San Diego Law Review
Copyright (c) 1999 San Diego Law Review Association
San Diego Law Review
36 San Diego L. Rev. 295
LENGTH: 30639 words
ARTICLE: Race, Space, and Place: The Geography of Economic Development
AUDREY G. McFARLANE *
* Assistant Professor, University of Baltimore School of Law. This research was
made possible by the generous support of the University of Baltimore Summer
Research Grant Fund. Earlier drafts of this Article were presented at the
Latino Critical Race Theory Conference III, the Law and Society Association's
1998 Annual Meeting and the Association of American Law Schools' 1999 Annual
Meeting. I thank the many people who read and commented on drafts of this
Article, without whom this project would not have been possible: Keith Aoki,
Maxwell Chibundu, Gerald Frug, Cassandra Jones-Havard, Odeana Neal, and Leslye
Obiora. I also thank my research assistants Anjanette Dixon and Roxanne Pitts.
Any errors or omissions contained in this Article are my own.
... In 1993, Congress authorized a community and economic development program
called The Empowerment Zone and Enterprise Cities Demonstration Program ("Empowerment Zones Program") to create geographic zones within certain selected cities that would be
eligible for special federal attention to alleviate pervasive conditions of
poverty and economic distress within the cities. ... More particularly, this
approach is reminiscent of a prior federally initiated community development
program of the War on Poverty era - the Model Cities program - while also
drawing from the economic development program of the 1980s - enterprise zones.
... Notwithstanding Hall's cautionary admonition that his idea was an extreme
model for exploring possible approaches and, in particular, that he did not
recommend it as a solution for urban ills, the
"freeport" idea was embraced by Sir Geoffrey Howe, economic spokesman for the British
Conservative Party, who became the leading proponent of adopting the enterprise
zone approach as the method for renovating and revitalizing abandoned
industrial areas in Britain. ... A simple way to confront the structural issues
is to ask a critical question: Can the Empowerment Zones approach reduce
inner-city neighborhood marginalization and return a whole category of place
into the mainstream of social and economic life? Ironically, the Empowerment
Zones Program's utilization of a geographically targeted economic development
program does not reduce marginalization but, in fact, reinforces and
exacerbates ghetto marginalization for a number of reasons. ...
In 1993, Congress authorized a community and economic development program
called The Empowerment Zone and Enterprise Cities Demonstration Program ("Empowerment Zones Program") to create geographic zones within certain selected cities that would be
eligible for special federal attention to alleviate pervasive conditions of
poverty and economic distress within the cities.
n2 The program is self-described as a strategy
"to create jobs and business opportunities in [the] most economically-distressed
areas of inner cities"
n3 by providing tax incentives and social service funds within the zone to
stimulate business creation and expansion and attain, over the long-term,
[*296] the distressed community.
n4 The Empowerment Zones Program promises a definitive counter to all rules of
inner city existence
n5 and targets federal financial resources to these distressed areas as a signal
that the inner city should no longer be shunned by business and neglected by
government. Rather, inner city communities are now to be reunderstood (i.e.,
reconfigured in our understanding) in terms of their underestimated or
overlooked potential, assets, and resources. The Empowerment Zones Program also
promises improved inter-agency coordination, to streamline potentially
conflicting federal programs to work in favor of developing Empowerment Zone
communities, and to establish a federal government-wide priority for funding
programs that benefit the Empowerment Zones.
n6 In concept, with the right configuration of local, state and federal
government programmatic priorities, all of the necessary developmental
processes will take place to facilitate a thriving inner city economy and,
inevitably, an improved quality of life. In addition to the economic
revitalization, the zones are also to be the site of democratic governance and
community decision-making and participation.
n7 To that end, the program envisions a holistic, inclusive process of planning,
implementation, and development.
The Empowerment Zones Program is noteworthy because, apart from
[*297] recent federal welfare reform legislation,
n8 the geographic, self-help approach embodied in the program is currently the
only explicitly urban federal policy initiative. Also, the term
n9 suggests something new and exciting - the liberation of poor people.
Specifically, the program encourages economically disadvantaged people to work
effectively on their own behalf to eliminate their own economic suffering. The
program is considered different from previous urban revitalization efforts
because its emphasis is on business and job development rather than the mere
provision of social services.
n10 Also, local communities are intended to drive the decision-making. According
to literature from the Department of Housing and Urban Development,
"residents decide what happens in their neighborhoods, not federal officials in
n11 Therefore, the Empowerment Zones Program not only embraces economic
development as the preferred approach to remedying poverty in the cities, but
also promises to correct the deficiencies of prior urban revitalization
programs that excluded community input from the development process.
Essentially, the program is viewed as a new and improved urban development
program, neutrally and rationally tailored to address the complexities of the
causes of and solutions to inner city poverty.
This Article examines the extent to which the Empowerment Zones Program can be
properly viewed as a neutral, rational, and beneficial program for poor,
inner-city communities and their residents by exploring the limits and
potential of its chief mechanism, economic development, as a tool to achieve
social justice for the inner cities. This Article grounds its exploration
within the contested terrain of the city, not simply as a legal or juridical
concept, but in terms of its reality as a
"lived place" on the eve of the 21st century.
n12 By explicating some of
[*298] the unwritten rules and processes of economic development in their proper
context, this Article demonstrates that economic development is not a neutral
policy that government can advance without addressing significant structural
issues that externally impact inner-city communities. Probably one of the most
significant issues is that the program is applied within many cities that are
places laden with racialized meaning and are encumbered by the unstated, yet
popular, consensus that the problems of the inner cities should be contained.
In particular, this Article examines: 1) the legacy of historic programs that
have led to current metropolitan configurations characterized by a disparity
between declining inner cities and growing edge cities; 2) the impact of
globalization and technology; and 3) the present
"lived" urban context of racialized space that manifests itself not only in a chasm
between city and suburb, but also as an intra-city chasm between elite business
interests and poor people. Parts II and III of this Article examines the
genesis of the Empowerment Zones concept from the rise in popularity of
economic development, both internationally and domestically, as a tool to
attain social justice. Part IV explores the context of the
"lived" city as both an affluent place for the global elite and marginalized ghetto
neighborhoods that have been racialized and
"class"ified as black and poor. Part V analyzes the Empowerment Zones Program's
emphasis on jobs and the promise of federal funding priority for designated
zones. This Article concludes by recommending that we ought to begin to rethink
inner city development as an instrument to further economic, social, and
II. The Development Concept
A. Understanding Development Through the Lens of International Development
The Empowerment Zones Program utilizes development as the method of choice for
responding to poverty and unemployment in the inner cities. The concept of
development connotes favorable change or the moving from
"inferior to the superior [and] from worse to better,"
[*299] and seems compatible with the common conviction that only by self-help can
individual persons and geographic areas progress from their current plight.
Development as a social ideal envisions people and communities actively
determining their own condition and future, rather than passively being
affected by others. Accordingly, development is a tofu-like principle - it is a
neutral medium, capable of absorbing any flavor, view, or idea as to the
appropriate or desirable method to improve currently unacceptable conditions in
a particular geographic area. Therefore, in the abstract, development is a
noncontroversial concept. It is considered as acceptable, if not desirable, by
people of widely varying economic, social, and political backgrounds because it
suggests improvement, progress, and even social justice. But in reality,
development is a conservative principle. It seeks only that change which is in
harmony with a set of existing rules and relationships, and assumes that new
value and wealth can be created within these boundaries. Development also
prioritizes or addresses social problems only to the extent the problem can be
transformed into one with an exchange value and thereby exhibits the potential
for private profit. For this reason, communities in critical need of conversion
or revitalization remain largely neglected unless and until a private entity
finds, or government creates, a profitable opportunity to exploit.
When cities and communities embraced self-help through the process of
development, they adopted a concept both accepted and contested.
n15 Development, as a concept, has been soundly criticized both for its focus and
for its methods. The most salient criticism concerns development's exclusively
localized view, which focuses on the specific problems of the targeted poor or
disadvantaged community rather than seeing these problems in the context of a
n16 This myopic approach effectively ensures that those who are poor or
disadvantaged remain isolated from the problems of others who are similarly
situated, thereby inhibiting, if
[*300] not preventing, collective organizing.
n17 Therefore, rather than an exclusively localized approach, a dialectical
perspective, one that understands a local community both as a totality in
itself and as part of a larger totality, is called for. Under this more
comprehensive view, development of a local community cannot properly occur
except in interaction with the other parts of the total context of which the
local community is a part.
n18 Moreover, such a dialectical perspective is relevant to a critical analysis of
the Empowerment Zones Program. This perspective properly focuses the
examination of development in the United States by training our sights not only
on the communities targeted by the program but also on the greater context
within which they exist. As used herein, the
"totality" represents more than an emphasis on a larger physical area; rather, the
"totality" also encompasses the concepts, history, and purposes associated with
development and the specific targeted communities.
Development has also been criticized for being supported by a discourse that
regards economic development as an unambiguously favorable process that must go
forward at all times and, often, at any cost. This discourse is based on a
system of relations among the economic, cultural and institutional elements of
society, shaped by forms of power in terms of class, gender and race, that
creates a space in which only certain things can be said or even imagined.
n19 The development discourse, therefore, embodies a
"top-down, ethnocentric, and technocratic approach, which treats people and
cultures as abstract concepts, statistical figures to be moved up and down in
the charts of
n20 When the
"Third World" as a concept emerged following World War II and development emerged as a
response to the then recent
"problemization" of poverty, it was viewed as a scientific technique for economic and social
n21 Colonial regions of the world were declared under-developed, culturally
backwards, and in need of
n22 These regions and countries were uniformly defined in terms of what they
lacked in relation to the West: they were not modern, they were not financially
wealthy, and they were not industrial - i.e., they were not First World, they
were Third World. Rural people who earned a subsistence living were routinely
considered impoverished under Western economic standards such as
"per capita income." The standard approach promoted urbanization and industrialization while
invariably disregarding any adverse impacts of this approach, including
deterioration of community ties and deprivation of general
"access to land, water, and other resources."
n23 Development became a seemingly methodical set of interventions carried out by
batteries of Western experts who sponsored and supervised decades of
experimental economic programs ranging from village-based community development
projects in the 1940s and 1950s, to large-scale, elite-enhancing,
industrialization projects in the 1960s and 1970s. More recently, these
programs have returned to people-centered, village-based community development
The retreat from the large-scale industrialization approach of the 1960s and
1970s was due to the now apparently flawed assumption that there is one ideal
standard of economic production and self-sufficiency in the world applicable to
both Third World and First World countries.
n25 This approach also ignored the viable cultures and knowledge systems existing
in Third World countries.
n26 As a result, people-centered,
[*302] village-based community development programs now flourish in an effort to
counteract the shortcomings and destructive tendencies of large-scale
n27 Nevertheless, even village-based development has been criticized for applying
a uniform economic prescription to all countries regardless of cultural,
historical, and economic context.
n28 In particular, village-based programs fail to address structural causes of
n29 Development fails to consider how the Western-dominated world economic system
operates to subordinate Third World populations and to perpetuate conditions of
poverty and economic instability within Third World countries.
Development in poor communities in the United States is closely related in
principle and application to international development techniques. First,
development techniques like the Empowerment Zones Program are designed to be
applied in geographic areas within the United States that are the functional
equivalent of the Third World - i.e., inner-city, low-income neighborhoods.
These areas can be considered the functional equivalent of the Third World
because they are dramatically out of sync with the standards of wealth in
surrounding urban and suburban geographic areas that enjoy middle class or
higher levels of status and affluence.
n30 Considered underdeveloped rather than undeveloped, inner-city ghettos are
described in terms of obsolescence and dysfunction, culturally perverted and
not in keeping with Western, middle-class norms.
n31 Therefore, development within the United States manifests itself under a
slightly different rubric - the rubric of redevelopment, revitalization, and
renewal - all of which are processes of adjustment to urban economic decline.
Second, similar to the Third World development experience, domestic development
techniques must be practiced by a range of experts who impart knowledge and
[*303] assistance to client communities who, without this assistance, would be unable
to access or navigate the highly specialized bodies of knowledge required to
obtain financing, organize projects, and traverse legal requirements. Third,
economic development is supported by an appealingly can-do discourse: everyone
is better off from the pursuit of economic development because citizens will be
employed, state and local government will have an increased tax base with which
to promote the general health, safety, and welfare, and local politicians can
proudly claim credit for the number of jobs created at the next election. The
discourse fails, however, to take into account the structural and relational
constraints placed on certain geographic places, like low-income, inner-city
communities, that are currently marginalized and increasingly disconnected from
the mainstream of American society. Finally, development in the United States
is focused inward, within low-income, inner-city communities, rather than
outward, toward the structural forces that impact and contribute to the
conditions within those communities.
B. The Domestic Trilogy of Economic, Community, and Community Economic
The development concept is broken down into three somewhat distinct
subconcepts that heavily overlap: economic development, community development,
and community economic development. The American Economic Development Council
defines economic development as the
"process of creating wealth through the mobilization of human, financial,
capital, physical and natural resources to generate marketable goods and
n32 Ideally, the process is one in which, over a long period of time, real per
capita income of a country increases while, simultaneously, the number of
people below a chosen poverty line and the distribution of income remains
n33 Economic development is, therefore, measured both linearly and
distributionally, by the extent to which economic wealth among citizens is
increased. While this measurement can take place on an international, national,
regional, state, or city level, in the United States the rubric of economic
development usually involves a unit of analysis at the state or local level and
traditionally has involved the efforts of both the private and public sectors.
[*304] At the local level, economic development (i.e., local economic development) is
best understood as a set of state and local governmental practices designed to
encourage the creation of new business or the relocation of existing businesses
from one geographic area to another.
n35 Because business firms provide employment and pay taxes, directing resources
to business firms can, arguably, foster long-term economic self-sufficiency and
well-being by ensuring conditions conducive to business strength. Economic
development involves fashioning and directing state and local institutional
structures and practices in a way that is supportive of and attractive to
n36 It also typically involves consciously competitive tactics by geographic areas
(states and localities) to position themselves as the most attractive sites for
business firm relocations. These tactics include providing an infrastructure to
support new developments and making available tax-exempt industrial development
bond financing, low-interest loans, grants, land acquisition cost subsidies,
tax reductions, and employment credits.
Community development, by contrast, refers to social, human, and physical
structure development activities at the neighborhood or community level.
n38 As discussed above, international efforts to promote development in Third
World countries have involved community development methods. Once
disillusionment with large-scale international industrialization development
projects set in because such projects failed to provide economic benefits to
the vast majority of both urban and rural populations, non-governmental
organizations began to advocate village-based projects designed to directly
enhance local economic and living conditions.
n39 In the domestic, local context, community development is a
"place-based," self-help strategy undertaken by ordinary people in their communities.
n40 The theory is that
[*305] by encouraging the social, physical, and human development of a neighborhood
or community, overall quality of life (health, income, and safety) can be
n41 Ideally, local community residents assume the mantle of taking proactive steps
to protect their community by engaging in various activities, including
neighborhood patrols, neighborhood clean ups, and protests against liquor
stores or billboards peddling cigarettes and liquor in residential areas.
n42 These types of projects often serve to mobilize and inspire participants to
tackle larger projects such as fixing up dilapidated buildings to provide
affordable housing or community centers.
n43 Ideally, community development allows ordinary citizens to come together to
conceive of ways to address common problems, from something as simple as clean
streets and sidewalks or recreational opportunities to health initiatives,
housing development, crime prevention or neighborhood watches. By creating the
opportunity for residents to have a say about what happens in their communities
and neighborhoods, the underlying theory of community development is that the
actual experience of personal involvement in leadership, organization, citizen
mobilization, goal-setting, planning, decision-making, negotiation, and
implementation leads to personal growth.
n44 The reality is that most development projects are controlled by
[*306] professional community development corporations that allow for varying degrees
of community control or input.
Locally-initiated community development has lead to miraculous changes in
communities where none could be expected, where conventional wisdom had written
off entire communities as beyond hope.
n46 Well-known examples include the Dudley Street Neighborhood Initiative in
n47 the Banana Kelly Community Improvement Association and the Mid-Bronx
Desperadoes (MBD Community Housing Corporation) in the South Bronx, New York;
n48 the New Community Corporation in Newark, New Jersey,
n49 and the Tacolcy Economic Development Corporation in Miami, Florida.
n50 Rather than bow to the inevitability that a neighborhood is doomed, community
development is often a gutsy project of valuing the community based on its
assets rather than its apparent deficits. Instead, the attitude towards
community is reconfigured to recognize the assets in the community and to make
a concerted effort to harness, promote, and enhance these assets through an
array of complementary programs and activities designed to shore up the
community against further economic and social devastation and to
"develop" the community so as to enhance the quality of life therein. Owing to a number
of unexpected and seemingly miraculous
[*307] successes in sprucing up or rejuvenating portions of physically devastated
neighborhood space, community development has become quite popular and today
receives widespread, nearly universal, support.
On the other hand, community development adopts a narrow view of the problems
and issues facing a neighborhood or other community. It tacitly accepts that
neither poverty nor racial segregation
n51 can be eliminated. Instead, community development simply focuses on
"place" as the locus of an individual's rights and attempts to selectively endow that
place with some of the privileges enjoyed by other more fortunate places.
The concept of economic development at the community level, or community
economic development, has gained wide recognition and acceptance in recent
years. Adding the term
"economic" to community development is significant - it seems to get a wider range of
people to take a community and its self-help efforts seriously because economic
development seems to be concrete and rational.
n52 It also bestows a certain pragmatic panache associated with the term
"economic" on its practitioners (community development corporations), which legitimizes
them in the eyes of citizens, foundations and corporate donors.
n53 If we momentarily consider development as an absolute, fixed practice, then
community economic development can be characterized as a hybrid process that
promotes the overall quality of life in a neighborhood by viewing the
neighborhood holistically and valuing its human assets. Community economic
development also treats the neighborhood as a discrete and insular economic
unit. The focus becomes one of encouraging the creation of new business and the
relocation of existing business in the targeted neighborhood in order to
improve the economic conditions for residents of that area. While community
economic development borrows its approach, technique, and rhetoric from its
cousin, economic development, the focus of community economic development is
tuned down a notch or two to the level of the neighborhood, as opposed to the
entire city or the state. The goal then becomes to move community development
activities beyond housing rehabilitation and improved service delivery into
activities that convert the target neighborhoods into full-service communities
that meet both
[*308] housing needs and commercial needs.
n54 Popular projects include supermarkets, small retail shopping centers,
n55 as well as micro-enterprise business incubators.
n56 Other techniques include small-business counseling and peer lending circles.
n57 In this manner, community economic development assumes a significant burden:
finding an economic niche for older residential neighborhoods by ostensibly
re-creating them as self-sufficient economic units.
C. Development as a Post-Civil-Rights-Era Strategy
The Empowerment Zones Program's embrace of economic development as the
mechanism for achieving social justice
n58 through economic prosperity and parity can in some ways be understood as a
post-civil-rights-era approach appropriate for an era where systemic
disparities of wealth, life opportunities, or plain discrimination are
impossible to address.
n59 The civil rights era was one in which the law's guarantee of certain
inalienable rights regardless of identity or social consequence was
reinvigorated and broadened.
n60 During the 1960s and 1970s, the boundaries and outer limits of what
substantive rights could be guaranteed by law were still being judicially
explored. At that time, many more lawyers moved to the forefront as the
defenders and protectors of the poor and downtrodden - the only limit seemingly
was one's ability to conceive of compelling arguments about rights which one's
clients were denied.
n61 Gradually, the boundaries of substantive rights were channeled into guarantees
of basic procedural rights within certain benefit programs, and the limits of
expanding substantive rights protecting the interests of poor people were
Protection of civil rights in the 1960s and 1970s contrasts sharply with
today's emphasis (beginning in the 1980s) on the protection of property rights.
The Supreme Court commenced the current approach in a series of cases beginning
in the late 1980s.
n63 The law has been expanded in
"takings" cases to guarantee the rights of property against incursions by
[*310] the state that are deemed to diminish the value of property rights, even if
this means conceptually severing a strand in the bundle of rights or requiring
compensation for what are deemed to be investment-backed expectations.
n64 At the same time, principles of states' rights and federalism have been
reinvigorated to protect the sovereign rights of state government to resist
incursions by the federal government into constitutionally protected spheres of
n65 These decisions have seemingly left those without very much property
n66 or claim to autonomy
n67 scrambling to find and claim their own sphere of property or autonomy to
provide their own defensible space.
n68 Accordingly, community-based self-help ideas became increasingly popular.
Rather than looking externally or structurally for solutions, communities began
to look within - to their own resources.
A second characteristic of the current era is the popular view that welfare and
other income support programs have been widely discredited as a way to
permanently supplement income for poor people (women and children in
particular). As the economic necessity of two-wage-earner families converged
with an increase in female-headed households, those who were forced to take
second and third jobs to make ends meet became intolerant of the generations of
families and children living on welfare.
n69 As a result, the social compact that provided cash-
[*311] support payments to the poor eroded and lawmakers found it expedient to
"offer up" the welfare dependent woman to appease working class people.
n70 Welfare has now been limited to a lifetime cap and is administered in finite
block grants from the federal government to the state government, this being
justified as devolution of power from the federal to state government.
n71 Accordingly, the political environment is such that the idea of adjusting the
existing economic system to encourage redistribution of wealth to benefit the
poor is unthinkable. Rather, an individualized
"do what you can do to help yourself" approach is popularly embraced. Accordingly, both conservatives and
progressives have converged in their support of self-help approaches to
problems faced by poor communities.
n72 Arguably, the conservative support of self-help strategies is based, in part,
on a pervasive assumption that opportunities abound for improving one's
condition through hard work, struggle, and perseverance. The subtext of this
assumption is that claims of discrimination, exclusion, and disability are
claims for preferential treatment or privileged-victim status and should be
n73 Arguably, the progressive support of community development strategies is part
of an ongoing process to refashion the rhetoric and methods of an effective
post-civil rights agenda for social justice.
Economic development is also preferable to substantive legal or judicial
processes that might extend the reach of the law beyond its proper sphere -
into an area where legal rights to subsistence,
n74 a living
[*312] wage, employment, or minority set-asides in public contracting
n75 (assuring a portion of the public marketplace) are popularly deemed a threat
to the delicate balance between the free market and regulation. In other words,
economic development is favored because it is consistent with the prevailing
view that law should be limited to ensuring equal opportunity rather than
equality of outcome. Therefore, law is relegated to what is viewed as the
unambiguously neutral, impartial, and supportive position of quietly
facilitating the urban development process.
As a post-civil rights strategy, however, it is incumbent on the proponents of
development, particularly lawyers and legal scholars, to ask how law and
geography are linked. According to Edward Soja,
"linking law and geography [involves]...asking... how law shapes geographies....
Legal understandings and knowledge of law [should be] applied to help in
understanding the social production of space, how social spatiality is
constructed and organized and expressed."
n77 The first step should be understanding how legal structures ratify and support
structural constraints on inner city communities.
D. Dissecting the Empowerment Zones Program's Attempt to Split the Difference
Between Economic and Community Development
Rather than focusing on structural constraints faced by the communities the
program is meant to benefit, the Empowerment Zones Program focuses on combining
economic development with community development to address economic
development's inability, standing alone, to address the range of problems
facing impoverished urban
[*313] neighborhoods. The program, therefore, stands apart from other urban
development programs in its utilization of two seemingly consistent, but
ultimately divergent, approaches to development: economic development and
community development. More particularly, this approach is reminiscent of a
prior federally initiated community development program of the War on Poverty
era - the Model Cities program - while also drawing from the economic
development program of the 1980s - enterprise zones. As part of the economic
development emphasis, the Empowerment Zones statute makes available wage tax
credits to employers for each employee who resides within the zone and performs
services in a trade or business of the employer located within the zone.
n78 It also provides accelerated depreciation for certain business property and
tax-exempt facility bonds for lower-cost financing to induce commercial
investment and foster job creation within impoverished inner-city
n79 While a number of critics have argued that tax incentives rarely, if ever, are
the chief determinant in a business firm's decision to relocate,
n80 tax incentives have become such an accepted tool in a state or local
government's arsenal of economic development incentives that companies have
come to expect incentives as an indication of a state's or locality's
n81 On the other hand, as compared to the potential tax incentives that could have
been offered, the Empowerment Zones Program's tax incentives are quite modest
and are almost symbolic rather than actual inducements for business relocation
or expansion. One significant limitation on the tax incentives, which will be
discussed later, is that they are available only to new companies that start
operations in impoverished inner-city communities or to existing companies that
expand their operations to these areas. Moreover, they are simply not available
to companies that relocate their operations to the designated zone areas.
n82 Therefore, the number of companies that could potentially take advantage of
the incentives is strikingly reduced.
[*314] As a complement to the economic development approach, Congress has provided
for a community development component by authorizing the use of Social Security
Block Grant ("SSBG") funds in the designated zones to prepare and enable residents to participate
in the new employment opportunities and to further make the areas attractive to
businesses. These programs include services such as job training, child care,
transportation, financial management counseling, educational programs, and
physical structure rehabilitation.
n83 In concept, by improving the work-readiness of the individuals within the
community, the community could be developed, its economic viability enhanced,
and its revitalization anchored to secure foundations. As part of the
revitalization, the statute further attempts to ensure that the development
process involves community residents by: 1) requiring designated cities to
follow a comprehensive strategic plan for revitalizing the target communities;
and 2) requiring the affected community to be made a full partner in the
process of developing and implementing the plan.
n84 Department of Housing and Urban Development ("HUD") explanatory literature has expanded on the statutory language by interpreting
these requirements to mean that the Empowerment Zones Program's brand of
economic development is a bottom-up, community-controlled process. Under the
statute, these requirements are a prerequisite for designation as an
Empowerment Zone: cities must vie for designation in a competitive application
process that requires each city to undergo an extensive community planning
process to produce a community-designed application and strategic plan.
n85 The result of this
[*315] comprehensive planning process is a strategic plan for accomplishing the
purposes of the legislation. As interpreted by HUD, the strategic plan is
required to focus on the coordinated economic, human, community, and physical
development plan, and the related activities planned for each proposed area,
n86 according to four principles: 1) creating economic opportunity for an
Empowerment Zone's residents; 2) creating sustainable community development; 3)
building broad participation among community-based partners; and 4) describing
a strategic vision for change in the community.
n87 The strategic plan requirement is due, in part, to the Government Performance
and Results Act, which requires federal agencies to clearly define their
missions and to establish long-term strategic goals and shorter-term annual
n88 Strategic plans are a method of structured planning borrowed fromthe corporate
sector that sets baselines and benchmarks for achieving specific goals and
measuring progress and performance in attaining those goals.
n89 Intended to limit the wasting of time, energy, and government money through
unstructured, goal-less planning and activities at the community level,
strategic plans require a community to set goals and standards (benchmarks)
tailored to meet the needs of the community.
However, there is some debate about the applicability of corporate planning
methods to cities.
n90 In addition, there are serious, but common sense, questions about the
strategic plan's evaluation methods.
[*316] Empowerment Zones Program's strategic plan, like most if not all development
projects, measures its success based on the completion of individual projects
and ignores the question of whether any progress has been made towards the
ultimate goal set for the program as a whole - economic wealth, parity, or even
social justice. As the following discussion will demonstrate, the faith in
development as a process comes not from what it has been proven to achieve but,
rather, from what processes most people feel comfortable using to address
aspects of poverty and oppression deemed problematic. In the context of
Empowerment Zones, this begs the question,
"Why this approach?"
III. The Empowerment Zone Concept
A. Empowerment Zones and Lessons from the Past
As indicated above, the structure and emphasis of the Empowerment Zones
Program reflect not only a revival of the development project in the United
States as the preferred way to address conditions of poverty and economic
n92 but also a reaction to the lessons and experiences of past development
programs. The period leading up to the Empowerment Zones Program had seen the
domestic development project undergo various incarnations and versions
throughout the twentieth century, subjecting inner-city slums to a series of
projects promising to remedy unacceptable physical, economic, and social
conditions. As early as the 1920s and 1930s, cities and the federal government
sponsored slum clearance programs.
n93 As communities
[*317] pondered the continued problem of slums and turn-of-the century architecture
began to be viewed as backwards and old-fashioned, the federal approach to
remedying unacceptable living conditions in cities in the 1950s turned to a
redevelopment approach, euphemistically called
"urban renewal." The urban renewal approach attempted to transform old-fashioned neighborhoods
and districts into modern, sanitary, and economically-exploitable places by
applying the proper scientific planning tools, expertise, and knowledge.
n94 Urban renewal's approach to development was to prevent as well as eliminate
slums by effectively
"subsidizing the gap between the market value for existing land uses and the
re-use value of land if cleared and developed."
n95 In reality, this approach to revitalization entailed replacing low-income
neighborhoods, which were often black, with highways, sterile housing
developments and municipal office complexes, an approach which became known as
Based on the belief that the causes of poverty were political as well as
economic, the idea of
"community action" took precedence as the way to remedy poverty during the 1960s.
n97 The Model Cities and Community Action programs in the late 1960s and early
1970s came about partially in response to urban renewal's assault on black
neighborhoods and partially in response to the Civil Rights Act of 1965.
n98 These programs are most significant for their assumption that urban black
poverty could be eliminated by targeting intervention solely within the
n99 Under the Economic Opportunity Act of 1964, the federal government sponsored
the Community Action Program, a local, neighborhood-based strategy.
n100 The purpose of the Act was threefold: to coordinate the many governmental
anti-poverty programs (nutrition,
[*318] employment, and welfare programs),
n101 to allow the poor to assume a direct role in designing and implementing
responsive and effective anti-poverty programs,
n102 and to provide jobs for the poor in program administration.
n103 Hundreds of independent local organizations (community action agencies) were
created to coordinate a variety of service programs including
"neighborhood services, education, health, manpower, housing, social services,
and economic development."
n104 The concept of community action was initially controversial and later evolved
into what has been described as
"the less controversial, more palatable concept of community development": the Model Cities Program.
n105 In response to disillusionment with U.S. federal urban renewal, housing, and
anti-poverty programs, the Model Cities Program was designed to address the
problems of physical infrastructure within ghetto neighborhoods while drawing
upon the lessons of community action and demonstrating that urban development
could be inclusive of the poor.
n106 Throughout its life, however, the Model Cities Program was fraught with
n107 and struggles over community participation and control.
n108 The Model Cities Program also failed in its effort to redefine urban renewal
"tended to be controlled by large
[*319] real estate and construction interests."
n109 Notwithstanding the admitted failures of the Model City Program, some of the
ideas about community participation are still considered fundamental principles
of urban planning. Therefore, the Model Cities Program and programs similar to
it continue to resonate for some as viable and worthwhile approaches to
inner-city poverty - hence the community participation and comprehensive
planning elements in the Empowerment Zones Program.
The Empowerment Zones approach was initially derided for simply reviving
discredited strategies from the Community Action and Model Cities era.
n110 It is true that many similarities exist. For example, both the Empowerment
Zones and Model Cities approaches emphasize federal agency coordination and
n111 In addition, both approaches require a comprehensive, community-wide planning
process while retaining city control of funding and governance board
n112 However, the criticism is not entirely justified, as the Empowerment Zones
Program clearly took some of the lessons from the Model Cities experience to
heart. First, the Empowerment Zones Program was launched only as a
demonstration program (i.e., on a trial basis) in order to avoid dilution of
the programmatic and funding commitments among too many cities, thus allowing
it to avoid some of the problems experienced by the Model Cities Program.
n113 Second, the Empowerment Zones strategy consciously and purposefully adopted an
economic development, free market approach to community development. Thus, the
enterprise-zone component of the program and its laissez-faire,
anti-governmental regulatory emphasis significantly distinguishes the
Empowerment Zones Program from the Model Cities Program. While the
enterprise-zone concept can be traced to earlier international development
efforts, the emphasis had become completely devoid of any social justice or
B. Empowerment Zones and Enterprise Zones: From Hong Kong to Washington
The enterprise zone is based on the theory that geographic areas or zones can
be stimulated economically to the point of flourishing by removing economically
stifling or deadening governmental regulation.
"zone" idea has its origin in a
"radical solution" by British geographer and urban planning expert, Peter Hall. Hall's radical
solution was to address urban decline by establishing
"freeports" in small, selected industrial areas of inner cities and opening them to all
kinds of free market initiatives with minimal regulatory control.
n116 Each area would be completely open to immigration of entrepreneurs and capital
while bureaucracy and regulation would be kept to a minimum.
n117 Hall's proposal was based on his observation that economic activity in Hong
Kong had flourished with minimal governmental regulation, very low taxes, and
minimal to nonexistent wage and labor legislation, factory safety regulation,
restrictions on the import of materials used in manufacture, and restrictions
on land use.
n118 Notwithstanding Hall's cautionary admonition that his idea was an extreme
model for exploring possible approaches and, in particular, that he did not
recommend it as a solution for urban ills, the
"freeport" idea was embraced by Sir Geoffrey Howe, economic spokesman for the British
Conservative Party, who became the leading proponent of adopting the enterprise
zone approach as the method for renovating and revitalizing abandoned
industrial areas in Britain. A commentator explains that Howe believed that the
best way to remove the urban blight afflicting an area like the Docklands in
London was to
remove as much government as possible from a number of small areas in the most
derelict and depressed sections of Britain's cities. Within these enterprise
zones... taxes and government regulation would be virtually eliminated to
create the most attractive possible environment for free enterprise to
[*321] Private enterprise would thereby be encouraged to revive areas in which
government development programs had so dismally failed.
One of the earliest critics of the enterprise zone approach, William
Goldsmith, pointed out that reliance on Hong Kong and other free trade zones,
such as Taiwan, Singapore, South Korea and even Puerto Rico, as the basis for
the enterprise zone idea was disturbingly flawed.
n120 To advocate the type of dramatic economic growth experienced by these defacto
model enterprise zone countries was to advocate
"recreating third world labour conditions in the midst of rich, industrialized
countries, specifically Britain and the United States."
n121 While business would gain from the deregulated environment,
"the citizenry [would lose] protection from regulations and also the benefits of
some public services."
n122 Goldsmith also observed that the successful development of free-market
economies in the enterprise zone countries was anomalous, these countries
"for very particular reasons of history, location, and international politics."
When the enterprise zone, a geographically-targeted, de-regulatory approach to
economic development, traveled across the Atlantic to the United States in the
early 1980s, it was adapted from an experimental industrial park policy of
converting abandoned and uninhabited industrial land from obsolete uses to new
and more productive uses.
[*322] In the United States, enterprise zones became the preferred policy approach to
poverty and unemployment in the inhabited and only partially abandoned inner
city. The theory was, and continues to be, that the best and most efficient
remedy for poverty and unemployment is to stimulate and attract business
activity through deregulation, thereby reducing unemployment and providing a
tax base for inner cities.
n125 This was consistent with the influence of neo-liberal thought on national
policy which favored
"facilitating capital mobility and cutting community programs that might distort
private investment decisions."
n126 The pure theory of enterprise zones is intrinsically appealing because it is
based on the assumption that there is
"enormous latent potential within even the most blighted neighborhoods."
n127 This appeal is especially significant because it promises to produce growth
"without having to divert people and economic activity from elsewhere."
n128 Therefore, adoption of the enterprise zones approach represented the best of
the American attitude towards the beneficial potential of initiative and
Despite repeated efforts, enterprise zones were never successfully incorporated
into federal urban policy during the 1980s.
n129 During that time, however, in the wake of cutbacks in federal funding to state
and local governments, state officials embraced enterprise zones as a new tool
in the local economic development arsenal.
n130 While this was due,
[*323] in part, to the expectation that a federal program would eventually be
adopted, it also coincided with a trend at the state level to expand its
traditional role from merely supporting business through infra-structure
development to attracting corporations and investment by making direct payments
and providing subsidies to business.
n131 Thus, the enterprise zone idea was enthusiastically adopted and incorporated
into existing economic development programs by more than seventy-five percent
of the states as a way to attract business or foster economic activity in
specific geographic locations within the state.
n132 State enterprise zones vary widely from state to state in terms of size,
criteria, and benefits offered. One consistent attribute, however, is that the
de-regulated quality of the original enterprise zone concept was never adopted.
Aside from tax credits or abatement, de-regulation is
"a minimal component of enterprise zone programs."
n133 Instead, many enterprise zones provide for a more active governmental presence
"loans and venture capital, land assembly to facilitate new uses of land, and
public investment in physical infrastructure."
Oddly enough, however, a study of enterprise zone programs found that
"virtually all state enterprise zone programs include in their eligibility
criteria for zone designation measures of the economic need of individuals or
households residing in the zone."
n135 The study concluded that, while resident need is the implied justification for
the programs, the other
"stated goals and structure of most state programs are not strongly
[*324] oriented toward helping needy residents or improving their neighborhoods.
Rather, economic development, broadly understood, is the primary program
n136 The unproven assumption is that economic development is synonymous with
"job creation" which will lead to an improved overall public welfare for zone residents.
Other literature suggests, however, that state tax incentives provided to
for-profit, private business firms are more likely to stimulate capital
investment than job creation.
n137 The federal investment tax credit evidence suggests that the
"credit fostered the substitution by employers of physical capital for
production workers, and may actually have reduced the supply of low-skilled
blue collar work."
"despite the considerable attention given to the enterprise zone concept...
remarkably little [data exists as to] what [it has actually] accomplished."
n139 Most methods used to assess the Enterprise Zones Program tend to overstate the
program's impact on economic growth.
n140 For example, many studies are
"before and after studies" and employer surveys which, in effect, report increases in the number of jobs
without accounting for jobs lost or whether those jobs were simply moved from
one area to another. Further, no conclusive, or even persuasive, link is ever
made between the number of jobs and the program.
The Empowerment Zones Program's embrace of enterprise zones reflects a
troubling contradiction. The best of the Model Cities Program was its resulting
emphasis on use values, such as community-based participation and programs that
improve the quality of life. By contrast, the enterprise zones approach
exclusively emphasizes exchange values and a commitment to furthering an
ideological goal of proving that government over-regulation caused the decline
of the inner city. Urban policy assertedly need only focus on eliminating
regulation in order to reverse the decline by stimulating and promoting
business activity. While ideology, law, and policy are never far from one
[*325] arguably, are in constant dialectical tension with one another,
n142 the ideology promoted by the enterprise zones approach is that any latent
creative potential is to be found within the private sector - not in the public
sector or in the people who live within inner city communities. Thus, the goal
is not to empower inner city residents or to focus wealth creation on inner
city residents. It is unclear whether enterprise adherents overlooked the
impact of applying these concepts to inhabited organic communities or whether
it was simply that the people in those communities did not matter to such a
degree that the communities were best viewed as vacant and devoid of resources.
Even though enterprise zones originated from a theory based on a commitment to
the precepts of the free market, enterprise zones in the American context have
been converted to serve the pragmatic goals of local economic development - an
ongoing project of local governments.
n144 As discussed above, apart from tax breaks, enterprise zones in the United
States rarely, if ever, involve the elimination of local governmental
n145 Presumably, enterprise zones can involve regulatory waivers as needed,
particularly as demanded by specific agreements with particular business firms.
Because enterprise zones provide a useful vehicle in which to package and
market already existing economic development tools and incentives, the zone
concept is nevertheless compelling to localities responding to the twin
imperatives of the demands of capital and the failures of persistent urban
decline and unemployment.
IV. The Ghetto and the Global City
A. Post-Industrial Cities and Economic Distress
The foregoing discussion has extensively analyzed development programs as
methods for attaining beneficial change. Unfortunately, these programs have yet
to meet intended goals. This failure typically prompts little critical analysis
other than to continue the quest for new development techniques that can avoid
past failures. The quest for the perfect urban economic development technique
cannot succeed, however, unless development, in particular as embodied in the
Empowerment Zones Program, is fully contextualized within the lived reality of
the city. The relevant lived reality of the city extends beyond the boundaries
of impoverished inner-city communities - often the exclusive focus of attention
- to the entire city and metropolitan region. A proper appreciation of the
economic, legal, and social processes that determined our current metropolitan
configuration - as well as a system of relations that is understood and
practiced by all - is crucial for beginning to reimagine development.
Understanding the places where Empowerment Zones are located is important for
understanding the challenges facing an economic development program. The
international development literature demonstrates the importance of not
universalizing the development concept without taking
"space" into account.
n146 This is because the relationships between people and places will impact how a
program will function. As a
n147 rather than
[*327] providing direct benefits to individuals in the form of direct transfer
payments such as welfare or social security,
n148 the Empowerment Zones Program focuses federal financial aid and regulatory
priority on the communities in which the urban poor live - i.e., the place and
space that they occupy.
n149 In order to be eligible for designation, each city must select a carved-out
geographic area within its boundaries that meets stringent maximum area and
population limits, as well as minimum poverty, unemployment and
n150 The geographic and population criteria were intended to ensure that nominated
zones were discrete areas within the city so that an entire city did not become
n151 Accordingly, based on census tract data,
n152 an eligible area must have a significant poverty rate that is widespread
throughout the zone
"has become entrenched or intractable over time."
[*328] As an alternative, the city can demonstrate that no portions of the geographic
area contain any component areas of an
n154 The area must also be characterized by unemployment or severe economic
conditions due to plant or military base closings,
n155 and meet criteria of general distress, such as a
"high incidence of crime, narcotics use, homelessness, abandoned housing, and
deteriorated infrastructure or substantial population decline."
While a number of applicant cities had territory that easily met the objective
federal criteria, the original eight cities selected for Empowerment Zone
status were selected on the strength of their proposed strategic plans:
Atlanta, Baltimore, Chicago, Detroit, Philadelphia/Camden,
n157 New York City, Cleveland and Los Angeles.
n158 While all different, the cities bear a striking resemblance to one another.
Each city has geographic areas that are home to significant numbers of
economically impoverished people. Such areas are referred to by various names:
the inner city, the center city, the barrio, the ghetto, or the
"hood." Not only do they share a common impoverished present but also a common vibrant
industrial or mercantile past. The majority of Empowerment Zone cities were
formerly leading cities of America's Manufacturing Belt, more recently referred
n159 The decline of America's industry meant that these cities changed from
"overcrowded manufacturing centers to partially abandoned, post-
[*329] industrial cities in the global economy."
B. Globalization and the Changing Nature of Cities
Globalization is a relevant social and economic construct for understanding a
much-discussed world-wide economic, social, and cultural phenomenon whose
precise dimensions and exact definition are contested.
n161 On a cultural level, globalization manifests itself as
"[a] social process in which the constraints of geography on social and cultural
arrangements recede and in which people become increasingly aware that they are
n162 On an economic level, it is an international economic shift to a
geographically dispersed but globally integrated economy. Accordingly, from the
North American point of view, globalization has meant increased international
economic competition that undercut high-priced, American-based manufacturing
and caused manufacturing to shift first to the Southern and Western U.S. and
then overseas to countries with very low wages.
n163 Locally, globalization is considered to have impacted the ability of local
places to make decisions addressing their economic needs in the face of
hyper-mobile capital and fixed cities.
n164 Whatever the explanation, important changes in the organization of labor and
urban life have taken place throughout the world. While global trade and
competition have existed for centuries, rapid changes in technology, and in
particular communication, have contributed to the hyper-mobility of capital,
resulting in a decentered relationship between capital and labor.
n165 Under the current, service-dominated U.S. economy, cities' major employers are
now financial, educational, and health care institutions.
[*330] administrative arms of major corporations have remained in the U.S., the
economy has reshaped itself to meet the service needs of the new global
economic elite. Therefore, local urban economies that necessarily emphasize
expensive information services, communications, personal services, restaurants,
and advertising have given rise to an essentially bifurcated society and
economy. This has lead to cities characterized by a growing dualization between
extreme wealth and extreme poverty.
n167 Highly skilled, professional jobs fall into the primary sector, characterized
by high wages and privileges. Secondary sector jobs are, more often than not,
characterized by low wages, are often temporary, and do not offer benefits.
In the face of a decentralizing world, cities have competed with one another to
shore up their economic base in the form of local economic development,
utilizing a variety of tactics designed to make local areas hospitable and
attractive to private industry and business. This approach has evolved from
focusing exclusively on
"smokestack chasing" (i.e., trying to restore the eroded manufacturing base by enticing industry to
relocate to a particular jurisdiction) to a current emphasis on attempting to
identify and occupy a particular niche within the national and regional
n169 A significant part of the local economic development project involved
expanding and reconfiguring the central business district or downtown using
federal urban renewal funds, from the late 1940s until the early 1970s,
n170 and Community Development Block Grant funds and Urban Development Action
Grants, during the 1970s and early 1980s.
n171 Urban renewal, in particular, provided federal funds to allow cities to
condemn and acquire
"slum" properties and assemble them into large parcels of land to be redeveloped into
n172 Cities were dramatically affected as ailing business districts or former
warehouse districts were replaced with gleaming office towers, luxury hotels,
convention centers, and other recreation facilities.
n173 In fact, local economic development is specifically structured to meet the
high-end service, entertainment, and shopping needs of the
"global elite" as well as to promote tourism to attract suburban visitors. This emphasis has
converged with the spectacular rebirth of formerly ailing central business
districts in the form of newly gilded downtown areas organized around
showcasing the entertainment, sports, and cultural resources of cities in the
form of sports arenas, convention centers, and festival market places
replicated throughout the country:
n174 the Inner Harbor in Baltimore, surrounded by two new sports stadiums; the
Riverwalk in San Antonio, with a promenade of upscale restaurants and shops;
South Street Seaport in New York City, with an array of specialty food shops
and novelty vendors in a converted fish market; Quincy Market in Boston; and
Union Station in Washington D.C., with a gold-leaf trimmed, high-end shopping
mall and an array of restaurants.
Nevertheless, many cities are increasingly characterized by an incredibly
glaring duality - extreme wealth and extreme poverty.
n175 The rise of the gilded downtown (subsidized and funded with public dollars,
predicated on an unfulfilled promise that downtown revitalization would lead to
economic benefits for the entire city) has failed to benefit the neighborhoods
that are home to the poorest residents of the cities. While urban renewal
certainly allowed cities to transform their economies in the light of the
disappearance of manufacturing jobs, a great many of the newly created jobs
benefitted primarily suburban commuters.
n176 Moreover, urban renewal often eliminated poor and working class neighborhoods
and replaced them with high-rise, luxury structures for the more affluent while
concentrating public housing sites within black neighborhoods.
n177 Often poor neighborhoods just outside the revitalized
[*332] business districts benefit, if at all, only to the extent that the
neighborhoods become attractive to young urban professionals. However, the
gentrification usually results in displacement of the existing residents who are forced to
seek affordable housing elsewhere.
n178 Poor inner-city neighborhoods have not benefited from the economic development
going on around them because economic development promotes capital accumulation
and mobility that intentionally bypasses poor neighborhoods.
n179 Redevelopment policies, historically geared at containing the ghetto, were so
successful that, today, economic development activities need not be
deliberately geared at bypassing the ghetto - they do so as a matter of
practical common sense.
C. Impact of External Forces on the Central City
As globalization and technology have reorganized the nature and location of
productive, financially rewarding work and have skewed the economy into dual
sectors, the spatial consequences of globalization have been determined by
decentralizing forces existing at the local level. Poverty in particular places
generally begins not only with inequalities in global capitalist production but
also in societal patterns and conventions of discrimination.
n181 In different geographic contexts, this translates into striking geographic
variations in life opportunities for different people.
n182 Accordingly, the contours and conditions of inner city places cannot be
understood solely as a function of the activities that have or have not taken
place within the cities. Instead, the surrounding
[*333] regional context, federal policy, and local government fragmentation, as well
as the privatization of services, have each had a significant impact on the
urban inner city's condition. The contours and conditions of urban inner cities
have been shaped through a confluence of local decentralizing events,
influenced by state and federal policies and generally promoting the movement
of millions of people outwards to an ever-extending periphery of the
n183 As new production, transportation, and communication technologies have reduced
or eliminated the physical need to be geographically close to one's place of
work or business and have increased the distances that are part of daily life,
n184 populations within central cities have begun to decline as people moved from
the cities to the suburbs, subsidized by the mortgage interest tax deduction.
n185 Bank redlining
n186 and Federal Housing Administration policies perpetuated and skewed this
out-migration for many years by devaluing neighborhoods that were racially
mixed and by refusing to insure or make available mortgages for neighborhoods
occupied by blacks.
n188 and urban
n189 - movement from central cities and inner-ring suburbs to outer suburbs in
decreasingly dense settlement patterns
n190 - have been supported by federal highway and transportation policies and state
and local government law that allow locally fragmented government to practice
fiscal and racially exclusionary zoning.
n191 Through large-lot rules and other regulations, land use controls promote
high-end, single-family use and prevent less-costly, multifamily housing.
n192 Local government law has facilitated the contours, race, and class makeup of
the metropolitan region.
n193 Notions of localism reinforce geographical inequalities with political power
to the benefit of affluent localities and to the detriment of poorer
n194 By allowing suburbs to incorporate as autonomous municipalities regardless of
the motivation or impact on surrounding communities,
n195 by limiting cities' ability to
[*335] annex surrounding suburbs,
n196 by allowing suburban cities to utilize state-granted powers to control land
use through zoning,
n197 and by taxing suburbs and using the proceeds for the exclusive benefit of
n198 local government has been the facilitator of the decentralization of people
and jobs to the suburbs - while leaving central cities, and increasingly older,
inner ring suburbs, to cope with shrinking tax bases and higher concentrations
of poverty, crime, and the need for services.
n199 While many of the policies that gave rise to current metropolitan
configurations were carried out specifically for racially discriminatory
reasons or in a manner that was detrimental to black people, the race factor
has been neutralized into policies that continue to have a racially segregative
effect but are facially neutral.
n200 Therefore, a shifting, yet enduring, context of fear of otherness defined by
race and class continues to exist and operate.
D. The Significance of Racially Neutral Criteria for Inner City Boundaries and
While the criteria used for Empowerment Zone designation is textually
race-neutral, the eligible areas in cities happen to be racially and
economically concentrated in startlingly consistent patterns from city to city
throughout many cities in the U.S. and, as the discussion below will show,
conveniently play the same spatial role in each city. Each eligible Empowerment
Zone is located in a geographic area that is hyper-segregated, not only by
poverty, but by race - comprised of concentrated populations of poor black
people ranging from thirty-seven percent to ninety percent.
[SEE TABLE IN ORIGINAL]
By geographically targeting its efforts to address the poverty experienced in
these neighborhoods, Empowerment Zones were created
[*338] on the side of a boundary line with significant social and racial meaning. In
the cities, a strict line of demarcation - between central business district
and neighborhood, between affluence and poverty, between places to be sought
out and places to be avoided, between optimism and frustration, or simply
between black and white - clearly signals to all the difference between those
"live in the city" versus those who are
"inner city." As the discussion of the forces that gave shape to the ghetto demonstrates,
the hyper-concentration of poverty along racial lines is not simply an accident
of the market or individual choice. Studies illustrate the contrast between
segregation of the black and impoverished versus the white and impoverished.
n203 In a typical metropolitan area, most black and poor families are concentrated
in ghetto neighborhoods while most white and poor families are scattered
throughout suburban areas.
n204 While the characterization of either race or class as the determining factor
of concentrated poverty is debated,
n205 the fact remains that Empowerment Zones are being offered to remedy conditions
in particular places that have taken on a racialized character with significant
n206 As Edward Soja has explained, analysis of space is important because it
"enables us to see more clearly the long-hidden instrumentality of human
geographies, in particular, the encompassing and encaging spatializations of
n207 that occur in the city. In other words, space serves as the physical
manifestation of relationships.
n208 Contemplating the spatial role played
[*339] by the geographic areas that are Empowerment Zones provides crucial insight
into the relationships that take place in the city and the impact of those
relationships on the Empowerment Zones Program's potential to meet its stated
goals. Because the racially segregated city is
"a racialized social structure [that] frames racialized experience and
conditions racialized meaning,"
n209 the black racialized space of the ghetto is a place that provides an
identifiable and contained site where the
"Other" is located.
n210 A program that is predicated on helping the Other without really contemplating
the relationship that the dominant society has with the Other is inadequate
because it pretends away important barriers to the stated goal, barriers that
are insurmountable as long as they remain unacknowledged or deliberately
E. Images of the Places that are Empowerment Zones: Segregation and
The Empowerment Zones Program's goal is to attract businesses back to the city
into places that are racialized black and classified poor. Black racialized
space is regarded as extremely poor, overcrowded, dangerous, dilapidated, and
threatening to property values unless contained.
n211 This is the case regardless of whether a particular black neighborhood is in
fact as bad as it is regarded. The process of racializing space is distinct
from the fact that a neighborhood or area might be inhabited by people of one
race. Racializing space effectively demarcates particular areas
[*340] not only based on racial identity but also imposes popular stereotypes,
anxieties, and concerns on these places.
n212 The role of these places in the popular imagination justifies their
subordination and oppression. The ghetto is a place that makes the places
outside of it (whether affluent central-city neighborhoods, the suburbs, or
exurbs) a desirable refuge and a safe haven. Racialized space also provides a
stark point of reference that can make onlookers more content with where they
are in their lives.
n213 Black racialized space is also space that people usually leave as soon as they
are able: moving up means moving out.
n214 The irony of development programs designed to restore ghetto space back to its
prior glory is that those who are successfully aided to obtain employment will
usually be inclined to move out.
n215 Nevertheless, those who leave often move to suburban neighborhoods that are
predominantly black. Examples are neighborhoods like Baldwin Hills in
[*341] Los Angeles, California, Upper Marlboro, in Prince George's County Maryland,
and Shaker Heights outside of Cleveland, Ohio - all of which reflect the
results of affirmative action: increased purchasing power accompanied,
ironically, by a growing suburbanization trend for middle class blacks over the
past twenty-five years.
n216 While black suburban neighborhoods are solidly middle class and, in many
cases, quite affluent, they are nevertheless areas that are racialized black
and are devalued as compared to similar predominantly white neighborhoods in
terms of property values and business and retail services.
Places that have been racialized black and classified poor suffer devaluation
to such an extent that they are significantly marginalized. The life and the
work of the city happens around these neighborhoods, often nearby but
nevertheless outside. Communities receiving the most significant attention are
those areas that have
gentrification potential because they are located next to or close to the central business
n218 Otherwise, they are disconnected from activities and social interactions that
give life to the city. This marginalization is perhaps the most dangerous form
of oppression because it subjects an entire category of people to severe
material deprivation, or possibly extermination, because it banishes them from
productive participation in social life.
While it is indisputable that Empowerment Zone areas suffer from very high
rates of unemployment and have experienced serious business disinvestment,
economic development, in general, and the approach of Empowerment Zones, in
particular, treats the economic and social conditions within these
neighborhoods and their resulting
[*342] marginalization as an internally driven condition. This necessarily leads to a
focus on replacing missing jobs or bolstering social services such as
job-skills training and day-care services. Promoting business expansion and
economic growth logically follows as the most sensible way to alleviate the
problems of the ghetto. This internally driven view of marginalization is
defied by external realities. Because the Empowerment Zones Program fails to
acknowledge the structural issues confronting ghetto communities - as well as
the spatial and ideological biases of economic development, this program and
others similar to it are unlikely to ever appropriately address the oppression
and subordination experienced by these communities.
A critical theory of social justice is a useful starting point for adopting the
dialectical perspective necessary to allow us to move past looking at the
problems of impoverished inner city neighborhoods as simply an internally
driven and internally remediable problem. A critical examination must include
often-ignored social structures and institutional context that nevertheless
often determine distributive patterns.
n220 Because our dominant conception of justice currently exists within the limited
confines of a distributive paradigm of justice, we tend to think exclusively
about social justice based
"on the allocation of material goods such as things, resources, income, and
wealth, or on the distribution of social positions, especially jobs."
n221 This leads to
"talk of justice that regards persons as primarily possessors and consumers of
goods to a wider context that also includes action, decisions about action, and
provision of the means to develop and exercise capacities."
n222 In particular, a critical theory of social justice allows us to look beyond
issues of distribution directly at forms of oppression that are relevant to the
lived urban reality of affluence and poverty in the city. While oppression has
n223 the most illuminating aspects of oppression as applied to poor ghetto
neighborhoods and the economic development remedies that are practiced there
are marginalization, cultural imperialism, and exploitation.
n224 Cultural imperialism universalizes a dominant group's experience, culture, and
meanings in a way that renders the perspective of another group invisible
while, at the
[*343] same time, marking them as the deviant and inferior Other.
n225 The injustice of exploitation moves beyond a narrow Marxian vision of class
exploitation and encompasses other aspects of exploitation based on race or
"consists in social processes that bring about a transfer of energies from one
group to another to produce unequal distributions, and in the way in which
social institutions enable a few to accumulate while they constrain many more."
n227 Therefore, the oppression faced by ghetto communities that have been
racialized black and classified poor is that they are regarded as deviant and
inferior, often are subjected to programs that are beneficial to others and
less beneficial to them, and, most seriously of all, abandoned to suffer from a
marginalization that threatens to permanently cut them off from the rest of
V. The Internal Critique Of the Empowerment Zones Program
A. Job Essentialism and the Rhetoric of the Empowerment Zones Approach
The first issue critical theory raises with respect to the Empowerment Zones
approach is the extent to which it adopts an essentializing rhetoric of
"jobs" that reduces the problems of ghetto poverty to a unidimensional problem. This
rhetoric exercises a hegemonic force to get inner-city residents to
uncritically accept the program's terms because very few are situated to
critically assess the idea of jobs, regardless of the reality. Economic
development in general, and in particular as envisioned by the Empowerment
Zones Program, is primarily justified by the distributional promise of jobs.
Because living in central city ghetto or high poverty neighborhoods restricts
meaningful access to employment opportunities for black and Latino people in
inner-city neighborhoods, due to hyper-segregation and business disinvestment,
jobs seem to be the logical antidote.
[*344] theories generally attribute lack of proximity to jobs as a cause of
unemployment, while other explanations focus more closely on the individual
behavioral patterns of black inner-city residents.
n229 For example, the lack of economic opportunities available to black inner-city
residents has been connected to their social isolation which impacts both
connections to work opportunities and readiness for or inclination to work.
n230 Social connections to the mainstream individuals and institutions that provide
information about job opportunities and model good working habits is more
important than trying to reduce the spatial distance from work to home.
n231 Skills-mismatch theories emphasize the increasing mismatch between the skills
possessed by residents of low-income communities and the skills required by
jobs that dominate the central city economy.
Although it is beyond the scope of this Article to resolve this particular
dispute, it is important to note that the Empowerment Zones Program addresses
"employment" problem by incorporating all three types of approaches: business development,
skills training, and job-readiness training. Nevertheless, the overall approach
to the mal-distribution of employment opportunities is a static spatial
approach: picking a narrow target beneficiary area and attempting to encourage
potential employers to choose an Empowerment Zone as a location to operate a
new company or a new branch of an existing company. The wisdom of this approach
is questionable for a number of reasons. First, the reality of the relationship
between jobs and economic development is somewhat counterintuitive: economic
development is not synonymous with employment development.
n233 Instead, economic development is a process designed primarily, if not
exclusively, to meet the needs of business elites by encouraging capital
investment in particular
[*345] geographic areas through incentives.
n234 Jobs of a particular type, quantity, or duration are not guaranteed and, in
fact, are simply a possible secondary outcome and concern. The quality jobs
produced in most economic development projects often come from firms that
require highly skilled primary sector employees and are thus relevant to only
highly educated or trained people. More typically, the jobs found in the
typical convention center, sports stadium, or festival-marketplace are
low-skilled, service jobs that pay relatively low wages, insufficient to
support a family.
Even at the level of community economic development, the overall job benefits
have not been clearly demonstrated. For example, David Rusk's study of
community economic development suggested that this approach did not have an
economic impact on ghetto neighborhoods in the absence of
gentrification from an influx of affluent young, urban, and mostly white professionals.
n236 Rusk studied thirty-four community economic development programs in the United
States and found that the average household income improved in only three -
Jamaica Plain, Boston; Walnut Hills, Cincinnati; and Mission District, San
Francisco - all driven mainly by
n237 How are we to reconcile Rusk's conclusions with the many inspiring examples of
successfully completed community development projects?
n238 One explanation: While the
[*346] success of those projects tends to be measured on the successful completion of
each individual project, there is relatively little critically analytical
literature assessing the overall impact and efficacy of community development
as a national project.
The most significant criticism of the Empowerment Zones Program immediately
followed the adoption of the program from one commentator who argued that
community development is a myth that disserves ghetto communities which,
instead, need service provision.
n240 Because the Empowerment Zones approach conceives of the problems of the poor
ghetto neighborhoods and residents as a problem of jobs, it does the
communities a disservice by ignoring economic development's dubious
job-creating capacity and it simply misunderstands the oppression of geographic
space racialized black and classified poor. In other words, it disregards the
real problem - the subordinating structure of relations between elite and
marginalized communities within cities.
A second criticism of the Empowerment Zones Program's job emphasis is the fact
that the benefits of the program are tied to particular places, thereby
connoting that existing boundaries of ghetto neighborhoods should be respected
and maintained. This aspect of the program, in effect, imposes a federal
geography reinforcing existing spatial boundaries and demarcation lines between
ghetto communities and the rest of the city. This is because federal funding
establishes a development framework that acts as a disincentive to question
these boundaries and an incentive to respect them as acceptably fixed and
unchangeable. Also, the Empowerment Zones Program's benefits are tied to the
zone residents' continued residence in and connection to marginalized
n241 Making benefits available based on place of residence threatens to further
harden those boundaries. For example, an employee within an Empowerment Zone
who was hired by a business because of the tax incentives designed to encourage
the hiring of zone residents would no longer be eligible for those incentives
if the employee were to move.
[*347] A third criticism of the job emphasis is the underlying assumption that job
creation efforts within an Empowerment Zone will not result in increased
employment of ghetto residents.
n243 A study conducted in the Red Hook section of Brooklyn, New York demonstrated
that Red Hook residents were unable to obtain relatively low-skilled
manufacturing jobs in their own neighborhoods because social networks, rather
than employment proximity, were more crucial to employment.
n244 The implication of the Red Hook study for the Empowerment Zones Program is
that proximity will not necessarily lead to the desired goal of increased
employment within the zones. While the Empowerment Zones Program does contain
some flexibility to use program funds for building social networks, it and
similar economic development programs continue to enjoy a troubling level of
uncritical support simply by virtue of the persuasiveness and allure of the
"jobs" promise. The exclusive focus on jobs as the essential factor missing from poor
inner-city communities suggests that a lack of jobs is the only problem
experienced by poor neighborhoods that should be addressed. When there is a
hunger and unmet need for employment, all critical examination of economic
development as a sensible investment of public resources becomes impossible.
n245 In particular, the extent to which economic development meets the needs of
private business firms for capital investment while, at the same time,
imparting a less than satisfactory benefit to inner-city residents must be
critically examined. Justifying the Empowerment Zones Program on the promise of
jobs is based on the seemingly inevitable logic of promoting economic growth
and development even though it will not inure to the benefit of the targeted
communities. Rather, it obscures the true beneficiaries - established business
and governmental elites - while unfairly and unjustly playing upon the
desperation of those who have no other choice.
B. The Empowerment Zones Program's Reflection of New Federal Economic
Development Policy: No Business Relocation to the Inner Cities Allowed
The Empowerment Zones Program's eligibility requirements create a troubling
condition. As mentioned earlier, Empowerment Zone funds and incentives are only
available to newly created, startup businesses or to existing companies that
have expanded to create a new branch or office within the Empowerment Zone.
Moreover, as part of each city's application, the strategic plan is required to
recite that the plan
"does not include any action to assist any establishment in relocating from one
area outside the [Empowerment Zone] to the [Zone], except that assistance for
the expansion of an existing business entity through the establishment of a new
branch, affiliate, or subsidiary is permitted."
n246 Further, assistance to any such new entity is permitted only if establishment
of the new entity will not result in a decrease in employment in the area of
original location or in any other area where the existing business entity
conducts business operations, and there is no reason to believe that the new
[entity] is being established with the intention of closing down the operations
of the existing business entity in the area of its original location or in any
other area where the existing business entity conducts business operation.
The statute, in effect, requires a guarantee that the business firm has not
relocated from another area to the Empowerment Zone. Thus, the Empowerment Zone
incentives are only available to businesses that are new or expand to create a
new office in the Zone. This relocation retardant was included to calm suburban
representatives' fears that federal incentives would be used to lure businesses
from suburban locations.
As a matter of economic development policy, this restrictive provision of funds
and incentives contradicts the central basis of economic development, which is
the accepted goal of luring businesses with competitive incentives to
particular geographic areas that will be more advantageous and make the new
location worthwhile to the company. With respect to the Empowerment Zones
Program in particular, it means that the inner city economic development
incentives, to the extent that they could have worked, are weakened further in
their potential effect. Moreover, a study conducted by the General Accounting
Office reported that three out of the eight federal economic development
[*349] have outright prohibitions on the use of federal funds to relocate jobs.
One possible justification is that the federal government is, as a matter of
policy, acknowledging some of the potentially destructive effects of unfettered
geographic competition for business relocation. As a matter of timing and
historical sequence, however, the relocation retardant, as applied to the inner
cities, is at the very least ironic because one of the causes of inner city
decay was the relocation of jobs, often to suburban locations. As a result, two
standards for economic development have been created: one for cities and one
for suburbs. When jobs fled the cities facilitated by state and federal
policies and subsidies, relocation was an accepted process of inevitable
change. When the Empowerment Zones Program and other federal programs threaten
to reverse some of what was lost, by encouraging relocation from suburb to
city, economic development is transformed into a denuded process that cannot
provide incentives to compete geographically. Clearly, inner-city
marginalization is not aided by the relocation retardant. Instead, inner-city
marginalization is reinforced by a federal policy that fortifies the
decentralizing forces that benefited the suburbs to the detriment of the city.
Moreover, the retardant suggests the exploitative nature of Empowerment Zones
Program's promise that it is a program to provide jobs. To the extent that the
existing tax and financial incentives could attract a company to relocate and,
thereby, provide decent jobs, the relocation retardant means companies cannot
relocate and take advantage of the business incentives. Therefore, the job
promise becomes even more illusory.
VI. Conclusion: The Geography Of Economic Development: Addressing The
Structural Marginalization of the Inner City
Rather than being abandoned, as with most poststructural theory, development
must be analyzed in terms of contradiction, indeed ransacked, to liberate its
potentially emancipatory intentions, technologies, and practices.
Economic development has captured the popular imagination of the state as well
as the community as a desirable policy for producing wealth and economic
prosperity. As a policy for revitalization of black ghetto communities,
economic development clearly will never deliver what it promises: economic
transformation through self-help and hard work. There are three principle
reasons. First, as the foregoing discussion has demonstrated, the problems
experienced by ghetto communities are not all internally-driven. They are a
product of external forces - metropolitan, technological, and global - that
have all operated to eliminate the traditional job and population bases in the
inner cities, transferring some of these jobs to other regions of the United
States and the world, accompanied by a decentralization of population and jobs
to the peripheries of metropolitan areas. Second, economic development is not a
job development process, but, in truth, is a capital production process.
Therefore, it always has worked, and probably always will work, primarily to
benefit the interests of the business elite. While some benefits may accrue to
non-business, non-elite people, the jury is out on whether economic development
"ends justifies the means" test. Third, it is unlikely that enough jobs will ever return to the inner
cities to replace the ones that left. Absent personal or social network
connections, employers are reluctant to hire inner-city residents. Thus,
bringing the jobs to the cities is simply not enough.
The searing question, therefore, is whether economic development in general, or
the Empowerment Zones approach in particular, can be made to work as a tool of
social justice - in particular, in poor inner-city communities that are heavily
segregated by race, ethnicity and poverty. By drawing together the different
contextual dimensions of the problems facing poor inner city communities a
correspondingly contextually sensitive remedy begins to become clearer. In
[*351] rights paradigms must begin to conceive of ways of addressing the racially
disadvantaging effects of race, space, and place: the geography of economic
development. The current geography of economic development is one in which
economic development is designed and intended to be carried out in particular
ways in particular places: privately and exclusively in central business
districts on the other side of the line demarcating the difference between the
inner city and the rest of the city. By drawing upon existing geographic
boundaries that reflect the divided relationship between the people who live on
either side of the boundary, the Empowerment Zones Program recognizes and
implicitly affirms existing configurations of poverty segregated by race or
ethnicity. It threatens to harden these boundaries beyond all hope of remedy
because the program ignores current structural and historical policies that
have shaped and configured our racialized landscape. Even where it is clear
that the status quo works to the absolute disadvantage of these communities,
plans and policies persist in promoting them as the opposite: advantageous and
essential. This narrow focus on the problems of impoverished geographic areas
ignores the impact of their racialization and classification as Other within
the city as well as the metropolitan area. It also ignores a certain level of
contentment that the larger society has for the conditions because these
neighborhoods provide somewhere to get away from.
Overcoming the severe shortcomings inherent in the geography of economic
development requires moving beyond a way of thinking that trivializes the
oppression of racially and ethnically segregated communities as a problem of
mere distribution of jobs. Under this prevailing view, the only role for urban
policy is to ensure an improved distribution of low wage service jobs through a
process that validates business development as being the only hope left for
poor communities. The individualized and privatized notion of economic
development, which views obstacles solely as a matter of individual failure,
views the persistence of poor economic and social conditions in segregated
communities as an individual and private problem. Thus, individual residents
within Empowerment Zone communities, by definition, have failed personally
because of their own failure to keep up. Similarly, inner-city communities have
failed because they have failed to keep up with the competition. Just as
programs that address internal impediments to change or social justice are
important, so too are external impediments to change. Therefore, in order to
have an Empowerment
[*352] Zone program that is of benefit to poor urban communities, fundamental
structural issues must be confronted.
A simple way to confront the structural issues is to ask a critical question:
Can the Empowerment Zones approach reduce inner-city neighborhood
marginalization and return a whole category of place into the mainstream of
social and economic life? Ironically, the Empowerment Zones Program's
utilization of a geographically targeted economic development program does not
reduce marginalization but, in fact, reinforces and exacerbates ghetto
marginalization for a number of reasons. The chief reason is the program's
failure to address the underlying structural reasons for the depressed economic
and social conditions existing in the inner-city neighborhoods - the impact of
decentralizing forces in the metropolitan region reinforced by federal policy,
and the fragmented organizational structure of local government - both of which
are tainted by racism. First, as urban sprawl relocates persons to the
periphery of metropolitan areas, further and further away from the core, the
core inevitably suffers from depleted financial, social, and human resources
that have relocated to the suburbs.
n252 Second, fragmented local government erects jurisdictional boundaries that
insulate wealthier suburban areas from any responsibility for the communities
and people within cities that are left behind.
n253 Third, both historical and current policies further contribute to inner-city
marginalization by insulating and benefitting suburban communities. These
policies include FHA policies limiting public housing to the inner cities and
certain neighborhoods in the inner city, exclusionary zoning, bank redlining,
insurance redlining, public housing concentration, and transportation policies
that continue to fund highway development into outlying areas. If we view
neighborhoods not as autonomous, self-sufficient entities capable of
self-sustaining economic development but as parts of metropolitan regions, it
becomes clear that continuing growth of the metropolitan region through urban
sprawl, facilitated by federal subsidies that make continued expansion
possible, must be taken into account. So long as suburban dominance of our
metropolitan regions in terms of population, business operations, and political
clout is taken for granted as inevitable and immutable, an Empowerment Zones
[*353] will never have incentives strong enough to counteract that acceptance.
Finally, the structural causes and reinforcement of concentrated inner city
poverty can only be addressed by understanding that suburban advantage or
privilege will be affected by any urban program truly designed to impact the
problem of concentrated poverty.
Notwithstanding this seemingly bleak analysis, community-based development
cannot be completely abandoned. The opportunity to help oneself is critical to
human social development, if not to mere existence. Making available the tools
to identify problems in one's community and to remedy them are crucial, mainly
because small, unexpected miracles can be achieved by dint of human dedication
and commitment. Nevertheless, the provision of these tools does not replace the
need for critically assessing community-based development.
In its most favorable light, the Empowerment Zones Program is a federal attempt
to provide the tools of community-based development to inner-city communities.
This effort is valuable, especially given all of the attention and fanfare the
program's launch and implementation brought to these communities. On the other
hand, the fanfare and promises of economic transformation promised too much.
The conditions in the inner cities came about through a slow progression and,
likely, will require an equally long progression to fix. Moreover, while
recognizing that people should have the opportunity to work to improve, at
least incrementally, their living conditions, the Empowerment Zones Program
unnecessarily limits permissible projects and activities to those that can be
characterized as being in furtherance of economic development. Development
should be held to a higher standard - one of actually allowing residents of
impoverished neighborhoods the capacity to pursue self-development and
self-determination according to projects they identify.
The answer may lie simply in a willingness to understand that development needs
to be reimagined in ways that it does not currently exist today - reimagined in
ways that reflect the needs and desires of ordinary people and disregard the
unspoken demarcation lines between affluent city and impoverished ghetto;
reimagined in ways that do not continue to either isolate poor communities or
effectively eliminate them
gentrification; and reimagined in ways that do not continue to allow the existing local
governmental jurisdictional boundaries to block our abilities to think across
those demarcation lines. One way to begin that reimagining is to begin to
critically examine the accepted legal norms and legal processes of development.
Critical analysis of development requires not simply assuming that its problems
reflect faulty implementation strategies that can be fixed. Rather, critical
analysis must address development as an inherently contradictory method of
attaining social justice. As the quotation at the beginning of this section
asserts, development cannot and should not be completely abandoned. Rather, it
must be examined for its contradictions so that it can be redesigned and
implemented to address both external and internal structures and forces that
contribute to our segregated and racialized urban poverty.
n2. See Omnibus Budget Reconciliation Act of 1993,
26 U.S.C. 1391-1397(d) (1994), amended by Taxpayer Relief Act of 1997, Pub. L. No. 105-34,
951-952, 111 Stat. 788, 885.
n3. Office of Community Planning and Dev., Empowerment Zones Initiative,
& Enterprise Communities Fact Sheet (1996) [hereinafter Empowerment Zones
Initiative Fact Sheet].
26 U.S.C. 1392(a)(2) (1994); U.S. Dep't of HUD, Building Communities Together: Urban
Empowerment Zones and Enterprise Communities, HUD-1551-CPD (1995).
n5. Many poor people live in rural areas. See David T. Ellwood, Poor Support:
Poverty in the American Family 194 (1988) (reporting that 29% of the poor live
in small towns and rural areas). Because of this fact, Congress also provided
for the creation of three rural Empowerment Zones within three states: eastern
Kentucky, the Mississippi Delta and the Rio Grande Valley in Texas. See Bruce
K. Mulock, Congressional Research Service, Empowerment Zones/Enterprise
Communities Program: Background and Analysis of Economic Issues 4 (1995).
Because the majority of the poor live in urban areas and because of the
protracted history of attempting to remedy poverty in poor urban areas, this
Article focuses exclusively on urban Empowerment Zones.
n6. See Memorandum Establishing the President's Community Enterprise Board, 29
Weekly Comp. Pres. Doc. 1716 (July 12, 1993) (creating a federal inter-agency
26 U.S.C. 1391(f)(2)(B) (1994). But see Mildred Wigfall Robinson, Empowerment Zones and
Enterprise Communities Under the Omnibus Budget and Reconciliation Act of 1993:
A Promising Concept with Some Modifications,
11 J.L. & Pol. 345, 363 (1995) ("OBRA
"93's requirement for broad-based community participation will prove difficult
or impossible to administer, while benefiting enterprise communities and
empowerment zones little, if at all. It should thus be eliminated as an
n8. See Personal Responsibility and Work Opportunity Reconciliation Act of 1996,
Pub. L. No. 104-193, 110 Stat. 2105 (current version at
42 U.S.C. 1305 (1994
& Supp. III 1997)); see also Jennifer R. Wolch, America's New Urban Policy:
Welfare Reform and the Fate of American Cities, J. Am. Plan. Ass'n, Jan. 1,
1998, at 8 (arguing that welfare reform is the new national urban policy and
that this policy will alter cities' fate by deepening economic marginalization
and social isolation of residents).
n9. See Patricia A. Wilson, Empowerment: Community Economic Development from the
Inside Out, 33 Urban Studies 617, 622 (1996). Wilson defines the goal of
"self-realization of each individual's own well-being and potential for changing
themselves, their families and their community."
n10. See Nicholas Lemann, The Myth of Community Development, N.Y. Times Mag., Jan.
9, 1994, at 27, 28 (noting that efforts to improve slum conditions used to be
"social uplift" and included education, counseling, housing, and crime control).
n11. Empowerment Zones Initiative Fact Sheet, supra note 3, at 2. See also U.S.
Dep't of HUD, Building Communities Together: Urban Empowerment Zones
& Enterprise Communities Application Guide, HUD-1552-CPD (1995) [hereinafter
n12. See Gerald E. Frug, The City as a Legal Concept,
93 Harv. L. Rev. 1057 (1980); Joan C. Williams, The Constitutional Vulnerability of American Local
Government: The Politics of City Status in American Law,
1986 Wis. L. Rev. 83 (1986).
n13. Esteva, supra note 1, at 10.
n14. See John R. Logan
& Harvey L. Molotch, Urban Fortunes: The Political Economy of Place 3 (1987);
Manuel Castells, The City and the Grass Roots 319, 331 (1983) (noting that
cities are shaped by the struggles to promote use values, i.e., quality of
life, against the dominating combination of multinational capital, the mass
media, and the bureaucratic state which usually define urban living and
services as merely a commodity with an exchange value). See id.
n15. See generally The Development Dictionary: A Guide to Knowledge as Power
(Wolfgang Sachs ed., 1992) [hereinafter The Development Dictionary]; Dominating
Knowledge: Development, Culture and Resistance (Frederique Apffel Marglin
& Stephen A. Marglin eds., 1990) [hereinafter Dominating Knowledge]; Arturo
Escobar, Encountering Development: The Making and Unmaking of the Third World
n16. See Paulo Freire, Pedagogy of the Oppressed 137-38 (Myra Bergman Ramos trans.,
Seabury Press 1970).
n17. See id.
n18. See id. at 138 n.17.
n19. See Escobar, supra note 15, at 39-44; David Wilson, Metaphors, Growth
Coalition Discourses and Black Poverty Neighborhoods in a U.S. City, 28
Antipode 72, 73 (1996) (analyzing the metaphors used in
"growth" discourse in Indianapolis, Indiana).
n20. Escobar, supra note 15, at 44.
n21. See id. at 31. But see Richard Peet
& Michael Watts, Introduction: Development Theory and Environment in an Age of
Market Triumphalism, 69 Econ. Geography 227, 232 (1993) (arguing that the
development concept originated in 19th century
"organicist notions of growth").
n22. See Wolfgang Sachs, Introduction to The Development Dictionary, supra note 15,
n23. Escobar, supra note 15, at 22 (observing that systemic poverty emerged
"when the spread of the market economy broke down community ties and deprived
millions of people from access to land, water, and other resources").
n24. See John Foster-Bey, Bridging Communities: Making the Link Between Regional
Economies and Local Community Development,
8 Stan. L. & Pol'y Rev. 25, 26 (1997) (providing an overview of the evolution of Third-World development programs,
from ineffective village-based community development policies to large-scale,
elite-enhancing, macro-economic projects and then towards more
"people-centered" low-income strategies).
n25. Large-scale industrialization development projects are also faulted for
enriching the ruling elite to the detriment of the masses. Id.
n26. See Tariq Banuri, Modernization and its Discontents: A Cultural Perspective on
the Theories of Development, in Dominating Knowledge, supra note 15 at 59, 66.
We usually think of culture as a set of tacit rules that structure our social
interaction at one level. At another level, culture is the values that underlie
these rules and give the rules and our actions - meaning. Culture is not only
rules and values but ways of knowing. A culture is composed of many systems of
knowledge. A knowledge system is defined by 4 characteristics: 1) Epistemology
(theory of knowledge); 2) Transmission (rules for sharing knowledge); 3)
Innovation (distinctive ways for changing content of what counts as knowledge);
4) Power (political rules for governing relationships among insiders and
between insiders and outsiders). See Dominating Knowledge, supra note 15, at
24; see also Stephen A. Marglin, Losing Touch: The Cultural Conditions of
Worker Accomodation and Resistance, in Dominating Knowledge, supra note 15, at
n27. See, e.g., Hubert Camferns, Community Development Around the World: Practice,
& Training (1997); see also Sustainable Community Development: Studies in
Environmental and Cultural Revitalization (Marie D. Hoff ed., 1998) (discussing
origins and case studies of the
"new" approach to development).
n28. See Banuri, supra note 26, at 66; Escobar, supra note 15.
n29. See Foster-Bey, supra note 24, at 26.
n30. See generally Myron Orfield, Metropolitics (1997) (noting the decline of
inner-ring suburbs); David Rusk, Cities Without Suburbs (1993) (noting the
decline of inner-ring suburbs).
n31. See Douglas S. Massey
& Nancy A. Denton, American Apartheid: Segregation and the Making of the
Underclass (1993); The Urban Underclass (Christopher Jencks
& Paul E. Peterson eds., 1991).
n32. Richard D. Bingham
& Robert Mier, Preface to Theories of Local Economic Development: Perspectives
from Across the Disciplines at vii (Richard D. Bingham
& Robert Mier eds., 1993).
n33. See Gerald M. Meier, Leading Issues in Economic Development 6 (5th ed. 1989).
n34. See generally Public-Private Partnership: New Opportunities for Meeting Social
Needs (Harvey Brooks et al. eds., 1984).
n35. See Rochelle L. Stanfield, City Slickers, 29 Nat'l J. 1461, 1462-63 (1997)
(using the metaphors of hunting and gardening to contrast older and newer
methods of economic development). Hunting is the old way of smokestack chasing.
Gardening is the new method of growing businesses. See id.
n36. See Logan
& Molotch, supra note 14, at 57-62 (discussing elements of the modern-day
"good business climate").
n37. See Peter K. Eisinger, The Rise of the Entrepreneurial State: State and Local
Economic Development Policy in the United States 188-99 (1988).
n38. See Avis C. Vidal, Reintegrating Disadvantaged Communities into the Fabric of
Urban Life: The Role of Community Development, 6 Housing Pol'y Debate 169,
n39. See Foster-Bey, supra note 24, at 26.
n40. See Shanti K. Khinduka, Community Development: Potentials and Limitations
(1969), reprinted in New Perspectives on the American Community 396, 396
(Roland L. Warren
& Larry Lyon eds., 5th ed. 1988). The author defined community development as
a composite of process and [substantive] program objectives [that]... aims to
educate and motivate people for self-help; to develop responsible local
leadership; to inculcate among... the residents of urban areas a spirit of
civic consciousness; to introduce and strengthen democracy at the grass-roots
level through the creation and/or revitalization of institutions designed to
serve as instruments of local participation; to initiate a self-generative,
self-sustaining and enduring process of growth; to enable people to establish
and maintain cooperative and harmonious relationships; and to bring about
gradual and self-chosen changes in the community's life with a minimum of
stress and disruption.
n41. See Vidal, supra note 38, at 205, 208-215.
n42. See Hilary Abramson, Sign Out: Following Baltimore's Lead, Cities Nationwide
Are Getting Tough on Cigarette and Booze Billboards, City Paper (Baltimore),
Feb. 4, 1998, at 17 (detailing the grass-roots effort that gave rise to a ban
on billboards advertising cigarettes and alcohol although noting that the
advertising continued after the ruling);
Penn Adver., Inc. v. Mayor of Baltimore, 862 F. Supp. 1402 (D. Md. 1994), aff'd,
63 F.3d 1318 (4th Cir. 1995) (banning billboards advertising cigarettes in certain zones within the city);
Anheuser-Busch, Inc. v. Schmoke, 855 F. Supp. 811 (D. Md. 1994), aff'd,
63 F.3d 1305 (4th Cir. 1995) (upholding ordinance banning billboards advertising alcoholic beverages).
n43. See Peter Medoff
& Holly Sklar, Streets of Hope: The Fall and Rise of an Urban Neighborhood 69-74
(1994) (describing the beginning of anti-garbage projects that eventually lead
to housing rehabilitation projects).
n44. See generally Vidal, supra note 38, at 207, 212-215 (discussing community
building); Wilson, supra note 9, at 622 (analyzing the internally empowering
aspects of community development); Marilyn Gittell et al., Expanding Civic
Opportunity: Urban Empowerment Zones, 33 Urb. Aff. Rev. 530 (March 1998)
(examining the extent to which the Empowerment Zones Program has contributed to
the expansion of community capacity).
n45. See Randy Stoecker, The CDC Model of Urban Redevelopment: A Critique and an
Alternative, 19 J. Urb. Aff. 1, 7-8 (1997) (discussing financial constraints,
dependence on staff for leadership, and other structural constraints that can
lead to illusory community control). See generally Rachel G. Bratt, CDCs:
Contributions Outweigh Contradictions, A Reply to Randy Stoecker, 19 J. Urb.
Aff. 23 (1997); W. Dennis Keating, The CDC Model of Urban Development: A Reply
to Randy Stoecker, 19 J. Urb. Aff. 29 (1997); Randy Stoecker, Should We...
Could We... Change the CDC Model?, A Rejoinder, 19 J. Urb. Aff. 35 (1997).
n46. See generally Rob Gurwitt, Neighborhoods and the Urban Crisis, Governing
Magazine (Sept. 1992); Ron Stodghill II, Bringing Back Hope to the Hood, Bus.
Wk. (Aug. 19, 1996); Alexander Van Hoffman, Good News! From Boston to San
Francisco the Community-Based Movement Is Transforming Bad Neighborhoods, 279
The Atlantic Monthly 31 (Jan. 1997); but see Robert Worth, Guess Who Saved the
South Bronx? Big Government; Urban Renewal in New York, New York, 4 Wash.
Monthly 26 (arguing that CDCs could not have reversed urban decline in the
South Bronx without federal government help).
n47. See Medoff
& Sklar, supra note 43, at 251-71.
n48. See Vidal, supra note 38, at 209.
n49. See id. at 210-11.
n50. See id. at 211-12.
n51. See Richard Thompson Ford, The Boundaries of Race: Political Geography in
107 Harv. L. Rev. 1841, 1849-57 (1994) (arguing that affirmative steps must be taken to eliminate segregation, which
has developed into a self-perpetuating condition).
n52. See Escobar, supra note 15, at 85 (describing the typical identity and role of
the development economist).
n53. See Lemann, supra note 10, at 54 (criticizing community development and
community economic development, in particular, as expedient myth).
n54. See Michael E. Porter, The Competitive Advantage of the Inner City, Harv. Bus.
Rev., May-June 1995, at 55, 71. Porter argues in favor of rethinking the inner
city in economic rather than social terms and that community-based
organizations should restrict their activities to service delivery and not
engage in economic development activities. Rather, these local groups should
"help create a hospitable environment for business by working to change
community and workforce attitudes and acting as a liaison with residents to
quell unfounded opposition to new businesses." Id. at 70.
n55. See Vidal, supra note 38, at 211-12.
n56. See Michael H. Schill, Assessing the Role of Community Development
Corporations in Inner City Economic Development,
22 N.Y.U. Rev. L. & Soc. Change 753, 771 (1997); see also Susan R. Jones, Small Business and Community Economic Development:
Transactional Lawyering for Social Change and Economic Justice,
4 Clinical L. Rev. 195 (1997).
n57. See Schill, supra note 56, at 771; see also David Osborne, Bootstrap Banking,
Inc., Aug. 1, 1987, at 69, 70-71 (detailing the rise in popularity of the peer
lending circles made popular by Bangladesh's Grameen Bank). But see Lawrence
Solomon, Micro-Credit's Dark Underside, World Press Rev., Aug. 1998, at 33, 33
(describing the problems that befall impoverished borrowers who are unable to
repay loans, including loans from moneylenders at ruinous rates, and also
noting that membership in the bank had fallen from a high of 375,000 people a
year in 1993, to fewer than 200,000 in 1994, and to 50,000 in 1995); John
Buntin, Bad Credit: Microcredit Yields Macroproblems, The New Republic, Mar.
31, 1997, at 10, 10 (noting that
"microcredit programs have generally flourished in places where the majority of
the workforce is self-employed, the economy
"informal' and credit shortages the primary obstacle to founding a business"). This is not the case in the United States, where the informal economy is
generally regulated. See Regina Austin,
"An Honest Living": Street Vendors, Municipal Regulation and the Black Public Space,
103 Yale L.J. 2119, 2121 n.4 (June 1994).
Following the same principle of peer-enforced, rotating credit arrangements,
these lending circles have been practiced independently by immigrants to the
United States under many different names: Mandarin Chinese and Vietnamese
(hui), Haitian (sangue or min), Korean (keh), Japanese (tanomoshi), Mexican
(tanda), Ethiopian (ekub) and West Indian (su-su). See Eva Pomice, New
Bootstraps for Today's Immigrant Entrepreneurs; The Ties That Bind - and
Enrich, U.S. News
& World Rep., Apr. 25, 1988, at 42, 43; see also Christine Gorman,
Do-It-Yourself Financing; Loan Clubs Offer Cash and Dreams, Time, July 25,
1988, at 62, 62, cited in Jane Kaufman Winn, Banking and Finance in Taiwan: The
Prospects for Internationalization in the 1990s,
25 Int'l Law. 907, 917 (1991); Michel S. Laguerre, Rotating Credit Associations and the Diasporic Economy, 3
J. Developmental Entrepreneurship 23, 23-24 (1998).
n58. See Iris Marion Young, Justice and the Politics of Difference 15-25 (1990).
n59. While economic issues became a part of the Civil Rights agenda when the
movement focused its energy on the problems of black people in Northern cities,
see David J. Garrow, Bearing the Cross: Martin Luther King, Jr. and the
Southern Christian Leadership Conference 462 (1987) (describing the Southern
Christian Leadership Conference's
"Operation Breadbasket," an effort to negotiate increased black employment in targeted industries), the
chief thrust and impact of the movement was in eliminating legalized Southern
n60. See Gordon Clark, The Geography of Law, in New Models in Geography: The
Political-Economy Perspective 310, 312 (Richard Peet
& Nigel Thrift eds., 1989) (arguing that Anglo-American laws
"rest on [the]... supposition [that] there are inalienable rights which we as
human beings deserve and have the right to claim regardless of social
n61. See generally Martha F. Davis, Brutal Need: Lawyers and the Welfare Rights
Movement, 1960-1973 (1993).
n62. See, e.g.,
Goldberg v. Kelly, 397 U.S. 254 (1970); see also Joel F. Handler,
"Constructing the Political Spectacle": The Interpretation of Entitlements, Legalization and Obligations in Social
56 Brook. L. Rev. 899 (1990).
Nollan v. California Coastal Comm'n, 483 U.S. 825 (1987);
First English Evangelical Lutheran Church v. County of Los Angeles, 482 U.S. 304 (1987)';
Dolan v. City of Tigard, 512 U.S. 374 (1994);
Lucas v. South Carolina Coastal Council, 505 U.S. 1003 (1992); see also
Suitum v. Tahoe Regional Planning Agency, 520 U.S. 725 (1997).
n64. See cases cited supra note 63.
Printz v. United States, 521 U.S. 898 (1997);
United States v. Lopez, 514 U.S. 549 (1995);
New York v. United States, 505 U.S. 144 (1992);
Garcia v. San Antonio Metro. Transit Auth., 469 U.S. 528 (1985). But see
National League of Cities v. Usery, 426 U.S. 833 (1976), overruled by
Garcia v. San Antonio Metro. Transit Auth., 469 U.S. 528 (1985).
n66. See Carol M. Rose, The Several Futures of Property: Of Cyberspace and Folk
Tales, Emission Trades and Ecosystems,
83 Minn. L. Rev. 129, 172-73 (1998) (discussing environmental justice as a problem of uneven or partial
propertization between wealthier, white communities that enjoy a
community-wide, property-like protection of their communities, and poor, black
communities that suffer from an inadequate recognition or protection of their
communities' property rights). Rose suggests that correcting the imbalance in
property rights by recognizing more protectable property rights in poor, black
communities is preferable to resorting to increased environmental regulatory
id. at 173.
n67. See generally Richard Briffault, Our Localism: Part II-Localism and Legal
90 Colum. L. Rev. 346 (1990).
n68. A defensible space is a living residential environment that groups dwelling
units so as to reinforce a sense of security by creating a
"clear understanding of the function of a space, and who its users are and ought
to be." Oscar Newman, Defensible Space: Crime Prevention Through Urban Design 3-4
n69. See generally Dennis Farney, Elite Theory: Have Liberals Ignored
"Have-Less' Whites at Their Own Peril?: Anger in a Tennessee Town Unmasks Deep
Divisions, Trouble for Democrats, Wall St. J., Dec. 14, 1994, at A1; Chris
Tilly, Short Hours, Short Shrift: Causes and Consequences of Part-Time Work
(1990); Polly Callaghan
& Heidi Hartmann, Contingent Work: A Chart Book on Part-Time and Temporary
n70. See Janet E. Kodras, The Changing Map of American Poverty in an Era of
Economic Restructuring and Political Realignment, 73 Econ. Geography 67, 73-74
(1997) ("As increasing numbers of Americans faced economic insecurity through rising
unemployment, falling real wages, declining benefits, and dwindling savings,
many bought the argument that the government lavished their hard-earned tax
dollars on the undeserving and indolent, despite the fact that less than 4
percent of the federal budget was allocated to means-tested public assistance.").
42 U.S.C. 601-03 (1994
& Supp. III 1997).
n72. See Luther K. Snow, Economic Development Breaks the Mold: Community-Building,
Place-Targeting, and Empowerment Zones, 9 Econ. Dev. Q. 185, 188 (1995).
n73. See, e.g., James Traub, Floyd Flake's Middle America, N.Y. Times Mag., Oct.
19, 1997, at 60, 102 (describing former Congressman Floyd Flake's church-based
community development empire as fueled by a post-civil-rights, bootstrap
philosophy practiced by congregants who do not seek redress as victims).
n74. See Barbara Stark, Urban Despair and Nietzsche's
"Eternal Return": From the Municipal Rhetoric of Economic Justice to the International Law of
28 Vand. J. Transnat'l L. 185, 227 (1995) (arguing that the United States has already agreed to the existence of
economic rights by signing international treaties guaranteeing the recognition
of such rights).
Adarand Constructors, Inc. v. Pena, 515 U.S. 200 (1995) (holding that federal minority set-aside public contracting programs, like
state programs, must withstand strict judicial scrutiny and be narrowly
tailored to further compelling government interests);
City of Richmond v. J.A. Croson Co., 488 U.S. 469 (1989) (holding that state minority set-aside public contracting programs must
withstand strict scrutiny and be narrowly tailored to further compelling
n76. See Rob Imrie
& Huw Thomas, Law, Legal Struggles and Urban Regeneration: Rethinking the
Relationships, 34 Urb. Stud. 1401, 1402 (1997). For example, law provides the
neutrally supportive tools of contract, rules of corporate organization, rules
of property ownership, real estate transactions, eminent domain, and local
government organization. The extent to which legal tools or doctrines support
and are supported by the economic development discourse as a method of
legitimating development processes that may or may not be favorable to
particular types of social groups or geographic areas seems a relevant point of
inquiry. See id.
n77. Edward Soja, Afterword,
48 Stan. L. Rev. 1421, 1426 (1996).
26 U.S.C. 1394 (1994
& Supp. III 1997).
n79. See id.
n80. See, e.g., John P. Blair, Local Economic Development: Analysis and Practice
179 (1995) (suggesting that economic development subsidies can be poorly
targeted when a local community provides a service or infrastructure
improvement that is costly to taxpayers and not highly valued by the locating
n81. See Logan
& Molotch, supra note 14, at 59.
26 U.S.C. 1391(f)(2)(F) (1994); see also Audrey G. McFarlane, Empowerment Zones: Urban
Revitalization Through Collaborative Enterprise, 5 J. Affordable Housing
& Community Dev. 35, 38-39 (1995). In fact, the Empowerment Zone statute
requires oversight to ensure that no ill effects are suffered by the area where
the business has been conducting its primary operations. See U.S. General
Accounting Office, Community Development: Status of Urban Empowerment Zones,
GAO/RCED 97-21 (1996) [hereinafter GAO Report].
42 U.S.C. 1397a (1994). SSBG funds are typically used by state governments to fund social
"[OBRA] amended title XX of the Social Security Act to authorize the special use
of SSBG funds for the EZ program... to cover a range of economic and social
development activities." GAO Report, supra note 82, at 3.
26 U.S.C. 1391(f)(2)(B) (1994). As a result of the community participation requirement each
city has established a somewhat elaborate governance structure in order to
ensure that the empowerment zone process is controlled by a partnership between
ordinary residents, businesses, government, religious organizations, and
non-profit entities. See Who's Making the Decisions: Governance in the
Empowerment Zone, EZ Exchange: A Nat'l Empowerment Zone Q., Jan. 1996, at 1, 1
(describing the governance structures within each city awarded Empowerment Zone
n85. In 1994, six cities were designated as Urban Empowerment Zones. In 1997, the
number was expanded from six to eight when HUD administratively named Los
Angeles and Cleveland as Supplemental Empowerment Zones eligible for $ 125
million and $ 90 million in HUD economic development grants, respectively, but
ineligible for federal tax incentives. See
26 U.S.C. 1391(b)(2) (1994
& Supp. III 1997). In 1997, Congress authorized Los Angeles and Cleveland to
become full-fledged Empowerment Zones, eligible for the federal tax incentives
beginning in January of 2000. In addition, up to 20 other Empowerment Zones
were authorized (15 urban and five rural), which will only have the federal tax
incentives; SSBG funds will not be available. See Taxpayer Relief Act of 1997,
26 U.S.C. 1391(g) (1994
& Supp. III 1997). While designations were made during 1998, these are effective
January 1, 2000. See Taxpayer Relief Act of 1997, Pub. L. No. 105-34, reprinted
in 1997 U.S.C.C.A.N. 678, 1314.
26 U.S.C. 1391(f)(2)(A) (1994).
n87. See HUD Regulations,
24 C.F.R. 597.200(c) (1998). The strategic plan is also required to demonstrate how the affected
community was made a full partner in the process of developing and implementing
the plan and the extent to which local institutions and organizations
contributed to the planning process. Id.
n88. See GAO Report, supra note 82, at 14.
n89. See June Manning Thomas, Applying for Empowerment Zone Designation: A Tale of
Woe and Triumph, 9 Econ. Dev. Q. 212, 219 (1995); GAO Report, supra note 82, at
n90. See Todd Swanstrom, The Limits of Strategic Planning for Cities, 9 J. Urb.
Aff. 139, 150-52 (1987) (arguing that strategic planning by cities is not a
neutral technique; rather, strategic planning biases the planning agenda in
favor of economic growth over other goals such as redistribution of wealth or
n91. See GAO Report, supra note 82, at 15. The report states that
the measures being used generally describe the amount of work that will be
produced (outputs) rather than the results that are anticipated (outcomes). For
example, for the... benchmark...establishing a one-stop capital shop... the
[Empowerment Zone] has not indicated how the outputs (the amount of money
provided in commercial lending, the number of loans made, the number of
consultations provided, and the number of people trained) will help to achieve
the desired outcome (creating economic opportunity... ). To link the outputs to
the outcome, the [Empowerment Zone] could measure the extent to which
accomplishing the benchmark increases the number of businesses located in the
zone. Without identifying and measuring desired outcomes, HUD and the
[Empowerment Zones] may have difficulty determining how much progress the
[Empowerment Zones] are making toward accomplishing the program's overall
n92. See, e.g., Thomas L. Friedman, Cold War Agency Looks at Problems Back Home,
N.Y. Times, June 26, 1994, at A1 (stating that United States AID announced
plans to explore the possibility of directing its international development
expertise towards domestic social and economic problems of the inner cities.)
n93. See United States Housing Act of 1937, Pub. L. No. 75-412, 50 Stat. 888
(current version at
42 U.S.C. 1437-44 (1994
& Supp. III 1997)) (making federal public housing funds available for cities
that undertook slum clearance).
n94. See United States Housing Act of 1949, Pub. L. No. 81-171, 101-110, 63 Stat.
413, 414-21 (replaced by Title I of the Housing and Community Act of 1974, Pub.
L. No. 93-383, 101-118, 88 Stat. 633, 633-653, current version at
42 U.S.C. 5301-5320 (1994
& Supp. III 1997)); Keith Aoki, Race, Space and Place: The Relation Between
Architectural Modernism, Post-Modernism, Urban Planning and
20 Fordham Urb. L. J. 699 (1993).
n95. Charles M. Haar
& Michael Allan Wolf, Land Use Planning, A Casebook on the Use, Misuse and
Re-Use of Urban Land 784 (4th ed. 1989).
n96. Sarah F. Liebschutz, Empowerment Zones and Enterprise Communities: Reinventing
Federalism for Distressed Communities, Publius, Summer 1995, at 117, 125.
n97. See Nicholas Lemann, The Unfinished War, Atlantic, Dec. 1988, at 37, 48.
n98. See id.
n99. See Robert Halpern, Rebuilding the Inner City: A History of Neighborhood
Initiatives to Address Poverty in the United States 124 (1995) ("Locating the urban strategies of the War on Poverty almost exclusively in
isolated and depleted neighborhoods was a fatally planned strategy, particulary
in that time and place.").
n100. See id. at 107.
n101. See Lemann, supra note 97, at 49.
n102. See Halpern, supra note 99, at 108.
n103. See Foster-Bey, supra note 24, at 27; Halpern, supra note 99, at 115; Lemann,
supra note 97, at 49.
n104. Halpern, supra note 99, at 108.
n105. See Halpern, supra note 99, at 118 ("Model Cities was to be community development de-coupled from community action"), referring to the Demonstration Cities and Metropolitan Development (the
Model Cities Program) Act, Pub. L. No. 89-754, 80 Stat. 1255 (repealed 1975)).
The Model Cities Program was terminated and folded into the Community
Development Block Grant program in 1974. See Bernard J. Friedan
& Marshall Kaplan, The Politics of Neglect: Urban Aid from Model Cities to
Revenue Sharing 47-49, 215-16 (1975).
n106. See Peter B. Edelman, Toward a Comprehensive Anti-Poverty Strategy: Getting
Beyond the Silver Bullet,
81 Geo. L.J. 1697, 1715-16 (1993).
n107. The Model Cities Program was continuously underfunded because congressional
appropriations, designed to provide funding for 75 cities, were never increased
despite the fact that the number of cities awarded funds tripled to 225. See
Otto J. Hetzel, Some Historical Lessons for Implementing the Clinton
Administration's Empowerment Zones and Enterprise Communities Program:
Experiences from the Model Cities Program,
26 Urb. Law. 63, 72 n.18 (1994).
n108. See Halpern, supra note 99, at 122 ("In most cities, plans were often prepared by City Hall before neighborhood
residents could mobilize."). See, e.g.,
North City Area-Wide Council, Inc. v. Romney, 456 F.2d 811 (3d Cir. 1972) (holding community organization was wrongfully excluded from participation in
implementation of Philadelphia Model Cities Program).
n109. Halpern, supra note 99, at 124.
n110. See Lemann, supra note 10, at 30; Marilyn Marks Rubin, Can Reorchestration of
Historical Themes Reinvent Government? A Case Study of the Empowerment Zones
and Enterprise Communities Act of 1993, 54 Pub. Admin. Rev. 161, 166 (1994).
n111. See, e.g., Memorandum Establishing the President's Community Enterprise Board,
29 Weekly Comp. Pres. Doc. 1716 (Sept. 9, 1993).
24 C.F.R. 597.200(a) (1999) (setting forth comprehensive planning principles to be incorporated in
the strategic plan); Halpern, supra note 99, at 121.
n113. See Hetzel, supra note 107, at 71-72 (cautioning the EZ program to ensure that
constituents of a majority of legislators will participate in order to maintain
a funding stream).
n114. See Vidal, supra note 38, at 175.
n115. See Logan
& Molotch, supra note 14, at 290 (articulating the
"philosophy of the enterprise zone: to reduce to a bare minimum the place
constraints on the organization of capital").
n116. See Peter Hall, The British Enterprise Zones, in Enterprise Zones: New
Directions in Economic Development 179, 180-81 (Roy E. Green ed., 1991)
[hereinafter Enterprise Zones].
n117. See id.
n118. See id.
n119. Stuart M. Butler, The Conceptual Evolution of Enterprise Zones, in Enterprise
Zones, supra note 116, at 27, 27.
n120. See William W. Goldsmith, Enterprise Zones: If They Work, We're in Trouble, 6
Int'l J. Urb.
& Regional Res. 435, 435 (1982); see also Martin Hart-Landsberg
& Paul Burkett, Contradictions of Capitalist Industrialization in East Asia: A
"Flying Geese" Theories of Development, 74 Econ. Geography 87, 88 (1998) (questioning the
"miracle" and examining its potential to
"generate new and wider competitive pressures on workers and their communities
[that will] create the objective basis for new and wider forms of
anticapitalist solidarity and struggle").
n121. Goldsmith, supra note 120, at 435.
n122. Id. at 437.
n123. Id. at 439-40. Goldsmith explains:
Hong Kong, as a financial centre, a gateway to China, and an outpost of British
and other western interests, is the beneficiary of intensive commercial
activity.... South Korea and Taiwan are different from their neighbours for
many reasons. Perhaps most important, they were the beneficiaries of extended
financial assistance and trade concessions from the United States during the
long postwar era, and they were also deeply involved in the economic boom from
America's almost continuous military involvement in east and southeast Asia.
Id. at 440; see also Ramon E. Daubon
& Jose J. Villamil, Puerto Rico as an Enterprise Zone, in Enterprise Zones,
supra note 116, at 207 (describing the less than successful Puerto Rican
experience as an enterprise zone, predating Hall's
"freeport" idea); Hall, supra note 116, at 181 (admitting that his reliance on Hong Kong
failed to take into account
"the huge scale of its subsidized public housing program, which...played a vital
role in allowing employers to resist demands for higher wages").
n124. See Butler, supra note 119, at 31.
n125. See Porter, supra note 54, at 63, 71 (calling for the elimination of
unnecessary municipal business and land use regulations that stifle untapped
potential for inner city economic development).
n126. Susan E. Clarke
& Gary L. Gaile, Local Politics in a Global Era: Thinking Locally, Acting
Globally, 551 Annals Am. Acad. Pol.
& Soc. Sci. 28, 33 (1997) (emphasis added).
n127. Butler, supra note 119, at 32.
n128. Id. at 33.
n129. See id. at 39.
"Notwithstanding bipartisan support in Congress, enterprise zone legislative
proposals failed repeatedly throughout the 1980s for a number of complex and
disputed reasons." Id. In 1987, a weak version of enterprise zone legislation was enacted.
Enterprise Zone Development, Title VII of the Housing and Community Development
Act of 1987, Pub. L. No. 100-242, 101 Stat. 1815 (1988). The law, which was
never implemented, relied only on enhanced federal agency coordination and
expedited handling of existing HUD or USDA programs within the established
zones. See Rodney Erickson
& Susan W. Friedman, Comparative Dimensions of State Enterprise Zone Policies,
in Enterprise Zones, supra note 116, at 155, 155; Revenue Act of 1992, H.R. 11,
102d Cong.; see also H.R. Rep. No. 102-1034, at 690-725 (1992) (discussing the
enterprise zone bill provisions).
n130. See Enid Beaumont, Enterprise Zones and Federalism, in Enterprise Zones, supra
note 116, at 41, 43.
Department of Revenue of Or. v. ACF Indus., 510 U.S. 332, 347 (1994) (noting the common state practice of granting tax exemptions to private
commercial entities for
Maready v. City of Winston-Salem, 467 S.E.2d 615 (N.C. 1996) (rejecting challenge to the use of public tax dollars to promote private
business development and discussing the evolution of state economic development
n132. See Beaumont, supra note 130, at 41, 43.
n133. Richard Briffault, The Rise of Sublocal Structures in Urban Governance,
82 Minn. L. Rev. 503, 510 (1997). Even the original deliberately created enterprise zone is not the
"self-executing" zone of unregulated business activity. See Bob Colenutt, The London Docklands
Development Corporation: Has the Community Benefited?, in Hollow Promises:
Rhetoric and Reality in the Inner City 31 (Michael Keith
& Alisdair Rogers eds., 1991) (offering a critical assessment of the London
Docklands Development Corporation); see also Timothy Bates, Political Economy
of Urban Poverty in the 21st Century: How Progress and Public Policy Generate
Rising Poverty, in The Inner City: Urban Poverty and Economic Development in
the Next Century 111 (Thomas D. Boston
& Catherine L. Ross eds., 1997) (arguing that the Reagan administration's
initial conception of enterprise zones sought to adopt the laissez-faire
practices of the informal economy).
n134. Briffault, supra note 133, at 510; see also James A. Schriner, Bottom-Line
Governors: States Change Their Use of Incentives - and Firms Can Benefit,
Industry Wk., Nov. 4, 1996, at 74, 74 (suggesting that states are shifting
their emphasis from incentives to encourage firm relocation to incentives
intended to promote firm retention).
n135. Vidal, supra note 38, at 179.
n136. Id. at 179.
n137. See id. at 180 (citing Rodney A. Erickson
& Susan W. Friedman, Comparative Dimensions of State Enterprise Zone Policies,
in Enterprise Zones, supra note 116, at 155).
n138. Franklin J. James, The Evaluation of Enterprise Zone Programs, in Enterprise
Zones, supra note 116, at 225, 232.
n139. Vidal, supra note 38, at 180.
n140. See Margaret G. Wilder
& Barry M. Rubin, Rhetoric Versus Reality: A Review of Studies on State
Enterprise Zone Programs, 62 J. Am. Plan. Ass'n 473 (1996).
n141. See James, supra note 138, at 233-34.
n142. See Robert Cover, Nomos and Narrative, in Narative, Violence, and the Law: The
Essays of Robert Cover 101 (Martha Minow et al. eds., 1992) ("Law may be viewed as a system of tension or bridge linking a concept of a
reality to an imagined alternative ....").
n143. See Fred Siegel, Don't Feed the Bureaucracies, New Democrat, Nov. 1993, at 18,
18 ("Enterprise zones... confuse social isolation with geographic distance.").
n144. See Logan and Molotch, supra note 14, at 246-47. Iris Young has observed that,
despite contemporary rhetoric to the contrary, the primary beneficiary of big
government in advanced capitalism is private enterprise, which has become
inextricably dependent on government for its continued welfare. Government
creates institutions and develops policies explicitly aimed at promoting the
long-term interests of capital accumulation. To this end federal and sometimes
local government regulates the economic system through tax policy, monetary
policy, tariffs and import-export trade policies, debt spending, farm and
corporate subsidies, and regulation of its own spending levels.
Young, supra note 58, at 68.
n145. See Briffault, supra note 133.
n146. Although the concepts of
"place" seem interchangeable, when I refer to place, I am referring to geographic
place which is, admittedly, a spatial concept. When I refer to space, I am
referring to space as a representation of ideas, beliefs, and relationships
that is, by definition, ideological and contested. See, e.g., Henri Lefebvre,
The Production of Space (Donald Nicholson-Smith trans., Blackwell Publishers
1991) (1974). In attempting to construct a science of space through analysis of
spatial practices, representations of space and representational spaces,
Lefebvre has criticized the overuse of the term
"space" and the frequent failure to define the term. See id. at 3-4.
n147. See Donald A. Hicks, Revitalizing Our Cities or Restoring Ties to Them?
Redirecting the Debate, 27 U. Mich. J.L. Reform 813, 858 (1994) (criticizing
place-based targeting of urban policy for failing to take into account how real
economies perform and transform over time and noting that,
"places, and people in places, are ever
"in play' as the development of larger economic systems proceeds"); Miguel de Oliver
& Teresa Dawson-Munoz,
"Place-Not-Race"?: The Inadequacy of Geography to Address Racial Disparities, 25 Rev. Black
Pol. Econ. 37, 42 (Sept. 22, 1996) (arguing that geographically based
development programs will disproportionately benefit
n148. See Clarke
& Gaile, supra note 126, at 33. According to Clarke and Gaile,
Place-based funding [has] increasingly [been] replaced by transfer payments to
individuals, particularly the nonurban middle class and elderly. In 1996 [the
Clinton Administration] proposed that 61 percent of federal aid to states and
local governments go directly to individuals, compared to 35 percent in 1960;
16 percent in capital grants to state and local governments, compared to 47
percent in 1960; and 22 percent in other state and local grants, compared to 17
percent in 1960.
Id. The authors further noted that
"Empowerment Zone program includes more social funding than [other recent]
proposals, but stirs only modest local expectations." Id.
n149. See Liebschutz, supra note 96, at 122-23. The author writes,
Although total federal aid to state and local governments increased by 33
percent during the 1980s - and even more dramatically between 1988 and 1994, by
88 percent - it was almost entirely driven by rises in aid for persons. In
1980, 35.7 percent of federal intergovernmental grants were dedicated for
payments to individuals; by 1994, that proportion was estimated at 63.3 percent.
Id. (citing U.S. Advisory Comm'n on Intergovernmental Relations, Significant
Features of Fiscal Federalism 9 (1994)).
26 U.S.C. 1392(a)(1), (a)(2), (a)(3)(A), 1391(b)(2) (1994
& Supp. III 1997).
n151. The legislation requires that one zone designation span two states, including
an area having a population under 50,000. Under these criteria,
Philadelphia/Camden became assured of designation. See Thomas, supra note 89,
n152. One criticism of the use of census tracts is that each city has a zone that is
"creature of federal EZ provisions" rather than of indigenously established neighborhood boundaries or planning
department policy. This federally designated geographic area within a town or a
city is set off as distinct from surrounding or adjoining areas in the city.
Even though areas just on the other side of the boundary can exhibit identical,
indistinguishable characteristics, they are not part of the zone. See John
Gaventa et al., Empowering People: Goals and Realities, F. for Applied Res.
& Pub. Pol'y, Winter 1995, at 116, 120; Thomas, supra note 89, at 218 (noting
that the federal criteria led to a salamander-shaped zone of 101,000 people in
24 C.F.R. 597.102(a) (1997). A general poverty rate of 20% is required throughout each census tract
with at least 25% for 90% of the tract and 35% for 50% of the tract. See
26 U.S.C. 1392(a)(4). A central business district could be included, however, if it has a 35%
or greater poverty rate. See id. 1392(a)(3)(D).
24 C.F.R. 597.102(a).
n155. See id. 597.102(b).
n156. Id. 597.102(c).
n157. The legislation explicitly provided for a joint Empowerment Zone to be
established in two cities in two different states according to criteria that
left Philadelphia and Camden as the only cities that fit the criteria. Camden's
performance and participation in the Empowerment Zone process has been adjudged
by all as a failure. See Thomas, supra note 89, at 216.
n158. A number of cities that were likely candidates for Empowerment Zone status,
including Miami, Los Angeles and Houston, were not originally chosen. See Dept.
of HUD, Notice of Designation of Empowerment Zones and Enterprise Communities,
60 Fed. Reg. 10,018 (1995).
n159. Atlanta and Los Angeles are relatively newer cities whose decentralized
configuration not only has given rise to some of the worst traffic problems in
the nation, but also has managed to duplicate the phenomenon of significant
concentrated poverty without the degree of obsolescence experienced by
Northeastern and Midwestern cities. See generally Edward Soja, Thirdspace:
Journeys to Los Angeles and Other Real-and-Imagined Places (1996) (describing
and analyzing the indescribably varied landscape of Los Angeles).
n160. David W. Bartlett, Urban Housing in an Era of Global Capital, 551 Annals Am.
& Soc. Sci. 121, 123 (1997).
n161. See Michael Peter Smith, The Global City - Whose Social Construct Is It
Anyway?, 33 Urb. Aff. Rev. 482, 485 (1998) ("The global city is best thought of as a social construct, not as a place or an
object consisting of essential properties that can be readily measured outside
the process of making meaning.").
n162. Malcolm Waters, Globalization 3 (1995) (emphasis omitted). See Castells, supra
n163. See Vilna I. Bashi
& Mark Alan Hughes, Globalization and Residential Segregation by Race, 551
Annals Am. Acad. Pol.
& Soc. Sci. 105, 112-14 (1997) (disputing the existence and significance of
n164. See, e.g., Hazel Henderson, Development Beyond Economism: Local Paths to
Sustainable Development, in People, Land
& Community 89, 96-97 (Hildegarde Hannum ed., 1997) (arguing that liquidity of
capital has moved currency to circulate the globe freely while starving
localities for cash and currency).
n165. See Saskia Sassen, The Global City: New York, London, Tokyo 22-34 (Princeton
Univ. Press 1991).
n166. See Gregory D. Squires, Capital and Communities in Black and White 103 (1994).
n167. See John Accordino, The Consequences of Welfare Reform for Central City
Economies, 64 J. Am. Plan. Ass'n 11, 12 (1998) (describing the increasingly
polarized job structure as an
"hourglass economy"); Sassen, supra note 165, at 300-07.
n168. See Accordino, supra note 167, at 12.
n169. See Clark
& Gaile, supra note 126, at 31.
n170. See Bernard J. Frieden
& Lynne B. Sagalyn, Downtown, Inc.: How America Rebuilds Cities 26 (1989);
Benjamin B. Quinones, Redevelopment Redefined: Revitalizing the Central City
with Resident Control, 27 U. Mich. J.L. Reform 689, 700-03 (1994) (describing
cities' use of federal urban renewal funds to finance new downtowns).
n171. See generally Paul R. Dommel et al., Decentralizing Urban Policy (1982)
(analyzing the CDBG program); The Urban Development Action Grant Program
(Richard P. Nathan
& Jerry A. Webman eds., 1980) (describing the UDAG program).
n172. See Massey
& Denton, supra note 31, at 55.
n173. See Squires, supra note 166, at 95.
n174. See Haya El Nasser, New Approaches to Rebuilding Cities: Entertainment Centers
a Big Draw, USA Today, Dec. 27, 1996, at 1A (labeling the new boom in economic
development as a boom in
n175. In many cities, the dualization phenomenon is disguised beneath wealth
statistics that fail to reflect the poverty contained within the cities. For
example, in Silicon Valley, the statistics disguise the fact that poverty, in
the form of female immigrant workers, at minimum coexists with and has
facilitated the economic boom. See Kodras, supra note 70, at 82.
n176. See Frieden
& Sagalyn, supra note 170, at 265, 288-89; see also Roger Friedland, Power and
Crisis in the City: Corporations, Unions and Urban Policy 62-68 (1982)
(detailing the postwar transformation of central cities).
n177. See Massey
& Denton, supra note 31, at 56. As Massey explains, in order to satisfy urban
renewal requirements that an adequate supply of replacement housing be made
available for families displaced by urban renewal, local planning agencies turn
to public housing. Such projects are usually built on cleared land within or
adjacent to existing black neighborhoods. Further, they often take the form of
high density, multi-unit projects in order to save money, maximize patronage
jobs, and squeeze as many black people in as possible. See id. at 55-56; see
also John F. Bauman, Public Housing, Race, and Renewal: Urban Planning in
Philadelphia, 1920-1974, at 144-82 (1987); Arnold R. Hirsch, Making the Second
Ghetto: Race and Housing in Chicago, 1940-1960, at 40-99, 171-217 (1983).
n178. See generally William Grisby et al., The Dynamics of Neighborhood Change and
n179. See Squires, supra note 166, at 107.
n180. See W. Dennis Keating
& Norman Krumholz, Downtown Plans of the 1980s: The Case for More Equity in the
1990s, 57 J. Am. Plan. Ass'n, 136, 136-52 (1991) (criticizing six downtown
plans for inadequately addressing concerns of social equity).
n181. See Kodras, supra note 70, at 73.
n182. See id.
n183. See generally Joel Garreau, Edge City (1991).
n184. See Hicks, supra note 147, at 825. The author stated,
As industries continued to accommodate shifting technological regimes,
manufacturers began to filter out of older, less efficient production settings
and into newer ones. What steam-powered technologies had once tethered tightly
to central city locations, electricity-based technologies began to pry loose.
As successive transportation and communication innovations combined to diminish
the significance of physical distance, the importance of geographical proximity
- the once-powerful centralizing influence on residence and production - began
n185. See Daniel R. Vining, Jr., Migration Between the Core and the Periphery, Sci.
Am., Dec. 1982, at 45, 45-53.
n186. See Massey
& Denton, supra note 31, at 51; see also Kenneth T. Jackson, Crabgrass Frontier:
The Suburbanization of the United States 197-218 (1985). The practice of
"redlining" grew out of practices initiated by the Home Owners' Loan Corporation (HOLC),
the federal program that made long-term, self-amortizing mortgages widely
available. HOLC used a loan-risk assessment rating system that established four
categories of neighborhoods, the lowest of which was coded with the color red.
The highest rated category included homes located in neighborhoods that were
new and homogeneous, i.e., the suburbs. The lowest rated categories included
homes in central cities in or near black neighborhoods. See Jackson, supra, at
n187. See Jackson, supra note 186, at 208; Massey
& Denton, supra note 31, at 53-54. FHA-insured home loans issued by private
banks made home ownership available on a mass scale in the United States. In
rating homes for eligibility under the program, inner-city dwellings were often
found to be ineligible for the program because of minimum lot sizes, setbacks
and separation requirements that favored suburban areas. Moreover, the FHA
followed HOLC's neighborhood rating approach: the 1939 FHA Underwriting Manual
"If a neighborhood is to retain stability, it is necessary that properties shall
continue to be occupied by the same social and racial classes." Jackson, supra note 186, at 208.
n188. For a detailed discussion of suburbanization, see Peter Mieszkowski
& Edwin S. Mills, The Causes of Metropolitan Suburbanization, 7 J. Econ. Persp.
135, 135-47 (1993).
n189. For a detailed discussion of urban sprawl, see L.S. Bourne, Self-Fulfilling
Prophecies? Decentralization, Inner City Decline, and the Quality of Urban
Life, 58 J. Amer. Plan. Ass'n 509, 509-13 (1992); Henry L. Diamond
& Patrick F. Noonan, Land Use in America (1996); Alternatives to Sprawl (Dwight
Young, ed., 1995).
n190. See generally Anthony Downs, New Visions for Metropolitan America (1994).
n191. See Peter D. Salins, Metropolitan Visions, 26 Reason 60 (Dec. 1994) (arguing
that zoning has inhibited high-density development and mixed residential and
commercial land uses).
Hills Dev. Co. v. Township of Bernards, 510 A.2d 621 (N.J. 1986);
Southern Burlington County NAACP v. Township of Mount Laurel, 456 A.2d 390 (N.J. 1983);
Southern Burlington County NAACP v. Township of Mount Laurel, 336 A.2d 713 (N.J. 1975), cert. denied,
423 U.S. 808 (1975); see generally David L. Kirp et al., Our Town: Race, Housing, and the Soul of
Suburbia (1997) (drawing on letters, interviews, newspaper accounts and
personal and professional correspondence from civil rights organizations to
illustrate the impact that local activists who precipitated the Mt. Laurel
litigation had on the region's cultural and physical landscape).
Hunter v. City of Pittsburgh, 207 U.S. 161, 178-79 (1907) (holding that states have absolute discretion in creating, combining and
eliminating local government); Ford, supra note 51, at 1860-78.
n194. See Briffault, supra note 67, at 1.
n195. See id. at 76-77. But see
In re Incorporation of Town of Pewaukee v. Wisconsin Dept. of Dev., 521 N.W.2d 453 (Wis. Ct. App. 1994) (upholding denial of incorporation petition because it would result in
government fragmentation that would inhibit the provision of municipal
services); The Cortese-Knox Local Government Reorganization Act,
Cal. Gov't Code 56375, 57103 (requiring municipal incorporation petitions to be reviewed and
modified or denied depending on impact upon surrounding areas while
nevertheless precluding county residents from voting in an election to confirm
the petition unless they reside in the territory to be incorporated); see also
Board of Supervisors v. Local Agency Formation Comm'n of Sacramento County, 838 P.2d 1198 (Cal. 1992) (upholding the distinction between county residents as consistent with Equal
n196. Almost half of the states provide the power of annexation by general state law
but limit its exercise either by only permitting the annexation of
unincorporated territory or, in more than half of the states, by requiring
consent of the annexed territory by referendum, an often impossible hurdle to
overcome. Accordingly, most major Northeastern cities have not grown
territorially since the early 20th century. See Briffault, supra note 67, at 79
nn.334-35. In light of growing inner-ring suburban decay, however, the ability
of cities to use annexation in order to benefit from surrounding suburban
growth may be of declining value. See Michael Danielson, The Politics of
Exclusion 16-17 (1976) (analyzing the early 20th century resistance to
annexation resulting from a desire for political containment of the city and a
desire for suburban separation).
Village of Arlington Heights v. Metropolitan Hous. Dev. Corp., 429 U.S. 252, 271 (1977) (requiring proof of a racially discriminatory motive in Equal Protection
challenges to exclusionary zoning).
n198. See, e.g.,
San Antonio Indep. Sch. Dist. v. Rodriguez, 411 U.S. 1, 55 (1973) (rejecting a federal Equal Protection challenge to Texas educational funding
and school quality disparities);
Buse v. Smith, 247 N.W.2d 141 (Wis. 1976) (holding that school financing equalization program violates state equal
protection guarantee). But see
Edgewood Indep. Sch. Dist. v. Kirby, 777 S.W.2d 391, 397-98 (Tex. 1989) (holding that the Texas educational financing system violated state
constitutional guarantees of the right to
"an efficient system of public free schools");
Claremont Sch. Dist. v. Governor of New Hampshire, 703 A.2d 1353, 1354 (N.H. 1997) (finding the New Hampshire property-tax-based school financing system
Jerry Frug, The Geography of Community,
48 Stan. L. Rev. 1047, 1070-71 (1996).
n200. See Ford, supra note 51, at 1857 (arguing that even in the absence of racism,
color-blind policies will not alter the racialized and racially-segregated
nature of metropolitan regions).
n201. See David R. James, The Racial Ghetto as a Race-Making Situation: The Effects
of Residential Segregation on Racial Inequalities and Racial Identity,
19 Law & Soc. Inquiry 407, 413 (1994) ("The concentration of poor African Americans in high-poverty neighborhoods is
not only an effect of racial prejudice and discrimination. It is a powerful
referent in the minds of whites that defines how blacks are different from
n202. Two cities, New York and Los Angeles, also reflect concentrations of black and
Latino people. Thus, further analysis of racialization and ethnicization of
space is required. See William H. Frey
& Reynolds Farley, Latino, Asian, and Black Segregation in Multi-Ethnic Metro
Areas: Findings from the 1990 Census, 9 Research Report No. 93-278, Population
Studies Center, University of Michigan (1993). During the 1980s, Latino and
Asian segregation increased 52% and 74%, respectively. See id. at 2.
n203. See David Rusk, Inside Game Outside Game: Winning Strategies for Saving Urban
America 71 (1999).
n204. See id. Rusk writes,
"In a typical metro area... three out of four poor whites lived in middle-class,
mostly urban neighborhoods. By contrast, three out of four poor blacks and one
out of two poor Hispanics lived in inner-city
"poverty neighborhoods' where at least 20 percent of the residents were poor." Id.
n205. See Massey
& Denton, supra note 31, at 37 (discussing the impact of racial discrimination
on segregation); William Julius Wilson, The Truly Disadvantaged: The Inner
City, the Underclass, and Public Policy 41-42, 126-132 (1987) (arguing that
unemployment and social isolation rather than race are the most important
determinants of urban black poverty).
n206. See John O. Calmore, Racialized Space and the Culture of Segregation:
"Hewing a Stone of Hope from a Mountain of Despair,"
143 U. Pa. L. Rev. 1233, 1236-38 (1995) (tracing the idea of racialization and racialized space in the context of
delineating the residential segregation); Ford, supra note 51, at 1913 (arguing
that society uses the law to invisibly create and perpetuate racially
identified spaces). While we tend to understand racialized space as black
space, racialized space can also be white space. As Alastair Bonnett has
observed, we tend to view white space as socially transparent, normative,
neutral, banal, dull, noncontroversial and normal. No debatable racial
categories are involved. See Alastair Bonnett, Geography,
"Race' and Whiteness: Invisible Traditions and Current Challenges, 29 Area 193,
n207. Edward W. Soja, Postmodern Geographics: Taking Los Angeles Apart, in Roger
Friedland and Deirdre Boden, NowHere: Space, Time and Modernity 139 (1994).
n208. See Loic J.D. Wacquant, Three Pernicious Premises in the Study of the American
Ghetto, 21 Int'l J. of Urb.
& Regional Res. 341, 344 (1997) ("An institutionalist approach seeks to locate underlying breaks in the urban
fabric and to trace the (re)drawing of the dividing lines of which the ghetto
is the physical manifestation.").
n209. Calmore, supra note 206, at 1242-43 n.49 (citing Michael Omi
& Howard Winant, Racial Formation in the United States: From the 1960s to the
1990s 59 (2d ed. 1994)).
n210. See Peter Marcuse, The Enclave, the Citadel, and the Ghetto: What Has Changed
in the Post-Fordist U.S. City, 33 Urb. Aff. Rev. 228, 255 (1997) ("The isolation of the ghetto is seen as a benefit by much of the outside white
society, quite contrary to the [historical] view of the isolation of the
immigrant ghetto, which was seen as a danger by social leaders.").
Huntington Branch, NAACP v. Town of Huntingon, 844 F.2d 926 (2d Cir. 1988) (holding that the designation of urban renewal zones as the only places where
low income housing could be built violated the Fair Housing Act by, in effect,
creating black zones); Keith Aoki, Direct Democracy, Racial Group Agency, Local
Government Law, and Residential Racial Segregation: Some Reflections on Radical
and Plural Democracy,
33 Cal. W. L. Rev. 185, 200 (1997) (discussing the real estate market in Monterey Park, Cal. which bestows
tangible economic benefits by devaluing or valuing real estate based on the
presence or absence of black people).
n212. See Margaret Weir, From Equal Opportunity to
"The New Social Contract': Race and the Politics of the American
"Underclass,' in Racism, the City and the State 93, 105 (Malcolm Cross
& Michael Keith eds., 1993). Weir explains,
"[The] geographic separation of blacks has important political consequences: it
transforms the problems of living in cities into
"black' problems, making it easier for politicians to solve urban problems at
the expense of poor black residents." Id. at 104. Weir also writes,
Isolation has made the lives of blacks in urban ghettos so remote that most
white Americans have little direct knowledge which could promote either a sense
of commonality or insight into the pattern of racial discrimination which has
contributed to the plight of poor blacks. In this context, the policies which
have been considered for addressing black economic problems during the past
decade have stressed individual behaviour over racial disadvantage or economic
Id. at 105; see also Loic J.D. Wacquant, Urban Outcasts: Stigma and Division
in the Black American Ghetto and the French Urban Periphery, 17 Int'l J. Urb.
Regional Res. 366 (1993).
n213. See Patricia J. Williams, Alchemical Notes: Reconstructing Ideals from
22 Harv. C.R.-C.L. L. Rev. 401, 423-24 (1987). The author explains,
Some structures are the direct products of people and social forces who wanted
them that way. If one assumes, as blacks must, not that the larger world wants
to overcome alienation, but that many heartily embrace it, driven not just by
fear but by hatred and taboo, then one is compelled to recognize the degree to
which informal systems as well as formal systems are run by unconscious and/or
""Human nature has an invincible dread of becoming more conscious of itself."'
Id. (citations omitted); see also, e.g., Tom Gorman, Riverside School to Be
Named After King, L.A. Times, Jan. 6, 1998, at A3 (reporting that many town
residents protested the school board's decision to name a high school after
Martin Luther King, Jr., arguing that it would identify the school as a black
school and impact college admissions).
n214. See Edward Gramlich et al., Moving into and out of Poor Urban Areas, 11 J.
& Mgmt. 273, 281-83 (1992).
n215. See Lemann, supra note 10, at 30 (describing the role of the ghetto as a
transitional point passed through by successive generations of ethnic groups);
Marcuse, supra note 210, 228-29, 237 (describing the ghetto of today as the
"outcast ghetto," as exemplified by Harlem, New York, which is no longer a magnet for the
n216. See Reynolds Farley
& Walter R. Allen, The Color Line and the Quality of Life in America 142 (1987).
n217. See Rudolph A. Pyatt Jr., Prince George's, Seeking More Stores, Takes Its Case
to Retail Executives, Wash. Post, Dec. 25, 1997, at D3 (reporting black
suburbanite letter-writing campaign to educate retailers about disparities in
chosen locations of upscale retail stores); see also Judge Tells Florida Pizza
Shop to Deliver to Black Community, N.Y. Times, Feb. 15, 1998, at 20 (providing
a further example of the dictates of racial geography). The article states that
a federal district court issued a preliminary injunction to a pizza delivery
franchise requiring it to provide home delivery to residents of a tiny black
seaside resort. Residents had been required to go to a convenience store in
town to pick up orders while deliveries were available for surrounding, more
affluent white resorts. This phenomenon has also been described as a pattern of
"unequal autonomy" among minority neighborhoods. See Logan
& Molotch, supra note 14, at 124.
n218. See Robert Beauregard, Politics, Ideology and Theories of
Gentrification, 7 J. Urb. Aff. 51, 51-62 (1985).
n219. See Young, supra note 58, at 53-54.
n220. See id. at 33.
n221. Id. at 15.
n222. Id. at 16.
n223. See id. at 40 (explicating five aspects of oppression: exploitation,
marginalization, powerlessness, cultural imperialism, and violence).
n224. See Calmore, supra note 206, at 1269. Calmore writes,
"As applied to the urban poor, [both] marginalization and cultural imperialism
are the most insightful references. First, racial oppression in this country is
more likely to take the form of marginalization rather than exploitation....
Second, the urban poor... experience a deep cultural imperialism." Id. (citations omitted).
n225. See Young, supra note 58, at 59.
n226. See id. at 52. Under Young's vision of racial exploitation, there are societal
pressures and tendencies to fill service jobs with black and Latino people. See
id. at 52. This author (and Webster's Dictionary) regards exploitation as a
term depicting practices that take advantage of people in a mean or unfair way.
See Webster's New Collegiate Dictionary 400 (150th ed. 1981).
n227. Young, supra note 58, at 53.
n228. See Vidal, supra note 38, at 176. See generally John D. Kasarda, Urban
Industrial Transition and the Underclass, 501 Annals Am. Acad. Pol.
& Soc. Sci. 26 (1989); John F. Kain, The Spatial Mismatch Hypothesis: Three
Decades Later, 3 Housing Pol'y Debate 371 (1992); Hicks, supra note 147, at
827-28 ("As... central cities became centers of information processing and
administration rather than goods production, .... many kinds of entry-level
production jobs previously available as the lower rungs on ladders of
opportunity for central-city residents were as likely to evaporate as to
emigrate to the suburbs.").
n229. See Vidal, supra note 38, at 176.
n230. See, e.g., Wilson, supra note 205, at 60-62.
n231. See id. at 60.
n232. See E. Douglas Williams
& Richard H. Sander, The Prospects for
"Putting America to Work" in the Inner City,
81 Geo. L.J. 2003, 2016 (1993) (noting that mounting research has thrown skills mismatch theory into question
as an explanation for unemployment).
n233. See Robert A. Beauregard, Constituting Economic Development: A Theoretical
Perspective, in Theories of Local Economic Development: Perspectives From
Across the Disciplines 267, 270 (Richard D. Bingham
& Robert Mier eds., 1993).
n234. See Logan
& Molotch, supra note 14, at 62-65 (discussing the organization and imperatives
"growth coalition" in every city).
n235. See Robert A. Baade
& Allen R. Sanderson, The Employment Effect of Teams and Sports Facilities, in
Sports, Jobs, and Taxes: The Economic Impact of Sports Teams and Stadiums 99
(Roger G. Noll
& Andrew Zimbalist eds., 1997); Beauregard, supra note 233, at 270. Baade and
Sanderson explain that jobs are created, but most of the revenues go to
players, coaches, and executives who do not live in the community or spend
their incomes there. Other jobs result when new stadiums are built, but these
jobs last for relatively short periods and divert resources from other
construction in the community. See Baade
& Sanderson, supra, at 98.
n236. See Rusk, supra note 203, at 59-62. Rusk characterizes community-based
anti-poverty programs as
"helping a crowd of people run up a down escalator." Id. at 59. Rusk argues that the goal should be to reprogram the direction of
the escalator. See id.
n237. See id.
n238. A solely economic critique of community development and community economic
development probably fails to grasp the point that each of these successfully
completed projects has significant symbolic impact and means a great deal to
people who are able to obtain goods and services, and sometimes jobs, that they
were unable to obtain before. The struggle for those who are concerned about
conditions in impoverished communities is how to meet these unfulfilled needs
and support the small victories. Rusk's study suggests, however, that the small
victories within poor communities prevent us from tackling the larger,
seemingly intractable, issues. See id. at 59-62.
n239. See Beauregard, supra note 233, at 267 (attributing the scant critical
assessment of economic development to its
"inherent sensibility, avowed pragmatism, and unflinching optimism [that]
overwhelms intensive probing of its theoretical tendencies and ideological
n240. See Lemann, supra note 10, at 60.
n241. See Stephen Barlas, Program May Help Fight Urban Decay, 113 Am. City
& County 10, 10 (1998). Barlas notes a small item in the SBA reauthorization
bill creating HUBZones - inner city and rural census tracts that are designed
to attract small businesses thorough a set aside pool of federal contracts
representing one to three percent of all federal contracts. See id. Barlas also
notes that under the bill companies must agree to hire a minimum of 35% of
their employees from the HUBZone in which they are located or from surrounding
HUBZones. See id.
26 U.S.C. 1391(b) (1994
& Supp. III 1997).
n243. See Daniel Immergluck
& Timothy Hilton, Breaking Down Barriers: Prospects and Policies for Linking
Jobs and Residents in the Chicago Empowerment Zone 52 (Woodstock Inst. ed.
1996) (recommending the employment benefits be made available in an Employment
Zone surrounding the Empowerment Zone to increase the number of potential
n244. See Philip Kasinitz, The Real Jobs Problem, Wall St. J., Nov. 26, 1993, at A8.
n245. See Marc DuBois, The Governance of the Third World: A Foucauldian Perspective
on Power Relations in Development, 16 Alternatives 1, 2 (1991) (noting the
"economistic essentialism of development thinking").
26 U.S.C. 1391(f)(2)(F) (1994).
26 U.S.C. 1391(f)(2)(F)(i)-(ii) (1994).
n248. The three are as follows: (1) The Department of Commerce's Economic
Development Administration's Public Works and Development Facilities Program;
(2) The Empowerment Zones Program; and (3) The Department of Labor's Employment
and Training Assistance for Dislocated Workers. See GAO Report, supra note 82,
n249. See William Fulton, The Subsidized Job Shuffle, Governing, Feb. 1998, at 66,
n250. Richard Peet, Power of Development, 73 Econ. Geography 257 (1997).
n251. See, e.g., Janice K. Tulloss, Citizen Participation in Boston's Development
Policy: The Political Economy of Participation, 30 Urb. Aff. Rev. 514, 521-522
(1995) (discussing the structure of participatory mechanisms in Boston in
relation to the city's parcel-to-parcel linkage program, which attempts to
redress inequitable development generated by normal market mechanisms by
linking the development of desirable downtown parcels with less attractive
parcels in low-income neighborhoods).
n252. See supra notes 158-68 and accompanying text.
n253. See supra notes 158-68 and accompanying text.
n254. But see Esteva, supra note 1, at 22 (suggesting that the pursuit of
development in any form is illusory because it follows economic rules based on
chronic scarcity in modern society, and if the assumption is chronic scarcity,
the result will track the assumption).
Prepared: January 24, 2003 - 5:02:29 PM
Edited and Updated, January 25, 2003
Kristen A. Stelljes