They're going to need those walls. The question is only how to make them affordable and effective and also, aesthetic. That last part is optional but the part everyone focuses on and kills the project over.

The gaps in the wall are to let out water that needs to flow back out, but they can also probably be gated in some way for a full on barrier. In the midwest near some river towns you will often see underpasses between levees with massive steel gates that can be rolled into place when the worst flooding is imminent.

Taggers will assault these surfaces. The only thing you can do is muralize them first, and, construct complex surfaces that don't take the paint well. That can be thru expensive special coatings, or making the surface rough and corrugated and uneven enough that traditional tagging methods don't come out looking that good, or staying long.  You can also put a lot of low-income or unemployed people or low level criminals  to work, cleaning them continually.. Keeps them busy and fed.

I just now thought more about it and those walls could be built with a system of planters in them for vines and flowers and etc. that could grow to obscure the wall, leaving no room for tagging, but also making them look good from the dry side. Maybe even some of that wall space could be a vertical gardening opportunity for things like tomatoes, strawberries, what-have-you. But vines and flowers, stuff that's near-zero maintenance, that could be very nice, laid out on the walls strategically...

You could also put a lot of artists to work doing sculptural things onto those inner wall surfaces, friezes and such, three dimensional works.