, rather than getting involved in small-town Seattle. It may be that the real lesson of these past years is that Seattle no longer is a coherent, smallish city where everyone gets along and is "nice," according to the shared culture of modesty, courtesy, and never flaunting wealth. Seattle, like Portland, has long feared the costs of becoming a big city even as it has, unlike Portland, desperately aspired to that status. We may secretly hope that the ride back to normalcy caused by the economic downturn will enable us to go home again. No such luck. Somewhere in the past year, we crossed the Rubicon. |
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