The Chimera of Enterprise Zoning

As the debate about America’s urban crisis sharpens and “reindustrialization” gains momentum on the Republican agenda, a controversial proposal to aid distressed urban areas is making the rounds in policy-making circles. With nostalgic appeals for a return to traditional American values (entrepreneurialism, self-help), enterprise zones are being marketed as a panacea for urban blight and unemployment. Yet the opinions of legislators, planners, and interest groups on the program’s effectiveness, merits, and impact remain largely divided. Some believe enterprise zoning, which is based primarily on tax “incentives” to business, will remedy inner-city decline. Others suspect it is simply voodoo urban policy or, in the words of George Sternlieb of Rutgers, “a merchandisable phrase in search of a program.”

President Reagan, who has presented these enterprise zones as the cornerstone of his urban policy, recently sent the details of hi...