Thursday, April 09, 2015
New York and San Francisco are expensive places to live. That's a big problem for the nation because these cities are centers for the booming knowledge economy. High housing costs discourage this growth.
So sayeth The Economist, its trademark voice of reason spiked with charges of greed against those who would resist the god of gross domestic product. The venerable British magazine has a prescription, unfortunately: Make housing cheaper by building higher and denser and degrading the local zoning laws.
Plopped where a bungalow used to be is a skyscraper of conclusions built on a plywood foundation. Let us dismantle the top hundred floors.
Because of building restrictions, The Economist says, "American GDP in 2009 was as much as 13.5 percent lower than it otherwise could have been."
New Yorkers trying to squeeze into Grand Central Terminal at 4:30 on a working afternoon are not so much worried about GDP as finding a free square foot on the crowded sidewalk; not that their opinions matter. The questionable assumption is that there's no level of discomfort they won't put up with.
In reference to San Francisco, The Economist writes, "Many workers will take lower-paying jobs elsewhere because the income left over after paying for cheaper housing is more attractive."
What's wrong with that? The American heartland is home to superb cities with far lower costs of living, to name four, Omaha, Columbus, Nashville and Kansas City. Texas has built much of its urban growth on low housing prices. And the tech powerhouses of Seattle and Denver, though hardly cheap to live in, are still easier to swing than San Francisco.
The Economist seems shocked that residents of Mountain View, in rapidly populating Silicon Valley, have been resisting Google's plan to build housing on its campus there. "The population density is just over 2,300 per square kilometre, three times lower than in none-too-densely populated San Francisco," it notes as though that were an argument.
Houston is about half as dense as Mountain View. Its economy has been doing just fine.
And Frisco is "none-too-densely populated"? Who sez? Not the scientists noting that the San Andreas fault runs right through its geologically unstable heart.
"Home ownership is not especially egalitarian," The Economist states, adding, "It is no coincidence that the home-ownership rate in the metropolitan area of downtrodden Detroit, at 71 percent, is well above the 55 percent in booming San Francisco."
Perhaps the young tech workers piling into Frisco are more mobile than the struggling folks of Detroit and don't seek to own homes. Lots of good Americans rent.
So, what can you do if the people like their land use laws? The Economist has an answer: Policymakers "should ensure that city-planning decisions are made from the top down. When decisions are taken at the local level, land-use rules tend to be stricter."
The lower-downers seem to be under the impression that voters get to determine their community's future development. Back on the hamster wheel, you peasants! Your quality of life pales in importance next to the higher value of economic growth.
The mother of all lousy assumptions could be encapsulated in this line: "As the return to knowledge-intensive activities exploded, so did the economic fortunes of idea-producing places."
Of course, places don't produce ideas. The places that attract the idea people tend to be urban scapes offering cafes, culture and the hipster vibe found in old, low-lying neighborhoods. Level the tenements, raze those vintage warehouses and erect forests of glass towers in their place and bye-bye, creative class.
No one can move more easily than these people. As noted, many are renting.
Follow Froma Harrop on Twitter @FromaHarrop. She can be reached at email@example.com. To find out more about Froma Harrop and read features by other Creators writers and cartoonists, visit the Creators Web page at www.creators.com.
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