Majority rule, minority rights — or Moses and NIMBYs

Terror alert

I snarkily wrote up a little headline last Monday: “Belmont Bypass’ Immediate Neighbors Slam Outreach, Will Vote On Keeping Bottleneck.” Then Daniel Kay Hertz wrote a somewhat fuller reponse, pointing out that a few people would vote on a project that impacts rail service for hundreds of thousands.

(Not surprisingly, the referendum failed, with 583 votes against. In June 2014, the three rail lines that would benefit from the bypass carried 6,353,313 passengers.)

Many broadly beneficial, but locally detrimental, projects are subject to being torpedoed by hyper-local concerns. As with any Locally Undesirable Land Use (LULU), the benefits are broadly distributed but the costs are highly focused. Many will gain a bit, but the benefits are in the distant future and somewhat speculative, so the issue has soft salience to the majority. On the other hand, a few will lose a lot, so those loss-averse few have a strong incentive to fight tooth and nail against threats to their homes. It’s just human nature.

Later comments directed at both Hertz and I raised the specter of Robert Moses bulldozing East Tremont for the Cross-Bronx Expressway. Yes, there are some surface similarities: properties expropriated for a transportation improvement. Yet these projects differ incredibly, not just in what is being done, but more importantly in how they are done.

A new highway arguably fails a cost-benefit analysis once social costs are calculated: It exacts leviathan costs, from destroying communities to contributing mightily to destabilizing the planet’s climate. (This probably even applied in Moses’ era, before thousands of miles of highways were built, subjecting further investments to the law of diminishing returns.) A new transit connection has a much better balance sheet. The Belmont Bypass has particularly high leverage, since it finally unleashes the bottlenecked potential of the miles of four-track structure beyond it.

More important is how the project is executed. In a democracy, the majority rules with respect for the basic rights of the minority. Moses infamously low-balled property owners when seizing land, and paid tenants (and rent-controlled tenants in an era of high housing inflation arguably hold a claim resembling property) almost nothing; such expropriation is clearly contrary to the Fifth Amendment or to the UDHR‘s Article 17.

Several property owners stand to lose their property to the Belmont Bypass. In such a high-profile situation, which public opinion broadly in their favor and multimillion-dollar properties on the line, I imagine that this group will receive just compensation — quite unlike the residents of East Tremont, who were largely ignored by the press, whose cries for help went almost entirely unheard by their legislators, and who lacked funds to file lawsuits.

Yes, a slightly larger population will be inconvenienced by construction for a few years, and this crowd appears to have provided most of those damning 583 votes. While pollution, even non-toxic pollution such as carbon, can justifiably be construed as violating others’ right to life, the noise and dust from construction can be mitigated to a significant extent.

In short, the substantial benefit that the majority will derive can justly be seen as outweighing the relatively minor rights claims in this instance, and the comparison to Robert Moses is spurious.

Of course, it’s rare for citywide transit agencies to make decisions at the hyperlocal level. Yet it’s absolutely typical for decisions to be made about permitting additional housing at almost a parcel level; in that case, the marginal benefit to other regional residents is so marginal as to be doubted entirely. Yet affordable rentals, in particular, are a LULU that local NIMBYs have successfully engineered the regulatory regime to discriminate against. Ryan Avent writes in the Economist: “The benefits and costs of population growth occur in a way that practically guarantees highly restrictive building rules.” Michael Lewyn takes the view that “cities cannot be trusted to weigh the citywide interest in new housing against neighborhood concerns… the chances of abuse are simply so high that a higher authority must step in.”

New economic geography: fewer centers, more edges

from a plane

There’s obviously no room to build anything, anywhere.

October’s Economist Survey on the global economy by Ryan Avent included a shout-out to his Piketty-informed thoughts on housing prices. In short, the productivity gains from current technology have increased inequality between people and places. The returns on specialized skills are worth more in an era of cheap communication and transportation, great cities aggregate many people with such specialized skills –and furthermore, agglomeration effects appear to be growing even as communications costs decline. Even virtual reality won’t be able to replicate the everyday, subtle reinforcement of ambition that great cities provide; as Paul Graham writes:

The physical world is very high bandwidth, and some of the ways cities send you messages are quite subtle… A city speaks to you mostly by accident—in things you see through windows, in conversations you overhear. It’s not something you have to seek out, but something you can’t turn off.

Ideas have become so complex that those with specialized skills need to gather around others with complementary skills just to understand topics, much less to achieve the discovery or innovation stage. And, well, interesting people like one another; not for nothing has “assortative mating” taken off, spawning study of managing “the two-body problem” in fields like academia and medicine. (Hint: bigger cities, with bigger labor markets, are more likely to solve the problem. This has become a boon to universities recruiting in large metro areas, while those in small college towns struggle.)

In short, there are fewer centers and more edges. Scarcity being what it is, the centers (and only the centers) are winning more capital, and the edges are losing.

The result has been a highly uneven reallocation of wealth, whereby some places are winning in the form of skyrocketing property prices. These high prices create a substantial drag on the economy: increasingly high rents in the most productive locations steal from the most productive. This steers:

  1. Capital towards landlords, enlarging a rentier class (as Piketty notes) and starving more productive sectors.* This creates a vicious circle, as the NIMBY cartel further tightens its regulatory capture over the land use regime, and extracts ever-higher rents.
  2. Labor towards less costly, and less productive, places, creating economic losses. One recent study quantified that economic loss to the United States in 2009 at 13% of GDP — equivalent to sawing off the entire state of California.

—–

This might be worth unpacking further at a later date: Just reforming land-use regulations, or even entirely repealing the “shadow tax” of zoning, still won’t do enough to produce more affordable housing. Even if zoning is reformed to “make more land,” that land’s still subject to construction’s “hard costs,” which are just too high nowadays.

Construction costs have risen faster than inflation, and far faster than stagnant workforce incomes. Slides 5-6 of this presentation [PDF] by Thomas Hoffman from Enterprise points out that even with free land, even the cheapest construction now costs 50% more than the affordable rent for a low-income family.

Sure, embedded within construction costs are other perhaps-useless regulations, but housing affordability in gateway cities is a problem with many root causes, and with many solutions as well.

—–

* Rent or mortgage principal paid, aka “housing service expenditure,” does not have a multiplier effect on GDP because it’s not factored into GDP. However, it’s worth noting that in 2000, HSE amounted to nearly $1 trillion, which supported only some of the 1.1 million jobs in real estate (NAICS 531). Reducing rental prices would take investment income from landlords and give them back to consumers, who would probably spend in other sectors that generate more jobs per dollar.

Parallel trends: bigger houses, tinier apartments

size of new houses

It’s lately become very fashionable to contrast the concurrent trend towards ever-larger new houses and ever-smaller new apartments. Recently, Richard Florida,* Kaid Benfield, and even the Streetsblog podcast have all mentioned this peculiar contradiction.

But scratch a little bit at the surface and you’ll find that it’s an artifact of the Great Recession, not an existential conundrum. Consider that the Census’ Survey of Construction, the source of said statistic, only measures a universe consisting of new single family (usually for-sale) houses. However, these share of total new housing construction that is in single-family houses continues to fall. Just from 2011 to 2013, multi-family houses went from 29% to 33% of all new housing completions. Meanwhile, their size hasn’t budged: it’s consistently been around 1,100 square feet (+/- 50) since 1999.

The chart above also comes from Census data, and tells a more complete story. The average size of new houses built in the USA, both single- and multi-family, declined from 2011 to 2012, then ticked up to a record in 2013. It hasn’t been on an upward march forever. Another reason why this data point isn’t quite as important as it might seem at first glance: many fewer Americans are in new houses, period.

houses creeping back up

Construction may be up slightly, but it’s still well below its peak. Completions fell 70% from the 2004-2006 rate, and now we’re back up to 60% below that (completely unsustainable) rate. From builders I’ve heard at ULI panels and the like, new move-up product is still selling in the suburbs, but first-time buyers are staying in rentals longer, largely due to tighter financing. Hence, fewer small homes are getting built, as younger households stay in existing stock for much longer, and the average home size is increasing. (Oh, and remember: we’re talking about fewer smaller single-family houses. The number of multi-family houses, small and medium-sized, is increasing.)

Thus, the real story is that the for-sale single-family starter home, as a product type, is dying off. For example, when my brother recently purchased his first new house (at 35, considerably older than the typical new buyer at, say, Levittown), he didn’t get a starter home. He went directly from an existing multi-family unit to a move-up sized house.

* Making the additional methodological error of taking the definition of “central cities” seriously.

Two perspectives on the future of urbanism(s)

Kentlands just hosted its 25th anniversary celebration, a milestone that now firmly places it among the various New American Towns that dot the lower Potomac valley. In this time, what has New Urbanism accomplished, and where does the future lie? Two perspectives, both from the vanishing world of print-only publications, are excerpted below.

mid-rises

New mid-rises in Toronto.

1. Spacing Magazine‘s 10th anniversary issue (which we [few] American subscribers get pretty late in the game) has a great article by Dylan Reid about “the future of urbanism,” or rather the challenges ahead:

This rise of urbanism is good. It is creating cities that are healthier, more efficient, and more sustainable fiscally and environmentally — and they are more enjoyable to live in. The fact that an ever-increasing number of people actually want to live in dense downtown neighborhoods is an astonishing transformation from two decades ago, and essential to urbanism’s success…

Urbanism’s problems don’t discredit it (although some would like them to); rather they mean that the movement needs to test, challenge, and extend itself rather than rest on its laurels…

Urbanists also need humility. The familiar urbanist solutions work in the older parts of the city and, perhaps, in concentrated blank slates like brownfields, but they won’t work out-of-the-box in the suburbs.

Reid then posits and elaborates upon ten challenges, first as statements and then as questions that elude easy answers, which I’ll quote here [with my clarifications]:

  1. How do we adapt and extend the benefits of urbanism to the suburbs in a way that will be welcomed?
  2. Can we figure out how to build avenues and greenfield neighborhoods that are vibrant?
  3. How do we ensure that everyone is able to enjoy the advantages of urbanism?
  4. How can we ensure that extending rail transit and walkability doesn’t simply push low-income households further away?
  5. How do we maintain viable spaces for creativity, or create new ones, in the face of gentrification?
  6. How do we keep small waterways without undermining the density and connections that make a city efficient and sustainable?
  7. How do we make sustainable local food available and affordable to everyone in the city?
  8. How do we maintain the role of manufacturing and food processing in our urban economy and start to integrate them into sustainable urbanism?
  9. How will we find the money and political will needed to fund the next waves of transit investment?
  10. How can we increase the number of year-round cyclists?

The list is heavy on questions of affordability, inclusion, displacement, and gentrification. While at first these might seem to be concerns primarily for fast-growing cities, they do speak to the need for urbanism to address a broader range of people, which would improve its prospects in slower growing cities as well.

Toronto is also exemplary in its embrace of mid-rise development along mostly auto-oriented strips — reinventing the highway strip into streetcar/BRT strips — but the implementation so far has been subpar.

Lively, affordable strip malls full of independent shops are being replaced by dull condo buildings with chain stores, because the new condo retail is too expensive and often too spacious for independents, and condo boards resist all but the safest tenants… Transit is tangled in politics and not getting built. The new buildings still feel isolated rather than part of a continuing streetscape.

2. Over in the more highfalutin’ Harvard Design Review, Alex Krieger asks a similar question:

One set of ideas about good urbanism may not be sufficient. We know from experience, and from the many prefixes that we attach to the word, that across an urban region there are multiple urbanisms, hardly all conjuring up the same well-scaled, well-defined finite “urb” guarding its enduring spatial character…

What is more interesting, and found in many mature areas of urbanization, is the juxtaposition of different patterns of settlement in close proximity. Competing urbanisms may actually be a good thing for an urban region…

My intent in applauding a range of urban environments found in a metro region is to question the ferocity behind the ideological battles under way among today’s various guardians of a particular urbanism. Isn’t a proliferation of ideas about urbanization a good thing? [….]

Conversely, and equally disrespectfully, many dismiss New Urbanism as if its proponents offer no insights about cities. This too is foolish. The New Urbanism movement has raised public awareness about the social and environmental limitations of extensive suburbanization; convinced many subdivision developers to think differently about their generic layouts; pointed to outdated zoning codes that privilege single-use districts; altered the Department of Housing and Urban Development’s view on what public housing should look like and how it should be best arranged; and highlighted the “un-usefulness” of the engineering profession’s concern for optimizing the movement of cars above all. These are not inconsequential achievements for a movement that progressive architects dismiss for the sin of promoting traditional architectural imagery. Newly minted Landscape Urbanists can also be dismissive when implying that those who wish to learn from traditional urban patterns are simply Luddites…

Jacobs explains, cities are environments of not one but multiple complex problems. While not always apparent, each aspect of urban complexity is somehow interconnected to others. Planning for human settlement, therefore, requires the seeking out of both direct and subtle interdependencies prior to posing conclusions or plans… Perhaps too few of us get to page 448 in Death and Life. If we side with Jacobs (and who claims not to), then we need today’s urban polemicists to continue to offer their insight, if fewer of their universal truths — to keep jousting intellectually and, more important, to endeavor to seek out the interdependencies among their positions.

Going forward, let’s all strive to understand the multiple complexities that comprise our cities.

It’s not just a phase: urban population dynamics have changed

National Park Seminary new EYA townhouses

EYA townhouses in Forest Glen, Md.

Ben Adler from Grist wrote about a recent NYT trend piece about how suburbia is hollowing out, with few young families to replace the empty nesters. He puts too much emphasis on gross migration and population change, without drilling into how those components have been changing:

A handful of coastal and upper Midwestern cities are attracting more young professionals than before and are retaining them for longer… Even where gentrifiers are moving in at a pace sufficient to reverse outmigration, they’re barely making in a dent in reversing the tide.

Migration population losses from cities paint an unnecessarily dire view of urban prospects. There is a good reason why large metros would tend to lose people to domestic migration — and, for the 20th century, pretty much always did. A statistically significant group of young people move to large cities, get married there, have kids, and then move away in search of more appropriate housing. Two people move in, three move out: presto, population “loss,” even though the same number of people moved in and out. Similarly, for decades a steady flow of retirees southward, away from large cities, was a good thing for society – an indicator that healthier seniors were physically able to move, rather than remaining house-bound.

Yet long-established movements like these (plus shrinking household sizes, plunging overcrowding, the twin crises of deindustrialization and crime, and employment displacing relatively dense central-city residential), may have largely run their course.

Yes, this does indicate that “the school problem” remains,* but indications are that cities are attracting more young people, and retaining them for more years. This is occurring both before and after the critical life milestone of marriage: new households are overwhelmingly singles, couples, and unrelated persons. Whereas many of the 1950s pioneers who settled what are now inner-ring suburbs were young families headed by 20-somethings, or maybe 30-somethings, today many married couples (without kids, or with young children) stay in the city for longer.

Here in DC (where the city’s small size and overwhelmingly post-industrial nature makes the demographic transition especially sharp), Carol Morello from the Post observes:

the number of children younger than 5 has grown by almost 20 percent, from 33,000 to 39,000, according to census figures. In the same time span, the number of children ages 5 to 13 rose 7 percent. But there were fewer children 14 and older, suggesting that many parents still choose to leave the city when their children reach high school.

This also shows up anecdotally, as in the NYT’s quote of a Westchester County official (“Parents used to be 35ish, now they’re 45ish. What we’re seeing is not so much an exodus as a later arrival”) and this observation (at a recent ULI conference) by the biggest developer of townhouses inside the Beltway:

Within the DC region, the geographically compact core (about 3% of the region’s area) accounts for a huge share of net growth of 25-34s. (Drawn from 2010-2012 ACS.)

A larger share of households spending more years living in the city is a marginal boon to cities’ residential market share. Few Americans live in one place for life, anyways, but imagine the implication for apartment owners as their tenant pool both grows in size and stays longer.

Meanwhile, population decline hasn’t hurt some urban areas (like my old neighborhood of Bucktown, where densities on some blocks have fallen 90% since their WW1 peaks, and continued falling in recent years). These can feel more lively and active than ever, even with much-reduced populations, because incomes are way up. More disposable income can substitute for a smaller population; retailers look for underserved pockets of spending power, not necessarily people.

Yes, at the end of the day, cities need to provide homes for a growing global population and so should welcome growing populations. However, gross population shifts need to be disaggregated and viewed cautiously.

On another note entirely, I’d like to honor the recent passing of Donald Bogue, 1918-2014, who taught me much of what I know about demographic processes. (My “Relocated Yankees” paper was done as a final project for his class.) Even though he was well into his eighties when I took his class, his approach was the best of UChicago: thoughtful, broadly read, engaging, and kindly critical, and he helped to tie together a lot of loose ends that I’d thought about for many years. He leaves behind a tremendous published legacy — scores of publications in the Library of Congress, for instance — and his work on topics like Skid Row still has strong resonance in planning today, for example in understanding the historical intersections between homelessness and place.

* Don’t look at me for any answers; this isn’t a school policy blog.

Lumpiness: in cities’ property values, and in metro structure

Two only tangentially related thoughts on lumpy growth:

1. Richard Florida in The Atlantic Cities was one of the few major outlets to cover a report from the Demand Institute (a collaboration between Nielsen and The Conference Board) called “A Tale of 2000 Cities.”

The top 10% of American cities account for more housing wealth than the next 90%. The gains in the 2000s were tilted towards the already wealthiest communities.

The report includes an extensive look at a typology identifying nine types of American communities primarily by the strength of their local housing markets, post-recession. In keeping with the name, the results show a striking divergence, with a select handful of healthy markets sweeping up much of the gains — and leaving half of American cities and towns “currently facing fundamental economic pressure.” The report’s summary says: “In today’s global economy, nothing is more important than the strength and sustainability of the local labor market, regardless of whether employers are serving customers in Chicago, Chile, or China.”

If anything, today’s telecom-centric, information economy has resulted in the geography of opportunity getting lumpier, not more diffuse as earlier expectations had predicted — “reports of the ‘death of distance’ have been much exaggerated.” We telecommuters haven’t all decamped to mountaintops. The most valuable places are becoming even more so: they account for not only an outsized share of wealth but also the gains of recent years.

The underlying economic reality, that human capital is what drives most prosperity today, is why I differ from my colleagues who believe that “investment ready places” can thrive based on previous investments in capital goods like housing.

(I’ll have more thoughts in a later post about how macroeconomic changes, and in particular greater economic inequality, have left their mark on “gateway cities.” In the meantime, I highly recommend Ryan Avent’s ‘The Spectre Haunting San Francisco,’ which ties in man-of-the-moment Thomas Piketty as well.)

On another note, the report also has a good omen for suburban retrofits in “favored quarter” suburbs, in the form of an interesting but familiar disconnect between housing supply and demand in “Affluent Metroburbs.” 58% of housing stock in these communities is detached, “but fewer than half [of those seeking to move] say they are seeking a detached single-family home, compared with a national average of 60 percent.”

Among residents of “historic skyline cities,” a broad category that includes both healthy and less-healthy cities, there isn’t exactly a stampede to the exits. 54% of those who intend to move still “intend to stay in an urban area,” and “nearly one in five” wants to move for better schools (hardly the unanimity some cry about).

2. Alon Levy has a great post about how, on a macro scale, the gridded West has a suburban layout that fosters high-coverage bus networks, whereas more organically settled Eastern suburbs have a dendritic, hub-and-spoke layout that lends itself to commuter rail. (Yes, he points out that Johnny-come-lately Washington has, through Metro, grown into the latter pattern.)

This might go some way towards explaining “the Western Paradox” in Brookings’ findings regarding transit access to jobs. In short, Western cities (particularly in the desert southwest) had a strange spread: many jobs were technically accessible by transit, but low transit-to-work mode shares. The highest mode shares were found in older eastern cities, where a large fraction of suburban service jobs are inaccessible by transit.

If “everyone” were moving back to the city, would you?

“That would depend on what you mean by ‘everyone’ and ‘the city,’ of course.”

Liberties Walk, Philadelphia

Recently, Kaid Benfield linked over to my recent post about “peak sprawl”, tying that phenomenon to broader changes in the housing market. I always have more to say on this particular topic, but this particularly stood out for me: those Boomers who look down their noses and sniff “you’ll undoubtedly grow up and move away (because that’s what I did)” refuse to understand that it really is quantitatively different this time. In an RCLCO market survey, “31 percent of Millennials prefer a ‘core city’… it is twice the portion of the preceding generation when polled at the same age.” As quality of life — crime, traffic, pollution, etc. — has undoubtedly improved markedly in cities and declined in suburbs, the city grows comparatively more attractive.

What’s more, young people aren’t just saying this — they’re acting upon these tastes. Over at Planetizen, Michael Lewyn points to statistics showing that cities are doing a much better job today of attracting young people. Yes, young people have traditionally moved to cities — back in the 1970s, 20-somethings were the only age group with positive net migration into many central cities — but not at anywhere near the rates that we’re seeing today. As a proportion of population, youth in-migration into SF has doubled since the 1970s, into NYC has tripled, and into DC has increased twenty-fold.

A lot of national wags love to dismiss DC as a “ boomtown” overfed by a compliant (if not “tyrannical,” etc. etc. etc.) federal government, but that takes far too reductionist a view of the region’s economy. Population growth in this region was not appreciably different between the shrinking/reinventing-government ’90s and the metastasizing-security-state ’00s: 16.3% in the ’90s and 16.4% in the ’00s. More recently, another shift in government spending has similarly had no effect: in 2013, the city lost 6,000 federal jobs (the region has lost federal jobs every month since October 2011) but continued to see Texas-sized population growth.

The difference is not how much growth, but where that growth happens: DC’s suburbs saw their population growth rate drop by 10.6% from the ’90s to the ’00s, whereas DC’s population growth rate skyrocketed by 6700%. It’s the same number of people, but going to different destinations. The same pattern is true nationally, and in both fast- and slow-growing metros.

Cities are capturing not just a large proportion, but an increasing proportion, of the largest generation in American history (and, Lewyn also points out, limiting their out-migration losses among older generations as well). The result isn’t just a momentary fad, it’s a large-scale migration with far-reaching consequences. The 1970s “back to the city movement” of young urbanites, so familiar from Woody Allen and David Mamet narratives, were so few in number that they could all crowd into the Upper West Side, Lincoln Park, and North Beach — whereas today’s young urbanites now threaten to disrupt entire cities.

What’s more, two other interacting shifts in lifestyles have vastly expanded the market for urban housing catering to younger Americans. Even if one makes the (increasingly tenuous) assumption that urban rental housing is only for those brief years between college and childbirth, and that “everyone” needs to move to distant suburbs for child-rearing purposes:

1. Ever-later marriages: the average age at first marriage has risen 5.5 years since 1960. Whereas 80% of young adults aged 25-34 were married in 1960, today only 46% are. The inherent flexibility of urban areas’ smaller housing units means that they can do a better job of accommodating the growing number of non-family households.

2. The ever-expanding universe of single householders: from 15.1% of households in 1960 to 26.7% today (easily outnumbering married couples with children by about 4:3). Thanks to Eric Klinenberg, this phenomenon has been better documented lately — but discussions around housing still center around the needs of families rather than of all households. (More on that in upcoming posts.)

Those who discount the second point ignore, at their peril, the rise of pluralism within the worldview of the first generation raised after “the death of the meta-narrative.” The mass market, epitomized by giant corporations like Sears or the Big Three TV networks, has splintered into myriad fragments. Increased acceptance of diversity and globalization mean that there’s no longer one right way of doing something, or living one’s life; instead, multiple viewpoints are equally valid. Even in religious matters, young Americans are much more likely than older Americans to say that there are multiple valid perspectives. “It’s all good” carries a more profound meaning than “I’m alright;” it also means “I’m good, you’re good.”

Some of society’s fragments may find the good life in cities, others may prefer suburbs, but to posit that “everyone” eventually will choose the same suburban nuclear-family lifestyle is a dangerously simplistic (and, in my eyes, almost offensively heteronormative) characterization. And in the meantime, the physical form that can best adapt to fragmentation and change is walkable urbanism.

As often happens in these discussions, the definitional problem of where to draw “the city line” also rears its head. Yesterday’s delineation between “suburb and city” makes little difference in today’s metro-centric discussions, where the real distinction is between sprawl and urbane, or “drivable suburbia” and “walkable urban places.”

Pictured: Philadelphia is one of many central cities where young people are not just a large proportion, but also a growing proportion, of central city residents. Its increase in attractiveness to young people is incalculable, since it went from net outmigration in the 1970s to substantial net inmigration in the 2000s.