Considering there's, variously,
- the Lazarus pit leeching into the groundwater,
- The
IlluminatiCourt of Owls enabling more crime alongside the general pervasive corruption by the ruling class, - The buried evil bat god Barbatos who was summoned and remains under the city
- The corruption of insane wizard Dr. Gotham who has also been buried under the city for over 40,000 years (Who gave him a doctorate 40,000 years ago is what I want to know.),
- Amadeus Arkham (and seemingly every warden of Arkham since) grossly mistreating the patients there.
- The city being surrounded by swampland lending it to be perpetually gloomy.
One can see why the city might not have the best base to positively grow from.