Why you should care
Because some of the president’s urban pledges have bipartisan backing.
After Katrina broke New Orleans’ levees and Sandy surged onto Staten Island, the Federal Emergency Management Agency followed. So, what if FEMA set up shop in the most dismal sections of Chicago, Detroit and Baltimore, no flooding necessary?
As part of an ambitious urban agenda set forth during the presidential campaign, Donald Trump proposed using federal disaster declarations to free up funds for developing new infrastructure, razing blighted buildings and increasing law-enforcement presence. There’s been no follow-through so far, but given the recent stumble on health care, the White House might want to prioritize an initiative that could yield a bipartisan win.
Count Lyneir Richardson among the optimists. The executive director of the Center for Urban Entrepreneurship and Economic Development at Rutgers Business School works on reviving Newark, New Jersey, a city bedeviled by chronically high poverty rates (29.7 percent, according to the most recent U.S. census data). Richardson says neighborhood struggles derive primarily from a lack of capital — from banks to entrepreneurs and from the government to fix roads and bridges. Richardson wants FEMA funds or targeted tax breaks to “leverage the federal resources to get more results from private investment.” Richardson says it’s time to ditch training programs for specific jobs in favor of entrepreneurship guidance that gives strivers the tools to start businesses or side hustles.
… during the campaign Trump rolled out a 10-point “New Deal for Black America” … [that] pledged “tax holidays for inner-city investment” and the disaster-zones idea.
U.S. Sens. Tim Scott (R-S.C.) and Cory Booker (D-N.J.) have proposed a bill that would give a capital gains tax break to investors in certain “opportunity zones” and create funds for investors to pool their resources to do so. States have long dangled incentives for such investment. Richardson points to New Jersey’s Urban Transit Hub tax credit, which led Panasonic to open its new headquarters in Newark in 2013. A ribbon cutting drew political leaders from both parties to christen the city’s first new office building in 20 years, while critics contended the deal reeked of corporate welfare. Panasonic’s headquarters and 800 employees had been just 10 miles away in Secaucus, and New Jersey lavished $102 million in tax credits on the company to keep it in the state. Since the new tower planted a flag, billions of dollars in investment have flowed into downtown Newark. A sign of the times: The city’s first Whole Foods Market opened in March.
When the Panasonic tower opened, Robert Doar was toiling across the Hudson River as head of the Human Resources Administration and Department of Social Services under then New York City Mayor Michael Bloomberg. While gentrification is not without controversy and homelessness has soared, Doar pointed to blossoming Brooklyn neighborhoods like Crown Heights and Bedford-Stuyvesant as success stories. Now a resident fellow at the American Enterprise Institute, a conservative think tank, Doar says the federal government can help other struggling communities by adding work requirements to safety-net programs like food stamps — a notion attacked from the left as cruel, given the difficulties of finding a job in high-poverty areas — and by issuing vouchers rather than building new federal housing. But he’s not so sure about playing the FEMA card. “They do good work,” Doar says, recalling Superstorm Sandy. “But it seems to me that’s a little bit of a stretch and sort of a round peg in a square hole.” He’s warmer to targeted tax breaks, but says their results have been mixed.
In any case, the political path for new tax breaks is uncertain. Trump and congressional Republicans are itching for a massive tax reform bill. The GOP proposes to wipe out targeted deductions in exchange for lowering corporate taxes, which would seem to leave a new special deduction for troubled inner cities dead on arrival. But if the tax code is cracked open, it’s an opportunity for a new goodie — and this one could lure urban Democratic votes.
Though the president has not tipped his hand on these initiatives, during the campaign Trump rolled out a 10-point “New Deal for Black America.” Most of the planks in the platform were familiar, such as cracking down on illegal immigration and renegotiating trade deals. But he also pledged “tax holidays for inner-city investment” and the disaster-zones idea. The proposals were mostly overshadowed by Trump’s harsh rhetoric in seeking Black votes, painting America’s cities as lethal wastelands with the refrain: “What the hell do you have to lose?”
According to exit polls, Trump won 8 percent of the Black vote. When he recently hosted leaders of the Congressional Black Caucus at the White House, they brought a 125-page policy agenda titled “We Have a Lot to Lose.” The policy document did not include the FEMA idea, which was pitched in 2013 by activist Rev. Jesse Jackson. In a Chicago Sun-Times op-ed, Jackson wrote that “the inner city deserves a disaster relief plan.” Now, Jackson tells OZY, “it could work,” and he is willing to meet with Trump about the idea — as long as the meeting is more than a photo op. “Someone has to come through with a plan for urban renewal,” he says. “That requires a plan and an investment and not just an observation that people are shooting each other.”
If Chicago doesn’t fix the horrible “carnage” going on, 228 shootings in 2017 with 42 killings (up 24% from 2016), I will send in the Feds!— Donald J. Trump (@realDonaldTrump) January 25, 2017
So far, there is no public plan. Asked for comment, a White House spokesman directed OZY to FEMA. A FEMA spokeswoman then sent OZY back to the White House. The White House spokesman did not respond to follow-ups. Trump’s proposed budget outline for 2018 makes no mention of inner cities as disaster zones, though it does slash FEMA grants to states and local governments by $667 million, or 26 percent from what the feds doled out in fiscal year 2016.