RALEIGH — North Carolina continues to exhibit impressive economic performance. Last year, for example, only five states — Idaho, Tennessee, Florida, Nevada and Texas — enjoyed faster growth in gross domestic product than we did. Our inflation-adjusted rate of 3.2% surpassed the national (2.1%) and regional (2.6%) averages.

John Hood

Now, it’s fair to point out that North Carolina’s economic growth isn’t evenly distributed across the state. It never has been. Most of our major metropolitan areas are growing, some rapidly. Many rural communities aren’t. Even within those metropolitan areas, levels of investment, sales and employment can differ substantially by neighborhood or business district.

Consider, for example, the recent experience of retailers, restauranteurs, and other businesses in downtown Raleigh and Charlotte. Most are doing better than they were in the height of the COVID lockdowns, to be sure, but not nearly as well as they were before the onset of the pandemic in early 2020.

According to a recent study by scholars at the University of Toronto, foot and vehicular traffic in downtown Raleigh (as measured by mobile-device pings) during the winter of 2022-23 was only 51% of the comparable pre-COVID period. Though uptown Charlotte fared a little better at 58% of pre-COVID activity, both North Carolina cities were below the median (63%) of the 63 downtowns studied — which is itself a pretty weak recovery.

Which downtowns snapped back the strongest? Well, five of them — Salt Lake City, Bakersfield, Fresno, El Paso and Columbus, Ohio — actually have more downtown activity today than they did in 2019. Meanwhile, Portland (40%), St. Louis (38%) and hapless San Francisco (32%) remain in severe distress.

The normalization of remote employment is certainly part of the story. Tech firms, financial institutions and other major employers haven’t brought back into their workplaces all the folks who got used to working from home during COVID.

Some will never come back, at least not five days a week. That means some of the shopping, errands and dining out they used to do downtown are now occurring in suburbs and smaller communities within the metro. There’s not much policymakers can or should do about this. In fact, I happen to think the resulting dispersion may turn out to be a more efficient use of land, capital and transportation infrastructure.

But such voluntary changes in employment relationships are far from the whole story. Why are downtowns in such places as Portland, St. Louis and San Francisco struggling so mightily to recover? In part because potential workers, shoppers, entrepreneurs and investors don’t feel safe and welcome there.

Downtown conditions in Raleigh, Charlotte and our other major cities aren’t nearly so dire, of course. And crime rates have recently ticked down a bit in some of these places. Still, criminal activity and social disorder remain bigger problems today than they were just a few years ago.

Some policymakers think the answer is to pour additional tax dollars into transit lines, redevelopment projects or public-private partnerships. They’re mistaken. Tackling the problem will, indeed, require public expenditures — but they need to flow to core public functions, not speculative investments.
First and foremost, we need more police officers patrolling the streets in downtown neighborhoods and business districts. As my John Locke Foundation colleague Jon Guze observed in a research paper last year, “a large and growing body of academic literature confirms that police presence deters crime and helps maintain public order.”

The immediate return on investment in law enforcement is to save life, limb and property — a benefit that accrues disproportionately to the black residents who face the highest probability of being victimized. Reducing crime and disorder then has the secondary effect of making communities a more attractive place to live, work, shop and invest.

Guze isn’t saying the solution is to arrest, convict and incarcerate more criminals. Greater police presence discourages socially destructive behavior in the first place. “It is time for a new approach to crime control,” he argues, “one that focuses on deterrence rather than punishment.”

John Hood is a John Locke Foundation board member.