In many discussions of the death of downtowns, the focus is on residents. Having fled to the car-oriented suburbs, the residents found driving and parking difficult in old downtowns built for pedestrians and streetcars, so they drove to the malls, and the downtown businesses either moved to the malls or died.
This is only partly true, and it ignores the cities' original reasons for existing. If you look at the history of almost any city, you'll find that it developed where it did because business was good, and business was good because transportation was good. Actually, because transportation was bad and good at the same time.
This may become clearer with an example, let's take New York. It's an ocean port city, and it developed because it was a good place for goods to be transferred from riverboats and pack animals to oceangoing ships. This means jobs for people doing the transferring, and for financial agents negotiating payments, and for people to fix the boats and care for the pack animals. Ocean port cities are also border cities, which means work for customs and immigration agents. There are tons of other ocean port cities: London, Alexandria, Hong Kong, Buenos Aires.
Paris is a river city. It developed where a major Roman road crossed a major river. That means ferryboats and later bridges, with tolls. Crossing a river is a good place for caravans to stop for rest and replenishment. It's also a good place to transfer goods from caravans to riverboats or vice versa. Cities also developed where two or more rivers came together. Other river cities include Saint Louis, Timbuktu and Istanbul.
Other cities grew up with other means of transport. Albany and Buffalo were canal cities. Chicago is a train city and a lakeport city; Pittsburgh is a train city and a river city. Albuquerque is a river city, a train city and a highway city. Havana, Hania and Honolulu are island port cities, good places for ships to refuel or wait out storms. Denver, Peshawar and Turin are mountain pass cities.
What all these places have in common is that travelers and traders had to slow down there, for one reason or another. Stopping was often a good idea, and sometimes mandatory. If they stopped, they almost always grabbed a bite to eat, often stopped for the night, sometimes got stuck for a long time, and occasionally settled down. In addition to the jobs I mentioned above, there were also jobs related to dining, lodging and, yes, prostitution.
Industries grew up in these places, because they are good places to get raw materials and ship finished products. Financial businesses too, because they're good places to make deals, change money, etc. Places that already have goods, services and lodging are good places for the entertainment industry, education, religion, government and other service industries.
As time goes on and transportation changes, may towns lose their original reasons for being. Not much canal freight goes through Chicago anymore, but the train tracks do, and so do the highways, and now the airports are major hubs. The shipping importance of Detroit declined over the years, but for a long time it had car manufacturing. Now that that's declining, there's not much left.
Transportation counts, and through transportation counts for more. This is where we get back to the failed downtowns of the 1970s and 1980s. They forgot this. They just assumed that everyone would want to go downtown, but they didn't remember why. Then they built bypass roads around their towns because the downtowns were "too congested." Almost always, a new mall was built out by the bypass, usually at the junction of two highways, and the downtown declined. The towns had had their transportation systems rearranged, often with their approval, to the point where they were irrelevant.
A case in point is Kingston, NY. At first it was a river port, then briefly a state capital, then a canal port, then a major railroad junction, and finally a highway junction. It had two "downtowns," the old Stockade area to the west (Uptown) and the port on the Rondout Creek to the east (Downtown). Then in the 1950s, it was blessed with a series of bypasses. First the New York State Thruway was built a mile west of the Stockade area; about that time, the East Chester Street bypass rerouted Route 9W around the Downtown area. The George Chandler Drive bypassed Uptown just a few hundred feet to the north, and finally, the Route 209 bypass made a big loop around the west and north sides of the city.
Beginning in 1960, no one with a car had any reason to go through Uptown Kingston. From south to north they could take Route 9W or 209, and from west to east they could take the Chandler Drive. Outside the city in the Town of Ulster, the intersection of Routes 9W and 209 became the center of a new, sprawling, car-oriented commercial district. IBM built a number of plants there, and then came a mall, then a bunch of strip malls, then a new mall, and finally a Wal-Mart. Uptown and Downtown, business after business closed. The only reasons to go to either center were the government offices, the bus station and a few specialty shops and restaurants.
I'm sure many of the merchants cheered the new bypasses, even as they were destroying the reason for their own existence. The lesson seems to have been lost on many urban planners and politicians, as well. Even those who long to revitalize downtowns don't seem to grasp the value of transportation transitions to the economies of towns. As long as people drive around the downtowns, they will not be stopping to buy things. Even if they go straight through the downtown, as in Syracuse or Hartford, if they're on a highway that gives them no reason to stop, they probably won't. And if they're going too fast to see the businesses around them, how would they know to stop?
Bringing industry back to downtown is a good idea. What's also good is to give people a reason to go through the downtown again, slowly, and to stop.