False Economy, by Alan Beattie

by on April 23, 2009 at 8:55 pm in Books, Data Source, Economics, History | Permalink

I enjoyed the book, most of all the chapter comparing Argentina and the United States.  I was struck by this bit:

New York is the only one out of the sixteen largest cities in the northeastern or midwestern states whose population is larger than it was fifty years ago.

Over that same time period our national population has roughly doubled. The subtitle of the book is A Surprising Economic History of the World.

Stephen April 23, 2009 at 4:24 pm

Here in Minneapolis, it seems that the city’s population peaked right after they started dismantling the street car system. Perhaps New York City has done a better job on the public transit front? Or that the stigma from using public transit in the city is lower than most other cities? Those would be my two guesses.

http://en.wikipedia.org/wiki/History_of_Minneapolis#A_growing_city

Doc Merlin April 23, 2009 at 5:04 pm

Large cities in the NE and Midwest (more the NE than MW) tend to have high taxes, not enough roads for their population, and high crime rates.

Why would I want to live inside one of those cities, when I can live much better in the suburbs or in the south/south west where the local governments and state governments are not scared of economic growth and sprawl, and the tax burden and cost of living are both much lower.

Bobar April 23, 2009 at 5:25 pm

As Christopher also pointed out, I’m pretty sure most (if not all)of these metropolitan areas have grown in population over the last 50 years. It’s just that the appeal of urban living versus suburban living has decreased for a variety of reasons.

Casper April 23, 2009 at 7:28 pm

Air condition imo.

John Thacker April 23, 2009 at 8:06 pm

Here in Minneapolis, it seems that the city’s population peaked right after they started dismantling the street car system. Perhaps New York City has done a better job on the public transit front? Or that the stigma from using public transit in the city is lower than most other cities? Those would be my two guesses.

Perhaps you have the order of causation backwards? Perhaps people fleeing to the suburbs has decreased public transit? In any case, that still goes back to the “streetcars vs. buses” post from here. Hmm, maybe you’re saying that white flight to the suburbs was all because white people like streetcars more than buses?

In any case, I’m generally not a believer in the idea that the way to go is to build mass transit first, then try to convince the people who live there (who just got a nice gift of walkable transit) that density should be increased. Ease zoning to allow more density at the same time, or preferably before. In my experience, transit-led development doesn’t happen, because residents fight the zoning changes, or the same people who champion transit-led development champion lengthy planning processes and stakeholder meetings, and everything else that makes a developer save time and money by just going and building in the suburbs.

James April 23, 2009 at 9:21 pm

You are struck by that bit? It is common knowledge that many US cities have declined in population in the North. However, that is purely core city, as the metropolitan region of almost all said cities has never stopped growing; not even Detroit.

Such statistics, by themselves, don’t carry that much meaning. However, once you start examining the divergence between declining cities and rising suburbs you start to see interesting correlations.

Jake April 24, 2009 at 12:07 am

Columbus, Ohio? That’s the 15th largest city in 2009. Pray tell how large that city was 50 years ago. And pray tell if that city is in the northeastern quarter of the United States.

anonymous April 24, 2009 at 12:49 am

New York City’s luck has probably come to an end, since the downsizing of Wall Street means sharply lower tax revenues for the foreseeable future, as well as all the trickledown consequences for businesses catering to the previously elevated level of consumer spending.

Slocum April 24, 2009 at 7:59 am

Due partially to ridiculous annexation laws (and, despite my strong transit support, having very little to do with the loss of a streetcar system), cities in the NE and Midwest haven’t been remotely able to grow…

But cities haven’t lost population because they could not get physically larger or even because household sizes are smaller — large numbers of housing units within the city boundaries have been abandoned and demolished in many of the shrinking cities (Detroit, Cleveland, St Louis, Buffalo, Milwaukee). These cities could be much more populous within their existing boundaries if more people were interested in living in them (Detroit has about half the land area of New York but 1/8th the population).

Although I suppose you could argue that limits to annexation have made it impossible for cities to reach out and grab people who were trying to get away — but I don’t think we can regret that.

mickslam April 24, 2009 at 8:45 am

What is remarkable is that cities did not lose more of their population.

1. Why did we build public housing in the cities? We could have built it much more cheaply in the suburbs. We were building public housing in a place where jobs were disappearing at a huge rate. See point 3.
2. Why did we not fund additional PT in the cities? I think Chicago has had 1 new train line built in the last 40 years. There are entire square miles that are close to downtown in Chicago that are not accessible to an el train. In the burbs, new roads were put in at the smallest request. Anyone who has played simcity for even 30 minutes knows that the quality of transportation is directly related to the density of the population. These cities were not going to add more population without better transportation choices, and they were not subsidized to the extent that the new roads in the burbs were. Lets face it, 355 near chicago only supports my point. The Ukrainian Village is very close to downtown Chicago on a map, but if you actually have to get to downtown Chicago good luck. Of course it would not become more dense, the transportation infrastructure is the same as it was 50 years ago.
3. The deindustrialization killed the economies for cities and they only in the 90′s began to really recover. There has been numerous studies out of the U of C about the true cause of urban poverty – it turns out that it is the fact that these factories moved overseas, and not anything else. Tons of people moved here for jobs, then those jobs went away. All those exposed brick loft condo buildings? They used to be places where people went to make money and work. I grew up in northwest indiana, where the mills laid off 50,000 people in an area where the total population is about 500,000. I’ve seen Hammond, a thriving city, become a burned out shell and 6,000 sq ft mansions – yes, mansions – sell for under $200,000. When these jobs leave an area, it takes decades to recover if ever. I bought a house in Hammond that had 17 stained glass windows, servants quarters, a servants staircase, ornately carved wooden columns inside the house, and 12 rooms for under 160,000. A home built for truly wealthy people, priced for middle class wages. When you lose 10s of thousands of well paying jobs in an area, blight happens.

Dennis April 24, 2009 at 10:06 am

My friend Tim protests the author’s data, which makes him wonder about the rest of the book:

“Falsehood. columbus, ohio is the 15th largest city in the country and the population growth rate between 1970 and 2000 was 31.8%. or… at least that’s what a quick google search told me. gotta stick up for my midwestern roots!”

My advice: If you are going to play fast and loose with your facts, never, ever, mess with Columbus, Ohio.

Tristan April 24, 2009 at 11:14 am

Not sure if Beattie is refering to the 16 largest cities 50 years ago in the NE/MW or the current 16 largest. I’m in Indianapolis, the 13th largest in the NE/MW (26th overall) according to the 1960 census. It’s grown by 65% between that 1960 census and the 2006 estimate (and still growing) to become the 14th largest overall. Also, that’s only in city proper, not including suburbs.

As has been pointed out, Columbus was just a couple of spots down from Indy in 1960 and is now the 15th largest.

Either way, some of the “big” cities in this quadrant of the country have grown quite a bit. Almost as much as some of the Sunbelt/Western cities.

Slocum April 24, 2009 at 11:57 am

1. Why did we build public housing in the cities? We could have built it much more cheaply in the suburbs. We were building public housing in a place where jobs were disappearing at a huge rate.

Why? For the simple reason that most of the people who needed public housing were city residents.

2. Why did we not fund additional PT in the cities? I think Chicago has had 1 new train line built in the last 40 years. There are entire square miles that are close to downtown in Chicago that are not accessible to an el train…The Ukrainian Village is very close to downtown Chicago on a map, but if you actually have to get to downtown Chicago good luck.

Because construction of PT (except for adding bus lines, obviously) is now extremely difficult, slow, and expensive in built-up urban (and political/regulatory) environments. But if you want to get from Ukrainian Village to downtown, hop on a bus (it’s only a couple of miles).

Anyone who has played simcity for even 30 minutes knows that the quality of transportation is directly related to the density of the population.

Are you saying that because the game programmers of Sim City put that in there, it MUST be true of real cities?

…it turns out that it is the fact that these factories moved overseas, and not anything else.

No. Many overlapping trends were responsible for the loss of inner-city factory jobs. Among them:

1. Far fewer workers are needed in a modern factory to produce the same quantity of goods. Which means you don’t need high population density around the factory.
2. Cities are a high cost (taxes, land, labor, regulation) place to build and run a factory. Once workers have cars and are mobile enough not to need to live near the factory, factory owners would be nuts to build in a city neighborhood.
3. Successful cities (New York, San Fransisco, Chicago, San Diego, Phoenix, Boston) are clearly NOT successful because they have retained their heavy industries–they haven’t.
4. The factories that are putting the big hurt on the D3 are located in the non-union southern U.S. states, not overseas (and few D3 factories are now located in downtown locations anyway).

In general, you seem to be asking, “Why didn’t we engage in wholesale social engineering to prevent the decline of these cities?”. And the answer is that the politics were not there support it. The same people voting with their feet against city life certainly weren’t going to turn around and vote to tax themselves to subsidize the cities they had left.

joan April 24, 2009 at 4:08 pm

Why is it that when we travel we go sightseeing in cities and hardly ever visit suburbs unless forced to by our work, but most people in the US who have enough income to choose where they live, choose to live in suburbs. Do we prefer to live in boring places, is it due to government policies, or is there another reason? The claim that it is due to high taxes in cities doesn’t really explain it because the taxes in cities are high because they must pay for most of the social services in a metro and have a low tax base which was the result of the flight to the suburbs not the cause.

John Dewey April 25, 2009 at 4:58 am

joan: “Do we prefer to live in boring places”

Perhaps everyone does not find suburbia to be boring, joan. I enjoy my suburban friends and neighbors. The many golf courses and parks in the suburbs around Dallas provide me many hours of recreation. Shops and restaurants in upper middle class suburbia provide for all my needs, as retail entrepreneurs have also relocated to where the money is. Holiday celebrations in suburban cities – Christmas parades, for example – may not be as grandiose as those of their larger core cities. But I find them charming.

I’m not bored, joan. Is it possible we just have different interests?

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