How NIMBY leads to urination in the streets

That is the topic of my latest Bloomberg column, here is one excerpt:

…step back and consider two 19th-century “classical economists” who focused on high rents: David Ricardo and Henry George. Both built models where land is so scarce that the cost of renting land absorbs most of the social surplus. We are not (yet?) at that point, but these models give insight into where today’s most expensive cities are headed.

Consider an increase in the quality of public services — say, garbage collection, or perhaps in San Francisco the elimination of public urination. You might think that would make life much better for everyone. But in a Ricardo-George model, that is not the case. Mainly what happens is that rents go up and landowners capture most of the newly created surplus.

How would this work? Take the example of San Francisco; with nicer streets, even more people might want to move there. That would push up rents by an amount roughly equal to the value created — putting the gains from the higher quality of life into the pockets of landowners. In a normal market economy, those higher rents would then induce more construction and, eventually, a corresponding decline in rents. But San Francisco is a “not in my backyard” locale where the amount of new construction just isn’t that high, for legal and regulatory reasons. Again, as both Ricardo and George realized, the incidence of the benefit falls upon the very scarce factor, namely land.

The political economy problem now should be obvious: Why exactly would non-landowners press for improvements in their cities? The value of those improvements will be captured mainly by other parties.

There is much more at the link.

Comments

"furthermore many voters might end up using their votes to express their ideology (even more so than usual) rather than to elect leaders to solve problems."

Which creates a vicious cycle, but perhaps ideology in places like SF and NYC had a bigger role in starting the cycle, so some of them decamp and start the cycle in other cities.

The very rich in NYC seem to have little interest in 'decamping' - DC is a real step down for such people, for example, even if the museums at least meet their standards, and for those with a taste for politics, well, the White House is not bad as a backdrop.

And though SF has historically been a wealthy city, can you name even two billionaires that were born and grew up in SF or the Bay Area? SF is a destination, in a way that NYC isn't, so decamping is at least something understandable. Though one has to agree that Thiel's ideology certainly does seem part of a vicious cycle. Possibly, New Zealand will be able to break that cycle, but who knows?

To borrow from Tom Wolfe, the very rich in NYC learned the lesson that "you've got to insulate, insulate, insulate!" and can do so in a way that their merely upper middle inferiors cannot, so the latter are the ones most likely to decamp.

Sure - but that seems to ignore that a lot of those 'merely upper middle inferiors' are not native New Yorkers in the first place.

To put it cynically, the very rich in NYC have known how to hire the best help for generations, regardless of the help's origins (like NJ).

So the conclusion is that crapping in the streets is a good thing for society?

Steve Jobs, Steve Wozniak, Marc Benioff, Tim Draper, and that's just off the top of my head. Lots of billionaires are from here, on this particular point you are way off.

'Here' being the Bay Area (where I am)

Excuse me, it’s referred to as The Yay.

'Why exactly would non-landowners press for improvements in their cities?'

Because if you are Starbucks, it makes sense to have more customers, not less? Just spitballing, of course.

James Kunstler would argue that those with pride in where they live would also press for improvements, but then, he is the type of public commentator who laments that America is incapable of creating a place like Ghent. Why, one could almost imagine he wrote this - '...walk around and ponder why we seem unable (or is it unwilling?) to build such compelling cities these days.' The Geography of Nowhere is not primarily concerned about economics, which explains why Kunstler would never write something like this - 'putting the gains from the higher quality of life into the pockets of landowners.' Likely, he would say such thinking is part of the problem, to be honest.

Along these same lines, "Why exactly would non-landowners press for improvements in their cities?" would be answered for the same reason people vote (civic duty, though at the margin, every vote is trivial, pace maybe the 2000 Presidential elections in Florida, which ex ante was impossible to forecast so even there the rule holds).

But if you are Starbucks in SF, you most likely have another way of thinking: "I will get my customers regardless of peeing on the streets, that's just how this city works, moreover, if I could get away with it, I would rather not have a public toilet in this cafe as well, as long as they pee on the streets"

I would assume you actually mean "pee on some other street".

Kunstler and Jacobs are-were big fans of the medium density city, pocket parks, pedestrian friendly etc. Residential buildings no more than five or six stories tall.

However nobody would argue that their model of cities would necessarily produce affordable living or tame rents in general. In short, there is a lot of nimbyism in their urbanism.

You can get rather high densities with residential buildings only five or six stories high provided they're stacked close enough together. (cf. Paris, Barcelona, etc.)

Total nonsense! Those people aren't on the streets because the rents are too high.

Here's why they are "peeing in the streets":

1. Most of the homeless are either mentally ill or are drug or alcohol addicts. They would not work for rent no matter how cheap the rent is. They save whatever money they get - SS or disability - for alcohol, illicit drugs, or goodies.

2. They live on the streets because the state, local, and federal government susidizes their lifestyle - cash payments, snap, free food, free meals, free clothing and other stuff from thrift stores and vaious non-profits. They get free legal advice and medical care. They even get free needles!

3. They are not on SF streets because they lost their housing, they are in SF and other coastal cities (like mine) because the weather is mild and the locals tolerate their heinous behaviour out of misguided compassion. That compassion just sustains the bad behaviour.

4. There is a circle around these encampments containing all the services they need. In my city, very close to SF, they are within walking distance of the homeless services center that provides housing (minimal, and not for bums and addicts) and many other services, the county health services center, the public library (a big bum hangout that stinks so bad my kids wouldn't enter when I tried to bring them there to do homework), numerous free meal centers, numerous free food (and many other goods) distribution centers.

5. A gaggle of ngo's that get sympathy funding from local bleeding hearts and depend on the homeless for their funding.

6. A cadre of leftist political activists that feed off the homeless just like the ngo's.

I saw a Thomas Sowell interview in which he said, "you can have all the homelessness you are willing to pay for."

SF is willing to pay, and it does.

I am really disappointed in Tyler on this one. It seems as if he's latching on to this to support his desire to loosen housing construction restictions. Unfortunately, it is just not that simple.

Come on down here Tyler and see for yourself. And while you are in SF, take a day or two to head south and see the "homeless" debacle in Santa Cruz, CA.

You can have all the homelessness you are willing to pay for.

I'm sorry for your feelings. Your very special snowflake feelings.

Don’t mock. There very much is a Poverty Industrial Complex, which both helps the indigent / impecunious in the short run but also enables them.

I suspect you are referring to the sort of creatures who used to be known as "poverty pimps" - social workers, community organisers, socialist politicians, and landlords subsidised to house the poor.

SF has homeless bums the same reason Central Park has pigeons. NYC now has multitudes of highly visible bums as well.

I used to be poor, but now I am impecunious.

"the public library (a big bum hangout that stinks so bad my kids wouldn't enter when I tried to bring them there to do homework)"
This is really sad. I'm fortunate to live in a town that, even with a sizable homeless population, has a great and well-used library that my children love. Having been to San Francisco's and Berkeley's libraries, though, I know that you're not exaggerating. Why do people tolerate this? Especially when the people who lose are kids, people who like books, and worst of all kids who like books.

Librarians used to be the Guardians of the Library, but apparently they know longer perform that function.

They aren't allowed to police the library - it is too dangerous.

They tolerate because they don't want to look moral monsters in front of their progressive friends.

Governments did not create homeless beggars. Read any ancient text. The problem might be that governments found the ratio per million of population to be a little inflexible.

(I would think the number of homeless at the library follows the population rule. Much better odds of encountering that in a city of millions than a town of thousands.)

I am referring to a small city of tens of thousands.

It is not an easy problem to solve, especially in the case of the mentally ill, who we should treat with love and generosity. They need medical treatment and mental health services. The drug and alcohol abusers are another matter.

You have to think on the margins more. People are not either mentally ill or completely sober minded. Some drug and/or alcohol addicts are good productive workers who can keep a home if the rent is low enough. Many are homeless difficult or impossible to help but there are those on the margins and the cheaper the housing the easier they are to help.

Those programs are good, and effective, which makes me think the homeless now are "the remainder."

Perhaps some more can be saved.

But libertarians take note, slashing such programs brings back more people with their hand out. You get a larger remainder.

"...you get a larger remainder."

Perhaps, but maybe not.

Cleaning up externalities leads to higher property values because more people now like the area and are therefore willing to pay higher rents.

Whoda thought.

I'm going out to pick up some litter in the neighborhood to keep up my property values.

By the way, when I do pick up the litter, and make my neighborhood more attractive, my property taxes go up.

Maybe I should have the city pick up the trash in the street; my property taxes will go up, and that will pay for it. Damn Gov'mt...they are the real Ricardian wealth extractors...here they improve the neighbor and tax me to pay for it in the form of taxes on my increased land rent. Shameful. Someone else should pay for it; not me.

I'm going to defecate in the most noticable parts of my neighborhood to keep my rent down.

NIMBYs also lead to cuckoldry in our bedrooms. It is a menace to society. A very bad thing.

Those people peeing in the streets aren't poor. They're just temporarily embarrassed tech gazillionaires.

In a sense, peeing in the street is like the Trump tax cuts then. A one-time way to get rid of pressure, that leaves a bad smell bad to your political enemy for long after.

Reducing crime in NYC greatly increased property values; thus, the nexus between Trump (Kushner, et al.) and His Honor the Mayor. Should property owners be assessed the taxes used to reduce crime, urination on the street, etc.? I suppose that they are in part because the increase in real estate values increases real estate taxes, but in NYC property taxes are actually very low (.80%) and in SF not much higher (about 1.2%). Cowen is right.

As the earth's temperatures and sea levels rise, who will pay the taxes in order to mitigate flooding in the coastal cities? That's going to be a very big issue. Everyone benefits from the mitigation, but especially the property owners (what's the value of a property that is partly submerged?).

On whom does the property tax incidence fall? In a competitive market in the renter in constrained market like San Fransisco on the owners.

The flooding will wash away the urine! Win-win!

Good point and good example.

Yes, I never thought I would see a Libertarian argument for increased property taxes that would pay for services that increased property values, and thereby sustainably supporting public services.

Unrelated note, what’s prop 13?

And does that affect tax incidence for landlords and the underlying incentive structure?

I’m going to aggressively post snarky comments on this without knowing.

But for Prop. 13 California would a Progressive Utopia, or at least that's what they say ad naseum.

There is support for Tyler's point in Chicago and in China. Real estate is always scarce, as 'location, location, location' comes down to being on one side of the street or the other, or one block or the next. While tenants would like to see the neighborhood improved physically - street cleaning, garbage pickup, street repairs, sidewalk repairs, better public landscaping - they know that improvements get reflected in rents. But property owners who cannot easily realize a value increase can also oppose improvements. Homeowners with limited incomes can oppose improvements because of the fear that taxes will rise faster than property values and there is no other location for them that is as suitable. In that case, the government captures the increase in value years before an owner can realize it in a sale. That is NIMBY to the core. In China, land is scarce - land costs are in the range of 70% of development costs. Apartment owners do relocate for a better school district, but moving is a far less common phenomenon than in the US. Physical improvements outside the apartment - even in what we would call limited common elements like stairways and elevators and hallways - are of no value when the value cannot be realized except in a sale, years or decades away. The result is that the interior of apartments can be spotless and thoughtfully decorated. Outside the door, in the stairway and on the street, there is no concern.

To what should the concern be directed? In a utilitarian sense it should be all about infrastructure. The streets shouldn't be networks of potholes, the sewers should run freely and potable water should be available. You're implying what so many do, that the appearance is what is important. Are the visuals in the city more important than traffic congestion?

'The political economy problem now should be obvious: Why exactly would non-landowners press for improvements in their cities? The value of those improvements will be captured mainly by other parties.'

This is the argument for anti-gentrification too. Don't make my neighborhood too nice because I'll be out on the street when young business professionals discover my cool slightly edgy part of town. The renovators will make money. The new renters will arbitrage a better location for relatively less rent. But the low income renter living in a substandard dwelling is put to the door, facing relocation and always higher rent.

There is an active conversation on this topic at the U of MN CURA.

Disincentiving improvements is a dangerous proposition which will only lead to a downward spiral of decay. Real estate can be patched up and milked along for so long until replacement of all the major mechanicals makes preservation impractical. At that point the only viable solution is to tear down and start over- the most expensive housing option.

Some local cities have chosen to ease the burden of a major apartment complex renovation by imposing a 90 day notice period, to allow residents more time to make alternate plans. This seems more like a political gesture to ease the desire to *do* something rather than one that changes the course of any of the renters' decisions. However, it acknowledges an important component in the problem solving of housing and real estate: time.

There are numbers for how frequently the average homeowner moves, and the average renter moves much sooner. And it is quite common for whole neighborhoods to turn over as one homeowner realizes that they are at the same transition phase-of-life as their recently departed neighbor. It would be wise for cities to sync into these natural flows to navigate public improvements.

I'm not very familiar with the *important* cities. But using them as case studies to solve urban problems seems about as useful as watching the TV series Dallas to figure out how to become an oil tycoon. Their populations are made up of extremes and are missing the brilliant and banal middle class that so consistently has been the societal savior for social issues. That is perhaps why the new movie Emilio Estevez produced about the homeless, The Public, is set in Cleveland and not San Francisco.

If renters were disincented to vote for improvements in their city you would expect to see that in their voting patterns...what you see is the opposite...renters voting for more city services.

But, where you see a divergence is where the so called "improvement" is a subsidy to a developer to build a new building (tax increment financing, direct payments, etc.) or stadiums, etc. So, for example, a real estate developer builds a high rise and says: so many units will be for affordable housing...pay me for it.

To elaborate, I’ve never understood prop 13. Those who believe incentives affect behavior are little capitalist Hitlers, and should be extinguished.

Booker, Warren, Gillibrand and Beto know that incentives don’t matter. We’re creating a mini paradise and the rest will follow. Go Warren!

Regarding the comment about NYC under investing in its subway system, I think the view of many is that because of incompetent and corrupt government officials, funds earmarked to improve the subways will likely not end up being used that way -- note the astronomical costs of construction in NYC way in excess of anywhere else in the world. Also note the political decision of the municipal government to cease prosecuting fare beating and the costs that that decision has incurred.

NYC also invests far more in its subway system than almost anywhere else in the USA.

"In a normal market economy, those higher rents would then induce more construction and, eventually, a corresponding decline in rents."

Oh, it has induced more construction and will continue to do so -- in other places. Tyler is so fixated on San Francisco, that he has a hard time seeing the rapid growth and increasing attractiveness of other cities over recent decades (Denver, Portland, Seattle, Phoenix, Austin, Nashville, Charlotte, Salt Lake City, etc). Large percentage of people living in the bay area express a desire to get out and SF doesn't seems to show up in the lists of place my kids' millennial friends would like to move (unlike, say, Portland, Seattle, and Denver). The SF housing problem isn't going to be solved politically, but it just won't matter that much. The tech industry is both maturing and losing glamour and support across the political spectrum. Apple's 'next big thing' is an effing credit card.

San Francisco exports the technology and biz org that makes newer destinations like Salt Lake City grow faster than the Mid-West or Mid-Atlantic cities.

In the trivial sense that tech firms in secondary cities use Amazon Web Services, etc. And there are tech hubs in the Midwest too. I live in one in Ann Arbor which is strong in network security, factory automation, and is becoming a center for autonomous vehicle R&D as well. But to the extent you think it's all SV exports, that strengthens the point (that land bottlenecks will redirect growth elsewhere).

The post war urbanist planning ideology of highways criss crossing and cutting up major metropolitan areas has done an enormous amount of damage to the look and feel of cities like Charlotte, Atlanta, Orlando, Houston, Boston, Dallas, Miami, And Tampa. As a result, there isn’t a ton of competitive “product” on the market in the US that can compete with San Francisco and New York.

Robert Moses may have run highways all through Queens and the Bronx but he never was able to destroy Manhattan or Brooklyn. As a result, their pre war Urban fabric is still largely intact plus all of the good architecture.

The post war cities mentioned above are stuck with all of that crap post war corporate junk architecture plus the post war highway cut throughs. All in all it doesn’t help the supply problem.

"Why exactly would non-landowners press for improvements in their cities? The value of those improvements will be captured mainly by other parties."

I guess I would have expected that San Francisco has a property tax tied to the value of the property, and that it uses the proceeds of that tax to fund services and improvements that benefit non-owners. Like excrement cleanup.

Prop 13 means that increases in property value have essentially no impact on property taxes for existing homeowners.

My home has increased in value by 30% over the last four years while my property tax bill has only increased by 8.2% as the bill can only increase by 2%/year according to the law.

That's nothing. In my old neighborhood, one owner is literally paying property tax that is 60 times what another owner of a similar property is paying (who lived there before 1978). 2% is just not enough of an increase to catch up to the increase in Bay Area real estate

The properties turn over and the new owners pay higher taxes.

There is plenty of tax money available, but it is sucked up by public employee unions - especially police, fire, teachers, and prison guards ( yes, in CA).

There is no money left over for roads, but plenty for political patronage.

It's good to be a public employee - defined benefit pensions, healthcare for life, paid holidays no one in the private sector gets, no call-in mental health days off, you name it ...

In fact, the problem here is it's such a good deal the government jobs attract over-qualified candidates - degreed high-tech refugees etc - which makes it hard for the city/county to meet their "diversity and inclusion" goals. Yes, that was a real issue.

Perhaps wise Frisco planners can begin to enforce standards of hypsographic demography: requiring residents to live along the tops of crests and ridges, urine would duly flow down into the topographic troughs of the area, which means that most urine flowing down Frisco streets and sidewalks winds up in the Bay, correct?)

(Are we to guess or assume that public urination in Frisco is gender neutral?)

Big cities with high homelessness have a problem .. that complete solutions are very expensive or perhaps legally impossible. Round them all up, screen them, hospitalize some, institutionalize others, put the remainder in transition programs.

Since they can't do that, cities are left with very piecemeal questions. Should there be more public toilets? Should they be open all night?
Where is tenting allowed? Who is going to police it all? What is the maintenance and clean up cost?

If I recall correctly, Mao sent trucks out to collect everyone who was on the streets and night, and sent them to the villages.

Would it be better if San Francisco could do that?

Speaking of China and what you can or cannot do, Chen Qiufan at Burning Man.

https://logicmag.io/07-the-chinese-burner/

Hasn't Utah (Salt Lake City) had some success with a Housing First approach? Get these people a roof over their head even if it's just an SRO, and then you can work of mitigating their other problems.

That is indeed one of the theories or hypotheses that some people advocate, get people in housing first and then you can try to improve their lives in other ways.

AFAICT it's still an open question about how effective this approach is. My knee-jerk reaction is it means a large proportion of public low-income housing will be filled with addicts, abusers, alcoholics, and the like, which to me does not sound like a route to successful public housing. But Housing First advocates would say that's a feature not a bug. If cities or even states are willing to experiment with Housing First, more power to them and let's see how well it works.

A better illustration of this effect is right across the SF Bay in Alameda vs. Oakland which are separated by a small slough/river (or sorts). On the Oakland side rents are low and things pretty terrible. Across the slough in Alameda things are much cleaner, neater (by local design mind you)...and way more expensive.

Alameda has more "good school districts." This is not complicated.

>Why exactly would non-landowners press for improvements in their cities?

Resident non-landowners bear the cost of disease, crime, etc?

Land owners renting the land would ultimately capture the increase in value of their land. Owners not renting but personally using their land only get a paper gain and a very real increase in tax burden. Not sure if that proves a wash or not.

The none owners may well get a highly valued non-pecuniary return from the improvements that outweigh the cost of increased pecuniary rents. Then it becomes the normal question about organizational costs and diverse interest I would say.

What are the empirical observations here -- is the demand for public improvements originating from land owners or the general, mostly renting but long term residents, population?

What is a credible way of distinguishing between NIMBYism and general bad governance?

Detroit and parts of Chicago have deteriorated quite a bit, Detroit since way back, Chicago more recently.

@EdR points out that you get more of what you pay for, which seems to this layman like a credible argument based on economics.

The most interesting part of the Bloomberg article is this comment:

"How long has it been since anyone built a completely new city in the US? Imagine what would happen if Bill Gates and Warren Buffet announced that they had acquired a city sized piece of real estate and that they were going to build a brand new city from scratch. Imagine the savings if they didn't have to tear down an existing building before building a new one? Or if they could build the subway first instead of last? The politicians in the existing cities would be screaming that the new city was going to attract all the best businesses and inhabitants with lower costs and leave the old cities with their legacy costs and problematic populations. NIMBYs are going to object to competition anywhere - not just in their own backyards."

There's never been a "completely new city" built all at once in the US. That's not how cities start and grow. In fact only China really does that, and the Saudis and Emiratis.

Good point, it is clear that China mis-allocates resources. The closest example of a US new city is Las Vegas, that grew from population 5K to 500K from 1930 to 2000, and this growth did depend on government investment in Hoover Dam, and the technological advance of affordable air conditioning.

Your argument that no new city has been built is strong in the sense that past behavior is the best predictor of future behavior, however, one could make the same argument about interracial marriage in 1960.

The private equity scam of taking over some chain, sell off real estate, load up on debt, take out the cash as dividends, sell the shell of the old company to a gullible buyer, like a group of blue city pension funds, and some IPO with huge kickbacks to financial planners is a form of legalized theft.

Moving people and businesses away from parasitic government entities that represent a drag on the economy based on unwarranted promises of pensions and union contracts made in the past could realize similar benefits, but is actually ethical. The problem is growing beyond a critical mass. Potential win-win sponsors would be autonomous vehicle companies, where retrofitting roads to be suitable for self driving cars is an unmanageable task suffering from too many competing interests and jurisdictions. But with a new city, infrastructure can be made right from the beginning, and much cheaper, as it doesn't have to be retrofitted.

You can ridicule the Galt's Gulch similarity as much as you want, but that doesn't remove the potential advantage of a new city. It might be that legacy costs have to be much higher before enough investors would be willing to cooperate, however, at one point it will make sense to not throw good money after bad money.

PS, Brasilia was a new city, but obviously not investment driven, unless you count the Brazilian equivalent of beltway bandits.

PPS, Given the high initial investment and coordination needed, it is much less risky for companies like Google and Apple to simply add new office space in cities like Austin rather than the Bay Area, perhaps getting a 50% discount on cost of new sites, and 20-30% discount on labor costs.

A true greenfield city is an attractive idea, but one of the rules for big systems is tha successful big systems evolve from small systems, rather than blank sheets of paper. Complexity is a real issue.

Navigating the border between NIMBY-ism and poor governance is precisely what the alderman in Chicago is supposed to do. Now I know one is not supposed to use the words "good" and "alderman" in the same sentence, but there are aldermen who work hard at finding that balance. It is a political process, not simply an economic one or a sociological one. Again, a China comparison - when cities are larger in area than many of our small states, with a more or less unified public fiscal system, the relocations for new development zones do not cause such local disruptions. There are losses from relocation of businesses and people, but the government is able to push relocation of others into empty spaces and there is no local loss of tax revenue that impoverishes the local government - or, less so than in the US. If US city regions had a unified public fisc, then most of the negative public effects of local relocations or expansions could be eliminated. Many suburbs outside Chicago would not exist if it were not for Chicago as a fundamental regional economic anchor, but they give nothing back in terms of the public fisc.

As to the "charter city" movement - we are supposed to be at least peripherally related to economics here. Just what will be the economy of the charter city if it is located on sufficiently virgin land? What happened to all of our knowledge about locational externalities and concentration benefits and supplier relationships? IMHO, the charter city movement aficionados needs to find something better to do with their time. Only in an economy in which the government (or billionaires) controls all the land as well as the ability of firms and people to relocate will the charter city work as advertised. And, bingo, one finds plenty of such examples in China.

" There are losses from relocation of businesses and people, but the government is able to push relocation of others into empty spaces and there is no local loss of tax revenue that impoverishes the local government - or, less so than in the US. If US city regions had a unified public fisc, then most of the negative public effects of local relocations or expansions could be eliminated. Many suburbs outside Chicago would not exist if it were not for Chicago as a fundamental regional economic anchor, but they give nothing back in terms of the public fisc. "

This sounds suspiciously like another Chicagoism: "You didn't build this"! If the local government is not operating in a sustainable manner, that is the problem, not that a business wants to relocate to outside what it projects will be the taxing limit of the local powerhouse for the next decades, and is thus "ungrateful". If the relationship between government, taxpayer and businesses is not parasitic, but relying on a value for value model, then there is no incentive to relocate.

"As to the "charter city" movement - we are supposed to be at least peripherally related to economics here. Just what will be the economy of the charter city if it is located on sufficiently virgin land? What happened to all of our knowledge about locational externalities and concentration benefits and supplier relationships?"

This is the activation energy that has to be overcome. It is indeed difficult

Why not see if Henry George's ideas could be implemented? If land owning tends toward oligopoly as in various European locales, with little if any turnover across the years, that is dead capital that only serves to benefit those lucky sperm club offspring. Add in some externality issues that never get addressed adequately by the economics community and you start to see some troubles emerging.

I wonder if that's where Tyler's going with all this, he mentions George and his land tax fairly often. On the whole I think a better policy would be a combination of reducing the power of NIMBYs by rolling back residents' ability to call for zoning restrictions, plus elimination of mortgage tax deductibility, i.e. reduce Americans' inclination to see their houses as savings vehicles instead of sources of housing services.

Tyler's diagnosed the problem quite well, the harder question is what's the best solution.

https://www.theguardian.com/money/2018/jul/19/radical-plans-to-end-huge-costs-of-buying-a-freehold-unveiled

"America needs its best cities to be centers of national and international innovation — to serve as role models and sources of new ideas. "

No. Federal entanglement will contribute nothing. New ideas are dreamed up in unincorporated areas as well as cities. And ideas from people in Seoul can be bought and imported. Let's not have any nationalism for me but not for their, now. Let the cities govern themselves into the ground. That is the most valuable example they will ever generate.

"Why exactly would non-landowners press for improvements in their cities? The value of those improvements will be captured mainly by other parties."

I don't think this is as solid a YIMBY argument as you think. YIMBYs here in Boomtown are always sticking up for the renters and young people and immigrants-not-yet-here, saying that these groups care very much, every bit as much, about the city, that the idea that home ownership gives one a greater stake or interest is unnatural and crazy, that the turnout of this equity-less and somewhat transient group to civic meetings would be much greater if you just: scheduled the meeting at 10 AM or 8 PM or 3 AM, or provided dinner and childcare, or had no meeting at all but did it all online; that renters are practically disenfranchised by virtue of the extreme enfranchisement and engagement of the NIMBYs whose cardinal sin is that They Turn Out so reliably.

Why do otherwise intelligent people think that if San Francisco would only allow developers to build high-rise apartments everywhere that everybody could afford them? Or if they've ever wondered why San Francisco is San Francisco instead of Oakland?

What percentage of tenured academic economists live in single-family housing? I bet around 75%.

It's called the law of supply and demand. It's a pretty well-established theory in economics, so much so that they call it a "law".

Of course, don't worry, those progressive bay area politicians can just repeal it...

Yes, I know about the supply-demand curve. Therefore, if only San Franciscans were allowed to build skyscrapers, like they do in Manhattan and Hong Kong, everybody will be able to afford to live in San Francisco like they can in Manhattan and Hong Kong, right?

This has been a minor issue that can evolve to major one, they need some action to sort this out, simple waste removal daily will definitely help. Discipline is a must, most especially to the people who is residing in the area.

I was reading in a San Francisco business journal, can't recall which, sorry, that did a study on the number of SRO rooms that have been taken off the market by landlords. It was in the neighborhood of 10000 units, including whole SRO hotel buildings, that lie empty. When a tenant moves out they simply take it off the market and let it sit. The remaining SROs are at near 100% occupancy, because they are the last 'affordable' option for many working poor/middle class. Obviously the building owners of these vacant property have decided its to their economic advantage not to rent them out. The city needs to crack down on these reluctant landlords and free up these units for rental.

Comments for this post are closed