I live in Russia at the moment and probably the most startling thing is how well planned many of the cities and towns are and how very clearly these cities were not made for cars. While it's a hassle for vehicle traffic because the roads were never designed to handle everyone owning a car, the benefit is that no matter where you live there is a shop nearby for essentials (groceries, clothing stores, repairs, cafe's, etc), transit is readily availble even in the smallest of towns and fairly affordable. I spent time in Pereslavl-Zalessky about 140 km north of moscow and was surprised that even a relatively small town had faster and more regular public transit than most of the cities I've lived in in the US.
Granted it all comes with a slight adjustment to get used to some of the holdovers of life in the USSR, but when I lived in Seattle, it used to be if I missed the bus I had to wait ~30+ minutes for the next one home, and I needed to plan whether I'd take a side trip to get groceries or not, adding an additional mile or two to my walk home. Here it's nice to just be able to walk a few hundred meters at most to the nearest store for groceries.
Any city planned and developed before cars is generally considered very friendly, walkable, and desirable. Europe is full of such cities and they're loved for it.
If only planners, politicians and citizens would realise what they have given up just to make it convenient to drive.
i think the auto is a red herring. i think what it is is that these cities have a level of lifestyle that happened to be commiserate with the revenue that they can generate, because the more expensive infrastructure- fibre, 4g, or undergrounds, tram lines, auto traffic control, or even a large network of roads, have not or cannot be built in.
when i travel to the cities in the developing countries in asia, and speak to the locals, there's always a sense that they look forward to building their city into something like sydney or singapore. the people elect mayors and governors that promise development towards that goal. most of time, it doesn't go anywhere. what i thought, but did not say, is that these smaller cities don't generate the same kind of revenue that pays for the kind of infrastructure, modern buildings, and diversity in imports that you see in the major cities. To try and pursue that without finding a way to increase the value and productivity of their economy is going to get you in the kind of trouble that you see a lot of these bankrupt towns in the US in.
Part of the problem in the US is too much planning, alongside too many subsidies for cars. Look at a zoning map of any city: there's an incredible level of detail about what's permitted where. The local zoning code here in Bend, until recently, had a section on how many parking spots per customer for barber shops. As if, in a competitive market, those businesses couldn't figure out for themselves the optimal amount of parking to pay for to keep their customers happy.
Most of Europe is pretty walkable and it doesn't have that 'planned' look either.
> As if, in a competitive market, those businesses couldn't figure out for themselves the optimal amount of parking to pay for to keep their customers happy.
I don't know anything about Bend, but speaking generally ...
There are many ways that markets are inefficient and flawed; I wouldn't assume they would yield a good result. For example, the barbershops may be incentivized to push the parking costs onto others. It may be that every business has that incentive, nobody wants to pay for other people's parking, and thus nobody makes the first move. In situations like that, people succeed by coordinating their activities through democratic government and laws.
People living in cities, elbow-to-elbow and sharing large numbers of resources (such as parking), may need to coordinate more than people in rural areas.
Also, as they say, don't tear down a fence until you know the reason for which it was built. It's like that odd, useless-looking bit of code in that old application - maybe do some research before you delete it.
Portland, Oregon did an interesting analysis of the impact parking minimums has on housing costs. (spoiler: it's substantial)
Paradoxically, during my brief time living in San Diego, the nicest (and most expensive) neighborhoods were generally the ones built before parking minimums, because they were actually pleasant to live in. Newer areas had plenty of parking but nothing to do that didn't involve driving.
Actually in the eastern part of the Europe (former soviet influence zone) smaller cities are planned, and they are planned really well. As the parent posters have said, it is very similar to the former USSR - you have a lot of green, shops, schools, kindegardens, parks within a walking distance from where you live.
After we ditched the planning and switched to market economy, suddenly developers (the ones that make buildings, not code) started building a lot of buildings without leaving a space for either green or parking spots. As a result in the newer parts of the cities we have a very crowded leaving space, cars are parking everywhere, there are few shops, schools are far away etc.
The number of parking spots isn't for the barber, it's so that the customers don't park their cars in the spots of the residents or other users of the area! We in 'Europe' have exactly those rules (and then some). And we need them, because these old, not-planned looking cities lack space for everything that didn't exist 500 years ago, obvious things like cars but also 100's of people per building (few residential building were higher than 3 stories 300 years ago) and even bicycles (which already increase the travel range and thus centralization viability for core infrastructure like shops).
> Most of Europe is pretty walkable and it doesn't have that 'planned' look either.
The pattern that I've observed in my area (East Germany) is that towns have grown by merging with the hamlets and villages around them. So you can have a rapid succession of relatively loose areas with small houses and businesses (the former village centers) interspersed with large prefab apartment blocks (like those that were built in large numbers in GDR times) in the gaps between the villages.
The only major pattern change after the reunification was the emergence of a lot of small shopping malls that bundle a portion of the shops in each district into one place (usually at an intersection of large streets and tram lines).
In contrast, American cities look more like one big blob that grew out into the vast, empty space surrounding it. Since there wasn't any structure to hold onto, everything turned out much more uniform.
Houston actually has relatively lax zoning laws. This makes for some interesting stuff:
> those businesses couldn't figure out for themselves the optimal amount of parking to pay for to keep their customers happy.
Those businesses don't pay for the parking themselves. The tax payer pays for those parking spots. That's the entire point of street parking, city run parking lots, and the like. Public parking isn't market controlled it's state subsidized. That's why it's called 'public' parking.
Oh, it was definitely "planned" in the modern era. You can see similar problems to the states in many European suburbs (though not as bad because a lot more planning).
There are zoning and planning because, well, people actually live in those places, and it's natural for people to want some control over their environment. Is that really such a bad thing?
It's like drugs, and prostitution, and all of the many things that seem so trendy to want to 'free' from government these days. On paper, the ideas look fantastic and efficient. That is, until a 24-hour strip club / pot dispensary opens across from your kid's elementary school.
Government sucks because it is by nature design by committee. It's inefficient and ugly. Yet, what's the alternative? Maybe AI at some point, but until then we have either collaborative government or authoritative.
But back to the article. One thing overlooked is the pressure on city officials from developers to get rezoning rules waived. And, there's often a lot of corruption in that process, also. For instance, most cities know that residential units cost more in services than other units. And, usually the taxes are structured (too low) such that the residential tax is insufficient to pay for the supplied services. The city planners know this and they account for it in their zoning plans. But, the developers later pressure cities to allow rapid expansion of residential. And, ultimately the plans become broken by too many new units.
Without knowing the actual parking regulations, it's difficult to say whether the regulations are useful or unnecessary. Maybe they are saying that you need a certain number of handicapped parking spaces? Maybe they are saying you can't build a lot with 50 spots if you expect 10 customers?
All real estate related problems in American cities are about nonsensical level of regulation. It is really cool to find so much free parking in Sunnyvale but then we cant really complain about high rents can we ?
People fail to see the basic premise that you cant really have both, plenty of parking and lower rents. They go hand in hand.
Well, they got walkability mostly right, but living in those panel boxes was still not great. I'd never want to go back to that...
Personally, I find the 5-8 story setups of cities like Paris, Barcelona or Rome much more appealing - enough density to make all the good things like walkability and local cafes happen, but no blocked out sun (Like in NYC) or need to climb to 20th floor when the elevator gives out for the nth time.
Having lived in Berlin, which is mostly 5-6 story buildings, I think there's a real sweet spot at this height, perhaps a bit higher if people want larger apartments. This puts enough people in a small area that having good transit, including subways, makes economic sense, and all of the daily essentials are within a block or two. Going higher means you need bigger spacing between buildings in order for the lower floors to get any sunlight, especially in the winter. Bigger spacing between buildings creates a sense of disconnectednes between buildings. At 5-6 stories, you do need fairly wide streets. If you do them like Berlin, you allocate a lot of that width to sidewalks, which are then wide enough for the retail to spill out onto the streets with outdoor displays and sidewalk seating for cafes and bars. It also gives you plenty of room on the sidewalk for other infrastructure like subway stops with adequate width stairwells, bus stops, bike sharing stations, etc. It's also fairly easy to work on underground infrastructure without huge disruption because it runs near the street but under the sidewalk, so normally working on it just means closing off part of the sidewalk. The streets aren't so wide though that they create this cut-off feeling, everything feels continuous.
You don't need such density to have walkability to shops and cafés. Any 2-3 story small town from 2000-4000 to 30000-40000 inhabitants can provide it.
That's not at all in the league of the 1-3 millions inhabitants cities you quoted. Paris is a nightmare to live in and people want to flea from it. There used to be close to 3 millions inhabitants and it is now down to slightly over 2 millions.
Ick. In Vancouver we have some areas which are basically paved with 5-10 floor buildings -- there's no space between adjacent buildings, and only a narrow sidewalk separating buildings from vehicular traffic. We also have areas with 30-40 floor towers separated by parks and playgrounds, with plenty of trees and wide sidewalks.
The population density is basically identical between these areas, but I can't imagine why anyone would want to live in a low-rise area.
(Incidentally, the reason we have low-rise areas is because the city has an absurdly long list of "sight cones" to protect views of the local mountains.)
New York City -- even in Manhattan -- still has neighborhoods like you describe:
Town's have totally different economics. My town is fiscally solvent, takes are of it's infrastructure, and doesn't much raise taxes. And we are very spread out, with an average lot size of 2 acres. Small roads are the responsibility of the town. Bigger roads (there aren't many) are the responsibility of the county. I'll claim that the layout of the town doesn't matter nearly as much as the fiscal discipline of the town government.
As you scale from town to city, it is too easy for this discipline to break down. Whereas in my town, the town manager has to put up a pretty strong argument to justify hiring another employee or buying a piece of expensive equipment, in a medium to large city I, as a taxpayer, don't have any visibility let alone say, in any such expenditure.
Fiscal discipline comes mainly from individuals not wanting to spend their hard-earned money - unless going so is necessary to keep things in their current working order. Once these spending decisions are made by nameless bureaucrats, that personal discipline is lost.
That's not quite correct... fiscal discipline isn't going to make most suburb-heavy cities in America solvent. You can't cut your way to profitability in the long term, you can only stave off bankruptcy in the short term.
The article is saying that mostly-suburb cities are not sustainable. They cost more to build and maintain over the long term than the majority of cities can recoup in taxes. That has little to do with employees, they are mostly talking about straight-line capital costs to dig up the streets and install new sewer lines. Even worse is that many cities grew in a relatively small post-war boom so a lot of that infrastructure will need replacing at the same time.
Towns don't typically provide all of water, sewer, storm sewer, and other such services... they might provide water. They can also just dig up everyone's yard to replace what infrastructure they do have because things are more spread out (lost of "wasted" land between the house and road) and far fewer people are disrupted (that also means projects can be done at a slower pace). They also have a much sparser police and fire department, far fewer parks, etc.
I grew up in the same town and strongly share your sentiments! I noticed Americans tend to be incredulous when I speak positively about it. Perhaps this is due to the obvious similarity to public housing layouts here and their negative associations, but also from a lack of appreciation (due to lack of first-hand experience of) the benefits that you mentioned above.
If your quality of life is determined solely by walkability, then sure, you'd consider it "high". In the USSR things were walkable out of necessity: not everyone had cars. And besides, if you're building a block of high rises (stuffed with tiny 650sqft apartments, for the proletariat) and estimate there will be 1K kids, you might as well build a school, a drug store and a grocery store in the middle. Swimming pool within a walking distance was a rather extravagant luxury, not everyone had that. Shit, I hadn't even seen a real swimming pool until I started college. Woods, sure, that's kinda nice.
My point being, you make it sound like every town in the USSR was like that whereas in reality what you're describing sounds like a "unicorn" situation that was rarely encountered in reality. Walkability was about the only thing Soviet urban planning had going for it. Ironically, these days I live in US suburbia within walking distance of a pool, elementary/middle/high school, and a convenience store. And woods too: we pretty regularly see deer in our back yard.
Soviet union planned cities are mostly awful. They mandate helluva lot of open space between high-rises which doesn't get any care. It also creates corridors for fierce cold winds to blow. Most of buildings don't have space for commerce making area either as dead as suburbia or blistered with shackles selling stuff. Transit stops are far between and you have to get there thru ice and hail. Roads are few and congested while still getting in your way.
http://pora-valit.livejournal.com/4740340.html it mostly looks like this
It was fine up until the 50-s and then worse and worse with each year (even now)
Sprawl is pretty easy to avoid when car ownership rates are as low as they were in the Soviet Union.
Not it didn't, speaking as someone who lives in such a planned part of a city. There are several problems:
- the areas for living, for offices, and for industry are disjointed and far from each other, necessitating a lot of travel each day. This was partly understandable for workers in polluting industries, but now it's just a pain.
- the 'green' spaces are too big (yes, really), which further increases distances and makes it too expensive for the city to take care of them properly. Furthermore the absence of enclosed communal space (what is sometimes inside the 'city blocks') means that the inhabitants don't feel the green space 'belongs to them'. So they don't feel incentives to care for that space, and they don't. (as an aside, the absence of city blocks is sometimes explained as it should make easier for tank armies to control the area in the event of an uprising or war)
- the supporting infrastructure was to be built later than the flats, sometimes much later, sometimes never. That's a problem of the execution, though.
I'm not saying it's all bad, but it could be much better.
OTOH, Brasilia , the Federal Capital of Brazil, was 100% planned and included just spaces for cars. Not parking, just roads. Everything is very far apart, and the living part of it (houses, buildings) should consist in mega-blocks that would provide those basic needs: markets, pharmacies, groceries...
Didn't work. You need a car for everything. The roads are flooded with cars. The city expanded and a great part of the habitants live very far from the place they work, so it takes a long time to go home.
But isn't this what public housing projects in the US did, and are now considered massive failures?
You should check out Stuyvesant Town in NYC. I really like its layout and the lack of cars. It's a good community. I've envisioned building an entire city as a chain of these self contained Stuyvesant Towns.
I don't know a better solution in terms of space efficiency, but living in a high rise is so depressing. I prefer to live way out in the woods, but the benefits of what you describe sound great
It's the same in most of the eastern bloc, I've always been super surprised at how good the public transit is in Czech cities, and that's because of the high-rises.
Why did that town exist? Why did a small number of people live in that isolated area, instead of closer in to population centers?
Is it still the same way now?
I can't say much about mathematics of taxes described in the article, but I always thought that Soviet Union got a lot of it's city planning very much right. Even a small town is built as a relatively tight formation of high-rises, yet leaving plenty of public space and greenery in the middle. The quality of life in the town that I grew up in is super high, because everything one might need: school, hospital, store, swimming pool, park, woods is an easy _walk_ away. The traffic through the town was even disallowed, which opened up a giant traffic-free area for us to play around as kids and elderly to use for socializing and to run their errands. For ease of visualizing here's an aerial photo of said town in early 00s: http://i.imgur.com/sj9t3Jy.jpg
We have an infrastructure system that maximizes spending to political donor companies. Naturally under those conditions its laugh out loud obvious that its going to cost more to build roads than to build an entire city of houses. If the houses were built under the same level of government corruption as the roads, they'd cost 10x as much minimum and only last 5 years before needing teardown replacement, and then the ratio of replacement cost of structure to infrastructure would look more natural or believable.
The puzzle they have is trying to fix a corrupt system. Merely replacing "evil car streets" with "progressive bicycle paths" will not fix anything, they'll just be a followup article about how horrible it is that the replacement cost of the bicycle path infrastructure curiously remains the same $32B because that's what the politically active re-election campaign donor contractors require.
As the article says, there are plenty of solutions for these problems, individually.
The predicament, as a whole, is that we cannot afford them.
Infrastructure quality is, like so many things, directly proportionate to investment. You can trade off future maintenance by spending more initially, or vice versa, but you can't magically reduce both at the same time while providing the same level of service.
This is precisely the same problem as Terry Pratchett talked about in the boots theory of economics: http://www.goodreads.com/quotes/72745-the-reason-that-the-ri...
The problem is that the level of economic productivity supported by (for example) a strip mall is so low that it cannot support the ongoing maintenance of the infrastructure that is required to allow it to exist. This is also true for many suburban homes and office buildings.
You must either extract more productive value from the same land area and population, reduce service quality, or invest massive quantities of capital in maintenance cost reduction, which has virtually the same effect as either of the previous.
> I've seen the infrastructure thing come up for awhile now, and it's definitely true.
Sort of. I'm not convinced their infrastructure pricing is accurate at all. I fully believe infrastructure has a higher cost in the suburbs, and that we aren't fully saving for/planning for those costs. But the numbers this article uses are insanely too high, to the point that it feels like an outright lie.
Strongtowns claims it costs more money to maintain the infrastructure for a single-family home (on average), than the average house would cost to build from scratch using retail pricing today (including land + construction of the house, and all of the related road/water/power/sewer infrastructure).
The StrongTown estimate seems to claim it's replacing infrastructure "once a generation" (30 years?), but is charging enough money to rip-and-replace every piece of all infrastructure 6 times per generation. Which is really high -- no one does that, there wouldn't usually be any need to do so.
Or to put it another way, StrongTowns is claiming that infrastructure maintenance alone costs the same as leveling the entire neighborhood and rebuilding it all from scratch at retail pricing every 30 years. Which is just outlandish -- if infrastructure actually was that expensive, 90% of these suburban houses never could have been built in the first place, even if financed using subsidy or debt.
Who is going to do that innovation? A startup? Good luck getting a municipal government to take risks by handing maintenance contracts to a startup. Their incentives are to do nothing and wait to be bailed out through inflation.
I think you may be too used to the tech industry where factor-of-2 improvements frequently happen overnight, or at least over a few years.
> In my area, as in others I've read of, they're smashing paved roads into gravel roads as the paved are too expensive.
How much traffic do these roads get? How dense is the population in the area?
I've seen the infrastructure thing come up for awhile now, and it's definitely true. In my area, as in others I've read of, they're smashing paved roads into gravel roads as the paved are too expensive.
The thing that fascinates me is that it feels like a forgone conclusion that infrastructure costs cannot be made cheaper. Have we really hit the most cost effective, cheapest, most sustainable method of laying/replacing sewer/gas/water lines and roads?
There's no innovation left at all when it comes to making pipes that are more easily replaceable without digging the entire road up? There's no brilliant ideas left at all on how to 'pave' roads so they're smooth enough in a way that costs less money, or lasts way longer? Heck, while we're talking improvements maybe we should have a way to pave a road such that we don't have such massive runoff and its more resilient to minor settling underneath without opening large potholes.
I do wonder whether the shit really hitting the fan, and massive chunks of the population having their roads smashed back to gravel might shake a few new ideas out.
> it seems to be incredibly short sighted to force cities to fund infrastructure through only property taxes and such without funding from income tax the province/nation collects as what happens in other parts of the world.
In America, many cities get some revenues like that as well.
Many cities levy their own income or sales taxes, in addition to the state income/sales taxes. (NYC has a 2.9-3.6% income tax itself, Seattle has a 2.7% sales tax itself, many small cities in the Midwest have their own income taxes, etc)
Cities typically also get some amount of revenue back from state taxes -- although it has unfortunately become common for some state governments to take city/road/school funding to cover spending in other places.
Cities have access to money from property taxes and sales taxes. States have access to sales tax and income tax. The state should be assisting with local budgets to level the playing field but that isn't really detailed in this article for some reason.
States and the federal government certainly do help fund city infrastructure. Often it comes in the form of grants (used for capitol costs) and matching funds.
It seems to be a uniquely American practice to expect infrastructure maintenance and renewal to be funded by cities exclusively using property taxes.
Cities generally act not only as trading hubs providing services to the region surrounding them, they also act as tax revenue sweeteners due to higher concentration of high income residents. Ie. they have positive externalities for the region, province or nation.
While I'm certain there would be a level of corruption in city administration, it seems to be incredibly short sighted to force cities to fund infrastructure through only property taxes and such without funding from income tax the province/nation collects as what happens in other parts of the world.
I wish they would add some figures. They keep saying "doing you know how much these roads cost?". No I dont. Please tell. But they never do.
His stuff is frequently featured on Strong Towns as well, if I recall correctly.
thanks for this, the blog is quite interesting
There's a blog I enjoy that covers this sort of issue very frequently. It's interesting to see a hard data approach to explaining some of the municipal funding problems that are brewing nationwide.
The everything. In the US, those cities were built in the past for uses that are now outdated or outsourced. In China, the government appears to want "the city" to fulfill some sort of ego trip. They perceive cities as more valuable than rural towns despite their culture not really being at that point. Overtime US cities have become outdated while Chinese cities are a solution in search of a problem.
Yes, and it's the same with public employee pensions.
It's great to be able to spend (or at least commit) tomorrow's dollars today and then be long gone by the time the bill comes due.
Sorry if that hurts some American self-respect, but what's the difference between this and the Chinese housing bubble that American media always complain about? Sure some details are different, but the basic layout is the same from what I can see: Politicians had about 20 years long time of incentives to grow without really building self sustaining cities. Now the current generation is at a point were it nearly doesn't know any more what to do. Seems quite similar, doesn't it?
I'd love to see a more local approach where say a couple hundred of my neighbors from the few blocks around me could vote to raise taxes for something specific, like repaving a street, or rehabbing a park. It's local money that you know stays local.
I'm not sure why my original response, "Curing cancer with AIDS? No thanks" was flagged. HOAs are awful and mandating them is despicable. Curing one problem with another is not a solution.
Curing cancer with AIDS? No thanks.
There are some cities that get around this by requiring HOAs in new subdivisions, and requiring those HOAs to pay for maintenance of much of the infrastructure. The homeowners pay the same property tax they would pay anywhere else in the same city. There are a number of cities in the Sacramento area that have been doing this kind of thing for over a decade now.
That approach brings in another set of problems, but it's worth mentioning.
> A generation is what, 25 years? If you expect to replace all roads/electricity poles/sewers etc every 25 years you seriously need to look a quality. For this I feel this whole article is off.
Isn't that the typical depreciation schedule for infrastructural assets? I've seen some useful life tables used by accountants and 25 years seems to be a typical mark. Maybe 30 years, but rarely 50.
> Making asset sales/tenders/expenditure very public and show comparable cost ratios. E.g. cost per km of sewer
I think this is one of the main drivers in favoring cheap and punishing quality. I agree with 2 and 3, though I'd argue that private jails are one of the things that should be bought back in house.
> This is not true. One of the best test for predicting a child success is seeing if they will defer a treat now for more treats later. Many people have the sacrifice now for a better future instinct.
Surely, any intelligent child would factor in the rate of interest (additional treats earned per unit of time) and bond price (how many treats are sacrificed right now) before making their decision. Automatically saying yes to more treats later is analogous to not caring whether you earn 0.1% interest or 10%, and that's certainly not intelligent.
Promising more treats later in exchange for treats now is exactly what a bond is, and any wise investor would factor in rate of interest/coupon rate.
> One of the best test for predicting a child success is seeing if they will defer a treat now for more treats later.
Although a different take on it is provided by , which suggests that the marshmallow test is not always testing for the ability to defer reward, but for the ability/will to obey instructions/please authority figures. I consider the post well worth reading.
Love the idea behind point #3
Like many of us, my mind was instantly drawn to how the incentives would be gamed, but you know what? The current incentives are already gamed. We all read about the judge who got kickbacks for sending kids to a juvenile detention facility, etc.
Let's build our incentives in the opposite direction. A certain percentage of dishonest people will game the system. But many, and probably most, will actually work towards the idea. And nothing is accomplished perfectly in one pass, there will be reform and accountability.
A concrete road is good for 50 years at best. Water and sewer lines somewhere between 50-100 years.
> When we added up the replacement cost of all of the city's infrastructure -- an expense we would anticipate them cumulatively experiencing roughly once a generation -- it came to $32 billion.
A generation is what, 25 years? If you expect to replace all roads/electricity poles/sewers etc every 25 years you seriously need to look a quality. For this I feel this whole article is off.
> Humans are predisposed to highly value pleasure today and to deeply discount future pain
This is not true. One of the best test for predicting a child success is seeing if they will defer a treat now for more treats later. Many people have the sacrifice now for a better future instinct.
This article seems to make some vastly incorrect assumptions. Personally I think where cities are overspending 3 things could really help.
1) Making asset sales/tenders/expenditure very public and show comparable cost ratios. E.g. cost per km of sewer
2) Bringing more work back in-house. I feel this 'privatise everything is better' mentality is simply not true and does things that leads to infrastructure that needs replacement every 25 years and cost blowouts.
3) If you are going to privatise services price them on points of quality that you can enforce. E.g. Rather than jails getting a straight fee, they should get a small per convict allowance but a generous bonus for each released convict that spends 5 years crime free after release.
Can someone explain the downvotes?
City governments are parasitised by three groups. One is the body professional politicians that manage to get elected.The second is the construction companies they use to build/repair their infrastructure The other is the work force they employ.
All three arrange matters so they get twice as much money on average as the voters that pay their wages/
The politicians do it by simple theft by vote. They vote themselves large salaries/
The civil serpents form unions and strike and strike and get 3-5 year contracts with cost of living allowances (COLAS) AND 1 to 3% wage increase, for that 3-5 years.
The politicians pay it - to buy peace at the expense of the taxpayers. The construction companies are similarly unionised and do somewhat the same.
Compare the wages of the average city employee with the average non union tax payer.
Now you see why this insoluble problem has emerged over the past 30 years or so.
One year contracts. No signing bonus AT ALL (why reward strikers), so a one month strike costs ~~8% of your annual wage, 2 months ~~17% etc.
Why should these people get more than the tax payers? They are not more skilled.
They are in power or in the union.
Look at how much teachers wages have made books and equipment a vanishingly small % of their budget and how much they force the taxpayers to pay them.
These factors wrecked Detroit. They will wreck Chicago and all other cities as union wage and pension demands take so much money that people move away.
Newark died this way years ago.
He says at the end that nobody switches from Property Tax to Land Tax, because people who own underdeveloped land would vote against it due to an immediate increase in their taxes.
Are there no ways to make it happen? Maybe propose to switch it gradually over a long period of time? Or would that end just as poorly?
I was for a land value tax (because people with more wealth in the form of land would pay more taxes in theory) but after watching the video I am now against it. It hinges on the definition of improving land, and from an environmental standpoint human improvement of land is an externality that as often as not creates negative value through exhaustion of resources, waste and unsustainability. Also IMHO there is far too much investment in construction, when buildings are already sitting idle. As we keep moving forward with tech and automation, this spending will become more superfluous.
It's becoming more clear to me that we should be thinking about proportions, not arithmetic. Money is a construct, so hard numbers like the size of the money supply and debt are meaningless. It makes more sense to imagine the median global income as being a unit of 1 (per day, per year, it doesn't matter) and then measure individual assets and debts against that. Americans get a score of 5 ($50k median household income), 5 billion people in the world get a score of 1 or less as they earn under $10,000 per year. Millionaires ($100k per year or more) get a score of 10, billionaires get a score of 10,000, etc.
Yes yes there are taxes and expenses but the orders of magnitude remain the same. Dealing at the abstraction level allows seeing patterns that aren't normally visible. The biggest anomaly is the level of work people are willing to maintain while getting paid substantially less than a small minority. The other one is why is so much work nonproductive, for example why do people pay half a billion dollars for a TODO website when 3% of the population can grow all the world's food? It's like there is so much wealth in a few hands that it doesn't know where to go except to try to expand itself. Wouldn't it make more sense to invest that money to automate the other industries to get to a 3% level and let the other 97% of the population work in research or health or space travel, anything really? Solving problems once and for all so that we can have both money and time (actual wealth) rather than having to choose one (phantom wealth). For real solutions to these seemingly intractable problems I highly recommend looking into modern monetary theory (MMT):
The author, Chuck Marohn, has previously made this video that explains how a Land Value Tax would affect the fiscal situation of a city (for the better):
The article author Charles Marohn addresses this question in the comments section. His entire comment response:
"They are the ones with a very dominant urban core, where the urban fabric overwhelms the horizontal, auto-oriented stuff. I'm not saying these places won't struggle for the same reasons Lafayette will, but I suspect their decline/contraction will be less pronounced, less a defining characteristic.
NYC, Boston, San Francisco, Vancouver, maybe Chicago.... I'm not an expert on this scale of a place by any means so I could be very wrong but they don't seem to have the same underlying forces as a Lafayette (or even a Detroit or Memphis) where 80%+ of their infrastructure serves unproductive land use patterns. Might be 20-40% in these places."
I think you may have misread the article; it seemed to me that blame was placed much more on political incentives to encourage outward, sparse suburban growth. The kind of growth which incurs enormously more infrastructure cost per capita. Not on accounting practices.
Spitballing here, but I assume once cities with large enough density, e.g. skyscrapers, reach past a certain threshold, the amount of revenue as a result of high density overtakes the cost of horizontal expansion. Highly concentrated cities, such as NYC/LA/Chicago, are examples of these.
A local municipality here, Mississauga (https://en.wikipedia.org/wiki/Mississauga) grew as a typical suburb does, relying on aggressive expansion of low-density housing, with a large portion of that growth being in the 1960-1990 era.
The city pursued an agenda of low taxes by leaning heavily on subsidies paid by large-scale developers directly to the city. This was something very much embodied by the city's long-time mayor McCallion (https://en.wikipedia.org/wiki/Hazel_McCallion) who was something of a titan in her time and governed over the city from 1978 to 2014 with little political opposition.
The idea was that they'd build infrastructure to last 30-40 years and then figure out what to do later. Not surprisingly "later" came around all too soon and they were left scrambling.
The mayor pivoted from producing more sprawl, which just doubles down on the problem, to inviting developers to densify portions of the city, building codos and office towers. Through development fees they'd try and work their way out of a jam without having to massively increase taxes for everyone.
It looks like this strategy has so far worked, but it's not without risk. It's dependent on passing the buck to the typically younger crowd that's buying condos. They're paying for sewer replacements in those older neighborhoods that apparently never paid their fair share in taxes. Who will bail them out when their time comes? Hopefully the increased density makes it more cost-effective to do that.
There's a number of things working in favor of the city, like they're close to Toronto, so the're an ideal commuter hub, plus the regional airport is there, so there's a large buisness hub built out around it. Without that tax base and proximity to another city they'd likely be doomed. Nobody would ever want condos there.
If you're looking for those cities, look for suburbs built near major US cities that can leverage their location. Any that are on their own are ultimately doomed unless they dramatically re-work how they plan their urban layout. Low-density housing will strangle a lot of small cities to death.
Honestly it should be illegal for municipalities to collect less in taxes than they need to maintain their infrastructure in the long haul. They should be factoring in 60-year replacement costs and collecting money towards that in the decades leading up to a major overhaul. A change in the accounting rules to include this sort of depreciation as an expense that must be balanced out with revneue could go one step towards that, factoring in replacement costs and so on.
I don't know which the cities are, but I'd guess they're among the wealthiest ones. Maybe you'll find this useful: https://en.wikipedia.org/wiki/List_of_U.S._metropolitan_area...
In the intro, it is stated that "literally five or less" cities do not have these monetary problems. I'm curious what those cities are, and why are they special. If the answer isn't "they've always used accrual accounting", I don't buy that most cities are doomed due to accounting problems.
This problem can be projected out to Federal Spending as well. We can see this in the taxes paid versus tax revenue spent on urban states compared to rural . Alaska gets $1.84 back in federal spending for every dollar they pay in taxes compared to the $0.79 New York gets back on its federal taxes.
One quibble I have with the article though is that suburban communities did not start out as luxuries or inventions of convenience. Suburban growth was actually promoted by the federal government with tax incentives in response to the threat of nuclear war. The idea was to spread populations out away from the cities, where a single bomb could kill millions. Shawn Otto's book The War on Science covers this development in great detail, which I've clipped here:
Developers will build whatever they're allowed to. They'll do dense if that's where the money is, or single family homes if that's all that zoning allows.
There's probably some bias to what they know, and all we've allowed (zoning) is single family homes, strip malls and that kind of thing, so there is that, but if more were allowed, it'd probably end up being built, sooner or later.
Not sure "exurb" is a real thing--most people living that far out have wells and leech fields and the density is pretty low.
Practically every person who sits on our city council is involved with real estate--either sales or development. It is rotten to the core because of their conflicts of interest.
In most parts of the country, zoning regulations force developers to build low density. Just look at the fights in the SF bay area where developers want to build tall and local NIMBYs fight them tooth and nail.
Summary: infrastructure costs to maintain spread out exurb style development end up being more than the incremental tax revenue, especially when you consider replacement costs and the potential for future higher borrowing costs.
Property developers (along with car dealerships) are by far the strongest advocacy groups in many areas. It's not totally surprising that they've managed to capture the local government and push them towards counterproductive development that ends up being a massive subsidy from the taxpayers.
Both are intertwined. When there is not enough money, pension funds tend to take a hit. Population will move to greener pastures.
The bankruptcies are not happening, because a lot of the infrastructure can withstand 50 or a bunch more years. It has been built in say 50s - 70s so never had to be completely overhauled.
In EU, the problems with replacing infrastructure built in 1940s have already hit a few times, but it was better planned after the war.
This article seems to focus overmuch on infrastructure maintenance costs. While those are certainly an important factor, most of the actual municipal bankruptcies in recent years were caused primarily by expensive union contracts and pension obligations. Declining populations and financial malfeasance were also factors in some cases.
Perhaps an explosion in infrastructure maintenance costs will cause a new wave of municipal bankruptcies within the next few years but so far it's just not happening.
There's a followup article pointing out that the track of green on their revenue graph is actyually the poor part of town and going over some reason why that may be:
That calculation is for fully replacing all existing infrastructure on the basis that over the course of a single generation most infrastructure will need to be replaced at least once due to maintenance/upkeep. So basically it will cost something like $32b per generation just for the upkeep of the existing infrastructure.
This doesn't even include pensions.
32 Billion for 125K people.. feels like a lot. ~250K for each and every person? I wonder what that calculation looks like.
As elsewhere: I'm a member of Strong Towns, and think they're doing good things. Another one I like is the 'Market Urbanism' group - although some of the people there are very, very libertarian, there's still a mix of us so that it's not really a partisan thing. Then there are the various YIMBY groups, led by the one in the SF bay area.
This is one area where I think that people can move the needle some. The issues are not partisan in the way that so many others are, and I think there's a growing movement interested in doing things differently, that's more financially and environmentally sustainable.
This suggests that China has an amazing infrastructure time-bomb waiting perhaps a generation to mow it from the pinnacle of the world to the ground. As a nation that is "in it for the long game" I am going to watch and see what they do there.
Illinois pays some of the highest taxes in the country. The property taxes are extremely high with some counties having the highest rates in the entire country (second only to some New Jersey counties). Yet property values have been the worse to recover since the great recession.
If the value of my land goes down, the amount I pay in taxes goes down too :)
That being said, I always look to get the best value for my dollars, and the way folks run government around here, it is rarely worth it to feed the beast anymore than I have to.
Before saying no to higher taxes think about the value of your own property. If the infrastructure (streets, water, electricity, internet, schools, ...) becomes broken in the area around your house and garden, the value of your property will go down, too. In that sense paying higher taxes for infrastructure is also good for preserving the value of your property.
London is on the extreme side of "vertical" compared to the "bad" parts under discussion here. London is at least 5x more "vertical" (meaning dense) than the hugely expensive horizontal under discussion in the post.
He's advocating greater density than the typical American suburb but far less than a Manhattan. More like old fashioned main streets, with mixed commercial and residential and less driveways and parking lots. Stores and apartments generate tax revenue. Pavement for cars doesn't.
Lafayette has a population density of 934.5/km^2. London is 5,518/km^2.
Wait, what? He's saying that horizontal expansion is bad? Is he really advocating vertical expansion (concentrated tall buildings)?
Just compare London (horizontal) to any vertical city. London feels like so much better place to live. Low traffic (in comparison to vertical cities), parks everywhere etc. - you feel like you can breathe, not cramped in concrete walls.
This is a problem, but not the problem.
Like schools, local public safety and other core government functions in incorporated cities are provided by municipal government.
Broken streets and infrastructure are expensive, but engineers always overstate the costs of maintenance and replacement when they are waving the tin cup around. The acute problem is that opex is driven by police and fire salaries, pensions and workers compensation. Take those numbers and divide by 3 or 4 to get a realistic number, especially for things like water pipes that have very long service lives.
The more fundamental problem is that post-war America focused investment and tax bad growth on towns and other places outside of cities, and left the costs in the cities. If the average suburban/exurban community requires 1 police/fire visit per 100 household, and urban environment requires 15-20 per 100 households.
This sums up the main reason I'm not all that excited about electric/self-driving cars. The only scenario I see remedying our sprawling city is for gasoline prices to increase, making current levels of car travel financially painful. If we can continue driving cars cost effectively (with electric cars), I don't know if there will be enough political motivation to address our need to stop expanding cities.
The followup article linked on the same page is telling. It shows that the green areas, where positive revenue comes from, is the poor part of town.
Lafayette is my hometown. The article says this isn't a cultural issue, but when a majority of cities shares the problem, that speaks to a national culture of scarcity. The desire for growth stemming from feeling there isn't enough to do, land to build on, people living there, etc. was definitely prominent in Lafayette. It's that shared mindset driving this phenomenon.
I've always been opposed to folks who grumble about suburbs and urban sprawl. I thought that new developments and neighbourhoods meant a growing population and a bigger tax base. I've always lived in the suburbs and love it. I still think there's lots of great things about living in the suburbs, and there will always be demand for it.
I like how the author says that sprawl isn't the problem, the problem is that new developments are large scale, single-purpose, and with no room for improvement or addition.
The graph/map showing how downtown and poorer areas bring in more tax is what did it though. Even just thinking about ploughing in the winter makes it pretty clear that winding suburbian roadscapes are costing the city a lot more than we pay them. That's without mentioning schools, fire halls, garbage collection, etc.
I guess one of the more difficult issues is convincing North Americans that they don't need a private single-family house, large yard, 2+ cars, etc.
There are significant economies of scale for infrastructure that happen with density.
The amount of road surface a tall, mixed-use building requires per occupant is dramatically less than what a detached single family home does, but the latter road needs more maintenance than what the taxes on that single-family home provide for.
Sure, but the point is that your green had better outweigh your red overall or else you have a problem.
No one is arguing that there should only be green blocks - clearly some of the profits that make those blocks profitable come from the spending of people who live in areas that are red. So long as the net outcome is green then everything works out.
When you build endless sprawling suburbs that cost more to maintain than the tax base can raise from the businesses that serve them then you have a recipe for long term decline.
I'm not sure they're drawing the right conclusions from that winning/losing graph. That area downtown is green because that's where all the toniest businesses are located, and you can't have a city that consists of only upscale businesses.
They expanded after car ownership became widespread. The older the city the more compact it is generally.
The federal government gave cities money under the condition that they spend it on infrastructure. They did this to grab the money in the short term and their backwards accounting practices allowed them to ignore the long term costs, which are catching up to them now.
OK so the reason why US cities have no money is that they have grown horizontally instead of growing vertically and horizontal growth means high infrastructure cost. That's all very well, but I still dont understand why it happened. Does anyone know why US cities expanded horizontally instead of following growth patterns similar to Europe?
How do you move around in these neighborhoods? Take a daily stroll on foot for a few hours? It does not work when you want to do anything big, say a few thousand people in approximately the same place. Those people have to get to this place, which would require efficient mass transit. The large area makes both road and fuel costs go up.
It says: "maximum vehicle weight including passengers and cargo is 300 pounds"
Dear my. Americans will often need vehicles with negative weight. Does buoyancy count, or would a helium balloon just be more weight? (can you deduct the weight of displaced air?)
Extreme density is overrated. See http://tinyvillages.org
Other there is another reason : Wasteful expenditure.
At least in case of San Bernandino that was the case.
Good piece, but there is another major factor that is missing entirely - the impact of debt financing and continuously rolling bonds. In addition to what the article mentions, this is the other factor contributing to the slow death of our cities. What nearly every municipality in the US has done (all municipalities BTW, not just the "cities") is to take on a debt load to finance their desired expenditure, whether it be for infrastructure or otherwise - very similar to what our Federal government has done. And at first glance, it makes sense. It's a huge expenditure so let's finance it and pay it off over time in accordance with tax revenues. The problem is that they almost never pay it off. I know that statement sounds crazy at first, but it's not. Sure, they pay off bonds as they come due. But they pay them off and roll them into new bonds - that's the problem. This has been fueled by steadily decreasing bond rates over the past 30-33 years. This allows the municipalities to roll over their debt at a lower rate when it comes due, which reduces their interest payment and also allows them to borrow more at the same time.
Here's an example - It's 1/1/1985 and the rate on the 10 year treasury note is 11.65% (yes, that was the real rate), so our city was able to get a rate of, say, 12%. They issue a 10 year bond for $5 million to build a school and some road maintenance. They make the required coupon payments (usually semi-annually) using tax revenues - and that amounts to $600,000 each year. They keep doing that until just before the principal comes due in full on 1/1/1995. The idiots running the city haven't saved the 5 million required to pay off the principal so what do they do? Well they take a look at the market and see that the 10 year treasury note is now 7.19% so they can get around 7.5%. So they issue a new bond for $5 million for another 10 years and now only have to pay $375,000 in interest coupons every year. But they are still collecting 600k at the given tax rates which leaves them 225k in the green. So they can either spend that every year or they can use that as the coupon payment on an addition $3 million bond and they get it right now! Even if some scrupulous treasurer or township board member were to say that they should just spend the 225k and not take on any additional debt, someone will point out to them that over 10 years that's $2.25 million and here they get to instead use that money to spend a total of $3 million - these guys feel like they are making money taking on debt. And as long as interest rates keep going down and they don't need to repay principal, it all works so they agree. Now 1/1/2005 rolls around - they owe $8 million but rates are 4.5% so they can get 4.75%. So they rollover the $8 million for a yearly coupon of 380k. They also use the remaining 220k to open up a new bond for ~$4.6 million (4,631,578.95 to be precise) - and now they can still pay the same 600k in interest that they have been for decades but they have an outstanding debt issuance of $12.6 million.
Now, if you are still reading this far and fully grasp the horror of the above, you can begin to understand one of the many reasons rates can't go too far up anytime soon. We have been Japan'ed, and this is just part of the reason of how it happened. Also, I want to point out that in the above example no increase in the tax rate is needed to help pay for this, even without population growth at all. Tack on population growth, productivity and technological progress, as well as the increase of the money supply by the federal reserve over that time period and in real terms it becomes even less. Now think about how much your taxes have increased on a percentage basis over the same period on the state and municipal levels and it should become clear just how horribly mismanaged everything has been for quite some time. Rates can't really go much further south so even if they hold constant and never increase...all of our broke ass cities and towns will only be able to refinance at the same rate (best case scenario). This means they can't increase expenditure at all for anything unless they make taxes sky high to support the spending. The free money game is over.
This article embodies a lot of magic thinking and completely avoids asking the questions about _why_ things cost so much vs. when the infrastructure was first built.
Here is a clue: defined benefit pensions
So what's the main reason?
too many overpaid city employees?
too many city employees?
It's not the Federal Reserve. That's one of the few institutions left that are run by humans! The lizard people are spreading conspiracy theories about it because that's the last unimpeachable bulwark of human resistance. And you fell for it!
There is no complex situation that can't simply be explained by humanoid, human-skin-wearing alien creatures. For example:
* Bad economy: Lizard people siphoning off a secret "lizard tax" at the highest levels of government which they then spend on their giant underground lizard carnivals. Fun for them, but disasterous for our jobs.
* Crime: Lizard people sneak into toddler's bedrooms at night and tell them story after story of heroic muggers. They brainwash children to believe that people who take others money at gunpoint are in fact the ones who will end up saving civilization. From what? The very same problems that the lizard people create!
* Global warming: Doesn't exist! The lizards have been stealing mercury from thermometers for centuries.
See, it's obvious if you just think for yourself and do some searches on the internet for "simple theories that explain everything".
Can you expand on this? I don't follow how fiat currency pertains to city budgets and the net cost/benefit of public infrastructure.
Can you recommend a book for me to read? I ask because I completely agree and I'd love to be more educated about the issue.
When a state sponsored institution is granted a privilege that would be illegal for everyone else, it is called plunder.
The Federal Reserve fits the bill, but thats not what this article is about.
I upvoted your comment after I read because I agree with you and the text goes in the opposite direction.
I don't even need to read the article to know that the real reason is not mentioned in there.
The real reason is the FIAT debt based money system. The criminal private enterprise called the FED. Thats the real reason, everything else is a distraction from the truth.
It's the same reason Greece was going bankrupt ... they couldn't print their own currency and run their own fiscal policy after they joined the Eurozone.
The author chooses to describe the phenomenon like,
Psychologists call this temporal discounting. Humans are
predisposed to highly value pleasure today and to deeply
discount future pain, especially the more distant it is.
In the private sphere a similar phenomenon (if not conceptually identical at some level of abstraction) more often encountered is pollution. Or in Silicon Valley think of "technical debt". Both of these are costs that private actors accrue and that, because they do not need to internalize them immediately, are discounted inaccurately because of the temporal bias of the agents. In both cases, when the private actor eventually goes belly-up, other actors (public and private) are often left holding the bag to clean up the mess. And thus the original private actor has effectively imposed a hidden cost on others, intentionally or unintentionally, producing globally suboptimal results.
It's easy to see how an enormous network of pavement and pipes could be created and then left to rot and blight the environment by both private and public entities. Detroit is a prime example of both.
It's worth pointing out that like phenomena described by prospect theory, this temporal bias likely evolved as a heuristic device. Nothing in the future is certain--not even in probabilistic terms--and so it's not possible to foresee and accurately price all future costs today. There's no obvious alternative to the bias as a general matter, only in specific circumstances.
At the end of the day, to aliens arriving on planet earth and watching the machinations of our civilization, distinctions between private and public would really be quite artificial and perhaps not even the most informative axis on which to bifurcate our economy. Both private and public actors are subject to market forces, just like both boats and airplanes are subject to gravity. The normative mechanisms we choose in our attempts to optimize how actors respond to preferences and to internalize costs are different, but rarely singular--it's always some mix of policy and currency, among other things. The so-called "free market" approach is hardly, if ever, the best answer alone.
"This isn't a political, cultural or social failing." - Wrong this is 100% a political failing. This doesn't happen in the private sector.
Why are high rises so much more profitable to the city? Is it just that a larger part of the infrastructure (stairwells, elevators, power distribution, water supply, sewage, and related) are privatized and managed by someone with an eye on the bottom line?
Cities seem extremely poor paying for infrastructure based on performance. Water supplies should be paid for uptime, percent of the population they deliver water to, and quality of the water. Road companies should be paid by lanes * miles * years they last (according to some quality metric for common road failure methods). Bridges similar. If someone builds a building for the city they should be paid by the usable square foot and an incentive for delivery time.
Someone still has to pay for education, law enforcement, and firefighter.
There's not way around it; people are paying much less for infrastructure than they should be. Sorry to you but that's the price of civilization.
The median house in Lafayette costs roughly > $150,000. A family living in this house would currently pay about $1,500 per year in taxes to the local government of which 10%, approximately $150, goes to maintenance of infrastructure (more is paid to the schools and regional government).
I'm sorry but this kind of calculation is, I believe, the real reason infrastructure in America is suffering. If only 10% of my property tax is going to infrastructure then I don't need to pay 6 times as much, I just need my local government to cut the crap and spend 60% of my property tax on infrastructure. I understand that means less government jobs but we are already kidding ourselves if we think it's a good idea to grow government to reduce unemployment.
I don't read Strong Towns much, but I don't think you've read much of the stuff they put out. The blog definitely isn't in favor of mass privatization — that wouldn't help much, since the infrastructure is still crazy expensive and not worth paying for.
The model of development that gets us out of this mess probably is one of much greater density + changes in accounting practices.
I'm a member of Strong Towns, and it's an interesting mix of people from both left and right.
If I had to sum it up, it might be something like 'traditional development patterns', akin to what you saw in pre-WWII cities in the US, and much of Europe. More walking, and biking. There's a lot to like for a lefty like me.
My guess would be more along the lines of calling for more centralized development and less horizontal expansion?
I agree that it is extremely biased, but it doesn't seem to be "right wing" when it is the left wing that usually expounds about its utter hatred for suburban living. It's just too bourgeoisie.
Yes, wages are stagnant. Why is that? Taxes too high perhaps?
Real estate developers and real estate agents run most cities. They are always looking out for their own interests and damn the future consequences. The biggest problem with real estate people is their average IQ is so low.
> This is an extremely biased presentation meant to prime the reader for the awful right wing plan he's going to unveil in his next blog post.
Maybe, but urban densification is a very left wing thing.
What a crock. This is an extremely biased presentation meant to prime the reader for the awful right wing plan he's going to unveil in his next blog post. No doubt privatizing the infrastructure to "relieve" the taxpayer of the burden. Never mind that somehow it is still going to have to be paid for and if it's privatized we will have to pay more so the new owner can make a profit.
The reality is cities are insolvent because of decades of tax breaks for businesses and the stagnant wages of the middle class.