ABOUT 250 miles north-west of New York City, in the heart of New York state, lies the city of Syracuse. Like the rest of upstate New York, Syracuse has been the victim of suburban sprawl and deindustrialisation. It is poor (with almost 30% of residents below the poverty line), shrinking (its population has fallen by a quarter since 1970) and broke (its mayor has declared “a new era of crisis”). But unlike the rest of upstate, Syracuse has been offered a solution to its woes: Destiny USA, the biggest mall in the world.
Saving upstate New York is a key issue in this year's race for governor. Eliot Spitzer, the front-runner and current attorney-general, compared the region to struggling Appalachia in a speech in March. But how can it be rescued? Destiny represents the apex of the optimistic view that large projects will lift up the area. If it is built, some say, the mega-mall could save Syracuse and its region and—because it would operate free of fossil fuels—could be a model of how to save the world.
This bold scheme has been hailed by George Pataki, New York's governor, and by Chuck Schumer and Hillary Clinton, the state's senators. Yet politicians in Syracuse itself are more sceptical. City officials and the mall's developer are warring over Destiny's future, and show no signs of letting up. Destiny could save the city; it could also be an oversubsidised flop.
No one doubts that Destiny is a revolutionary concept. As imagined by Robert Congel of Pyramid Companies, the project's developer, the $20 billion mall would be powered by alternative energies and cover some 800 acres, luring tourists to shops, restaurants, an aquarium, a water park, a golf course and thousands of hotel rooms, among other attractions. Mr Congel also wants to build a 325-acre research-and-development park just north of Syracuse, to rival Silicon Valley.
It is an epic vision, but one rife with uncertainty. Mr Congel has yet to present an actual plan to the city. Meanwhile, many fear that Destiny's costs to the public—Mr Congel is seeking federal, state and local subsidies—may outweigh its benefits. The research park was delayed as local businesses rebelled against efforts to seize their land. State officials barred Mr Congel from building Destiny in Syracuse's inner harbour after he refused to proceed without extra tax breaks. The one Destiny-related project that Mr Congel is committed to—the expansion of Syracuse's Carousel Centre mall, which is already run by Pyramid—would simply make a big mall bigger, and is mired in a bitter quarrel.
When Mr Congel proposed his scheme for the mall's expansion, the drowning city gasped with relief. But now Syracuse's mayor, Matt Driscoll, worries that a 2002 deal with Pyramid could cost Syracuse up to $310m in lost property-tax revenues. In March, the state Supreme Court ordered the city to honour the deal. Mr Driscoll is weighing an appeal, while Mr Congel has offered a compromise that includes demands that the city cede control of construction details and issue up to $6 billion in bonds to pay for the project.
Some say that Syracuse is crazy not to embrace Destiny. A stack of steel beams near the Carousel mall is adorned with signs that read, “Some see steel, we see jobs”. Syracuse's long-term problems have become even more acute in the past decade, and the city relies heavily on support from the state (or rather, tax money from Manhattan's bankers). Destiny could draw millions of tourists to upstate New York, create 250,000 jobs and generate $65 billion in net taxes over 30 years, according to the company's website. But such figures are based on the unknowable future and a plan that does not exist.
What will truly revive Syracuse and upstate, according to E.J. McMahon of the Manhattan Institute, a think-tank, is not mega-malls, but reforms to make the region more competitive. At present, the state offers tax breaks to projects such as Destiny and businesses in so-called Empire Zones, scattered throughout New York. Instead, argues Mr McMahon, leaders should address the factors that keep businesses from thriving in the first place: employment costs (settlements for workers-compensation cases are the second-highest in America), energy costs (electricity prices are 63% above the national average), stifling regulations and the second-highest tax burden in the country.
Upstate New York is not a lost cause. It is chock-full of good universities and has an able, educated workforce. More jobs are what it needs. Thus far, New York's leaders have preferred to support projects such as Destiny, for all its complications, rather than tackle thornier issues such as regulation and tax reform. New York's next governor may have to show more courage.