Shipra Sanganeria
Published on: June 12, 2025
Freedom Cities are a proposed solution to key US challenges like the housing crisis, declining manufacturing, and slow economic growth.
First introduced in 2023 by President Donald Trump and expanded in 2025, the plan aims to build entirely new low-regulation cities designed to attract private investment, accelerate innovation, and provide more affordable living options.
Supported by tech entrepreneurs and libertarian policy thinkers, advocates see these zones as fast-moving hubs that could boost innovation and economic development. But this utopian idea raises a key question — can Freedom Cities avoid the failures of historical company towns and instead replicate the successes of modern Special Economic Zones (SEZs) and charter cities?
Critics of this idea also point to concerns around governance, economic stability, security, and long-term viability.
While Pullman, Illinois, in the US is often seen as a cautionary tale of centralized corporate control and worker unrest, Jamshedpur, India, offers a more stable, though still corporate-controlled, model.
In this article, our research team at SafetyDetectives explores whether Freedom Cities represent a viable next step in urban development or simply a high-tech version of the old company towns. We also compare them to past and present models like company towns, Special Economic Zones (SEZs), and charter cities such as Prospera and NEOM to assess their advantages and pitfalls.
Company Towns: What Worked, What Didn’t
Company towns emerged in the late 19th and early 20th centuries as a by-product of the Industrial Revolution. In these employer-owned settlements, a single company provided employment, housing, schools, and civic amenities.
Often under a paternalistic vision, these towns aimed to dominate socio-cultural values through environmental control.
Over time, many of these towns declined due to government intervention, rising wages, greater worker mobility, and a growing desire for independence from corporate control.
The following table compares company towns that succeeded, failed, or were abandoned, based on data gathered and analyzed from a range of secondary online sources.
Table: Historical and Modern Company Towns: Success and Failures
While some collapsed due to resource depletion, industrial shifts, or disasters, others adapted, evolving into more integrated and less centralized urban centers.
Understanding the Broader Patterns
While the case studies above offer individual stories of success or failure, a closer examination of broader trends reveals common patterns behind the decline or transformation.
The following chart uses aggregated data to highlight key causes for why many of these towns failed or disappeared altogether.
How Company Towns Ended: Key Causes of Failure or Transformation
In addition to leading causes like resource depletion (23%), corporate withdrawal (17%), and bankruptcy or financial collapse (14%), some company towns adapted to changing socio-economic conditions.
Some evolved into regular municipalities (14%), while others were reshaped by strategic relocation or shifts (6%) in industrial focus.
Once built as self-contained industrial communities, company towns laid the foundation for modern ideas like special economic zones (SEZs)Â and charter cities. However, their rigid, tightly controlled structure eventually led to their decline.
In conclusion, the fall of historical company towns highlights the risks of relying too heavily on one company or industry, signifying the need for economic flexibility, diversification, and sustainable urban planning.
Charter Cities and SEZs: The Modern Playbook
As company towns declined, a new model of economic urban development emerged in the form of SEZs and charter cities. These zones are designed to promote innovation, trade, and growth by offering tax incentives, flexible governance, and public-private collaboration.
What Makes Modern Models Work
Unlike historical company towns, SEZs and charter cities have succeeded in the past due to a combination of:
- Tax incentives
- Public-private collaboration
- Legal clarity and autonomous governance reducing bureaucratic challenges
- Fiscal incentives supporting investment
- Integrated infrastructure planning improves livability
- Multi-sector development strengthens the labor market
However, these models do have some flaws. Critics cite concerns around governance gaps, exclusion of marginal communities, weakened labor and environment protections, and over-reliance on fiscal incentives.
As policy makers and private institutions explore new urban models like freedom cities, the experience of SEZs and charter cities offer key lessons in building cities that are inclusive, sustainable, and future-ready.
Freedom Cities and the Tech Angle
Freedom cities are a new urban concept focused on creating high-tech, low-regulation zones led by the private sector. Built from scratch, freedom cities aim to support innovation through adaptable infrastructure and deregulated governance.
However, to avoid repeating past mistakes of historical company towns, freedom cities will need to be built with clear governance structures, fair labor standards, diversified economies, legal transparency, and scalable infrastructure.
Past attempts to create tech-driven urban projects faltered despite big visions. Projects like Google’s Sidewalk Labs in Toronto, Facebook’s Willow Village in California, and Bill Gates’ proposed Belmont City in Arizona all faced setbacks due to local resistance, poor integration, and data security issues.
Ultimately, the success of freedom cities will depend both on technological innovations and on how well these innovations integrate with governance, planning, and real-world urban complexity.
What the Data Says: Can They Work?
Freedom cities offer a new vision for urban development, and to assess their viability we’ll need to compare them against both past and existing urban models.
By analyzing survival rates, lifespan, population scales, economic control, and diversification, we can examine what works and what freedom cities need to avoid or adapt to succeed.
Survival Rate of Urban Models
The survival rates for different types of urban models provide insight into the historical success of each model.
Data shows that SEZs (100%) and charter cities (83%) have the highest survival rates, due to their economic flexibility and governance models.
Freedom cities (0%), being entirely new, have yet to prove their durability. However, their success will likely depend on avoiding the pitfalls of company towns and adapting innovative governance modes and economic diversity of SEZs and charter cities.
Lifespan & Adaptability
The data on average lifespan is important for understanding how long these towns typically last.
Historical company towns have the longest average lifespan (79 years) due to resource-driven stability, but often collapse when those resources deplete or become unprofitable (e.g., Fordlândia).
SEZs, though flexible and economically diversified, average just 38 years.
In order to outlast company towns, freedom cities will need to prioritize adaptability and economic diversification, similar to SEZs and modern company towns.
Population Peak
The average peak population reveals the scale and economic resilience of these towns.
In terms of population, SEZs lead the model type with Shenzhen (17.5 million) and Xiamen (5.35 million), showing how flexible trade and investment policies drive massive growth.
Modern company towns like Jamshedpur average over 438,000 residents, while smaller, less diverse towns fail to survive.
Charter cities fall in the middle, averaging 263,000, though failed projects like Lavasa stalled at 5,000.
To succeed, freedom cities will need to focus not only on population scale but also on building diverse, adaptable economies.
Economic Control Structures
The success or failure of urban models often comes down to how their economies are structured. Flexible, incentive-driven models like Shenzhen flourish, while rigid, single-industry towns like Fordlândia have collapsed.
Some, like Hershey, survive through reinvention, while projects like Starbase remain speculative. For freedom cities, success will depend on adopting adaptable, resilient governance, or risk failure due to repetition of past mistakes.
This graph reinforces that freedom cities should avoid outdated company-controlled models and instead adopt hybrid governance, combining private authority with corporate influence, much like successful SEZs and modern company towns.
Industry Diversification
Freedom cities will need to avoid repeating the failures of single-industry towns like Fordlândia and Pullman. A diverse economy helps ensure long-term success and stability.
Active Town Industry Focus
Among the 5 urban models, SEZs show that a broad industry base drives long-term success. Similarly, modern company towns also sustain growth through adaptable, diversified strategies.
Charter cities face moderate risks due to limited industrial focus, while proposed freedom cities like Starbase mirror the fragility of past single-company-dominated towns.
To succeed, freedom cities will likely need to move beyond tech-only models and adopt a diverse industrial mix to ensure economic resilience and avoid future unrest.
Methodology
The article explores the economic and governance models of freedom cities, historical and modern company towns, special economic zones (SEZs), and charter cities, using comparative analysis to explore their structure, lifespans, and policy implications.
In addition to manual search, AI tools like ChatGPT and Grok were used to gather relevant historical and current data from various sources including news articles, academic publications, policy documents, and Wikipedia.
The research primarily focused on freedom city proposals (e.g., Starbase), advocacy groups (e.g., Freedom Cities Coalition, Próspera), legacy company towns (e.g., Pullman, Jamshedpur), and zone-based developments (e.g., Shenzhen, NEOM).
Once collected, the data was categorized into key areas like taxation, housing, governance models, public vs. private ownership, labor regulation, and economic sustainability.
In-house statistical analysis was then applied to this categorized data to identify patterns, including the decline of resource-dependent company towns and the regulatory flexibility characteristic of SEZs.
Key limitations include inconsistent or unavailable data for older or confidential projects (e.g., Wehrum, NEOM), lack of standardized metrics (e.g., population peaks, closure reasons), and challenges in comparing different historical and regional contexts.
Discussion
Freedom cities represent a bold vision to address many of America’s urban and economic challenges, but proposals alone don’t guarantee success.
The failures of past company towns highlight the risk of single-industry dependence and centralized control. In contrast, SEZs and charter cities show that flexible governance, industry diversification, and integrated planning are essential to long-term success.
To succeed, freedom cities will need to look beyond a tech-first approach and adopt the lessons of past and present urban models — shared governance, economic adaptability, and inclusive growth.
