AUGUST 31, 2004

By Christopher Kenton

To Save a Town, Why Did They Destroy It?

Santa Maria used to be a city of small stores and Main Street lives. Now, all that is gone -- and so is its soul

I took a short vacation with my family to visit the town where my wife grew up. It was the town where we met some 15 years ago, the place where my parents retired, and where I landed after wandering overseas between college majors. Back then, Santa Maria was an agricultural backwater on California's central coast, a pit stop on the way from San Francisco to L.A. It was a town with a vibrant history, but little use for it -- an impossible place to love if you didn't have roots there. For me, it became the town where I met my wife, where my father died, and where I got my first tastes of both business and journalism.

Today, Santa Maria is a burgeoning Wal-Mart (WMT) suburb. Everything and nothing has changed. Where once there were neat rows of strawberries and broccoli that went on for miles, now there are endless fields of single-family homes. In a town that once couldn't attract a national grocery chain, you now find the same brand-name strip malls that dot almost every town in America. Starbucks (SBUX )-Blockbuster-Subway-Kinkos -- prefab economic zones you can buy off the shelf to drop into your half-acre plot along Main Street, some assembly required.

DINOSAUR TERRITORY. On a national scale, this is the face of progress. These manufactured main streets feature a star-studded array of brands that are leading markers on the stock exchange, where they build our retirement accounts and our children's education funds. But on a local scale, especially in a place like Santa Maria, the history that is being paved over holds some interesting clues about the future -- clues that are convenient to forget in the face of short-term profits.

Like most California cities, Santa Maria has an old town -- the intersection of Broadway and Main -- where solid buildings from the early 1900s line the streets. Well, Santa Maria used to have an old town. Where many California cities now have a revitalized core, with old brick buildings turned into stylish restaurants and side streets turned into open air markets, Santa Maria has a massive monument to one of the most influential fads ever to sweep city planning -- the Town Center Mall.

In the mid-1970s, Santa Maria bulldozed their entire city center in order to build a huge shopping mall and parking lot. The new mall generated a lot of wealth -- for about a decade. As soon as outlet stores started cropping up along the freeway, and then Big Box discount stores, even a Barney Carousel couldn't salvage the Town Center's consumer appeal.

GOD'S WAITING ROOM? Now the mall is half empty, and the anchor-tenant department stores are struggling. During our vacation, my wife took advantage of the 15-hour Super Double Discount Sale at one of the major retailers. When my wife balked at paying the "slashed" sale price of $29 for a Finding Nemo throw pillow my son was clutching, the check-out clerk whispered the name of a nearby discount store where she could get the same pillow for half the retailer's sale price.

You don't need an MBA to do the math on the future of that retailer, or the future of the mall. In fact, the city is already trying to figure how to do what they weren't willing to do with the old downtown -- revitalize a retail ghetto of empty storefronts. One of the leading ideas is to turn the entire mall into an assisted-living facility. That's right, renew the city center with a very large nursing home. I suppose there's a certain logic to it -- all the unused parking space could easily convert to a cemetery.

What no one seems to be asking, either in Santa Maria or many of the other towns that now look exactly the same, is what time frame should drive investment decisions. Just as business-development and investment decisions on Wall Street are driven by quarterly results, our city-planning decisions are increasingly governed by short-term payoffs. But instead of losing our shirts to scandals like Enron and Worldcom, we lose something far more profound behind the new facades of one-size-fits all city streets. What we lose are the stories that make our lives meaningful.

ILLUSORY GAINS. Okay, call me a romantic. Tell me I just don't understand the capitalist economy. Tell me all about the cycles of change that have gone on before, and how we always move forward. I'm not buying it.

Taking Santa Maria as an example, the payoff on the mall that wiped out much of the city's history lasted little more than a decade -- and that's not counting the hefty residual, which hangs like a mall-sized albatross around the city's neck. The economic cycles of outlet centers and big box stores are running even faster. As soon as one town builds The New Thing, the town at the next freeway exit has to get one too in order to recapture escaping sales tax revenues. In a couple of years, demand is diluted too much for any one city's investment to pay off.

In the short run, of course, developers do well, cities collect some nice fees and sales taxes, and retailers expand volume. And there's always the potential for another big project to bail us out when the current scheme runs out of steam.

A LIFE OF LABELS. But how much value do we place on a sense of place, or a sense of history? History only tells us where we've been, but it's those stories that help us understand who we are and where we're going. What stories do we tell about our communities when our history is relegated to some old black and white photos in the barber shop or a doddering historical society?

The sad truth seems to be that we are reduced to telling stories only through our possessions. We are what we own. We are what we drive. We are individual "brandscapes," buying and assembling our identities through the metaphors of clothing, furniture, and food.

There's some beauty in this. Everything is invested with meaning, since everything we own has the potential to say something about who we are. And the whole grand economic exercise, from corporate marketing to supply-chain management has a masterful efficiency -- our purchasing power as consumers, the lifeblood of our economy, is now directly coupled with, and driven by, our psychology of being.

HOME TRUTHS. But at the end of the day, we are giving up a society in favor of an economy. When every decision -- even decisions that cut to the core of our community -- are dictated by the most immediate profit opportunity, it makes sense to tear down a city in order to build a mall. It makes sense a few years later to build big discount centers to undercut the mall. Cross every bridge when you come to it, and let every decision be driven by the shortest break-even point on the balance sheet.

Maybe it doesn't matter, but Santa Maria no longer feel like the town where I met my wife, where my dad died, and where I got my first taste of business and journalism. It just feels like every other town on the way from San Francisco to L.A. That relentless consistency is what made McDonald's (MCD ) a household name in 150 countries around the world. But I don't want to live there.