There has been some controversy about the federal government’s new “Affirmatively Furthering Fair Housing” (AFFH) rule. Supporters hope, and opponents fear, that the rule will integrate lily-white suburbs and eliminate exclusionary zoning. However, there is reason to believe that the rule’s impacts will be fairly minor.

The Department of Housing and Urban Development (HUD) which enacted the rule, did so in order to implement sec. 808(d) of the Fair Housing Act, which requires federal agencies “to administer their programs…relating to housing and urban development…in a manner affirmatively to further” the policies of the Act—in other words, to affirmatively further fair housing.

In the past, HUD has sought to implement this statute by requiring grant recipients (such as local governments and public housing agencies) to draft an analysis of impediments (AI) to fair housing. An AI typically described impediments to racial integration, such as exclusionary zoning and racial disparities in mortgage lending. HUD decided that the AIs were not tremendously successful, because they did not contain enough data and were not adequately linked to other planning documents. (80 Fed. Reg. 42348).

The new rule requires grantees to create a new document called the “Assessment of Fair Housing” (AFH) every five years. The AFH will address a community’s barriers to integrated housing, such as “integration and segregation; racially or ethnically concentrated areas of poverty; disparities in access to opportunity, and disproportionate housing needs based on race, color [and other factors]” (80 Fed. Reg. 42355). The AFH will summarize any current litigation, analyze relevant data, and identify major factors limiting housing opportunity. The grant recipient must also set goals for overcoming the effects of these factors.To receive funding from HUD, a grantee must certify that it will affirmatively further fair housing, which means that it must promise to take meaningful actions to further these goals.  (80 Fed. Reg. 42316).  In other words, the grant recipient has to create paperwork stating: “This is why our city/county/area is more segregated than we would like, and this is what we would like to do about it.”

According to HUD, the new rule will impose increased costs of data collection and paperwork upon municipalities, because municipalities must solicit more community participation than under the prior rule. HUD also suggests that the municipalities that have already been taking their AI obligations seriously “may experience a net decrease in administrative burden as a result of the revised process” (80 Fed. Reg. 42349).

The rule does not require any specific policies; instead, it just requires municipalities to describe the status quo, promise to adopt some sort of policy related to fair housing, and to justify those policies to HUD. Thus, it seems to me unlikely (though not impossible) that HUD will actually force significant changes in municipal policy.

In theory, HUD could keep saying no to a municipal AFH until the city or county adopts far-reaching policy changes, or could deny funding on the ground that the city has violated the promises in its AFH. But I doubt that this will occur, for two reasons. First, if HUD has not been using the AI process to remake cities and suburbs, I question whether it will have the willpower to use its new and improved procedural tools much more aggressively. Second, if HUD went to the edges of its authority, it would be risking fights in the courts and fights with Congress.

(Cross-posted from planetizen.com)

In a recent article, Joel Kotkin critiques the work of Jane Jacobs; he points out that Jacobs idealized middle-class city neighborhoods, and suggests that because cities have become dominated by childless rich people, middle-class urbanity “has passed into myth, and… it is never going to come back.” He suggests that Americans are “moving out to the suburbs as they enter their 30s and start families” because central cities are only appropriate for “the talented, the young, and childless affluent adults.” This claim rests on a couple of assumptions: 1) that cities have little appeal to families and 2) that the only Americans whose preferences are typical are those middle-class families.

The first claim has an element of truth: families do tend to prefer more suburban living environments. But what Kotkin overlooks is that the tide is turning (at least a little). Although American suburbs clearly have more children than cities, the most desirable city neighborhoods are more appealing to parents than was the case a decade ago.

For example, Kotkin writes that Greenwich Village (where Jacobs lived) “today now largely consists of students, wealthy people and pensioners.” But according to the Furman Center’s neighborhoood-by-neighborhood surveys of New York housing, the percentage of households with children actually increased in New York’s more desirable urban neighborhoods. For example, in Jacobs’s own Greenwich Village, 15.1 percent of all 2013 households had children under 18—lower than in most places to be sure, but higher than in 2000, when only 11.4 percent had children. Similarly, the “households with children” percentage increased from 11.4 percent to 15.1 percent in New York’s financial district, from 14.6 percent to 17.8 percent in the Upper West Side, and from 13.3 percent to 16.6 percent in the Upper East Side.

Kotkin sees an America polarized between child-friendly suburbs and child-hostile cities, But in reality, there seems to be a kind of convergence between the city’s affluent central neighborhoods and the rest of the city—while the urban core is becoming more child-oriented and outlying areas (especially poorer outlying areas) are becoming less so. The percentage of households with minor children decreased from 38.1 percent to 29.3 percent in Central Harlem, from 40.8 percent to 29.4 percent in Washington Heights/Inwood, and from 38.1 percent to 29.3 percent in East Harlem. Similarly, the “households with children” percentage increased from 25.1 percent to 27.1 percent in affluent Park Slope, while declining in low-income Brownsville and East New York (two parts of Brooklyn especially far from Manhattan). New York is not unique: in Washington, D.C., the number of children increased in the city’s most affluent areas and decreased in the city’s poorer areas.

Kotkin correctly points out that despite widespread commentary about gentrification, even cities with lots of rich people (such as New York and Chicago) still have plenty of low-income areas. He therefore reasons that cities are perfectly fine for the very rich and the very poor, but not for the middle classes. However, he overstates this trend by relying on some statistics that might not support his case. In particular, he relies on a Brookings Institution study listing the most and least unequal cities: according to Kotkin, the most compact, walkable cities are the most unequal. However, Kotkin, by comparing central cities alone, misses one relevant fact: most of these compact cities are trapped within their 1950 city limits, while, according to the Brookings study itself, the low-inequality cities are usually “Southern and Western cities with expansive borders, and either include many ‘suburban’ neighborhoods alongside a traditional urban core, or are themselves overgrown suburbs like Mesa, Arizona and Arlington, Texas.” It logically follows that if 46-square-mile San Francisco was compared to the inner 46 miles of Omaha or Oklahoma City, the latter cities might seem somewhat more unequal, and San Francisco might seem less exceptional in comparison.

Despite my quibbles, Kotkin is on to something: it is true that large cities tend to be more unequal than their suburbs. But unlike Kotkin, I don’t treat this as an inevitable fact of life. Some cities are too expensive for middle-class families, but that is a result of public policy rather than some force of nature. Because older cities are more likely to be “built out,” those cities are less likely to be able to add housing to meet increased demand. So to retain the middle class, a city must go out of its way to encourage new housing. Instead, many cities have restrictive zoning that artificially limits housing supply, thus causing prices to rise. And when cities attempt to solve this problem, they sometimes do so by trying to build or mandate the creation of low-income housing, which may help the poor more than the middle classes. If cities had less restrictive zoning, perhaps more housing would be available for the middle class.

By contrast, Kotkin believes that cities are inherently undesirable because families in urban apartments today, says Cornell researcher Gary Evans, generally have far weaker networks of neighbors than their suburban counterparts, a generally more stressful home life, and significantly less social support.” However, the study that Kotkin links to says nothing of the sort. Evans does not mention the word “urban” at all. Instead, he claims that the “number of people per room [is] the crucial variable for measuring effects of crowding on children’s development.” This means that an apartment with one child living in one room is less stressful than one where four children live in two bedrooms. Evans also focuses on noise pollution, such as traffic noise.*

Kotkin writes that because urban centers are (allegedly) only for the childless, “the central city offers at best only a temporary lifestyle.” It appears to me that Kotkin is assuming that “desirability” and “desirability to 35-year olds with small children” are the same thing. This may have been the case in the America of the 1950s. But delayed marriages, an aging society, and plunging birth rates mean that “35-year-olds with small children” are a much smaller group than in the United States of the 1950s. In 1960, almost half of all households were families with children under 18. Since then, this number has fallen to under 30 percent. In 1960, only 13 percent of households included just one person; that number has more than doubled, to 28 percent. In sum, thirtysomething families no longer dominate American housing markets, and their preferences no longer need govern the majority of American construction.

*Kotkin may have been thinking about a portion of the article stating “families living in high-rise housing, as opposed to single-family residences, have fewer relationships with neighbors, resulting in less social support.” But since the sentence is in a paragraph that doesn’t even mention Evans, it is not clear that this sentence even refers to Evans’ research, or to some other research. Moreover, “urban” and “high-rise” are not synonymous, nor are “apartment” and “high-rise.”

(Cross-posted from planetizen.com)

A recent article by Joel Kotkin tries to stir up a stew of resentment about alleged “attacks on suburbia”.  Kotkin’s article is in black; my comments to the article are in gray.

COUNTERING PROGRESSIVES’ ASSAULT ON SUBURBIA

BY JOEL KOTKIN – July 10, 2015

NOT REALLY FALSE, BUT (1) THE ARTICLE KOTKIN LINKS TO (BY WENDELL COX) DEFINES “INNER CORES” REALLY REALLY NARROWLY (BASICALLY, AS JUST DOWNTOWN), AND (2) COX HIMSELF WRITES, IN THAT VERY SAME ARTICLE, ” THE CENTRAL CORES OF THE NATION’S LARGEST CITIES ARE DOING BETTER THAN AT ANY TIME IN RECENT HISTORY. “

(Cross-posted from mlewyn.wordpress.com)

In an excellent blog post, Reuben Duarte explained that many big-city zoning disputes involve a conflict of visions: a “preservation camp” favors preserving neighborhood character at all costs, while an “affordability camp” favors construction of new housing in order to make the city more affordable.

Duarte write that the preservation camp’s interests “hover around preventing evictions of tenants in long-held residences, but also includes the topics of traffic (“this neighborhood can’t support more development, because, traffic!”), parking (replace “traffic” with “parking”), and neighborhood character (“building is too tall or too dense!” “Views!”).”

It seems to me that to the extent government uses preservation as a reason to exclude new housing, arguments based on “neighborhood character” fail on their own terms: either because limiting housing supply itself changes neighborhood character, or because it forces less exclusionary places to change their character.

Zoning restrictions designed to limit traffic create the second problem. For example, suppose a city freezes a neighborhood’s housing supply in order to limit traffic and parking. Other things being equal, fewer households mean fewer cars. So at first glance, this policy has no losers. But if a city or region is adding households, those new households have to go somewhere. And if they don’t go to your neighborhood, they go to another neighborhood, adding cars (and thus traffic/parking problems) to that neighborhood.

To make matters worse, if the frozen neighborhood is more pedestrian-friendly than the “housing-receiving” neighborhood, freezing housing increases traffic everywhere. For example, suppose that the housing moratorium occurs in Pedtown, a neighborhood where 40 percent of households have no car, and 60 percent get to work without driving. The average household excluded by the moratorium moves to Sprawlville, a suburb where only 5 percent of the households have no car, and only 10 percent of them get to work without driving. Obviously, the new Sprawlville households are much more likely to drive cars throughout the region to work, thus increasing regional traffic and parking problems.

But zoning restrictions may also change the character of the neighborhood allegedly benefitting from them. Suppose a city freezes a neighborhood’s housing supply in order to prevent gentrification and the resulting increase in rents. As long as demand is stagnant (for example, in a declining neighborhood) this policy has no real effect: no one will want to build new housing anyhow. But when demand is growing (either because of rising city population or rising city incomes) rents are likely, all else being equal*, to rise in the absence of new construction. If rising rents lead to more evictions, freezing supply is actually likely to lead to more evictions, not fewer evictions. (Of course, I am assuming that the new construction actually increases the neighborhood housing supply, which is not always the case. A new building that merely replaces an old building is obviously more problematic.)**

And if rents rise, that in turn defeats attempts to preserve the intangible “character” of the neighborhood. Even if a neighborhood’s housing stock is frozen in amber, its character will be very different if it becomes more expensive. At a minimum, the inhabitants will be richer. And in turn, this reality will affect the age, race, and even religion of the neighborhood’s inhabitants, to the extent that some races, ages, and religions have more money than others. If the neighborhood has commercial blocks, the shops may look very different if the neighborhood gets wealthier. For example, a street catering to wealthy 50 year olds will have somewhat different shops than one catering to not-so-wealthy 25 year olds.

Moreover, if housing restrictions in one neighborhood cause new housing to be built elsewhere in a region, the “receiving” neighborhood’s character changes. Going back to Pedtown and Sprawlville: if Sprawlville was a rural, sparsely populated suburb in 2000, and zoning restrictions in Pedtown cause dozens of new subdivisions to be built in Sprawlville, obviously Sprawlville will feel very different in 2015. Thus, the restrictions in Pedtown are a classic example of a “beggar thy neighbor” policy—that is, a policy that shifts social harm from one neighborhood to another, rather than actually reducing the harm.

In sum, government sometimes restricts housing to preserve neighborhood character—but if those restrictions keep out new people and raise rents, that neighborhood’s character will still change (albeit in different ways), and shifting populations will change the character of other neighborhoods.

*One huge caveat: this is not the case where supply creates its own demand: that is, where the new housing is so desirable that it not only commands higher rents than the existing housing supply, but also makes the neighborhood as a whole more popular, thus attracting new people even into the existing units. Certainly, a few neighborhoods have become much more desirable in recent decades (for example, New York’s Williamsburg and Greenpoint)—so it could be argued that new housing in Williamsburg and Greenpoint is undesirable because it creates such demand. But this would only be the case if the new housing actually caused the increased demand rather than being a result of the increased demand. Moreover, housing restrictions based on this argument still create the “beggar thy neighbor” problem: if new housing is shifted to another neighborhood or suburb, how do we know that the new housing won’t make that neighborhood more desirable?

**In addition, government can try to avoid this problem by limiting evictions in other ways—but this seems to me to be a separate issue.

(Cross-posted from planetizen.com)

Is zoning racist? After a committee designed to study Seattle’s zoning codes suggested some significant reforms to the city’s code, Mayor Ed Murray said: “In Seattle, we’re also dealing with a pretty horrific history of zoning based on race, and there’s residue of that still in place.” Even if this remark is factually true, it doesn’t mean that today’s zoning is racist: low-density zoning exists in black neighborhoods as well as white ones, and opposition to changing such zoning crosses color lines.

But it seems to me that even though zoning is not consistently or intentionally racist, zoning is similar to racist housing discrimination (or “RHD” for short) in a few ways. Both involve a politically influential dominant class (in one case, whites generally; in the other case, homeowners of all colors) who have the votes to impose their will on the political process. In both situations, the dominators use their political power to exclude someone else from its neighborhood; racists usually seek to exclude blacks, while pro-zoning homeowners usually seek to exclude new residents regardless of color (to the extent that zoning is designed to exclude housing smaller or more compact than the status quo, such as smaller houses or multifamily dwellings).*

Both RHD and low-density zoning do, on balance, exclude blacks more than whites—though of course RHD does so much more consistently. One purpose of zoning is to raise housing prices (or, as courts and homeowners euphemistically say, “values”). And higher housing prices mean higher rents, which means that everyone has to pay more for less. If you don’t have any money, you are obviously going to suffer more from that policy than someone who has plenty of money, since the difference between having a small apartment and sleeping on the street is a bit more significant than the difference between having a 8000-square-foot mansion and a 12,000-square-foot mansion. And since blacks tend to have less money than whites, on balance blacks are going to suffer a little more than whites from these policies, just as they are going to suffer more from any tax imposed without ability to pay (for example, an increase in bus fares).**

RHD and low-density zoning are motivated by the same concern: fear of change in neighborhood character. Homeowners believe that new housing will change neighborhood character—and even if such housing does not have any tangible negative impact, this of course is the case. A neighborhood with ten houses per acre obviously looks and feels different than a neighborhood with one house per acre.

I suspect that racists similarly believe that an influx of blacks into their neighborhood will lead to crime, poor schools, and of course lower property prices—but even if they didn’t believe this, racists might believe that a neighborhood where they have to look at black faces on a regular basis has a different character from one where they don’t. Certainly, other forms of illegal discrimination affect neighborhood character: for example, a neighborhood full of Orthodox Jews has a very different character than an equally affluent neighborhood that does not, in that stores will be closed on the Jewish Sabbath and restaurants will comply with traditional Jewish dietary laws.

More importantly, both RHD and low-density zoning are rational for an individual neighborhood but perhaps irrational for a city, region or nation as a whole. A racist in the pre-Fair Housing era no doubt wanted to live in an all-white neighborhood, and even non-racist homeowners might have rationally favored RHD because they did not want to take a chance that integration would lead to unwelcome change. But the widespread adoption of fair housing legislation suggests that many whites did not welcome the nationwide results of rigid segregation.

Low-density zoning is more clearly rational for an individual neighborhood. After all, what homeowner would not like his home to be worth a little more, and what homeowner really wants his neighborhood to change (even in intangible ways)? But if no one liberalizes their zoning enough to accommodate new residents, rents explode, and a city’s prospective residents are either priced out of the city or forced to live on the streets.

So what? Why should we care about these similarities? It seems to me that if RHD and zoning have similar results, maybe they should be attacked with similar remedies. RHD was not eliminated by allowing neighborhoods to discriminate a tiny bit less than they had discriminated in the past or by requiring only a few neighborhoods to cease discrimination. Instead, Congress and state legislatures responded with a meat ax: the Fair Housing Act generally prohibits housing discrimination, and has only a few narrow exemptions. Maybe state legislatures in high-cost states should use a similar meat ax in addressing zoning.

*As opposed to commercial and industrial enterprises, or houses larger than the neighborhood norm.

**On the other hand, to the extent that higher home prices increase property tax revenue, and property tax revenue means better government services, poorer people (and thus blacks) may get a countervailing benefit from better government services—if the extra revenue goes to services that disproportionately benefit the poor (a very big IF).

(Cross-posted from planetizen.com)

A few months ago, I blogged about the impact of Airbnb on rents for traditional month-to-month or year-to-year tenancies. I suggested that this impact was pretty minimal, reasoning as follows: even in a large city such as Los Angeles, Airbnb units are less than 1 percent of all rental units. So even if every single Airbnb unit would (in the absence of Airbnb) otherwise be part of the traditional rental market, Airbnb is unlikely to increase rents in that market.

The comments (and a recent San Francisco Chronicle story) raised an interesting response to my theory: what matters isn’t the percentage of all rental units, but the percentage of all rental vacancies or all new housing units. In the words of the Chronicle story: “where a typical year sees just 2,000 new units added, a few hundred units off the market makes a significant dent.”

But as I thought about the argument, I was less and less persuaded by it. Here’s why: first, the number of vacancies is limited to new housing units. San Francisco has just over 236,000 rental housing units. The units other than the new units are not owned by their current owners or occupants forever: rather, they shift around from occupied to unoccupied as tenants move, and as owner-occupants become landlords or vice versa. So the number of units vacant at any given point in time is a bit higher than the 2000 figure, and the number of units that become vacant at some point over the next year or two will be higher still.

Second, it seems to me that a few hundred units will have little effect upon overall vacancy rates, which in turn means that they will have little effect upon rents. A recent report by the Furman Center [pdf] (affiliated with New York University) lists rental vacancy rates of eleven cities (p.8). San Francisco has the lowest vacancy rate (2.5 percent) and the highest rent ($1491). Boston, New York and Los Angeles are in a virtual three-way tie for second lowest vacancy rate (between 3.4 and 3.5 percent). These three cities are numbers 3-5 in rents (p. 10). (Washington is no. 5 in vacancies but no. 2 in rents, perhaps because Washington is a more affluent city).* At the other end of the spectrum, the two cheapest cities, Houston and Dallas, were no. 10 and no. 9 in rental vacancies. In sum, there seems to be a pretty strong correlation between vacancy rates and rental rates. Since the law of supply and demand suggests that a small supply normally leads to high prices for any commodity, I suspect that this correlation indicates a causal relationship.

The Chronicle story states that “at least 350 entire properties listed on Airbnb …appear to be full-time vacation rentals, bolstering claims by activists that the services remove scarce housing from the city’s limited inventory.” So what would San Francisco’s vacancy rate be if these 350 Airbnb units were used for traditional year-to-year rentals instead of shorter tenancies? According to the Furman Center report, there are just over 236,000 rental units in San Francisco (p.40) which means that (assuming the 2.5 percent vacancy rate mentioned above) there are about 5900 rental vacancies. According to the Chronicle story, Airbnb takes 350 rental units off the traditional rental market by turning them into short-term tenancies. So if government compelled those owners to turn their units into year-to-year tenancies, there would perhaps be 6250 rental vacancies. So the rental vacancy rate would be…2.64 percent, still significantly lower than those paragons of affordability New York and Los Angeles. So if the effect of the 350 units upon vacancy rates is that small, it seems to me that their effect upon rents will be that small.

One broader point is what the entire discussion shows about the growth of government regulation of housing. Government uses zoning to artificially constrict the supply of housing (or, in politicianspeak, “protect neighborhoods from overdevelopment”). This in turn causes a housing shortage which leads to higher rents. The higher rents in turn lead to additional government regulation, such as rent control, inclusionary zoning, or (in the case of Airbnb) efforts to prevent property owners from shifting property from the traditional rental market from other markets. In sum, government regulation of housing feeds upon itself.

*The median household income for Washington’s renters was just over $46,000, about $5-6,000 higher than the comparable figures for Boston and New York.

(Cross-posted from planetizen.com)

Much has been written about gentrification and about the specter of poor people being displaced from cities — despite the fact that nearly every central city still has higher poverty rates than most of its suburbs.

But the City Observatory blog has an interesting post about one Atlanta suburb’s attempt to gentrify not through market forces, but by using public money to buy up and destroy an apartment complex dominated by low-income African-Americans.  In other words, the city’s goal isn’t gentrification that might result in displacement — it is displacement as a goal in itself, gentrification or no gentrification.

(Cross-posted from cnu.org)

Every so often I read an argument that says something like this: “There’s no way that rents can ever go down in expensive cities like New York and San Francisco, because rich foreigners are buying up everything, and as a result demand is essentially infinite. So there’s really no reason to allow new apartments because the foreigners will just buy them all.”

This argument could certainly be true in theory: for example, if an entire city were so expensive that only wealthy foreign investors could afford to live there. But it doesn’t seem to fit the social reality of the expensive city I am most familiar with (New York).

If demand was essentially infinite, there would be some evidence of this fact other than high real estate prices. For example, if New York was growing faster than any city in the United States, there might be a credible argument that new demand is truly insatiable. In fact, many low-cost cities are growing far more rapidly than New York and yet have cheaper rents. Between 2000 and 2010, Austin and Raleigh (both of which are far cheaper than New York) grew by 20 and 46 percent, respectively, while New York grew by less than 10 percent.

It could be argued that New York is dissimilar to other high-growth cities, because the number of wealthy foreigners is so huge that it makes New York a high-growth city. For example, if New York had to accommodate not only half a million new residents per decade but also three million wealthy foreigners seeking second homes, its housing-consuming population would have grown by about 45 percent over the past decade, about the same level of population increase as Raleigh. But are there really that many wealthy foreigners in the New York housing market?

I suspect not. According to a New York Times article about the evils of foreign investment in New York housing, “About $8 billion is spent each year for New York City residences that cost more than $5 million each.” Using the magic of long division, I calculate that even if each residence cost only $5 million and not a penny more, there would be 1,600 such residences. In fact, some residences cost far more, so the actual number of super-expensive residences is lower (and of course, the number of such residences purchased by foreigners is lower still). In a city with 8 million people (and thus a few million households), a thousand or so really rich people seems to be like a drop in the bucket, even if their wealth does give them disproportionate influence and notoriety.

Moreover, it seems to me that if New York really were flooded with millions of foreign billionaires, housing prices would be even more expensive than they are. During my last year in New York (2013-14), I lived in a 448-square-foot studio in Midtown and paid $2,330 a month in rent  (The same apartment would cost $2,680 today). This rent is very expensive by the standards of Planet Earth—but by the standards of Planet Foreign Billionaire Oligarch (FBO), it is nothing. What self-respecting FBO lives in a 450-square-foot studio? And what self-respecting FBO pays less than $3,000 in rent? I don’t know how much FBOs make, but I’m guessing that the median FBO income was at least $10 million per year (1 percent interest of $1 billion in wealth)—which means that any self-respecting FBO should be able to afford $60,000 per month (the price of the most expensive New York apartment I found on zillow.com).

And I wasn’t even living in the neighborhood’s cheap housing: had I chosen to live in a walkup, I could have paid around $1,700-1,800 per month—not exactly billionaire rents. And in the supposedly oligarch-ridden Upper East Side, rents are even cheaper.

And these non-FBO-friendly rents are in the nice parts of Manhattan; rents are even cheaper in most of the outer boroughs. Thus, it is pretty clear that to live in New York (even in the nice parts of Manhattan) you don’t have to be a FBO.

In sum, the overwhelming majority of people who are living in, and bidding up the price of, New York real estate are not FBOs. There is no reason, other than government regulation (and the technical difficulties of building housing in a city that is already “built out”) why supply could not rise to meet demand more effectively.

Having said that, there is two grains of truth in the “insatiable demand” argument.  First, even if New York only has a thousand FBOs, it has lots of domestic rich people- not just billionaires, but “ordinary” people earning in the high six figures, people who cannot afford to pay $60,000 per month but can afford to pay $5,000.  The more rich people a city has, the more money that will be used to bid up real estate prices, which in turn means the city has to work harder to keep supply growing.

Second, even if an adequate building supply kept rents down, it might be that no politically feasible policies will increase supply enough to restrain rents. But as readers of this blog are probably aware by now, “policies I favor” and “politically feasible policies” are two concepts that rarely intersect.

(Cross-posted from planetizen.com)

Some months ago, I wrote that laws against so-called “jaywalking” (that is, crossing in places other than crosswalks or where traffic lights encourage pedestrians to cross) fail to promote safety, because traffic lights are inadequate guides to safety. When crossing midblock, a pedestrian need only watch out for traffic coming in one direction—right toward her. By contrast, when crossing at a light, a pedestrian may be in less danger from cars coming straight at him, but may be attacked by cars making left and right turns. Moreover, it is not at all clear that jaywalking is a major cause of pedestrian fatalities; although most crashes do occur outside intersections, these crashes often occur in places where there is no easily available crosswalk. According to traffic writer Tom Vanderbilt, “While jaywalking is often cited as a cause of pedestrian accidents, less than 20 percent of fatalities occurred where a pedestrian was crossing outside an easily available crosswalk.” And even where a pedestrian is jaywalking, a crash may be caused primarily by driver misconduct.

However, my article did not fully address the social harms caused by these laws. I did mention that to the extent these laws discourage walking, they increase traffic danger, because more cars mean more potential crashes.

But even if this were not the case, the social benefits of jaywalking laws might be outweighed from their costs. In particular, jaywalking laws are harmful from a public health perspective, a social equity perspective, and a libertarian perspective.

The public health costs from increased driving have been amply discussed in smart growth literature. But just to summarize the key issue, when we drive instead of walk, we create two major types of public health risks. First, we harm ourselves. Less walking means less exercise, which means an elevated risk of many diseases; for example, the risk of type 2 diabetes is 31 percent lower for participants who engaged in regular moderate-intensity physical activity such as walking. Second, people who drive more and walk less endanger the rest of society. Even leaving aside the risks of climate change, particulate matter and other pollutants emitted from motor vehicles create significant costs. For example, one study found that particulate matter emitted from motor vehicles creates $211.6 million of health care costs in Auckland, New Zealand, alone. So, to the extent jaywalking laws reduce walking, they create increased risks of harm for both their intended beneficiaries and for society as a whole.

From a social equity perspective, jaywalking laws disproportionately harm the poor in two ways. First, poverty-level households are less likely to own cars than the average household, which means they walk more and thus are more likely to be ticketed.  20.4% of all poor people live in households with no access to a car, more than twice the national average. In urban areas, these percentages are higher: for example, in New Orleans, 46.7% of the poor live in such households, including the majority of the black poor.

Second, even if all Americans walked equally, jaywalking fines would harm poor pedestrians more than everyone else because these fines tend to be quite large (often in the $100-200 range) and are unrelated to ability to pay. This is especially true in cities where fines can lead to other legal consequences. For example, Ferguson, Missouri is notorious for its aggressive use of fines. If a Ferguson resident is fined and is more than a few minutes late* for a court date, she is arrested and charged additional fines totaling at least $170 ($120 for the main fine plus a $50 fee for an arrest warrant) and if she cannot afford to pay her fines she is imprisoned until the next court session. Because the relevant local court is in session three days per month, this unlucky resident may spend weeks in a local jail—for which privilege she is fined yet again!

Finally, such laws make no sense from a libertarian perspective. The ordinary (albeit oft-violated) norm of American public policy is that people should be at liberty when they are not harming others; for example, we allow smoking because smoking primarily harms only the smoker. Despite the fact that smoking creates indirect health consequences such as health care costs that affect society as a whole, society treats smoking more leniently than walking.

Where jaywalking laws are not enforced, these laws may not do much harm. But to the extent these laws are actually enforced, they create pollution and disease by reducing walking, and redistribute money from poor pedestrians to not-so-poor local governments.

*Technically, the resident must be absent from court for these additional fines to apply.  However, courtroom doors close just five minutes after a court session starts, according to a recent Harvard Law Review article.

(Cross posted from planetizen.com)

It is conventional wisdom that big cities have problems retaining the middle class because of poor schools.  But many older cities labor under a disadvantage that their suburbs don’t have — lots of students from underprivileged background.

A recent study suggests that when one controls for social class, Chicago schools are actually not so bad. This study compared the test scores of Chicago’s elementary schools with those of other Illinois schools with similar poverty rates, and calculated a “Poverty-Achievement Index” (PAI) based on this comparison.  As it happens, 55 of the 100 schools with the best PAIs were in Chicago- which is to say, their test scores were better than those of suburban or small-city schools with similar student bodies.

(Cross-posted from cnu.org)