Newsletters

It is a rare occurrence when I bookmark a government white paper as a must read. Such reports tend to be dry, jargon-rich, bureaucracy-deadening affairs, more likely to induce a state of somnolence than impart knowledge or catalyze action.

The National Defense Industrial Strategy is an exception.

Note: This newsletter was initially published by Governing Magazine on February 21, 2024

As we start 2024, it won’t come as a surprise that most of the traditional metrics underpinning housing affordability are moving in the wrong direction. Despite improvements in long-term interest rates and a slowdown in multifamily rent growth, rental affordability reached an all-time low in 2022. Based on the U.S. Census, an estimated 22.4 million renters now spend over 30 percent of their income on rent.

Over the past several years, the Aspen Institute Latinos and Society Program and the Nowak Metro Finance Lab at Drexel University have dedicated countless hours to one central goal: using the expanding Procurement Economy to grow small local businesses, particularly those owned by socially and economically disadvantaged individuals.

Our collaborative effort has been driven by the substantial increase in federal spending, spurred by the successive enactment of the $1.9 trillion American Rescue Plan Act, the $1.2 trillion Infrastructure Investment and Jobs Act, the $280 billion CHIPS and Science Act, the $411 billion Inflation Reduction Act and the $800+ billion (and rising) annual Department of Defense appropriations.

One of the lasting images of the pandemic period is of ships carrying goods from Asia stuck off the coast of California. The images prompted a burst of heroic federal action and the term “supply chains” became embedded in the public consciousness.

As with many things in the US, the pandemic images have receded into memory. But supply chain issues and the inefficiencies of our logistics sector persist, complicated by a surge in work-from-home and shop-from-home behavior as well as the reshoring of production driven by national security concerns and climate imperatives. And now, on top of these seismic shifts, we are encountering a rising conflict in the Red Sea and drought challenges facing the Panama Canal.

Note: This newsletter was initially published by Governing Magazine on January 17, 2024

Fueled by macro dynamics and unprecedented federal investments, the reshoring of advanced manufacturing is happening at a pace and scale that would have been inconceivable even three years ago. As a result, in many respects the hierarchy of American metros is being reset.  If the decade between the Great Recession and the pandemic seemed to be all about “superstar” tech cities, many of the winners in the remote-work era are going to be places that make tangible things.

Since we launched the Innovative Finance Playbook in November 2022, Catalyze and the Nowak Metro Finance Lab have been assessing Revenue Based Financing, or RBF, as a tool to help address the capital gaps and deficiencies laid bare by the COVID pandemic; namely, the 83% of entrepreneurs who do not access traditional bank debt and venture capital. We recently released a report sharing our findings entitled “The State of Revenue Based Financing and CDFIs.”

The pandemic and post-pandemic period have been defined in many respects by capital. Beginning with the CARES Act and continuing with the American Rescue Plan Act, the Infrastructure Investment and Jobs Act, the CHIPS and Science Act, and the Inflation Reduction Act, this capital period has seen the federal government dedicate trillions of public resources for a broad set of activities, initially related to rescue and recovery (a focus on preserving existing businesses and communities) in 2020-2021 and then economic transformation (an industrial/energy transition of monumental proportions) in 2021-2023.

In War and Peace, Tolstoy famously observed that “Nobody was ready for the war which everyone expected.”

I was reminded of this quote when reviewing many of the newsletters published this year. As readers know, this platform returns again and again to the wicked challenges that cities and metropolitan areas face during this disruptive post pandemic period. (It’s difficult to say “post” when COVID seems to be raging again, but so be it).

Since the passage of the Bipartisan Infrastructure Law in 2021, the Biden Administration has championed unprecedented federal investments in infrastructure, clean energy, and advanced manufacturing. While the scale of federal investment has continued to grow, a disconnect between federal organization and local community operation has persisted.

Three years after the first wave of the pandemic, remote work is challenging the role and function of central business districts in the United States. This disruption has already pushed down transit ridership and revenues in major US cities and metropolitan areas: it is now triggering general concerns regarding the urban fiscal health of cities since central business districts and downtowns typically generate a disproportionate share of municipal tax revenues.