move, decentralized DREE’s administration to provincial and regional offices.77 A “flexible” new joint federal-provincial administrative mechanism driven by provincial initiative rather than centralized planning, GDAs became a politically popular model for federal-provincial cooperation in economic development. GDAs also created a national institutional framework for the type of local public-private partnerships that Hamilton’s civic leaders and elected officials wanted to establish. DREE was legally precluded from working directly with the private sector or municipalities, but the terms of individual GDAs often created public corporations for which municipal governments served as agents. The arrangement gave municipal officials the authority either to undertake projects on their own, using federal and provincial funding, or to hire private developers to carry out publicly funded projects. In this way, municipalities had significant authority over the management of development projects, making GDAs popular with local as well as provincial governments.78
Bureaucratic decentralization and the implementation of GDAs represented a sharp break from Trudeau’s plan to use centralized planning to redistribute wealth between provinces or regions within provinces. DREE’s new structure initially benefited wealthy Ontario and heavily industrialized areas like Hamilton. Under Jamieson, Canada’s economic development activities shifted toward provincially led development projects that leveraged federal incentives to entice private investment.79 Jamieson announced in 1974 that “the process of regional development should not limit itself to rather narrow programs focused on solving problems.” Instead, he said, it should “include the process of identifying and pursuing in a flexible and imaginative manner the many existing development opportunities.”80 The federal government began to use its regional development policy to stimulate private investment in distressed areas through federally financed demonstration projects, infrastructure improvements, and in some cases the relocation of federal offices, rather than to redistribute wealth from more prosperous to less prosperous regions. For municipal officials in cities like Hamilton who hoped to attract private-sector partners, DREE’s decentralization created tantalizing possibilities.
MSUA, too, quickly landed on public-private partnerships as a tool to achieve national urban development goals. Trudeau created MSUA to determine policy options for dealing with population forecasts that predicted an influx of new immigrants in the 1970s and 1980s. Federal and provincial policymakers agreed that people and economic activity should be decentralized out of the primary population centers of Toronto, Montreal, and Vancouver to less-developed areas in those metropolitan regions and to smaller cities throughout the country, such as Hamilton. In contrast to DREE’s redistributive impulses in its early years, from the outset, MSUA officials rejected efforts to reduce population disparity or regional underdevelopment as an “explicit intrusion into the market” that might threaten business interests. Perhaps with the conflicts over DREE’s Special Areas program in mind, MSUA officials worried that the newly prosperous western provinces or economically weak regions in the East might begin to believe that they were at “some sort of serious disadvantage” relative to the industrial heartland and consider leaving the confederation. They were also concerned that population redistribution along the Windsor-Quebec corridor might agitate domestic and American-owned corporations that relied on proximity to the U.S. market.81
As the political climate shifted after the 1972 elections and the Trudeau administration sought to mollify western voters, MSUA officials, like those at DREE, began to look to provincial and private sector partners rather than centralized planning to achieve national urban development goals. By the middle of the decade, MSUA officials viewed public-private partnerships as a mechanism through which to secure private sector buy-in to Trudeau’s national planning agenda and to help finance urban development projects. DREE was prohibited from entering into direct agreements with municipalities or the private sector, but MSUA’s officials had greater freedom to facilitate joint ventures between the public and private sectors.82 They did so with a wary eye on similar partnerships in the United States and mandated that in Canada public-private partnerships must “satisfy the principles of responsible government,” which meant that no public agency involved in a partnership could relinquish its statutory duties to the private sector.83 While MSUA officials acknowledged the need to provide an “attractive climate” for private developers, they also insisted that “no private agency should be able to profit from the public purse unduly” and that the government should “get a fair social return” for its investments.84 Public-private partnerships were a fledgling enterprise in Canada in the 1970s, but thanks to DREE and MSUA, public officials at all levels of government were cautiously optimistic that partnerships might be part of the solution to the country’s urban and regional development problems. Hamilton’s elected officials had reason to believe that the Allegheny Conference-style partnership they desired might be on the horizon.
In the United States, as in Canada, tensions over urban and economic development simmered in the late 1960s within the federal system and between ascendant and declining regions. Four months after Trudeau was sworn in as prime minister, Nixon accepted the Republican presidential nomination. Nixon, like Trudeau, took office intending to restructure the relationship between national and subnational governments. Unlike Trudeau, Nixon did not see centralized planning as a vehicle through which to solve social problems. Instead, he argued that federal intervention exacerbated social problems. His predecessor’s Great Society programs had not ended poverty or the urban crisis, but they had dramatically expanded the federal bureaucracy and increased the complexity of federal aid to city and state governments. Democrats criticized Johnson for underfunding social programs, while Republicans denounced them as too expensive, civil rights leaders demanded a Marshall Plan for cities, community groups complained about increased red tape, and urban violence rose rather than fell. These circumstances allowed Nixon to take office with substantial bipartisan support for his plan to return control over urban affairs to lower levels of government, a proposal that found a receptive audience in the nation’s state houses.85
During his first year in office, Nixon reminded Americans that the nation faced “an urban crisis, a social crisis—and, at the same time, a crisis of confidence in the capacity of government to do its job.” These crises, he said, were the legacy of three decades of failed social experiments emerging from New Deal. The government institutions established under Franklin Delano Roosevelt and expanded under successive Democratic presidents, Nixon explained, had become a “bureaucratic monstrosity,” whose “entrenched” social programs were no longer relevant. His solution was simple: Nixon would restore to the states the autonomy Roosevelt had taken from them. It was time, he declared, for “a New Federalism,” a devolutionary program intended to decentralize authority away from the federal government and return power and money to the “states and the people.”86
Nixon intended to decentralize federal power through revenue-sharing programs. He introduced a new program, general revenue sharing, designed to transfer a portion of federal revenue back to state and local governments. The week after announcing his New Federalism agenda, Nixon sent a message to Congress outlining a plan for general revenue sharing “to be used as the States and their local governments see fit—without Federal strings.” In his Congressional message, Nixon pointed particularly to the problems facing cities. Under Johnson, he argued, the federal government had promised too much and provided too little, which had created an urban crisis and led Americans to lose faith in the federal government. “Ultimately, it is our hope to use this mechanism to so strengthen State and local government that by the end of the coming decade, the political landscape of America will be visibly altered,” Nixon advised Congress, “and States and cities will have a far greater share of power and responsibility for solving their own problems.”87
Nixon portentously described revenue sharing as a “turning point in Federal-State relations, the beginning of decentralization of governmental power, the restoration of a rightful balance between the State capitals and the national capital.”88 He used the programs to direct federal aid away from socially and economically distressed central cities like New York, Detroit, and Pittsburgh and toward constituents in prosperous suburbs and the Sunbelt.89 His rhetoric of ending
