Monday, April 18, 2005


If you haven't read Jerry Paytas' Opinion piece in the PG on Pittsburgh Regionalism and the Mayor's Election, you probably should. Jerry's right on his command for the next mayor to embrace regionalism or die, but I have a slightly different take on it. But first, the RAND study he references is found here. A highlight:

The analyses of earnings are based on where people live and work. We [RAND] construct simple metrics to estimate the amount of earnings from workers who live and work within their community and those workers who bring their earnings home from other jurisdictions. Our analyses show that ten municipalities have estimated net deficits in earnings of more than $100 million, with the City of Pittsburgh at over $5 billion. Another fifteen municipalities have net surpluses in earnings of more than $100 million.

The flow of earnings across municipal boundaries is used to describe the degree of economic interdependence in Allegheny County. We find that 80 percent or more of the total earnings flowing into county municipalities are generated by jobs outside a municipality for 114 municipalities (88 percent). Further, 124 of municipalities (95 percent) in the county "export" 60 percent or more of earnings from jobs within their municipality to nonresident commuters. The amount of earnings flowing across the boundaries of municipalities is not surprising given that, on average, only 13 percent of residents work within their own municipality.
It continues...
This report demonstrates that there is a dense web of economic flows that closely tie the municipalities of Allegheny County to the City of Pittsburgh and to one another. The web is created through vast numbers of workers in Allegheny County who live in one municipality and work in another, meaning that enormous sums of income are flowing back and forth across jurisdictional lines. Similar to the other municipalities, the City of Pittsburgh is integral to the web when it comes to attracting commuters. However, the city is the lone exception in not "exporting" its residents as workers to other jurisdictions, with nearly 70 percent of city workers working within its boundaries, as compared with an average of less than 15 percent of workers in the other municipalities working within their own municipalities. Moreover, Pittsburgh is the economic engine of the county, with jobs in the city accounting for over one-third of total commuter earnings in the county and at least 15 percent of the commuter income in 116 of 130 municipalities.
Pittsburgh itself exports [defined as exporting more earnings to nonresident commuters than their residents import from other areas, yielding net deficit earnings for the municipality] a whopping $5.3 BILLION in earnings to the surrounding area, with Monroeville, Findlay, Robinson, and Green Tree following well behind at $300-350 million. On the obverse side, Mount Lebanon and Penn Hills rake in $350 million in earnings from their workers.

From an economic perspective it is clear, we should all be very concerned about the fate and future of the City of Pittsburgh for, as Jerry notes, the ability for region to regenerate jobs if Pittsburgh's economy collapses, will take a long, long time.

With that said, however, the state of the City of Pittsburgh is much more akin to the Econ 101 "Tragedy of the Commons" in which marginal value is driven down by collective overuse, driven by pursuit of individual advantage. Politically, Pittsburgh is often seen an economic commons for the region, the location for doing business. Collective neglect of the commons will lead to a decrease in the marginal productive value of the City... or in other words, if the suburbs (and the governmental units and politicians therein) don't give a damn about the city, assuming that it's in the City's problem, the City will slowly collapse.

To compound the problem, individual municipalities, rationally pursuing their own strategies, will inevitably conflict with the larger "good," leading to a less than optimal outcome. If one municipality can get away without paying out to the City, that municipality comes out ahead... so it makes sense for ALL municipalities to pursue the same strategy.

With that in mind, I suggest that the problem is not just with Pittsburgh, but also with the surrounding municipalities. This is a vital issue that will confound the plans of the next mayor. The problem, or one off several problems, all of which are important, is this: Pittsburgh is just one ship in the great fleet that is Western Pennsylvania. One hundred thrity-odd municipalities, not including regional authorities, school districts, tax districts, water boards, or the county IN ALLEGHENY COUNTY ALONE, need to follow one harmonious course in order to grow Pittsburgh.

If Pittsburgh does fabulously well, the region will benefit, yes. The Region, however, does not benefit if Pittsburgh benefits at the expense of its surrounding communities. If Blawnox is washed into the sea, Western Pennsylvania is the less. As said above, however, independent municipalities should not be expected to give up their autonomy in attracting development just because Pittsburgh wants it and especially if they stand to "lose".

So, it's not just Pittsburgh that needs to embrace regionalism it's the REGION that needs to embrace regionalism.

But no solutions to this problem this morning... not before the 2nd cup of coffee, anyway.

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