Alain Bertaud and the Future of Cities

Recently, our parent organization, Liberty Fund, embarked on a series of programs aimed at our local (Indianapolis, Indiana) community. The first topic we endeavored to explore was the future of cities.

One of the programs we hosted was a virtual “town hall,” in which I was privileged to interview former EconTalk guest and urban planner Alain Bertaud.

I asked Bertaud what a city like Indianapolis, whose goal is to attract and retain talented young professionals, ought to focus on, as well as why we might not want our city planners to have a “vision” for the future.

Here’s the video of our conversation:

 

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One hundred years of solitude

Rarely does one see such unambiguous good news as this:

The Berkeley City Council has unanimously voted to become the first Bay Area city to end single-family zoning. . . .

Berkeley was the first city in the country to enact single-family zoning more than 100 years ago.

Opponents of single-family zoning say it was used to exclude people of color from moving into certain neighborhoods.

Who wins?

1.  Conservatives that favor local control of zoning decisions.

2.  Conservatives that favor deregulation and free markets.

3.  Progressives worried about housing affordability for the poor and minorities.

4.  Urbanists worried that suburbia creates isolated, atomistic people, unconnected to their neighbors.

5.  Environmentalists worried about urban sprawl.

Congratulations to Berkeley for ending 100 years of solitude.

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The seen and the unseen

Here is someone arguing against loosening regulations to allow more home building, unless supported by the neighborhood in question:

I would only support upzoning in order to create affordable housing if the zoning changes were supported by the community that they would affect. Currently, our land use process provides inadequate opportunity for substantive community input. I oppose upzoning our City’s historic districts. We can address our city’s affordable housing needs without changing the character of our City’s neighborhoods.

Here’s another example:

Did you know that an advisory panel in San José has recommended the elimination of single-family home zoning on neighborhood streets away from major boulevards and transit? This betrayal of the families in those neighborhoods contravenes the Envision San José 2040 General Plan that was adopted after much civic input. This so-called “Opportunity Housing” concept also contravenes common sense. . . .

[It] is a recipe for neighborhood strife around parking, noise, and privacy. It also goes against the city’s pledge to protect the character of often-historic blocks not on major boulevards or adjacent to transit. Such a move would nuke the neighborhoods that give San José charm, character, and breathing room.

The first statement was made by Maya Wiley, a progressive running for mayor of New York.  The second comes from the Santa Clara California Republican Party.

We are frequently told that America is polarized between liberals and conservatives, and there is clearly some truth in that claim.  But perhaps we are missing an even bigger polarization, between those who focus on the seen and those who focus on the unseen.  (BTW, the title of this post comes from Frederic Bastiat’s brilliant essay on opportunity cost.)

Proponents of NIMBYism on both the left and the right are opposed by those who focus on the unseen effects of zoning restrictions, that is, all the anonymous people who will never be able to live in areas with lots of great jobs because the local residents refuse to allow new construction.

There are many proponents of protectionism in both political parties.  They focus on the easily seen impact of imported goods, which is a loss of jobs in import competing industries.  They are opposed by people on both sides of the ideological spectrum who  focus on the unseen effects of protectionism, such as a loss of jobs in export industries.

A few years ago, a bipartisan group of Congressmen successfully repealed the “Cadillac tax” on health insurance, which aimed to gradually phase out the heavy subsidy that the federal government currently provides to health expenditures made through company insurance plans.  They focused on the easily seen consequences on worker paychecks and health care jobs.  They were opposed by people on both sides of the ideological spectrum, who worried that the subsidy to health insurance causes costs to explode, thus reducing real wages for future generations.

People on both sides of the ideological spectrum often favor fiscal stimulus.  Other people on both sides of the ideological spectrum worry about its unseen effects, such as crowding out.

People on both sides of the political spectrum worry that immigration will reduce wages.  Others on both sides of the political spectrum think about future generations of people who are not now but will become American, and who will be better off because they were allowed to immigrate to America in the 2020s.

People on both sides of the political spectrum favor government deposit insurance to protect savers when a bank fails.  Other people (including FDR) worried about the less visible moral hazard thereby created, the tendency of insured banks to make riskier loans than uninsured banks.

People on both sides of the political spectrum have advocated that universities fire people who make offensive statements about Israel, or about minority groups.  Others worry about the chilling effects of moving away from a tradition of free speech.

Yes, in America we have the Democrats and the Republicans.  But perhaps at a deeper level the actual split is between the party of the seen and the party of the unseen.

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Free to build

You would think that if conservatives could agree about anything it would be zoning reform. Making it easier to build new housing would increases freedom (something libertarians like), increase economic growth (something businesspeople like), and help lower class Americans afford homes (something all conservatives like.)

Recently, however, a split has developed in the conservative ranks, as exemplified by a recent National Review article by Stanley Kurtz.  Here he criticizes the idea of having the federal government pressure cities to make it easier to build housing:

They will lose control of their own zoning and development, they will be pressured into a kind of de facto regional-revenue redistribution, and they will even be forced to start building high-density low-income housing. The latter, of course, will require the elimination of single-family zoning. With that, the basic character of the suburbs will disappear. At the very moment when the pandemic has made people rethink the advantages of dense urban living, the choice of an alternative will be taken away.

Before getting into zoning, let me acknowledge that the specific complaint here has some merit. It’s not obvious that the federal government has any business telling local governments to reform zoning.  (Is this more like schooling, where local control is best, or more like free speech and interstate commerce, where you want the federal government to guarantee certain freedoms? I don’t know.)

But Kurtz doesn’t stop with defensible complaints about the merits of federalism; he also disagrees with the claim that zoning reforms to boost density would be welfare improving.  And that argument is very hard to make.

Residents often complain about new apartment complexes because it increases traffic and brings in lower income residents.  But these arguments are very weak.  In aggregate, greater density reduces traffic.  People must drive farther in less dense suburbs.  And lower income people need a place to live.  Surely its better to allow them to live closer to job opportunities than to force them into slums, or even homelessness.

Nor would these proposals “destroy” the suburbs.  Even the NYC metro area—which is a sort of poster child for dystopian density in the minds of many zoning fans—the vast majority of the region is devoted to low density suburbs, including much of Long Island, northern New Jersey, Westchester County and southwest Connecticut.  When people hear the term ‘New York’ they think of Manhattan, but there are plenty of nice suburban communities for people who prefer that sort of living.

You might argue that removing zoning would turn American suburbs into New York City-style dystopias, but there are far to few people in America to densify more than a tiny, tiny fraction of suburbia.

And some densification is optimal.  Suppose Midtown and the Upper East and West Sides of Manhattan had not been allowed to densify, because residents who liked the formerly quiet neighborhoods had used NIMBY lawsuits to hold up development.  Think about how much less impressive New York City would be today.

The goal should not be to have all dense cities, or all sprawling suburbs, but a mix of the two.  Zoning reform helps to allow America to develop organically, according to the wishes of the public.  Each family will move to the sort of area that they prefer.

Conservatives often oppose progressive policies that are intended to help the poor.  In many cases, conservatives are correct to oppose those initiatives, as government involvement in the economy often does more harm than good.  But if conservatives were then to turn around and support government regulations that made it hard to build affordable apartments, even though those regulations reduced freedom and reduced economic growth, all because growth might inconvenience some affluent people who like things to always stay the same, then there are going to have to accept the fact that their motives will be questioned.  (I say “some affluent people”, because I favor more density in Orange County.)

Isn’t the conservative view that higher minimum wages reduce freedom and economic growth?  OK, but doesn’t zoning also reduce freedom and growth? Or is something else motivating conservative opposition to higher minimum wages?

I know why I oppose higher minimum wages, but I’m no longer confident I know why other conservatives do.

Of course many on the left oppose new low-density suburban developments.  I also disagree with that view.  So I’m not taking sides on the overall housing density debate, just the specific idea of relaxing zoning rules to allow greater density.

Some progressives have a vision for how people should live—densify.  Some conservatives have a very different vision for how people should live—suburban sprawl.  My vision is freedom.

PS.  The American Conservative has an article by Charles Marohn that points to numerous federal regulations that have subsidized suburban sprawl.  Stanley Kurtz mostly ignores those market distortions when he advocates a hands off approach by the federal government.

 

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