There are few cities in America as vibrant as Portland, Oregon. Pioneer Square is a cosmopolitan town commons with art exhibits, street singers, brown-bagging office workers, and an outdoor cafe occupying what was once the site of a parking garage. Light rail trains frequently glide by to take folks home to neighborhoods and suburbs on the east and west sides of town.

It wasn’t always so. Thirty years ago downtown Portland was like countless other cities written off for dead, with dismal public spaces, a crumbling center, and deteriorating neighborhoods. Those very same places now feature block after block of lively storefronts, coffeehouses, restaurants, hotels, parks, rehabbed warehouses, and office towers.

Yet even as residents celebrate the revival, Portland nevertheless has drawn the ire of free market think tanks and conservative economists. The reason? They argue that Portland’s success is illusory. In the view of critics, unsound principles of land use and civic planning designed to manage growth have done nothing more than produce much greater traffic congestion, more bureaucracy, lower quality of life, and higher housing prices. “The last bastions of central planning in the world today are North Korea, Cuba, and Portland, Oregon,” said Randall O’Toole, an economist with the Thoreau Institute, a free market think tank in Oregon.

As the United States approaches the November election, and both major party candidates address policies to improve metropolitan areas, it’s critical to understand Portland’s emergence as a world-class city. In other words, is Portland a potential model for a new national urban policy? Or are the critics right?

The answer is the critics are wrong. Portland is the one place in America doing something more creative and sustainable than urban-planning-as-usual. Instead of accepting ever-escalating levels of traffic, air pollution, sprawl, and inner-city decay, Portland made a commitment to public transit, environmental quality, compact development, and the revitalization of poor neighborhoods.

Portland took the first step toward a new kind of urban development in 1972 when Mayor Neil Goldschmidt responded to intense pressure from community groups in working-class southeast Portland and cancelled plans for the Mt. Hood freeway, which would have ripped apart several neighborhoods to accommodate suburban commuters. An east-side light rail line was later opened as an alternative to the freeway.

The cause of growth management won another major victory in 1973 when environmentalists teamed up with farmers and maverick Republican Governor Tom McCall to enact an ambitious statewide program of land-use planning that required all cities, including Portland, to establish an urban growth boundary beyond which sprawl development could not take place.

In a third significant move, Portland area voters in 1978 approved plans to establish an elected regional government, Metro, which is still the only one in the country. It has proven very effective in overseeing growth management policies. Efforts to limit sprawl in other regions have been hampered by the clashing self-interest of various municipal, county, and state authorities.

The wisdom of all these decisions is borne out by Portland’s performance as a place to live. Portland has not eliminated sprawl — you still see plenty of strip malls and tract houses — but it has contained it. Suburbia stops on all sides of the city between 3 to 18 miles from downtown, giving way to green expanses of fields and forests.

Metro officials are planning for 600,000 new residents in the next 40 years and plan to add only 18,600 acres of new land to the urban growth boundary — a 40 percent increase in population being accommodated with only eight percent growth in the region’s area. By contrast the Detroit metropolitan region has dropped four percent in population over the last two decades but expanded in size by 54 percent.

When Portland first adopted a growth management strategy 20 years ago, economists and other opponents said it would choke the region’s prosperity. They were wrong then too. Portland is booming, and growth management policies deserve a great deal of the credit.

Indeed a new study by Arthur C. Nelson, a professor of city planning at the Georgia Institute of Technology, found that Portland’s housing prices increased 60 percent in the 1990s compared to 20 percent in fast-growing Atlanta. The major reason, though, was not because Portland’s urban growth boundary limited the availability of land, said Mr. Nelson.

Instead the urban growth boundary and other planning measures turned Portland into such a choice destination for new businesses, jobs, and families that demand for homes is soaring along with wages. Portland’s average family income increased 72 percent from the mid-1980s to the mid-1990s compared to 60 percent in Atlanta. The growth in the number of jobs was six percent higher than Atlanta’s. Meanwhile Portland’s sound planning and good urban design paid off for families who have seen property taxes reduced 29 percent from the mid-1980s to the mid-1990s, commute times lowered nine percent, and energy consumption cut by eight percent.

In short, Portland is an urban center that works. Most important of all, Portland offers a different vision of what American cities can look like in the 21st century.

Jay Walljasper is the editor of Utne Reader, and writes about city life for The Nation. He is reachable at walljasper@utne.com.