As recently as the early 1990s, America’s big cities were widely perceived as trapped in a downward spiral of fiscal, economic, and social distress. I remember attending a conference in 1993 or 1994 during which then-HUD Secretary Henry Cisneros enthusiastically declared that “the cities are coming back!” He received polite, but very skeptical, applause. But by the  early 2000s, many cities—including the long-suffering District of Columbia—had indeed experienced a remarkable comeback.

Last week, I was lucky to listen in on a conversation between Cisneros and Tony Williams, former mayor of the District of Columbia, about the state of U.S. cities. Both are optimistic about the future and see the current economic downturn as a temporary bump in the road.

The recent reversal in big-city fortunes reflects long-term changes in the economy. Cities suffered mightily from deindustrialization—the painful transition from a mostly manufacturing economy to one dominated by information and services. Now they’re finding new roles in their region’s  economy, as hubs for education, finance, medicine, innovation, arts, and culture. And they’re attracting the kinds of people whose numbers are expanding rapidly: young singles and couples who value diversity, dynamism, and nightlife; empty nesters looking for shorter commutes and smaller yards; and immigrant families seeking economic opportunities.

Better governance helps, too. Cities don’t thrive unless citizens and businesses have confidence in the government’s ability to deliver basic services, like license renewals, inspections, and garbage collection.  And effective mayors listen to their constituents, explaining both their long-term vision and their near-term decisions, responding to legitimate fears and criticism, and monitoring progress.

Looking to the future, both Cisneros and Williams see public education as a major cause for concern. Despite some recent progress, many big city school systems still fail to deliver a decent education. Families with choices about where to live won’t stay in communities with lousy public schools. But more important, today’s children will become tomorrow’s workforce, and the economic vitality of the nation depends on their productivity and inventiveness.