and fixing “broken” service delivery mechanisms obscured the basic assumption underlying his urban policy prescriptions: that out-of-control residents (and particularly the individual moral failings of African Americans in inner cities), rather than long-term structural problems such as racial discrimination and economic inequality, were the cause of urban social problems.
General revenue sharing proved popular among state and local officials. “General revenue sharing is the cornerstone of our national strategy and, as such, must be recognized and built upon,” National League of Cities vice president Allen Pritchard informed his board of directors. “We cannot allow those who don’t understand cities and our problems—as evidenced in their denunciation of general revenue sharing—to tear apart the coalition of city governments which triumphed over all odds in this field.”90 Most governors, too, supported the new funding arrangements, which to them marked the success of two decades of lobbying for an increased state role in administering and distributing federal funds.91 Pennsylvania governor Milton J. Shapp, however, was among the program’s most outspoken critics. He broke with the National Governors’ Conference over revenue sharing and attacked Nixon and his supporters in state houses across the country for implementing a program that failed to solve the fiscal problems facing heavily industrialized states like his and manufacturing centers like Pittsburgh in both the short or long term.92 But serious critics of revenue sharing were in the minority, and the program remained popular among governors and mayors because it allowed them the nearly unrestricted use of federal funds.
Emboldened by the political success of general revenue sharing, Nixon set out to replace the categorical grant system used to administer social programs—the number of which had nearly doubled between 1962 and 1967—with special revenue-sharing “block grants” for particular types of activities, such as community development or public health, without reference to a specific project. Compared to categorical grants, block grants had very few conditions attached, required little federal oversight, and promised to dramatically reduce the number of applications city and state governments needed to file to receive federal aid in any given year. Administrators at all levels of government agreed that the federal grants-in-aid system had become unmanageable.93 Nixon co-opted bipartisan support for streamlining administrative requirements for his more ideological project of realigning intergovernmental relations and weakening federal agencies that administered liberal social programs.
Gerald Ford signed Community Development Block Grant (CDBG) legislation into law the week after Nixon’s resignation. CDBG funds went disproportionately to central cities, and federal officials formulated CDBG as a “hold harmless” program, which ensured that urban areas had access to at least the same level of funding they had received through categorical grants. As a result, the program received fervent support from big city mayors like Pittsburgh’s Pete Flaherty.94 With general revenue sharing and block grants, Nixon chose to sacrifice the fiscal for the ideological: he was far less concerned with transferring the burden of paying for urban development away from the federal government than he was with removing control of federal funds from the hands of Washington bureaucrats. Yet Nixon’s success with CDBG was evidence only of a widely perceived need for a streamlined grant application process, not of the emergence of a broad ideological consensus over the appropriate relationship between municipalities and the federal government.
In tandem with his revenue sharing proposals, Nixon decentralized oversight of federal urban development programs away from Washington. Federal housing, highway, and urban renewal programs required a large, centralized bureaucracy to review applications and administer and monitor grants; dismantling that capacity was the final aspect of Nixon’s New Federalism. In 1970, Nixon issued an executive order that created Federal Regional Councils (FRCs) charged with improving interaction between federal agencies and the local governments. The FRC system created ten multistate regions, each with a regional office and staff, to coordinate the grant-making activities of federal agencies. Nixon also decentralized HUD to thirty-nine area offices, which had the authority to make final commitments for almost all HUD programs. After expanding the federal bureaucracy in a bid to “streamline” government, Nixon called for drastic federal personnel cuts in the summer of 1971. At HUD, the expansion and almost immediate contraction of staff, combined with a pay freeze, damaged staff morale and capabilities for much longer than the duration of the hiring freeze.95
Nixon invoked state and local autonomy to gain support for his attack on centralized planning. Like DREE and MSUA in Canada, general revenue sharing, block grants, and HUD’s decentralization fundamentally altered the relationship between the federal, state, and local governments. By minimizing federal “strings” on assistance programs, Nixon hamstrung federal agencies. He ensured that HUD officials “only had carrots and no sticks,” as one official complained, and made it difficult for federal agencies to implement a development agenda with a truly national scope. Instead, the federal government could shape national development patterns on a case-by-case basis only, by supporting projects proposed by the private sector or by quasi-public agencies.96 Under Trudeau and Nixon, Canada and the United States had set out on different paths but arrived at the same destination: greater decentralization of federal authority and an increased reliance on the private sector to carry out urban development. U.S. cities like Pittsburgh had already established institutional mechanisms for public-private partnerships as part of federal urban renewal programs. DREE and MSUA laid the groundwork for Canadian cities like Hamilton to pursue similar arrangements.
In coming decades, the U.S. and Canadian governments would use decentralization and privatization as mechanisms to justify funding reductions in distressed urban areas. Growth coalitions with postindustrial ambitions in Pittsburgh and Hamilton had to work within the parameters of government retrenchment initiated under Nixon and Trudeau. In Hamilton, public officials and civic leaders continued to look to Pittsburgh as a redevelopment model but struggled to form more than an ad hoc public-private partnership. In Pittsburgh, the political coalition that nurtured the city’s redevelopment partnership began to lay the foundation for its eventual transition to a growth partnership. But at end of the 1960s Hamilton’s postwar urban renewal program remained stalled, Pittsburgh’s was completed, and public officials and civic leaders seemed unsure about the future direction of their cities.
CHAPTER TWO
Forging Growth Partnerships
The 1970 census took Pittsburghers by surprise. Mayor Pete Flaherty, who had taken office that January, knew the city had lost residents—nearly 92,000—over the previous decade. But suburban mayors and county officials had not anticipated that the Pittsburgh metropolitan area would be the only one among the country’s twenty-five largest to lose population in 1970. The New York Times marked the occasion with a feature article that highlighted disparities between the recently completed Golden Triangle and Pittsburgh’s declining neighborhoods and mill towns. The Times reported that U.S. Steel was about to move into a gleaming new headquarters building downtown and that the Pirates would soon open a playoff series in Pittsburgh’s newly completed, state-of-the-art baseball stadium. Outside the Golden Triangle and in working-class neighborhoods near the city’s steel mills, however, local businessmen complained that their stores were closing and the city was becoming “a plywood jungle.” Flaherty fretted that Pittsburgh needed more taxpayers, telling the Times that the biggest problem facing his city was “financial survival—whether we can get through without going broke.” For Pittsburgh’s corporate leaders, however, slow growth and declining manufacturing jobs were signs of good things to come. In the eyes of local executives, the shift from manufacturing to nonmanufacturing employment heralded “a new era of white-collar stability for Pittsburgh as a service and distribution center.” One senior executive who had been “active in community affairs” confidently asserted, “the lack of growth lets you get your arms around the problem.”1
Pittsburgh’s population fell by about
