One of my biggest pet peeves is when city planners discuss Smart Growth. Time and time again politicians and concerned citizens clamor for land regulations, regulations which ultimately lead to expensive real estate. I’ve written about this subject a few times, but Mark J. Perry has an awesome graph that displays the problem very well. His article has some other interesting statistics as well.
Are zoning laws and city regulation the only contributors to unaffordable housing? No, but they are a major part of the problem and unfortunately no one seems to understand.
The monuments of social justice
It’s no surprise that the average American is ignorant about economics. Public education places a higher value on evolution than it does on something practical like economics. If Americans had a better understanding of economics we wouldn’t have stupid policies like the minimum wage or “smart” growth.
Gallup has a new poll showing that a plurality of Americans don’t mind letting the Bush tax cuts expire for people making more than $250,000. Why should the average American care? Stick it to the rich guy and all that. This kind of populist thinking is like crack for politicians, except more addictive. It’s also dangerous. Rich people will do what they always do when you raise their taxes. They’ll fire some people. That middle class worker who thought they were “sticking it to the man” must sure feel good in the unemployment office.
The most liberal parts of the United States are our mega cities. A quick visit to the dystopian cities of Detroit, Philadelphia, Atlanta and Boston is a truly eye-opening experience. There are two groups of people who live in Detroit: The super wealthy or the super poor. The middle class has been wiped out by high taxes, unemployment, and government mismanagement. These are the fruits of “sticking it to the man.” Taxing rich people doesn’t help our society. It certainly doesn’t hurt the rich.
The progressive solution to dystopia is more idealistic plans. It’s like the captain of the sinking Titanic trying to find more icebergs to ram into in order to fix the gaping hole. The captain would name this solution “Smart Sailing” or something clever to be able to market it effectively. Who can oppose anything with the word “smart” in the title? Maybe if we educated people about economics it wouldn’t be so easy to fool people by simply clamoring for “smart growth” and other euphemisms for sheer idiocy.
The big news in downtown Sarasota this week is the announcement that Sarasota News & Books (SN&B) will be closing at the end of the month. A few days ago Club Soda gave a tongue in cheek description of the hipster dufus, and as you can imagine the local hipster dufus community is outraged about the bookstore closing. I love bookstores; the Main Street bookstore closed a year ago and I’m still sad about it. Unfortunately these are the casualties of a difficult market, stiff competition, and community organization gone horribly wrong.
The saddest thing about these closings is that it could be avoided in most cases. What’s happening in Sarasota is a microcosm of America. In Sarasota many well intentioned “concerned citizens” worried about too much growth. In their infinite wisdom they decided to make growth more difficult. What happens when you have an increasing population in an area with growth restrictions? Property values skyrocket. Take Houston and San Francisco for example: both city’s populations have grown at a similar rate over the last thirty years, but San Francisco’s property values have skyrocketed compared to Houston. What’s the difference between these two cities? San Francisco has implemented “smart growth” laws the over past thirty years and Houston has not.
What I find most annoying about this situation is that no one is educating the public about what’s happening. The United States isn’t running out of available real estate. Around 90% of the available land in the United States is undeveloped. Local governments are creating this problems with their dumb policies. What does an outraged hipster dufus think about the local bookstore closing? Let’s take a look at a comment left by hastalavictor… at the Sarasota Herald Tribune.
It’s also time for the public to go after the greedy landlord in a grassroots sort of way. The unreasonably wealthy landlord paid $6M cash for the property. Surely he can reach a compromise with Sarasota News and Books, especially in this market. No tenant that he can find will make a significant difference for this fat cat.
Mr. or Ms. Community Organizer, I know you’re out there.
When the bookstore closes it’s the greedy landlord’s fault. This type of thinking is difficult to combat because it’s just so shallow. It’s easier to be upset with the landlord than the well intentioned “community organizers” who set this in motion two decades ago. What we don’t need is more “grassroots” idiots dictating policy. That’s what created the problem.
If cities across the United States do not start to figure out the root of the problem there will be two types of cities. There will be cities like Detroit where no one wants to live and cities like Sarasota and San Francisco which are quickly becoming rich people theme parks. The only people who can afford to live here will be super wealthy people. Maybe that’s what they’re trying to accomplish.
It’s strange to me that books about the failures of centralized planning are even necessary anymore. The list of government induced problems is so long that it is surprising the public keeps succumbing to the Utopian promises of planners. Thomas Sowell touches on some the problems with “Urban Renewal” or the propaganda term “Smart Growth” in his book Economic Facts and Fallacies, but Randal O’Toole goes into painstaking detail in the Best-Laid Plans. I’m still working my way though O’Toole’s damning assessment of government planning. He starts with an assessment of the Forest Service and then turns the analysis towards city planning. The book should be required for anyone who wants to go into the field of urban planning.
Some see this is a nice place to live, planners see it as evil suburban sprawl.
All of these failed plans come from the same source. Planners promise to solve a problem (either real or imagined) and they make things worse. By the time everyone realizes how bad the plan was, other planners have moved in and compounded the problem. There is no better example in the book than the myth of urban renewal. Call it what you want; city planning, urban renewal, and smart growth are different names for the same thing. Planners are a group of people who think they know better than everyone else. They plan traffic, zoning, and housing for thousands or even millions of citizens. They implement simple plans for complex markets and ignore the externalities.
Most of the time planners prey on the worries of town citizens. “We’re growing too fast, no jobs will be available, and people will starve” they argue. Fear drives concerned citizens to kneel at the alter of city planners. As O’Toole points out “from 1950 to 1970 Santa Clara County, California, grew by 3,500 people per month and their living, employment, shopping, and recreation needs were fully accommodated by private entrepreneurs.” There was no need for planners. It’s not like the United States is running out of space. 95% of the US is undeveloped, and there still a lot of room for growth in major metropolitan areas. Unfortunately, due to city restrictions on growth such as Urban Growth Boundaries (congratulations Sarasota) real estate values are skyrocketing well over the national average.
Many of these plans are designed to created affordable housing. Unfortunately these plans have had the opposite effect. Trying finding affordable housing when the prices are skyrocketing in the city. In a roundabout way “Smart Growth” has become a soft way of segregating the poor from the rich. O’Toole goes further…
Planners either are unaware of these facts are assume that their constituents do not know them. They expect people to fear that unplanned growth will lead to high taxes; worsening traffic congestion; and the destruction of the nation’s last precious farmlands. Like knights in shining armor, planners offer to come to the rescue to prevent these problems. Their solutions just happen to produce higher taxes; worsening traffic congestion, and the reduction of some f the most valuable urban open spaces, namely people’s back yards.
Rolling back a lot of the red tape and regulation would go a long way in making housing more affordable in this country. The percentage of home ownership has stagnated since the 60s, around the same time urban planning started getting out of control. City governments have a role to play… I’m not asking for anarchy. Cities must provide safety, services, roads, and a clean environment.
Sarasota is facing the same problems. City planners have had a hand in creating a real estate environment with unusually high housing costs and it will be difficult for businesses to remain in the city. How do you attract employees to work for your company when they can’t afford to live in the city? Prospective employees aren’t stupid. They’ll just move to a town that’s more affordable. It’s about time “Smart Growth” comes to an end. Otherwise people and jobs will continue to flee urban areas.
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