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How Portland Is a Lot Like Texas

Thu, 11/26/2015 - 21:38

One theme I always hammer is that you have to look at proposed policy solutions in the context of the area where you want to apply them.

A great example of this is Portland’s Urban Growth Boundary (UGB). The UGB, a policy that limits suburban development outside of a line drawn around the Portland region, is widely admired and perhaps even seen a type of holy grail policy in terms of preventing sprawl.

Obviously restricting development outside the UGB raised demand for land inside of it and thus housing prices. Portland’s median home price multiple – that is, the median home price divided by the median household income – is 4.8. The average household in Portland would need to spend 4.8 times its annual income to buy a house there.  This compares with 2.9 in Kansas City, 3.0 in Columbus, and 3.9 in Austin.

So Portland is less affordable than many similar sized housing markets around the US.

But despite this, Portland remains the most affordable major West Coast metro area.  That’s because housing prices in other major coastal cities are even higher, including Seattle (5.2), Los Angeles (8.0), San Diego (8.3), the Bay Area (9.2), and Vancouver (10.6).

So even while its home prices have risen, Portland remains the cheapest major city to live apart from Sacramento (4.7).  That is, even with the UGB Portland has a big cost advantage over its regional competition. In short, it’s cheap.

In this way, the attraction of Portland is a lot like Texas. Its draw is more a cost arbitrage play for people leaving San Francisco than an upgrade to superior urbanism from the interior. As it happens, California refugees make up the bulk of the net migrants into Portland.

The Texas comparison is relevant on the tax front too. Portland is one of the rare places you have the potential for double border tax arbitrage. Washington state has no income tax and Oregon has no sales tax. While only a limited number of people can take advantage of both (you have to both live and work in Washington to avoid the income tax), being able to zero out one or more major tax categories is a win.

This is not to say that Portland is a lousy place to live. It’s fantastic as near as I can tell. The point is that Portland was able to put in place policies to create good enough urbanism to lure a certain number of San Franciscans without compromising its competitive position because it was in a high cost neighborhood.

The story would be very different for a place like Oklahoma City or Columbus. These cities are in low cost regions, and if they undertook policies that raised their housing prices, they’d rapidly find themselves the most expensive market in their area.

Cloning Portland’s UGB is simply not a viable policy for most interior cities, even if they had the political alignment to make it happen.

There are many policies that can be broadly implemented across cities. The general principle is to first understand why a policy worked in the original context, then ask whether it is applicable to the target context, and if so how to implement it most successfully.

Aaron M. Renn is a senior fellow at the Manhattan Institute and a Contributing Editor at City Journal. He writes at The Urbanophile, where this piece originally appeared.

The Detached iHome of the Future

Wed, 11/25/2015 - 09:22

Will new American housing growth continue to reflect old methods, or will the land development, home building, and consulting industry retool, re-educate, and collaborate to create a new era of more attractive, livable, efficient, and environmentally responsible growth at attainable prices?

Here is why it would be so significant to make a change: The US Department of Housing has determined that 620,000 new single family homes were completed in 2014, averaging 2,453 square feet on an 8,689 square foot average lot. The average price was $345,800, with a national total of $214.4 billion.

Those post-recession 620,000 homes have used up much of the existing empty suburban lots from the recession. Assume that 30 percent of a development is consumed by infrastructure, and that typical 8,689 square foot lot represents about 12,400 square foot of growth. That means we have newly-developed — or recently consumed — about 275 square miles of construction, using lot stock. In other words, now that the existing lots are consumed, future growth will annually consume more than 275 square miles of land.

That development, at $214 billion dollars in home value, is the equivalent of a $650 iPhone 6s for every US resident. Unlike the iPhone that is assembled in a minute, though, a single family home is built by craftsmen over many months in a development that takes years to go through the approval and construction process.
An iPhone is a marvel of technology, representing billions in research and development, and requiring close communication and collaboration between professionals in engineering, materials, software, and manufacturing.

The design for the $345,800 home and its neighborhood progress at a snail’s pace. Both floor plans and site plans are rooted in the 1960s, with civil engineering standards from the 1950s handbook. The professionals involved in land development design and construction — surveyors, planners, civil engineers, and architects — are a most un-collaborative group, fostering this stagnation.

Yet today, innovations in both technology and methods can empower the consulting industry to create neighborhoods and housing that matches the progress of other industries, like those that are creating mobile phones, cars, and medicines. Savvy developers and home builders are beginning to break free, setting new trends by merging planning, architecture, and engineering.

Of those 620,000 homes, it’s likely that only a few custom built ones had a tight coordination between the room function, the wall and window locations, and the connection to the surrounding viewsheds.

When land is ‘subdivided,’ the streets, and afterwards the lot lines, are all set to regulatory minimums. This method ‘stretches’ the public street to create the greatest volume of street and the smallest area available for lots. The compression of space forces cookie-cutter, mundane growth. Architectural design was traditionally an afterthought to the subdividing process.

To develop alternative approaches, we used the ‘down-time’ during the recession to research and develop new geometric relationships between lot and home, as well as to develop better spatial analysis and design software to accomplish 'Architectural Blending' for the mass market single family home.

We saw how advancements in land planning have been made possible by merging engineering and surveying geometry with organic site layout methods. This combination has proven to significantly reduce infrastructure (street-utility length), while increasing average lot area. Redistributed space allows for more flexible designs.

The merging of interior and exterior spaces, ‘Architectural Blending,’ was first implemented in a design idea coined as ‘BayHomes.’ The term came from the bay-like shape of common open spaces that undulated between home fronts. In 1999, Professional Builder Magazine called BayHomes "New Urbanism with a View."

BayHomes are single family detached homes set within townhome zoning, thus, they are in association-maintained environments. They were first implemented in 1998 on The Greens of Hutchinson, Minnesota, offering production housing that coordinated living spaces within the home with adjacent spaces and views, and for the first time merged planning and architecture at attainable prices. Since The Greens, there have been thousands of BayHome designs that have refined the method.

BayHomes are positioned to provide a panoramic view from the focal point, usually the kitchen, to common spaces adjacent to the home front. BayHomes hide the garages, which makes them ideal along arterial streets to create a ‘village-like’ appearance. By eliminating most of the public street right-of-ways, compared to traditional single family homes the BayHome can achieve duplex density with plenty of landscaped open space providing a lower density feel.

BayHomes serve a specific consumer who would have otherwise bought a duplex or townhome. The large scale housing market has been and will remain single family homes.

The next problem became: How to duplicate advantages of a BayHome in a single family home which must front a lot on a public street? The challenge to increase available space was solved through a design technique called coving. A rectangular lot is simple: You have few options — no side views and limited front and rear yards space — whereas ‘coving’ produces a larger, non-rectangular lot, yet still maintains the density of the rectangle.

When we looked at some traditional designs that would fit on higher density narrow lots, we saw typical floor layouts where — for example — 8.1 percent of the home was consumed by the hallway. If the home cost $200,000, then $16,000 was the cost of the hall. By merging planning and architecture, new models are more efficient within higher density single family-home neighborhoods, reducing or eliminating these common forms of waste within and around the home.

With a new era of design we can solve problems like these, as well as critical issues. The problem with increased density is the compaction of space, sacrificing livability, efficiency, curb appeal, views, and environment. Some may argue that the environment is not harmed by increased density, ignoring that while the lot and home size is reduced, streets, walks, garages, and other infrastructure elements remain the same size as larger lots. Thus, the ratio of housing footprint to paved areas serving the home increases, and ‘organic’ (landscaped) space is sacrificed.

As the home buying public becomes aware that it's possible to have a home of significantly higher value than the typical monotonous design rooted in the 1960s, and that it can be located in a neighborhood of greater character, they will demand change with their pocketbooks. They will be able to look at the streetscapes of nearby cookie cutter subdivisions, and see that neighborhoods of the same density can have a dramatic increase in function, curb appeal, views, safety, efficiency, connectivity, and perception of space. The differences will be as dramatic as comparing a dial phone of the 1960s to the iPhone of today.

Rick Harrison is President of Rick Harrison Site Design Studio and Neighborhood Innovations, LLC. He is author of Prefurbia: Reinventing The Suburbs From Disdainable To Sustainable and creator of Performance Planning System. His websites are and

Aerial view of Transoma, a community planned on the principles of coving, from the author.

Tech Titans Want to be Masters of All Media We Survey

Mon, 11/23/2015 - 21:38

The rising tech oligarchy, having disrupted everything from hotels and taxis to banking, music and travel, is also taking over the content side of the media business. In the process, we might see the future decline of traditional media, including both news and entertainment, and a huge shift in media power away from both Hollywood and New York and toward the Bay Area and Seattle.

This shift is driven by several forces: the power of Internet-based communications, the massive amounts of money that have accumulated among the oligarchs and, perhaps most important, their growing interest in steering American politics in their preferred direction. In some cases, this is being accomplished by direct acquisition of existing media platforms, alliances with traditional firms and the subsidization of favored news outlets. But the real power of the emerging tech oligarchy lies in its control of the Internet itself, which is rapidly gaining preeminence in the flow of information.

This transition is being driven by the enormous concentration of wealth in a few hands, based mostly in metropolitan Seattle and Silicon Valley. In 2014, the media-tech sector accounted for five of the 10 wealthiest Americans. More important still, virtually all self-made billionaires under age 40 are techies. They are in a unique position to dominate discourse in America for decades to come.

In recent years, like Skynet in the “Terminator” series, the oligarchs have become increasingly aware of their latent power to shape both the news media and the political future. A prospectus for a lobbying group headed up by Mark Zuckerberg’s former Harvard roommate, suggests tech will become “one of the most powerful political forces.” The new group’s “tactical assets” include not only popularity and great wealth but the fact that “we control massive distribution channels, both as companies and individuals.”

Read the entire piece at The Orange County Register.

Joel Kotkin is executive editor of and Roger Hobbs Distinguished Fellow in Urban Studies at Chapman University, and a member of the editorial board of the Orange County Register. He is also executive director of the Houston-based Center for Opportunity Urbanism. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is also author of The City: A Global History and The Next Hundred Million: America in 2050. He lives in Orange County, CA.

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2014 Journey to Work Data: More of the Same

Sun, 11/22/2015 - 21:38

The major metropolitan area journey to work data is out, reported in the American Community Survey ‘s 2014 one year edition. The news is that there is not much news. Little has changed since 2010 despite all the talk about “peak car” and a supposed massive shift towards transit. Single occupant driving remains by far the largest mode of transport to work in the 53 major metropolitan areas (with over 1,000,000 population), having moved from 73.5 percent of commutes to 73.6 percent. Little upward change in single occupant commuting can be expected, since it is probably already a virtual saturation rate.

The only significant change is the most important trend that is occurred for decades in US commuting: the reduction in carpooling. Between 2010 and 2014, carpooling dropped from 9.8 percent to 8.8 percent in the major metropolitan areas.

Transit continued to hold on to third place, with an increase from 7.9 percent to 8.1 percent in the major metropolitan areas. Working at home, including telecommuting, continued its more dramatic rise, from 4.4 percent in 2010 to 4.7 percent in 2014. Walking remained constant at 2.8 percent, while cycling continued its increase but from a small 0.5 percent to 0.7 percent. Other modes of transport, such as taxis and motorcycles remained constant at 1.2 percent (Figure 1).

In the major metropolitan areas, transit continued to lead over working at home (8.1 percent compared to 4.7 percent), though at the national level the margin was much smaller (5.2 percent compared to 4.5 percent). Transit strength was far more concentrated principally in a few metropolitan areas with “legacy” cities and, as a result, working at home exceeded transit's market share in 39 of the 53 markets.

Should carpooling continue its downward trend, it would fall below transit before the end of the decade among the major metropolitan areas (now at 8.8 percent compared to transit 8.1 percent), though the carpooling lead is sufficient to retain second-place far longer at the national level (9.2 percent compared to 5.2 percent). As in working at home, however, transit's strength is highly concentrated relative to carpooling. Transit leads carpooling only in the six metropolitan areas with transit legacy cities (New York, Chicago, Philadelphia, San Francisco, Boston, and Washington), while carpooling leads in 47 metropolitan areas.

Commuting market share data for the major metropolitan areas is shown in Tables 1 and 2.

Transit Gains and Losses

With by far the most attractive urban environment for transit use in the United States and far and away the largest system, New York dominated the transit share of the  journey to work data, adding 240,000 daily transit commuters between 2010 and 2014 (out of a national total of 576,000). Six other metropolitan areas with the strongest transit gains were San Francisco at 66,000, Chicago with 41,000, Boston with 38,000, Seattle with 34,000 and Washington with 32,000. All of these were above the next highest, Philadelphia, with 16,000. Each of these metropolitan areas, with the exception of Seattle, has a transit legacy city at its core. Overall the other 45 metropolitan areas, with nearly 70 percent of the population, accounted for less than 20 percent of the transit increase.

Los Angeles, which has been hailed as the becoming "next transit city," seems long on intentions and construction, but wanting in results.  The laggard transit performance of Los Angeles, despite one of the world's most aggressive rail construction programs has been described in a recent Orange County Register commentary. In 2014-2015, ridership on the legacy MTA (former SCRTD) bus and rail system was almost 10 percent below the bus only system of 1985, despite an increase in the Los Angeles County population of approximately one-quarter (see: Los Angeles; Rail for Others).

Thirteen metropolitan areas experienced modest transit commuting losses (less than 3,000). In addition to Los Angeles, these included rail metropolitan areas Virginia Beach-Norfolk, San Diego, Buffalo, Cleveland, and Pittsburgh.

Working at Home Gains and Losses

The largest working at home gain was also in New York, at 40,000 (out of 499,000 in the major metropolitan areas). The second largest gain was in Los Angeles at 32,000. San Diego added 27,000 people accessing work from home. Four metropolitan areas lost commuters who work at home, though the losses were modest (less than 1,000) in all but Virginia Beach-Norfolk, where the decline was more than 11,000.

Driving Alone Gains, No Losses

New York also led in the number of additional commuters driving alone to work, adding more than 420,000. The other largest gainers were in Los Angeles at 325,000 and Houston at 309,000. All of the 53 major metropolitan areas added single occupant commuters and in each single occupant commuting added more than any other mode, including transit. Rochester had the smallest increase, at 7,000.

Carpool Gains and Losses

Despite its continuing overall losses, carpooling made gains in some metropolitan areas. Detroit led with nearly 14,000 new carpoolers, followed closely by Orlando, Portland, and Dallas-Fort Worth both added more than 10,000 new carpoolers, adding more commuters than their rail oriented transit systems.

However, the car pool losses were generally more severe. Chicago lost nearly 36,000 carpooling commuters. Los Angeles lost 30,000, New York lost 29,000 and Tampa-St. Petersburg lost 19,000. Losses of more than 10,000 were also sustained in Washington, St. Louis, San Diego, Pittsburgh, Phoenix, Memphis, Baltimore, and Boston.

Cycling Gains and Losses

New York also gained the most cycling commuters, at nearly 14,000, followed by San Francisco at 13,000, Los Angeles at 10,000. Eight metropolitan areas lost cycling commuters, but only two exceeded 250, Grand Rapids (800 loss) and Riverside-San Bernardino (700 loss).

More of the Same

U.S. commuters continue to travel to work using the modes that have dominated for decades, with the exceptions of substantial increases in working at home and big losses in car pooling. Though even in these modes, the changes are slight in view of the dominance of single-occupant commuting, as Figure 1 indicates. This is not surprising, commuters who drive alone reach virtually anywhere in the metropolitan area and nearly always at a faster speed than any other method of commuting, save working at home.

Table 1 Transit Work Trip Market Share: 2014 Major Metropolitan Areas (53 over 1,000,000 Population) MARKET SHARE               MSA Drive Alone Car Pool Transit Bicycle Walk Other Work at Home Atlanta, GA 77.6% 10.3% 3.1% 0.2% 1.4% 1.4% 6.2% Austin, TX 76.6% 10.1% 2.5% 0.7% 1.7% 1.5% 6.9% Baltimore, MD 77.2% 8.2% 6.6% 0.3% 2.6% 1.1% 4.0% Birmingham, AL 85.2% 9.1% 0.5% 0.2% 1.1% 1.1% 2.9% Boston, MA-NH 67.6% 6.8% 12.9% 1.0% 5.3% 1.2% 5.1% Buffalo, NY 82.3% 7.7% 3.0% 0.4% 2.9% 0.9% 2.9% Charlotte, NC-SC 81.0% 9.4% 1.9% 0.2% 1.4% 1.1% 5.1% Chicago, IL-IN-WI 70.9% 7.7% 11.9% 0.7% 3.2% 1.2% 4.5% Cincinnati, OH-KY-IN 82.8% 7.9% 2.1% 0.3% 2.0% 0.8% 4.1% Cleveland, OH 82.3% 6.8% 3.2% 0.3% 2.6% 0.9% 3.9% Columbus, OH 83.0% 7.7% 1.8% 0.5% 2.1% 0.7% 4.4% Dallas-Fort Worth, TX 80.8% 9.9% 1.6% 0.2% 1.2% 1.7% 4.6% Denver, CO 76.3% 8.8% 4.5% 0.9% 2.0% 0.8% 6.6% Detroit,  MI 84.0% 9.0% 1.6% 0.3% 1.3% 0.8% 3.1% Grand Rapids, MI 81.6% 8.9% 1.7% 0.3% 2.2% 1.4% 4.0% Hartford, CT 81.4% 7.8% 2.7% 0.2% 2.6% 1.1% 4.2% Houston, TX 80.3% 10.7% 2.4% 0.3% 1.3% 1.6% 3.4% Indianapolis. IN 84.2% 8.5% 1.2% 0.3% 1.3% 0.7% 3.8% Jacksonville, FL 80.4% 9.7% 1.2% 0.6% 1.2% 1.7% 5.2% Kansas City, MO-KS 83.4% 8.5% 1.0% 0.2% 1.2% 1.0% 4.7% Las Vegas, NV 77.6% 10.2% 4.8% 0.5% 1.6% 2.3% 3.1% Los Angeles, CA 74.6% 9.7% 5.8% 1.0% 2.5% 1.3% 5.1% Louisville, KY-IN 81.8% 9.5% 2.0% 0.3% 1.7% 1.0% 3.7% Memphis, TN-MS-AR 84.9% 8.6% 1.0% 0.1% 1.1% 1.7% 2.6% Miami, FL 78.7% 8.9% 3.7% 0.6% 1.7% 1.4% 5.0% Milwaukee,WI 80.6% 8.4% 3.5% 0.5% 2.6% 0.8% 3.6% Minneapolis-St. Paul, MN-WI 77.3% 8.6% 4.8% 1.0% 2.4% 0.9% 4.9% Nashville, TN 81.7% 9.8% 1.3% 0.2% 1.6% 0.8% 4.6% New Orleans. LA 79.2% 9.7% 3.1% 1.3% 2.3% 1.5% 2.9% New York, NY-NJ-PA 50.2% 6.4% 31.1% 0.6% 6.0% 1.5% 4.2% Oklahoma City, OK 82.8% 10.1% 0.4% 0.4% 1.5% 1.1% 3.7% Orlando, FL 79.8% 9.9% 2.0% 0.6% 0.9% 1.2% 5.6% Philadelphia, PA-NJ-DE-MD 73.0% 7.8% 9.7% 0.6% 3.7% 0.8% 4.3% Phoenix, AZ 77.0% 10.5% 2.1% 0.9% 1.5% 1.9% 6.1% Pittsburgh, PA 77.5% 8.1% 5.6% 0.4% 3.4% 0.8% 4.1% Portland, OR-WA 70.0% 10.2% 6.5% 2.6% 3.3% 1.0% 6.4% Providence, RI-MA 81.1% 7.9% 2.8% 0.5% 3.4% 0.9% 3.5% Raleigh, NC 80.0% 9.0% 1.0% 0.2% 1.3% 1.1% 7.3% Richmond, VA 81.8% 9.1% 1.7% 0.4% 1.6% 1.2% 4.2% Riverside-San Bernardino, CA 77.4% 13.3% 1.6% 0.3% 1.7% 1.0% 4.7% Rochester, NY 82.5% 6.9% 2.5% 0.7% 3.1% 0.7% 3.7% Sacramento, CA 76.4% 10.2% 2.7% 1.8% 2.0% 1.3% 5.5% Salt Lake City, UT 74.9% 12.2% 3.8% 0.8% 2.1% 0.8% 5.3% San Antonio, TX 80.0% 10.8% 2.1% 0.2% 1.7% 0.9% 4.3% San Diego, CA 76.0% 8.6% 2.7% 0.8% 2.9% 1.4% 7.5% San Francisco-Oakland, CA 59.2% 9.4% 16.7% 2.2% 4.7% 1.6% 6.2% San Jose, CA 76.2% 10.4% 4.0% 1.6% 1.7% 1.2% 4.8% Seattle, WA 69.0% 9.8% 9.6% 1.2% 3.6% 1.1% 5.7% St. Louis,, MO-IL 82.7% 7.3% 2.9% 0.3% 1.8% 0.8% 4.1% Tampa-St. Petersburg, FL 81.1% 7.4% 1.5% 0.9% 1.5% 1.7% 5.9% Virginia Beach-Norfolk, VA-NC 82.4% 8.2% 1.6% 0.5% 3.0% 1.2% 3.1% Tucson, AZ 77.0% 9.1% 2.9% 2.1% 2.5% 2.0% 4.5% Washington, DC-VA-MD-WV 66.1% 9.7% 14.3% 0.8% 3.1% 1.0% 5.1% Major Metropolitan Areas 73.6% 8.8% 8.1% 0.7% 2.8% 1.2% 4.7% Outside Major Metropolitan Areas 80.4% 9.8% 1.2% 0.5% 2.7% 1.2% 4.1% United States 76.5% 9.2% 5.2% 0.6% 2.7% 1.2% 4.5% From American Community Survey: 2014 (1 Year)


Table 2 Transit Work Trip Market Share: 2010 (2008-2012 ACS) Major Metropolitan Areas (53 over 1,000,000 Population) MARKET SHARE               MSA Drive Alone Car Pool Transit Bicycle Walk Other Work at Home Atlanta, GA 77.6% 10.7% 3.2% 0.2% 1.3% 1.4% 5.6% Austin, TX 75.0% 11.3% 2.6% 0.8% 1.8% 1.9% 6.6% Baltimore, MD 76.3% 9.7% 6.3% 0.3% 2.7% 0.9% 3.9% Birmingham, AL 84.0% 10.6% 0.7% 0.1% 1.1% 0.6% 3.0% Boston, MA-NH 68.8% 7.9% 11.9% 0.9% 5.3% 0.9% 4.4% Buffalo, NY 81.8% 8.1% 3.5% 0.4% 3.0% 0.9% 2.4% Charlotte, NC-SC 80.5% 10.4% 1.8% 0.1% 1.4% 0.9% 4.9% Chicago, IL-IN-WI 70.9% 8.8% 11.3% 0.6% 3.1% 1.1% 4.2% Cincinnati, OH-KY-IN 82.6% 8.7% 2.2% 0.2% 2.1% 0.7% 3.6% Cleveland, OH 82.1% 7.8% 3.5% 0.3% 2.1% 0.8% 3.4% Columbus, OH 82.6% 8.2% 1.6% 0.4% 2.1% 0.8% 4.2% Dallas-Fort Worth, TX 80.9% 10.5% 1.5% 0.2% 1.2% 1.3% 4.5% Denver, CO 75.7% 9.5% 4.5% 0.9% 2.1% 1.2% 6.0% Detroit,  MI 84.2% 8.7% 1.6% 0.2% 1.4% 0.8% 3.1% Grand Rapids, MI 82.8% 8.9% 1.2% 0.5% 1.9% 0.7% 3.9% Hartford, CT 81.0% 8.2% 3.1% 0.2% 2.7% 1.0% 3.8% Houston, TX 79.2% 11.7% 2.4% 0.3% 1.4% 1.6% 3.4% Indianapolis. IN 83.6% 9.0% 1.1% 0.3% 1.7% 0.8% 3.6% Jacksonville, FL 81.1% 9.9% 1.3% 0.6% 1.4% 1.3% 4.4% Kansas City, MO-KS 82.9% 9.2% 1.2% 0.2% 1.3% 1.0% 4.1% Las Vegas, NV 78.5% 11.1% 3.7% 0.4% 1.8% 1.5% 3.0% Los Angeles, CA 73.6% 10.8% 6.1% 0.9% 2.7% 1.2% 4.9% Louisville, KY-IN 82.9% 9.3% 2.1% 0.3% 1.7% 0.8% 2.9% Memphis, TN-MS-AR 82.8% 10.7% 1.3% 0.1% 1.3% 1.0% 2.8% Miami, FL 78.2% 9.8% 3.7% 0.6% 1.8% 1.4% 4.5% Milwaukee,WI 79.9% 9.2% 3.6% 0.5% 2.8% 0.7% 3.2% Minneapolis-St. Paul, MN-WI 78.1% 8.6% 4.6% 0.9% 2.3% 0.8% 4.7% Nashville, TN 81.5% 10.4% 1.1% 0.2% 1.2% 0.9% 4.6% New Orleans. LA 79.0% 10.9% 2.6% 0.8% 2.4% 1.6% 2.6% New York, NY-NJ-PA 51.0% 7.1% 29.9% 0.5% 6.1% 1.6% 3.9% Oklahoma City, OK 82.9% 10.4% 0.5% 0.3% 1.6% 1.1% 3.3% Orlando, FL 81.1% 9.3% 1.9% 0.5% 1.1% 1.7% 4.5% Philadelphia, PA-NJ-DE-MD 73.4% 8.2% 9.4% 0.6% 3.7% 0.8% 3.8% Phoenix, AZ 76.4% 11.9% 2.1% 0.8% 1.6% 1.6% 5.6% Pittsburgh, PA 76.9% 9.3% 5.7% 0.2% 3.6% 0.9% 3.5% Portland, OR-WA 71.2% 9.7% 6.1% 2.2% 3.5% 1.0% 6.3% Providence, RI-MA 80.8% 8.8% 2.7% 0.3% 3.2% 0.9% 3.3% Raleigh, NC 80.6% 9.6% 1.0% 0.3% 1.4% 1.2% 5.9% Richmond, VA 81.3% 9.6% 2.0% 0.4% 1.4% 0.8% 4.5% Riverside-San Bernardino, CA 76.2% 14.4% 1.6% 0.4% 1.8% 1.1% 4.4% Rochester, NY 81.4% 8.4% 1.9% 0.5% 3.6% 0.7% 3.5% Sacramento, CA 75.1% 11.6% 2.7% 1.8% 2.0% 1.2% 5.6% Salt Lake City, UT 75.9% 12.0% 3.5% 0.8% 2.3% 1.2% 4.3% San Antonio, TX 79.1% 11.5% 2.2% 0.1% 1.9% 1.2% 3.9% San Diego, CA 75.9% 10.2% 3.1% 0.7% 2.7% 1.1% 6.3% San Francisco-Oakland, CA 61.5% 10.3% 14.7% 1.7% 4.3% 1.4% 6.0% San Jose, CA 76.5% 10.4% 3.2% 1.7% 2.1% 1.4% 4.7% Seattle, WA 69.7% 11.0% 8.3% 1.0% 3.6% 1.1% 5.3% St. Louis,, MO-IL 82.6% 8.4% 2.5% 0.3% 1.7% 0.8% 3.7% Tampa-St. Petersburg, FL 80.3% 9.5% 1.4% 0.7% 1.6% 1.4% 5.2% Virginia Beach-Norfolk, VA-NC 80.6% 9.0% 1.8% 0.4% 2.6% 1.1% 4.4% Tucson, AZ 76.5% 10.3% 2.4% 1.5% 2.5% 2.0% 4.8% Washington, DC-VA-MD-WV 66.0% 10.6% 14.0% 0.6% 3.2% 0.9% 4.7% Major Metropolitan Areas 73.5% 9.6% 7.9% 0.6% 2.8% 1.2% 4.4% Outside Major Metropolitan Areas 80.8% 9.8% 0.9% 0.5% 2.7% 1.2% 4.2% United States 76.6% 9.7% 4.9% 0.5% 2.8% 1.2% 4.3% From American Community Survey:2008-2012


Wendell Cox is Chair, Housing Affordability and Municipal Policy for the Frontier Centre for Public Policy (Canada), is a Senior Fellow of the Center for Opportunity Urbanism (US), a member of the Board of Advisors of the Center for Demographics and Policy at Chapman University (California) and principal of Demographia, an international public policy and demographics firm.He is co-author of the "Demographia International Housing Affordability Survey" and author of "Demographia World Urban Areas" and "War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life." He was appointed to three terms on the Los Angeles County Transportation Commission, where he served with the leading city and county leadership as the only non-elected member. He served as a visiting professor at the Conservatoire National des Arts et Metiers, a national university in Paris.

Photo: Harbor Freeway (I-110), Los Angeles (by author)

Cherry Hill: The Winners

Fri, 11/20/2015 - 21:38

This is Cherry Hill. It is by far the most desirable suburb in this part of southern New Jersey as measured by all the usual metrics. Property values are high. Public schools are great. The municipal government is lean and responsive. This is as good as the American Dream gets.


The families who live here are overwhelmingly well educated professionals, often first and second generation immigrants who have discovered the high quality of life on offer. What was once a nearly 100% white enclave is now a diverse multi-cultural community. You’re just as likely to live next door to Hindus, Jews, Greek Orthodox, or Muslims, as the main line Protestants that dominated the area in previous decades. When proponents of suburban living talk about the success of the suburban development pattern this is the kind of place they often refer to.

If you’re raising children you really can’t ask for a better environment. It’s safe, clean, and (most importantly) your kids will rub shoulders with the kids of equally successful families – which is what exclusive suburbs and premium school districts are really all about. Cherry Hill has successfully filtered out the riffraff.

Cherry Hill has a middle-of-the-road population when it comes to social issues, but it’s decidedly conservative when it comes to money. It has embraced all the usual cost savings techniques to keep the budget tight and taxes as low as possible. Traditional in-house departments have been dissolved in favor of contract services with low cost private firms for things like waste management, school buses, and landscaping. Sales tax revenue has been boosted by cultivating the most successful regional shopping mall in the area. Class A suburban office parks deliver commercial property taxes to help subsidize the shortfall from residential taxes.

And yet… there are problems. The average homeowner in Cherry Hill pays about $8,000 a year in property tax. Some of the larger homes pictured above pay on the order of $23,000 a year. You can blame teachers and cops and their “extravagant” salaries and pensions, but schools and public safety are the primary attractions to living in Cherry Hill. Outsourcing to low wage alternatives for these public services may not really work over the long term – although Cherry Hill keeps pushing that envelope. And the cost of maintaining a huge amount of very expensive attenuated public infrastructure like roads, sewers, and water pipes is rapidly getting out of control.

Here’s another problem with Cherry Hill. This is what passes for the public realm. All the emphasis has been placed on private space. The homes, the tree lined subdivisions, the quality retail establishments, and the hermetically sealed professional centers are pristine. But in between there’s nothing that even comes close to a pleasant commons. Route 70 is “Main Street.” That’s all you get. Of course, the people who self select in to Cherry Hill don’t care. They’re inside their homes, shops, offices, and cars 100% of the time. There’s simply no need for a public realm. It’s a fully private pay-per-view environment.

Unless you’re one of these poor bastards standing on the side of the highway waiting for a bus that may or may not arrive sometime within the next hour. These people can’t afford to live in Cherry Hill or own private vehicles so they commute on crappy inadequate public transit to and from neighboring low income suburbs.

Cherry Hill is a giant wealth sponge. It soaks up the segment of the population that can afford to live the best version of a suburban life. That means there are many other suburbs – the vast majority – that become the also-ran towns of fair-to-middling suburbs with just-okay schools and mediocre shops. And then there are the lower income suburbs farther out that can’t quite manage to bootstrap themselves up above the poverty line.

The dominant conversation in America today centers on the bleakness of inner city ghettos and the extravagance of newly gentrified urban elite neighborhoods. The reality is that most Americans live in the suburbs. A small number of people live in a few great places like Cherry Hill. The overwhelming bulk of the population, including the poor and large downwardly mobile middle class, now live in failing cheap anonymous declining suburbs that no one talks about – until they erupt Ferguson style.

I’m just sayin.

John Sanphillippo lives in San Francisco and blogs about urbanism, adaptation, and resilience at He's a member of the Congress for New Urbanism, films videos for, and is a regular contributor to He earns his living by buying, renovating, and renting undervalued properties in places that have good long term prospects. He is a graduate of Rutgers University.

The Cities Where Your Salary Will Stretch The Furthest 2015

Thu, 11/19/2015 - 21:38

Average pay varies widely among U.S. cities, but those chasing work opportunities would do well to keep an eye on costs as well. Salaries may be higher on the East and West coasts, but for the most part, equally high prices there mean that the fatter paychecks aren’t necessarily getting the locals ahead.

To determine which cities actually offer the highest real incomes, Mark Schill, research director at Praxis Strategy Group, conducted an analysis for Forbes of the 53 largest metropolitan statistical areas, adjusting annual earnings by a cost factor that combines median home values from the U.S. Census (20%) with a measure of regional price differences from the U.S. Bureau of Economic Analysis (80%).

The takeaway: When cost of living is factored in, most of the metro areas that offer the highest effective pay turn out to be in the less glitzy middle part of the country. 

Ranking first is the Houston-the Woodlands-Sugar Land metro area, followed by one high-cost outlier: San Jose-Sunnyvale-Santa Clara, Calif., aka Silicon Valley. Although average wages in the San Jose area are $38,000 higher than Houston’s $60,096, the much lower cost of living in Houston means residents there are effectively slightly better off. Adjusted for costs, Houston’s average real income is $62,136. A big contributing factor is Houston’s low home prices: the ratio of the median home price there ($215,000 in the third quarter) to median annual household income is 3.1, compared to 7.5 in the San Jose area (median 3Q home price: $795,000).

San Jose’s high ranking is somewhat of an anomaly: the very high salaries paid by the tech industry in a metro area made up of largely affluent suburban communities go a long way to make up for the high prices. San Jose’s prices were the third highest among major U.S. metro areas in 2013, the most recent year for which the BEA has data — 21.3% above the national average — while the average annual wage of $98,247 as of this year ranks first.

Another example of a higher-cost success story is the Hartford, Conn., metro area, which ranks fourth on our list with adjusted annual real earnings of $54,590. One of the lowest-density regions in the country, it boasts many small, prosperous communities with high housing prices surrounding a largely impoverished but small core city (population: 125,000 ). In 2011, the Harford metro area was ranked by Brookings as the most productive metropolitan region in the world.

But for the most part, it’s the low-cost heartland that dominates the top 15 of our ranking of Cities Where Your Salary Stretches The Furthest. Manufacturing powerhouse Detroit-Warren-Dearborn ranks third with cost-adjusted annual earnings of $55,950. The metro area is comfortably affordable, including an average home price value of $136,400, but also boasts strong wages given the area’s high concentration of factory and engineering jobs, which tend to pay better than other industries, particularly for blue-collar workers.

Low costs are an advantage that unites a number of the top-ranked heartland metro areas, including Cleveland-Elyria (seventh), where prices of goods and services are 10.5% below the national average, and Cincinnati (ninth), where prices are 9.5% below the national average. In all these areas, the cost of a house is about 20% of what passes for normal in Silicon Valley.

Hip, But Increasingly Not Worth It

Perhaps the biggest surprise in our survey is the low rankings of the “cool” cities that are widely discussed as the places that offer the best economic opportunities.

Take for instance San Francisco, a city that has become the epicenter of “disruptive” tech companies Uber, Lyft, Airbnb, that are changing our service economy, as well as Twitter. With an average annual salary of $74,794, you would think people would be fat and happy in Baghdad by the Bay. But soaring home prices — median value, $657,300 — have raised costs so high that the area ranks a poor 41st on our list.

The tech boom has also raised prices in Austin, which ranked fifth when we last did this ranking in 2012, but falls to 19th this year. Over the past year, the average home value in the Texas capital has risen by $24,000, twice the increase experienced in the rest of the country. Median prices now average $217,9000, well above the national median of $188,000 for all large metropolitan regions. This is still not ridiculous, but costs do seems to be eroding some of Austin’s still powerful advantage.

Similarly, greater New York City also fared poorly, ranking 33rd, in large part due to high housing prices and the overall cost of living: prices there are 22.3% above the national average, according to BEA data, making it the second-costliest metro area in the nation.

Some of the biggest gaps between cost of living and salary are in Southern California, which has experienced significant house price gains without the income growth that makes San Jose more competitive. Already high, prices in San Diego-Carlsbad (51st), Los Angeles-Long Beach-Anaheim (52nd) and Riverside-San Bernardino (last among the 53 largest metro areas) have all risen considerably above the national average.

Long-Term Implications

Our paycheck analysis does not impact everyone equally. Given the central role of housing, for example, long-term residents who bought their homes before prices began to rise dramatically can keep a bigger portion of their take-home pay, and if they decide to sell, they’ll benefit greatly from inflated values. More directly impacted may be young adults and immigrants, most of whom do not own their own homes, and often lack the resources to buy in the more expensive markets.

Over time this could influence where young families and singles chose to migrate. Since 2010, according to an upcoming study by Cleveland State’s Center for Population Dynamics, there has been a marked shift of college educated workers aged 25 to 34. While between 2008 and 2010, metro areas like San Francisco, New York, Los Angeles, San Jose and Chicago enjoyed the biggest upticks in this coveted population, over the most recently studied period, 2010-13, the leaders were generally less expensive places like Nashville, Pittsburgh, Orlando, Cleveland, San Antonio, Houston and Dallas-Ft. Worth.

This suggests that areas that have both high-wage jobs and low costs are likely to gain momentum in coming years, particularly if the economy expands. This is not to say that people do not like the excitement and culture associated with San Francisco, Los Angeles or New York, but many may be finding that the price of admission to these fabled places may be too high.

This could be a great opportunity for less-heralded communities, from Arizona and Texas to Ohio, to gain more educated workers and the companies that require them.

Metropolitan Average Annual Earnings Adjusted for Cost of Living and Home Values Rank MSA Name Adjusted Ave Annual Earnings 1 Houston-The Woodlands-Sugar Land, TX $62,136 2 San Jose-Sunnyvale-Santa Clara, CA $56,147 3 Detroit-Warren-Dearborn, MI $55,950 4 Hartford-West Hartford-East Hartford, CT $54,590 5 Dallas-Fort Worth-Arlington, TX $54,497 6 Atlanta-Sandy Springs-Roswell, GA $53,922 7 Cleveland-Elyria, OH $53,841 8 Pittsburgh, PA $53,726 9 Cincinnati, OH-KY-IN $53,405 10 St. Louis, MO-IL $53,115 11 Charlotte-Concord-Gastonia, NC-SC $52,508 12 Birmingham-Hoover, AL $51,710 13 Kansas City, MO-KS $51,460 14 Memphis, TN-MS-AR $51,339 15 Boston-Cambridge-Newton, MA-NH $50,373 16 Columbus, OH $50,369 17 Chicago-Naperville-Elgin, IL-IN-WI $50,351 18 Nashville-Davidson--Murfreesboro--Franklin, TN $50,168 19 Austin-Round Rock, TX $50,154 20 Minneapolis-St. Paul-Bloomington, MN-WI $50,117 21 Indianapolis-Carmel-Anderson, IN $49,790 22 Oklahoma City, OK $49,771 23 Seattle-Tacoma-Bellevue, WA $49,514 24 Philadelphia-Camden-Wilmington, PA-NJ-DE-MD $48,976 25 Louisville/Jefferson County, KY-IN $48,807 26 Milwaukee-Waukesha-West Allis, WI $48,341 27 Denver-Aurora-Lakewood, CO $48,287 28 Washington-Arlington-Alexandria, DC-VA-MD-WV $48,102 29 Buffalo-Cheektowaga-Niagara Falls, NY $48,071 30 New Orleans-Metairie, LA $47,956 31 San Antonio-New Braunfels, TX $47,837 32 Rochester, NY $47,660 33 New York-Newark-Jersey City, NY-NJ-PA $47,649 34 Jacksonville, FL $47,230 35 Raleigh, NC $47,164 36 Richmond, VA $47,002 37 Grand Rapids-Wyoming, MI $46,480 38 Phoenix-Mesa-Scottsdale, AZ $46,281 39 Tampa-St. Petersburg-Clearwater, FL $45,826 40 Baltimore-Columbia-Towson, MD $45,184 41 San Francisco-Oakland-Hayward, CA $45,082 42 Portland-Vancouver-Hillsboro, OR-WA $44,451 43 Salt Lake City, UT $43,857 44 Sacramento--Roseville--Arden-Arcade, CA $43,254 45 Miami-Fort Lauderdale-West Palm Beach, FL $42,976 46 Las Vegas-Henderson-Paradise, NV $42,960 47 Providence-Warwick, RI-MA $42,827 48 Orlando-Kissimmee-Sanford, FL $42,463 49 Tucson, AZ $42,264 50 Virginia Beach-Norfolk-Newport News, VA-NC $42,226 51 San Diego-Carlsbad, CA $37,395 52 Los Angeles-Long Beach-Anaheim, CA $35,691 53 Riverside-San Bernardino-Ontario, CA $34,040 Figure is the average annual wages, salaries and proprietor earnings adjusted for cost of living usine BEA Regional Price Parities (80%) and variation in Census median home value among the 53 regions (20%). Data Sources: EMSI 2015.2 Employment Data, U.S. Bureau of Economic Analysis Regional Price Parities, U.S. Census American Community Survey Analysis by Mark Schill,


This piece first appeared at

Joel Kotkin is executive editor of and Roger Hobbs Distinguished Fellow in Urban Studies at Chapman University, and a member of the editorial board of the Orange County Register. He is also executive director of the Houston-based Center for Opportunity Urbanism. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is also author of The City: A Global History and The Next Hundred Million: America in 2050. He lives in Orange County, CA.

Photo by w:Flickr user Bill Jacobus [CC-BY-2.0], via Wikimedia Commons

When Detroit Stood Tall and Shaped the World

Wed, 11/18/2015 - 21:38

My recent post about how urban planning decisions helped lead to the Motown sound in Detroit was inspired by David Maraniss’ new book Once in a Great City: A Detroit Story.

The book takes a deep dive into Detroit 1963, a city that was, although in some ways already in decline, in others near its zenith.

It’s a great read, in particularly for the depth of characterization. Too often Detroit writing is a story of heroes, villains, and victims. Maraniss rejects that approach and provides mostly nuanced portrayals of Detroiters that allows them to be the actual real, red-blooded human beings that they are.

I just posted a review of the book over at City Journal.  Here’s an excerpt:

In his new book, Once in a Great City: A Detroit Story, Pulitzer Prize winner David Maraniss takes a fascinating and engrossing look at the Motor City during this fateful year. Under Henry Ford II (“the Deuce”) and hard-charging salesman Lee Iacocca, the Ford Motor Company was set to unveil its revolutionary Mustang. The civil rights struggle was creating tensions in Detroit and elsewhere, but Mayor Jerome Cavanagh was committed to addressing discrimination and reforming the police. Detroit was about to transform the American musical landscape with Motown Records, whose roster of superstar artists included Smokey Robinson, Diana Ross and the Supremes, Stevie Wonder, and Marvin Gaye. The United States Olympic Committee even nominated Detroit as the American representative to host the 1968 summer Olympics, though it lost out to Mexico City. On the more dubious side, the mafia had a powerful presence in the Motor City, where colorful mob boss Tony Jack Giacalone rode around town in his garish “Party Bus” painted blue and silver, the colors of the NFL’s Detroit Lions.

Click through to read the whole review or buy the book.

Aaron M. Renn is a senior fellow at the Manhattan Institute and a Contributing Editor at City Journal. He writes at The Urbanophile, where this piece originally appeared.

China’s Demographics at a Turning Point

Tue, 11/17/2015 - 21:38

For decades, the decline in China’s birth rate was a big boost for the economy. What now?

This week, schadenfreude could have been a word invented for China experts if you judge by some of the commentary surrounding the country’s lifting of its one-child policy. Most got it right that the legacy of the one-child policy is now a problem for the Chinese economy because of a rapidly rising old-age dependency ratio (green line in the first chart below). This was tacitly acknowledged by the lifting of the policy.

But many got it wrong that the one-child policy has always been a problem for the Chinese economy since its inception. The cause of their error is the inclination in some quarters to merge a political and moral issue with an economic one, as if to press the point that unfree and coercive decisions are not only bad eventually for the economy, but bad always and from day one. Unfortunately, economic accountability does not come instantaneously after coercive policies are implemented. Politicians are lucky in that the ultimate consequences of their decisions can take years or even decades to finally be seen in full relief.

Before this occurs, the more immediate and proximate result of a bad policy may in fact be hugely positive for a long time. The reason is that a bad policy can borrow prosperity from the future, or in other words, front-load prosperity to the detriment of future generations. By enacting a policy that pulls prosperity forward, the present can look like a boom but the future then has to contend with the reversing undertow of that same policy.

At any rate, it is right that a free society focuses on the one-child policy’s encroachment on personal freedom and on the unintended consequence of a lopsided male-female ratio. But ignoring these very important issues for a moment, it must also be said that the one-child policy was in fact a significant contributor, arguably even a critical enabler, of the Chinese boom of the past few decades.

(The chart shows China’s dependency ratios: Total DR in blue; Child DR in red; Old-age DR in green. Source: UN Population Division. See definitions in footnotes.)

There is no mystery here because the chain reaction is well understood by demographers and economists, albeit perhaps forgotten or ignored by some this week. As the Chinese fertility ratio declined, so did the total and child dependency ratios (blue and red lines in the chart), opening a window of opportunity for a demographic dividend.

China’s policymakers managed to seize on this window to accelerate the economy. Here business dynamism, economic policy and the large expansion of trade with the US, Europe, Japan and other economies made a big difference and allowed the country to capitalize on the opportunity and to reap a large demographic dividend.

But there is no free lunch in economics or indeed in demographics. The long-term effect of the one-child policy was to pull prosperity forward by crashing the dependency ratio faster and generating a demographic dividend that was far larger than would have been if households had had more children.

Without the one-child policy, China’s dependency ratio would have fallen more slowly between 1980 and 2010 and may have looked more like India’s (chart below). The decline would have been less pronounced in 1980-2010 and therefore the demographic dividend less great, but the climb would be less steep now and therefore the future less challenging. See Demography Charts – 1 for dependency ratios of other countries.

BRIC Countries Total Dependency Ratios

With only one child to support aging parents, the dependency ratio has started a climb that will continue for several decades. Should the removal of the one-child policy result in more children, this would in the near term push the dependency ratio to rise even faster. As sure as demography was a tailwind in the years 1990-2010, it will be a headwind for decades to come.

This does not mean that the Chinese economy will be weak for decades. Demographics is only one component among many and economies can adapt to changing conditions. Should there be a surge in Chinese innovation and/or new reforms to raise productivity, China could very well skirt or mitigate the coming demographic challenge.

China’s target for annual real GDP growth is now 6.5%, compared to nearly 10% on average since 1980.  These figures must be seen against the backdrop of a working-age population that rose steadily from 500 million in 1975 to a billion in 2015, and that is expected to level off and contract to 920 million by 2035. See also Working Age Population Around the World 1960-2050.

Here are a few notable recent articles on the one-child policy:

  • Harvard Professor Amartya Sen writes in the New York Times that the empowerment of women had more to do with China’s declining fertility ratio than did the one-child policy. This is credible on the one hand because the fertility ratio had already declined significantly by the time the policy was enacted. But it is not wholly credible on the other hand because it does not square with the issue of selective abortions. It seems odd that empowered women would have a bias for male children. Perhaps the chronology of events must be examined more closely in order to validate Professor Sen’s thesis.
  • Several commentators are quoted in this other New York Times article and most get it right. Many agree with Harvard Professor David Bloom’s statement that “the economically active share of the population will fall, reversing the demographic dividend that has figured so prominently in China’s rapid economic growth over the past few decades”. Fred Hu, founder of Chinese investment firm Primavera Capital Group, argues that “what drives China’s future in the next two or three decades is not the population. It is whether future leaders can continue to push ahead political and economic reforms.”
  • In this Wall Street Journal piece, economist Nicholas Eberstadt seems to ignore the demographic dividend when he writes that “the one-child mandate is the single greatest social-policy error in human history.” As argued above, this is true from the point of view of individual freedom, and maybe true for the Chinese economy going forward, but certainly not true for that economy from 1980 to today.


The total dependency ratio is the ratio of the population aged 0-14 and 65+ to the population aged 15-64. They are presented as number of dependents per 100 persons of working age (15-64).

The child dependency ratio is the ratio of the population aged 0-14 to the population aged 15-64. They are presented as number of dependents per 100 persons of working age (15-64).

The old-age dependency ratio is the ratio of the population aged 65 years or over to the population aged 15-64. They are presented as number of dependents per 100 persons of working age (15-64).

Sami Karam is the founder and editor of and the creator of the populyst index™. populyst is about innovation, demography and society. Before populyst, he was the founder and manager of the Seven Global funds and a fund manager at leading asset managers in Boston and New York. In addition to a finance MBA from the Wharton School, he holds a Master's in Civil Engineering from Cornell and a Bachelor of Architecture from UT Austin.

Top photo by Rex Pe from Savannah, Georgia, USA (student teacherUploaded by Adrignola) [CC BY 2.0], via Wikimedia Commons

Too Many Places Will Have too Few People

Mon, 11/16/2015 - 21:38

The adage “demographics are destiny” is increasingly being replaced by a notion that population trends should actually shape policy. As the power of projection grows, governments around the world find themselves looking to find ways to counteract elaborate and potentially threatening population models before they become reality.

Nowhere is this clearer than in China’s recent announcement that it was suspending its “one child” policy. The country’s leaders are clearly concerned about what demographer Nicholas Eberstadt has labeled “this coming tsunami of senior citizens” with a smaller workforce, greater pension obligations and generally slower economic growth.

A second example is Europe’s open migration policy. Despite widespread opposition by its own citizens, and cost estimates that run to a trillion euros over 30 years, Europe’s political and business leaders regard migration as critical to address the Continent’s aging demographics. Germany knows it may not be able to keep its economic engine running without a huge influx of workers.

In defense of the migration policy, European Union economists project that refugees from the Middle East, Africa and Central Asia could boost Europe’s GDP by 0.2 percent to 0.3 percent by 2020.

This all speaks to a kind of demographic arbitrage between countries with aging demographics and those with youth to spare. Half the world’s population already lives in countries with fertility rates below replacement level (2.1 per woman).

Read the entire piece at The Orange County Register.

Joel Kotkin is executive editor of and Roger Hobbs Distinguished Fellow in Urban Studies at Chapman University, and a member of the editorial board of the Orange County Register. He is also executive director of the Houston-based Center for Opportunity Urbanism. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is also author of The City: A Global History and The Next Hundred Million: America in 2050. He lives in Orange County, CA.

Photo "Nursery Cart" by flickr user Pieterjan Vandaele

Berlin: The Imperial Impulse in City Planning

Sun, 11/15/2015 - 21:38

"He who controls Berlin, controls Germany, and who controls Germany, controls Europe." V.I. Lenin (but also attributed to Karl Marx, and sometimes to Otto von Bismarck)

About the time that Syrian refugees were on the march to Germany’s safe havens, I spent a few days in Berlin, which is not only the capital of reunified Germany, but the unofficial capital of the European Union, as well as being hipster ground zero.

The Europe that united under the EU — the New Europe — was predicated on a weak, federal Germany surrounded by strong members such as France, Britain, and Italy. On paper, the EU has its headquarters in Brussels and, for one week a month, in Strasbourg (to placate the envious French). But the Union's power emanates from Berlin, where Angela Merkel — the latest Iron Chancellor — has made most of the EU decisions concerning the Greek bailout and Syrian emigrants. The EU has become a ward of the Teutonic Knights, where solvency and peace come only from German diktats.

Does the modern city of Berlin speak about a resurgent Germany (über alles, so to speak), or about the ability of the Union to tame the excesses of German nationalism?

Since Germany united in 1989 the success of reunification has often been measured in the bright lights and new buildings that have spread across Berlin, from West to East. Once a Cold War no-man’s land, the Potsdamer Platz is now a crossroads on Architectural Digest walking-tour maps, while the worker housing in the East has been recycled into studios and sidewalk bistros for hi-tech executives and skateboarders.

For the past twenty years, I have believed that a healthy and vibrant Berlin could only mean good things for the European Union. It meant that reunified Germany was working, that Russia was at bay, and that in the New Europe there were enough new jobs to service the debt on the leveraged buyout of Eastern Europe.

On this trip to Berlin, however, I glimpsed the other side of the German coin, which is that as Germany succeeds — economically and politically — the European dream will become ever more distant.

What did I see in Berlin that made me doubt the future of the European Union?

On the surface, Berlin is a success story, with open-topped tourist buses crisscrossing the city and new restaurants. Old working-class neighborhoods such as Prenzlauer Berg and Kreuzberg have gotten facelifts, and the city’s infrastructure of railroad stations, banks, and conference centers glistens.

In other, more subtle ways, however, the city seems to be fulfilling the dreams of Adolf Hitler and his architect, Albert Speer, to turn Berlin into a capital of the thousand year Reich, even if, for now, it is a dream of admirable intentions.

Take the $600 million gilded palace of the Humboldt Forum that is being built on Museum Island, just off Unter den Linden, the imperial boulevard of Prussian dreams.

Swathed in marble frontage, the reconstructed palace dwarfs much that is nearby, including several classical museums. The web site descriptions make it sound like an elaborate visitors’ center, however, with nebulous goals:

The Humboldt Forum is a novel centre for exhibitions, events, and human encounter in the heart of Berlin. Museums, a library and a university will pool their competencies and create a lively place where knowledge about the cultures of the world can grow and be exchanged. In this, the Humboldt Forum distinguishes itself from the traditional idea of the ethnographic museum.

It's difficult not to recall that Hitler, when he spoke to Speer about the purpose of the nearby New Reich Chancellery on Voss Strasse, said, “On the long walk from the entrance to reception hall they’ll get a taste of the power and grandeur of the German Reich!”

* * *

On this trip, I had the use of a bicycle — until it was stolen — to ride around the city, including along Unter den Linden. Graffiti is still visible on the last fragments of the Wall; elsewhere, I came across some posters of the far-right National Democratic Party (NPD), with turbaned immigrants and the tag line: “Have a good flight home.”

I first saw united Berlin in December 1989, a month after the Wall came down, when it was a city in liquidation. As if in the Berlin airlift, I flew on a Pan American jet from Frankfurt, and in a friend’s small Trabant toured West and East Berlin, which felt, respectively, like Manhattan and Brooklyn, in the days before gentrification. The Kurfürstendamm had the brand-name franchises of New York’s Fifth Avenue, while East Berlin felt like the far reaches of Bensonhurst.

This time, on foot (post-bike theft), I saw a united Berlin, but one with many cracks in the sidewalks. I found a street on which the English writer Christopher Isherwood, whose fiction inspired the play and movie Cabaret, had lived. His building was destroyed in the war, and the replacement speaks of the temporary housing that became permanent. If writing now about the city’s decadence, he might describe its bureaucracies — Humboldt is run by the Prussian Cultural Heritage Foundation — rather than its cabarets.

Another thing I did was go around to Berlin's bookstores, and was surprised at how mediocre many were. Yes, they had book club novels and Hitler histories, but everything looked second-hand, not fresh off presses with any new ideas about the European Union, Mrs. Merkel, or Berlin. Has Germany discovered the end of history?

* * *

Before the bike vanished, I did take it up and down the Wilhelmstrasse to see what remains of Hitler’s and Bismarck’s Berlin. The city doesn’t have much from Bismarck's era as the head of the German government. He wanted Berlin at the head of a unified Germany. When he got what he wanted in 1871, he realized (although it was too late for him to do much about it) he had the rest of Europe as his enemies.

Likewise, the imperial masquerade of Speer’s Berlin went up in the smoke of the World War II. Hitler mandated him to draw boulevards wider than the Champs-Élysées, and reception halls vaster then the cathedral at Rheims. It was to have been Rome on steroids.

In his memoirs, published in the 1970s, Speer describes a Hitler consumed with architectural ambitions, as if his military and political aggression was just to make the world safe for his city planning. The two spent countless hours discussing castles in the air, or an imperial way from the south Berlin station to a Great Hall near the Reichstag.

There was to have been an oversized Arch of Triumph, and various Nazi ministries housed behind those faceless façades of National Socialism that spoke of government by diktat. Looking back on his dreams, however, Speer wrote of the Grunewald forest, “Of the whole vast project for the reshaping of Berlin, these deciduous trees are all that have remained.”

Matthew Stevenson, a contributing editor of Harper’s Magazine, is the author most recently of Remembering the Twentieth Century Limited, a collection of historical travel essays, and Whistle-Stopping America. His next book, Reading the Rails, will be published in 2015. He lives in Switzerland.

Flickr photo by Nigel Swales: Billboard announcing construction on the now-completed Schlossplatz - Berliner Schloss (Humboldt Forum); a modern building housing museums and offices, but with the façade of the original city palace.

12 Ways to Map the Midwest

Fri, 11/13/2015 - 21:38

What is the Midwest? There’s been a lot of debate about this question among folks passionate about such thing. But it defies easy definition. Here are eleven ways various people have taken a crack at drawing the map.

Traditional Maps

1. The Northwest Territory

Start with the original Northwest Territory, now sometimes referred to as the Great Lakes region. This is the historic core of what we now think of as the Midwest.

Image via

2. Midwest Census Division

The Census Bureau has an official definition of the Midwest, which is one of four so-called “Census Divisions.” This is further divided into two “Census Regions” as in the map below.

Census Divisions and Regions

Ethnic and Cultural Definitions

Others have attempted to draw maps based on shared ethnicity and culture. These tend to deny the existence of an actual Midwest as we think about it today.

3. Nine Nations of North America

One of the most famous of these is from Joel Garreau, who made a claim that there were actually nine nations on the North American continent in his book of that same name.

Joel Garreau’s Nine Nations

4. Eleven Nations of North America

Colin Woodard took this a step further and argued that there were really eleven nations in North America, which he identifies based on settlement patterns. You can see his writeup on this in an article in Tufts Alumni magazine.

Colin Woodard’s 11 Nations

Economic Definitions

Other maps try to define a region based on shared economic characteristics such as industries.

5. The Rust Belt

Here’s a map of the Rust Belt that’s floating around the I found on a website about coal communities of all places. I’m not sure exactly where it originated.

The Rust Belt

Hybrid Definitions

These maps attempt to use both shared cultural/historical and economic characteristics to define a Midwest region.

6. Richard Longworth’s Midwest

In his book Caught in the Middle: America’s Heartland in the Age of Globalism, Richard Longworth created his own bespoke definition of the Midwest. He notably excludes the southern regions of Missouri, Illinois, Indiana, and Ohio as extensions of the south (similar to the 9 & 11 nations map), and also the pure play Great Plains states along the western edge of the Census definition.

Richard Longworth’s Midwest

7. Pete Saunder’s Five Midwests

Pete combines the nations approach with the traditional Census definition of the Midwest in order to divide the Midwest into five sub-regions.

Pete Saunders’s Five Midwests

8. Kotkin’s American Regions and City-States

Joel Kotkin took a similar approach to dividing America up in Forbes magazine. His view also appears to be a hybrid of culture, economics, and history. He turns America into seven regions and three city-states (New York, LA, and Miami). The full map is too huge to blog, but an excerpt is below which you can click on to see the whole thing in a new window.

The Midwest in Kotkin’s map

Crowdsourced Maps

A couple of other people used crowdsourcing, in whole or in part, to define the Midwest

9. Walter Hickey/538 Map

Walter Hickey, writing at 538, conducted a survey with Survey Monkey to ask people which states they thought were in the Midwest. Here’s what he came up with.

Walter Hickey/538 Map

10. miguecolombia’s Reddit Map

Here’s one that I found on a Reddit thread started by user miguecolombia. It appears to be his personal take on how to divide America, with a strong dose of crowdsourcing from Reddit.

miguecolombia and Reddit’s map

Self-Defining Maps

And a couple maps that try to use statistical techniques to let the Midwest map itself.

11. Facebook Network Maps

Pete Warden took a look at Facebook profiles and connections to create clusters of regions. Most of what we’d think of as the Midwest he called Stayathomia, which also covers much of New England.

Pete Warden’s Map

12. Chicago Migration Map

Lastly, a special surprise – a map you’ve never seen before. This was created by someone named Daniel Jarratt, who emailed it to me back in 2012. Using Chicago as the capital of the Midwest, he used IRS migration data and a statistic technique called modularity to divide the US into regions based on affinity with Chicago. Darker red means more connection to Chicago and thus in a sense more Midwest.

Daniel Jarratt’s Midwest

Aaron M. Renn is a senior fellow at the Manhattan Institute and a Contributing Editor at City Journal. He writes at The Urbanophile, where this piece originally appeared.

Top photo by Benjamin Reed (flying over the midwestUploaded by France3470) [CC BY-SA 2.0], via Wikimedia Commons

How Land Use Regulations Hurt the Poor

Thu, 11/12/2015 - 21:38

Sandy Ikeda and I have published a new Mercatus paper on the regressive effects of land use regulation. We review the empirical literature on how the effects of rules such as maximum density, parking requirements, urban growth boundaries, and historic preservation affect housing prices. Nearly all of the studies on the price effects of land use regulations find that — as supply and demand analysis would predict — these rules increase the price of housing. While the broad consensus on the price effects of land use regulations is probably to no surprise to Market Urbanism readers, some policy analysts continue to insist that in fact rules requiring detached, single family homes help cities maintain housing affordability.

Ed Glaeser, Joseph Gyourko, and Raven Saks estimate the effects of regulations on house prices in their paper “Why Is Manhattan So Expensive? Regulation and the Rise in Housing Prices.” They estimate what they call the “zoning tax” in 21 cities. The zoning tax indicates the proportion of housing costs that are due to land use regulations. The chart below shows the percentage of housing costs that this “tax” accounts for:

The zoning tax as calculated by Edward Glaeser, Joseph Gyourko, and Raven Saks in “Why Is Manhattan So Expensive? Regulation and the Rise in House Prices” (2003).

Policies that increase housing costs have a clear constituency in all homeowners, but they hurt renters and anyone who is hoping to move to an expensive city. The burden of land use regulations are borne disproportionately by low-income people who spend a larger proportion of their income on housing relative to higher income people. These regressive effects of land use policy extend beyond reducing welfare if the least-advantaged Americans. Additionally, rules that increase the cost of housing in the country’s most productive cities reduce income mobility and economic growth.

In our paper Sandy and I also discuss proposals for reducing the inefficiency of cities’ current land use regulation practices. David Schleicher has proposed some of innovative policy improvements, including a zoning budget that a city can implement to commit itself to permitting a certain amount of new development. A zoning budget would create a situation in which local policymakers are forced to make tradeoffs between different land use restrictions, as opposed to the current situation in which there is no limit to policies restricting building. Another proposal that Schleicher suggests is a tax increment local transfer, or a TILT. With TILTs, homeowners who live near new development would receive some portion of the additional property taxes that the city raises by allowing the development. The purpose of TILTs is to reduce NIMBY opposition to development.

We hope that our paper will be a helpful resource to those looking for an accessible overview of this area of research and point to future research opportunities for institutional reforms to allow for the construction of affordable housing.

This piece first appeared at Market Urbanism.

Emily Washington is a policy research manager for the Mercatus Center at George Mason University. She manages the Spending and Budget Initiative and State and Local Policy Project portfolios. Her writing has appeared in USA Today, The Christian Science Monitor, Economic Affairs, and The Daily Caller. She contributes to the blogs Neighborhood Effects and Market Urbanism.

Public Transport’s Biggest Problem: The Public (That’s Us)

Wed, 11/11/2015 - 21:38

When’s the last time you heard some futurist or management guru suggest that in the future more of us will be working at the same desk doing routine tasks on a predictable working week schedule? No? That’s just one of many problems that advocates of limitless spending on public transport need to keep in mind in dealing with the issue of urban congestion.

Increasing urban congestion is said to cost the economy dearly and if Infrastructure Australia is to be believed, it will cost even more in the future unless something is done now. They warn the current estimate of a $13.7 billion annual cost will balloon to $53 billion by 2031.

Congestion is without dispute a handbrake on economic productivity but the range of solutions for reducing congestion range from the outright zany (see Elizabeth Farrelly’s suggestions  for Prime Minister Turnbull as one example) to milder versions of zany. They all tend to be very expensive and many impose unacceptable compromises on our basic freedoms (such as proposals to ban cars from cities).

Increased investment in public transport is a feature of many proposed solutions for alleviating congestion. It is true that we have under-invested in public transport systems in past decades and it’s equally true that we’ve under-invested in private transport. Basically, we’ve cheered a rising population while passing the buck for funding and delivering the infrastructure needed to support that growth to future generations. Rising congestion levels are making it feel like crunch time now.

But there are valid questions about the capacity of public transport to alleviate congestion which are rarely getting asked. Rather than a magical silver bullet, there are a few things to keep in mind before you climb aboard the merry bandwagon of limitless investment in public transport…

The nature of work is changing. Public transport systems work best on a hub and spoke model of employment and commuting, built on predictable schedules designed around predictable commuter needs. Central business districts of very high employment concentrations, where people work in the same workplace from day to day and for the same hours each day, are ideal candidates for public transport.  But increasingly this is looking like a 20th century model of work. Technology has been the primary driver of change, allowing more workplace flexibility and providing for increased location diversity. ‘Standard hours’ of work are being diluted and at the same time companies increasingly realise the high costs of ‘paper factories’ for administrative staff in costly CBD locations makes little sense. With this, the centralised nature of work is also being diluted and this is working against the centralised economic model that makes fixed public transport systems (especially rail) effective.

Society is changing. There was a time when commuting trips to work in central locations were mainly a case of getting there and getting home.  Much has changed. A rising proportion of women in the workforce and how this has changed family responsibilities means that commutes to and from work are also often tied in with other objectives: dropping off or picking up school kids or children in child care is only a part of this (but one which is said to contribute to 20% of private vehicle traffic on the roads in peak periods during school terms).  Add in to this the increasing propensity to shop less but more frequently (who owns a chest freezer anymore?) and to mix in pre and post work social or recreational appointments, and you have a very different pattern of commuting which public transport will struggle to service.

The suburban economy. A telling reality for proponents of increased public transport investment is that employment remains – and in some cases is increasingly – suburban by nature. Between 8 and 9 out of 10 of all jobs in metropolitan regions are suburban by location, and when you consider that the same proportion of residents in any metropolitan location are also suburban by residence, the problem of servicing this reality through public transport is apparent. In the last inter censal period, the proportion of metropolitan wide jobs located in the CBD actually fell in Brisbane (to 12.5%), while in Melbourne it remain unchanged (at 10%) and Sydney recorded a small rise (to 13.5%). The raw numbers of jobs in suburban locations are growing faster, as a rule, than those in CBDs.  The cost of creating a public transport system designed around suburban home to suburban workplace commutes is beyond calculation. In Australia, we will be in flying cars like the Jetsons long before this happens.

The new and emerging economy. The way cities were designed – with concentrations of white collar workers in CBDs and with discrete areas set aside for industrial, retail or other specified activities – is no longer as important for new or emerging economies. Technology in particular means that physical place is less essential for connectivity to markets. Communication is less dependent on physical proximity. This doesn't mean CBDs will lose their higher order function but it does mean that disruptive or emerging businesses, for which new technologies are more than just a novelty but a foundation, will have less need for the types of places offered by centralised business districts. They can locate in lower cost areas of the metropolitan area, and make use of the central business districts on occasion, rather than routine. Attracting and retaining these emerging types of businesses will also put the onus on suburban business centres to lift their game, but in many cases this isn’t difficult. Just think of any number of start ups or tech based companies you’ve read of recently and think about how many of these have been in non-traditional locations. Even when these businesses mature, their lack of interest in a CBD style presence doesn’t seem to change. Witness the many technologically innovative businesses in the USA or Europe, by way of example.

Where does this leave us with solutions for congestion? Ironically, increasing public transport investment designed to ferry people into and out of central business areas is unlikely to make much difference to metropolitan wide congestion. It can’t – simply because only a minority of jobs (between 10% and 15% in the case of Australia’s major cities) are in these locations. People with jobs in these locations may currently have relatively high rates of public transport usage already (often 40% plus) but imagine the cost of increasing this to 80%? The cost of getting there is incalculable for cities of our size, and in any way, it would only benefit 10% to 15% of the urban workforce. Ironically, the people most likely to benefit from this type of public transport prescription tend be much higher wage earners, living close to the inner city in highly valued real estate. (Have a look at this analysis from The Pulse a couple of years ago). Yet their higher capacity to pay is not reflected in most policy debate.

The reality is that public transport can only go so far in alleviating congestion. Social and economic change to the nature of work is changing the shape of employment decisions and has forever changed the nature of the commute. Public policy officials, urbanists and politicians who pretend that all that’s needed to ‘solve congestion’ is massively increased investment in heavy rail, light rail or dedicated busway networks are deluded: this thinking is rooted in nostalgic notions of work, unrelated to the future of work.

And as if to demonstrate the fact we should not expect better from our various governments, when a technological innovation comes along that promises to realize the long held dream of ride sharing and increased persons per vehicle - which if widely embracedwould go a long way to solving congestion at no cost to taxpayers -  governments stand in the way. It’s called Uber. Go figure.

Ross Elliott has more than 20 years experience in property and public policy. His past roles have included stints in urban economics, national and state roles with the Property Council, and in destination marketing. He has written extensively on a range of public policy issues centering around urban issues, and continues to maintain his recreational interest in public policy through ongoing contributions such as this or via his monthly blog The Pulse.

The Sociology of Fear

Tue, 11/10/2015 - 21:38

As part of its annual Survey on American Fears, Chapman University has tried to identify what Americans fear the most. A team of professors and students teamed up to retool last year’s survey tool and dig up American’s deepest horrors. In total, a random sample of 1,500 adults across the country were  asked about 88 different individual fears, in which they were to rank questions accordingly. Last year Americans were worried about walking alone at night and identity theft. But with the presidential elections just around the corner, it wasn’t surprising to see that corruption of our own government officials topped this year’s results.

Sociology of Fear

Nobody has ever cracked the code of human emotions. Our feelings are rooted within the depths of our physiology, but our cheers and screams are also products of our environment. Put in sociological terms, “fearfulness in varying degrees is part of the very fabric of everyday social relations”. This is bad news for those who thought the pursuit of happiness would be all fun and games.

Director of the Fear Survey Chris Bader recruited a group of interdisciplinary students to join the semester long course to help retool last year’s survey and to provide fresh perspective on what American’s Fear. But when the student researchers involved in the project (including me) arrived at the first class of Sociology of Fear, we weren’t completely aware of what would be a grueling month of debate, passion, and even tears.

Our class conducted multiple rounds of survey testing with friends, family and strangers to get feedback on additions made to last year’s survey tool. The most common fear amongst us twenty something college students facing the brink of graduation was “not living up to our potential”, and we considered this when evaluating the current state of American fears.

Rapid communication and transfer of information creates the perception that our peers are having more fun and being more productive than us, and FOMO (Fear of Missing Out) was brought up numerous times during discussion. But our personal explorations did not interfere with the macro-level research conducted for the project, and in the end, the fears that rose to the top of the list were cross-generational.  After all, the survey was on American fears, not millennial anxieties.

The course was a growing experience, but it was the work of the research faculty and project leaders that transformed this experience into excellent insights on the current American situation.

Biggest Fears Today

The survey explored four categories of fear: personal fears, natural disasters, paranormal fears, and drivers of fear behavior. The top American domains of fear averaged to be man-made disasters, technology, and government. Given the political transformations and technological developments taking place today, the results seem spot on.

In order of most feared to least, the environment, personal future, natural disasters, crime, personal anxieties, daily life, and judgment of others came in next on the list. Makes sense – I’m sure most of us have some concern about how we’re perceived by others, but this sentiment doesn’t quite stack up to a 8.0 earthquake or creepy government spying.

As for the top individual fears, 58% of respondents were afraid or very afraid of corruption of government officials. Perhaps Americans are on to some of the fishy things going on in Washington at the moment, or are simply sucked into the negative rhetoric commonplace in some opinion outlets.  Meanwhile, only 30% of Americans are afraid or very afraid of global warming impacting their lives.

Following behind fear of government officials, 44.8% of Americans are afraid or very afraid of cyber terrorism. 44.6% are afraid or very afraid of corporate tracking of personal info, and 44.4% of terrorist attacks. 41.4% where afraid or very afraid of government tracking of personal info, and 40.9% of bio-warfare. The remaining top fears surrounded financial and personal issues, with identity theft coming in at 39.6%, economic collapse at 39.2%, running out of money in future at 37.4%, and credit card fraud at 36.9%.

The survey also found that these fears are actually driving our actions. Fear has the strongest impact on our voting patterns. About one third who have an above average fear of government reported having voted for a particular candidate due to their fears. Even more alarming is the fact that “of those respondents who have an above average fear of the government, over 15% have purchased a gun due to fear.” Eight percent of people with an above average fear of the government send their children to private school out of fear.

As if gun control and education reform weren’t complicated enough, we can say that emotions will play some role in how policy is shaped in the coming years.

A society of hope or fear?

That fact that Americans fear government and technology is not surprising, given the individualist basis on which our nation was founded and the exponential technological growth we’re experiencing today. The Internet is forcing institutions and businesses to be increasingly transparent in everything from product sourcing to internal communications, and the watchdog power that citizens now have is both empowering, and frightening.

It’s easy to be blinded by fear, as our emotions are the most mysterious, yet powerful forces behind our decisions. But for every 58% who are afraid of government corruption, there is 42% who isn’t. For every 44.4 percent who are afraid of terrorism, there is 55.6% with no worries. Surely, there are preventative benefits that come with healthy skepticism and insecurity, but too much diminishes any hope for societal progress. Can we keep this in mind as we go about our business, citizenship, and personal lives?

The things that make us afraid can be dealt with. Some of them are opportunities, others are threats, and a good deal of them are complex issues and events that require brave souls to challenge them head on. This being said, we can all use a little inspiration to give us light in the face of darkness.

Nelson Mandela told us quite simply, “May your choices reflect your hopes, not your fears.” Emerson’s advice was a bit more menacing, perhaps more appropriate given the nature of this survey. “Always do what you are afraid to do.”

Charlie Stephens is a researcher at the Chapman University Center for Demographics and Policy, and an MBA candidate at the Argyros School of Business and Economics at Chapman University.He is also a regular contributor to the creative business site and the founder of, a social awareness site that helps people, businesses, and communities understand their cultural environments and connect in new grounds.

Photo: "Actress-fear-and-panic" by MyName (Bantosh) - self-made, taken in course of professional work. Licensed under

">CC BY-SA 3.0 via Wikimedia Commons.

A Question of Values: Middle-Income Housing Affordability

Mon, 11/09/2015 - 21:38

This is the Executive Summary from a new report “A Question of Values: Middle-Income Housing Affordability and Urban Containment Policy" authored by Wendell Cox and published by the Frontier Centre for Public Policy. Ailin He, a PhD doctoral candidate in economics at McGill University served as research assistant.

The "report is a public policy narrative on the relationships between urban containment policy, housing affordability and national economies. It is a synthesis of economic and urban planning analysis that is offered as a policy evaluation of urban containment. The analysis is presented in the context of higher-order objectives of domestic policy: improving the standard of living and eradicating poverty" (Page 9). The research focuses on the international experience, especially in Canada, Australia, New Zealand, the United Kingdom and the United States. Download the full report (pdf) here.

Middle-income housing affordability is important to people and the economy: Canada’s house prices have risen more than house prices in most other high-income nations. This is of concern, because higher house prices reduce discretionary incomes, which defines the standard of living and poverty. If discretionary incomes are reduced, households will have less to spend on other goods and services, which can retard job creation and economic growth. Improving the standard of living and eradicating poverty are among the highest-order domestic priorities.

Urban containment policy can lead to higher house prices: Urban land-use regulation has become stronger in many metropolitan areas and often includes urban containment policy. Urban containment severely restricts or bans development in urban fringe areas. Consistent with basic economics, this increases land values and house prices (all else equal). The planning intention and expectation is that higher housing densities will offset the land-price increases and that housing affordability will be maintained.

Severe losses in housing affordability have been experienced in urban containment markets: Top housing and economic experts attribute much of the loss in housing affordability to stronger land-use policy.

Housing affordability losses have been sustained in the five nations this report focuses upon: Across the United Kingdom, Australia, New Zealand and some markets in Canada and the United States, house prices have nearly doubled or tripled compared with household incomes as measured by price to income ratios. Much of this has been associated with urban containment policy.

Demand and supply: Some research suggests that the huge house-price increases have occurred due to higher demand and the greater attractiveness of metropolitan areas that have urban containment policy. However, the interaction of supply and demand sets house prices. Claims that metropolitan areas with urban containment policy are more attractive are countered by their net internal out-migration and diminished amenities for some households.

An intrinsic urban containment amenity seems doubtful: Some urban containment advocates claim that urban containment policy intrinsically improves amenities (such as a dense urban lifestyle). However, whether a feature is an amenity depends on individual preferences. Moreover, the strong net internal migration away from many metropolitan areas with urban containment policy is an indication that there is no urban containment amenity for most households.

Higher densities have not prevented huge losses in housing affordability: In contrast with planning expectations, the land-value increases expected from urban containment have not been nullified by higher densities within urban containment boundaries.

Intervening urban containment boundaries are more influential than topographic barriers: It has been suggested that topographic barriers such as mountains and the ocean cause higher house prices. However, in urban containment metropolitan areas, urban containment boundaries are usually placed between the built-up urban areas and the topographic barriers. As a result, house-price increase associated with the land shortage will be principally associated with the urban containment boundary, not the topographic barrier.

A competitive land supply is required for housing affordability: A risk with urban containment policy is that by limiting the land for sale, large landholders will seek to buy up virtually all of the land for future gain. Without urban containment, there will not be a land shortage, and there will not be an incentive to monopolize the land supply. A sufficient land supply can be judged to exist only if prices relative to incomes are not higher than before the urban containment policy came into effect.

Urban containment policy has been associated with reduced economic growth: Evidence suggests that urban containment policy reduces job creation and economic growth. The increased inequality noted by French economist Thomas Piketty is largely attributed to the housing sector and is likely related to strong regulation. Other research estimated a US$2-trillion loss to the U.S. economy, much of it related to strong land-use regulation, and called this “a large negative externality.”

Urban containment policy has important social consequences: There are also important social consequences such as wealth transfers from younger to older generations and from the less-affluent to the more-affluent households.

Urban containment policy has failed to preserve housing affordability: Some have expressed concern that urban containment policy might not have been implemented if there had been the expectation of losses in housing affordability. In fact, the administration of urban containment policy has been deficient, with corrective actions largely not taken despite the considerable evidence of losses in housing affordability. In urban containment markets, programs should be undertaken to stop the further loss of housing affordability and transition toward restoring housing affordability. Further, urban containment should not be implemented where it has not already been adopted.

Canada could be at risk: Canada could be at greater risk in the future. Already, huge losses in housing affordability have been sustained in Vancouver and Toronto. Other metropolitan areas are strengthening land-use regulations. This could lead to severe consequences such as lowering middle-income standards of living and greater poverty with less job creation and less economic growth.

The urban containment debate is fundamentally a question of values: Ultimately, the choice is between the planning values of urban design or urban form and the domestic policy values of improving the standard of living and reducing poverty. Urban containment policy appears to be irreconcilable with housing affordability. Proper prioritization requires that the higher-order values of a better standard of living and less poverty take precedence.

Download the full report (pdf) here.

Wendell Cox is Chair, Housing Affordability and Municipal Policy for the Frontier Centre for Public Policy (Canada), is a Senior Fellow of the Center for Opportunity Urbanism (US), a member of the Board of Advisors of the Center for Demographics and Policy at Chapman University (California) and principal of Demographia, an international public policy and demographics firm.He is co-author of the "Demographia International Housing Affordability Survey" and author of "Demographia World Urban Areas" and "War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life." He was appointed to three terms on the Los Angeles County Transportation Commission, where he served with the leading city and county leadership as the only non-elected member. He served as a visiting professor at the Conservatoire National des Arts et Metiers, a national university in Paris.

Are We Heading for An Economic Civil War?

Sun, 11/08/2015 - 13:30

When we speak about the ever-expanding chasm that defines modern American politics, we usually focus on cultural issues such as gay marriage, race, or religion. But as often has been the case throughout our history, the biggest source of division may be largely economic.

Today we see a growing conflict between the economy that produces consumable, tangible goods and another economy, now ascendant, that deals largely in the intangible world of media, software, and entertainment. Like the old divide between the agrarian South and the industrial North before the Civil War, this threatens to become what President Lincoln’s Secretary of State, William Seward, defined as an “irrepressible conflict.”

Other major economic divides—between capital and labor, Wall Street versus Main Street—defined politics for much of the 20th century. But today’s tangible-intangible divide is particularly tragic because it undermines America’s peculiar advantage in being a powerhouse in both the material and non-material worlds. No other large country can say that, certainly not China, Japan, or Germany, industrial powerhouses short on resources, while our closest cousins, such as Canada, Australia, and New Zealand, remain, for the most part, dependent on commodity trade.

The China syndrome and the shape of the next slowdown

Over the past decade, the United States has enjoyed two parallel booms that combined to propel the economy out of recession. One was centered in places like Houston, Dallas-Ft. Worth, Oklahoma City, and across much of the Great Plains. These areas were all located in the first states to emerge from the recession, and benefited massively from a gusher in energy jobs due largely to fracking.

At the same time, another part of the economy, centered in Silicon Valley as well as Seattle, Austin, and Raleigh/Durham, has also been booming. Though far more restricted than their counterparts in the “tangible” economy in terms of both geography and jobs, the tech/digital economy did not lag when it came to minting fortunes. By 2014, the media-tech sector accounted for six of the nation’swealthiest people. Perhaps more important, 12 of the nation’s 17 billionaires under 40 also hail from the tech sector.

Until China’s economy hit a wall this fall, these two sectors were humming along, maybe not enough to restore the economy to its ’90s trim robustly enough to improve conditions in many parts of the country. But as China begins to cut back on commodity purchases, many key raw material prices—copper and iron to oil and gas as well as food stuffs—have fallen precipitously, devastating many developing economies in South America, Africa, the Middle East, and Southeast Asia.

Plunging prices are also beginning to hurt many local economies in the U.S., particularly in the “oil patch” that spreads from west Texas to North Dakota. This is one reason why overall economic growth has fallen, and is unlikely to revive strongly in the months ahead. Overall, according to the most recent numbers, job growth remains slow and long-term unemployment stubbornly high while labor participation is stuck at historically low levels. Much of this loss is felt by the kind of middle and working class people who tend to work in tangible industries.

But it’s not just the much maligned energy economy that is in danger. The recovery of manufacturing was one of the most heartening “feel good” stories of the recession. Every Great Lakes state except Illinois now enjoys an unemployment rate below the national average, and several, led by the Dakotas, Minnesota, Nebraska, and Iowa, boast unemployment that is among the lowest in the nation. Now a combination of a too-strong dollar, declining demand for heavy equipment, and falling food prices threaten economies throughout the Great Lakes and the Great Plains.

Waging war on the tangible economy

President Obama’s emphasis on battling climate change—aimed largely at the energy and manufacturing sectors—in his last year in office will only exacerbate these conflicts. For one thing, the administration’s directive to all but ban coal could prove problematic for many Midwest states, including several—Iowa, Kansas, Ohio, Illinois, Minnesota, and Indiana—that rely the most on coal for electricity. Not surprisingly, much of the opposition to the Environmental Protection Agency’s decrees come from heartland states such as Oklahoma, Indiana, and Michigan. The President’s belated rejection of the Keystone Pipeline is also intensely unpopular, including among traditionally Democratic-leaning construction unions.

These policies have also succeeded to pushing the energy industry, in particular, to the right. In 1990 energy firms contributed almost as much to Democrats as to Republicans; last year they gave more than three times as much to the GOP.

In contrast, the tech oligarchs and their media allies largely embrace the campaign against fossil fuels. Environmental icon Bill McKibben, for example, has won strong backing in Silicon Valley for his drive to marginalize oil much like the tobacco industry was ostracized earlier. Meanwhile the onetime pragmatic interest in natural gas as a cleaner replacement for coal is fading, as the green lobby demands not just the reduction of fossil fuel but its rapid extermination.

Embracing the green agenda costs Silicon Valley little. High electricity prices may take away blue collar jobs, but they don’t bother the affluent, well-educated, Telsa-driving denizens of the Bay Area, who also pay less for power. But those rates are devastating to the less glamorous people who live in California interior. As one recent study found, the average summer electrical bill in rich, liberal andtemperate Marin County was $250 a month, while in impoverished , hotter Madera, the average bill was twice as high.

Many Silicon Valley and Wall Street supporters also see business opportunities in the assault on fossil fuels. Cash-rich firms like Google and Apple, along with many high-tech financiers and venture capitalist, have invested in subsidized green energy firms. Some of these tech oligarchs, like Elon Musk, exist largely as creatures of subsidies. Neither SolarCity nor Tesla would be so attractive—might not even exist—without generous handouts.

In this way California already shows us something of what an economy dominated by the intangible sectors might look like. Driven by the “brains” of the tech culture, the ingenuity of the “creative class,” and, most of all, by piles of cash from Wall Street, hedge funds, and venture capitalists, the tech oligarchs have shaped a new kind of post-industrial political economy.

It is really now a state of two realities, one the glamorous software and media-based economy concentrated in certain coastal areas, surrounded by a rotting, and increasingly impoverished, interior. Far from the glamour zones of San Francisco, the detritus of the fading tangible economy is shockingly evident. Overall nearly a quarter of Californians live in poverty, the highest percentage of any state. According to a recent United Way study, almost one in three Californians is barely able to pay his or her bills.

Silicon Valley’s political agenda

For the time being, with the rest of the economy limping along, the tech oligarchs seem, if anything, ever more arrogant and sure that they will define the future of the country’s politics. At a time when most small business owners hold Obama in low regard, the Democratic Party can consider the tech sector as an intrinsic part of its core political coalition. In 2000 the communications and electronics sectorwas basically even in its donations; by 2012 it was better than two to one democratic.

Once largely apolitical or non-partisan in their approach, firms like Microsoft, Apple and Google now overwhelmingly lean to the Democrats. President Obama has even enlisted several tech giants—including venture capitalist John Doerr, Linked In billionaire Reid Hoffman, and Sun cofounder Vinod Khosla—to help plan his no doubt lavish and highly political retirement.

The love-fest between Obama and Silicon Valley grows from a common belief in being extraordinary. The same media that has marveled at Obama’s celebrated brilliance also hails Silicon Valley’s ascendency as a triumph of brains over brawn.

Yet in reality many traditional industries such as energy and manufacturing still depend on skilled engineers. Indeed, after Silicon Valley, the biggest concentration of engineers per capita (PDF) can be found in brawny metros like Houston and Detroit. New York and Los Angeles, which like to parade as tech hotbeds, rank far behind.

In contrast to engineers laboring in Houston or Detroit, those who work in Silicon Valley focus largely on the intangible economy based on media and software. The denizens of the various social media, and big data firms have little appreciation of the difficulties faced by those who build their products, create their energy, and grow their food. Unlike the factory or port economies of the past, those with jobs in the new “creative” economy also have little meaningful interaction with working class labor, even as they finance politicians who claim to speak for those blue collar voters.

This may explain the extraordinary gap between the economies—and the expectations—of coastal and interior California. The higher energy prices and often draconian regulations that prevented California from participating in the industrial renaissance are hardly issues to companies that keep their servers in cheap energy areas of the Southwest or Pacific Northwest and (think Apple) manufacture most if not all of their products in Asia.

In the process the Democrats, once closely allied with industry, are morphing into a post-industrial party. Manufacturing in strongholds like Los Angeles, long the industrial center of the country, continues to erode. In a slide that started with the end of the Cold War, Southern California’s once-diverse industrial base has eroded rapidly, from 900,000 jobs just a decade ago to 364,000 today. New York City, which in 1950 boasted 1 million manufacturing jobs, now has fewer than 100,000. Overall, manufacturing accounts for barely 5 percent of state domestic product in New York and 8 percent in California, compared to 30 percent in Indiana and 19 percent in Michigan.

This divide could become decisive in the election. In contrast to advances in energy, autos, and homebuilding, which produced good blue collar and middle-skilled jobs, the benefits of the current tech boom have been limited, both in terms of job creation (outside of the Bay Area) and increased productivity, for the vast majority of voters.

This underlying economic conflict is redefining our politics less along lines of ideology and more in terms of interests. Increasingly states that follow the Obama line on energy, such as New York and California, are not contestable for Republicans. But elsewhere—beyond the coasts—there may be greater resistance.

Among those who are likely to revolt are those workers and entrepreneurs in the oil patch, those who build heavy machinery, and those who grow large quantities of food. The recent Republican win in Kentucky was in part based on opposition to anti-coal regulations coming from the Obama administration. As the EPA ramps up its regulatory onslaught, one can expect energy-dependent industries and regions to recoil, particularly at a time when their industries are headed into a recession. Republicans claims that regulatory policies hurt the tangible economies will gain traction if car factories and steel mills start shutting down again, while farmers plant fewer soybeans and developers build fewer suburban homes.

The emergence of an economic civil war?

Hillary Clinton may praise the economic progress under President Obama, and win the nods of those in the tech, media, and financial community who have done very well on his watch. There’s enough momentum from these industries to guarantee that the entire West Coast and the Northeast will fold comfortably, and predictably, into the Clinton column, despite rising concern about crime, homelessness, and loss of middle class jobs. But the very same policies that attract the tech world voter to Clinton will just as certainly alienate many working class and middle class Democrats in places like Appalachia, the Gulf Coast, and particularly the politically pivotal Great Lakes.

The stakes could be huge. If the Republicans can convince most voters in the middle of the country that the coastal-driven policy agenda is a direct threat to their interests, the GOP will likely carry the day. But if the Democrats can convince the country that coastal California and New York City represent the best future for us all, then get ready for Hillary, because nothing else—certainly not the old social issues—will stop her.

This piece first appeared at The Daily Beast.

Joel Kotkin is executive editor of and Roger Hobbs Distinguished Fellow in Urban Studies at Chapman University, and a member of the editorial board of the Orange County Register. He is also executive director of the Houston-based Center for Opportunity Urbanism. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is also author of The City: A Global History and The Next Hundred Million: America in 2050. He lives in Orange County, CA.

Collingswood: The Main Street Model

Fri, 11/06/2015 - 21:38

There’s a weird war raging these days. There are people who advocate high rise living and public transit in the urban core to the exclusion of other arrangements. And then there are folks who can’t hold their head up high in church on Sunday if they don’t live on a quarter acre lot out on the far fringe of the metroplex with four cars parked in front of their fully detached home. I always choose the thing in the middle. It’s called a “town”. I’m a Main Street kind of guy.

This is Haddon Avenue in Collingswood, New Jersey. It’s an intact functioning pre World War II Main Street town complete with hardware store, local mom and pop shops, great places to eat, business incubators, post office, public parks, and City Hall. The majority of the buildings are one and two stories tall.

Transit exists in Collingswood in the form of a PATCO train station and bus service, but transit isn’t necessary to travel within Collingswood itself. The train and bus are there to get people from one town center to another. Philadelphia is fifteen minutes away. Once you’re in town you can walk or bike everywhere. That includes the young, the elderly, people with limited physical mobility, the rich, the poor… everyone.

The most affordable apartments are directly above the shops. These are perfect for young adults as well as older people on a fixed income. Both groups enjoy the convenience of nearby shops and activities. As you turn off of Haddon Avenue the commercial buildings transition to residential side streets.

Duplexes nestle up against the commercial corridor and provide moderately priced homes and rental accommodations. These in-between properties work well for couples, empty nesters, and young families on a budget.

A couple of blocks away are fully detached homes on larger lots. Collingswood is built in such a way that a person could go from childhood to old age and find a comfortable place to live at an appropriate price point within a half mile.

Schools and public parks are located right in the residential neighborhoods.


All levels of employment from a first teen aged service job to an advanced career in Center City Philadelphia (fifteen minutes away by train) are available.

This arrangement satisfies nearly all the metrics for both of the warring factions. A traditional Main Street town is neither sprawl nor a hyper dense concrete city. It’s economical as well as ecological. It’s beautiful and family friendly. And perhaps most importantly, a Main Street town is physically structured in a way that allows its diversified local tax base to support the required infrastructure over the long haul.

Too bad it’s essentially illegal to build new places like this anymore…

John Sanphillippo lives in San Francisco and blogs about urbanism, adaptation, and resilience at He's a member of the Congress for New Urbanism, films videos for, and is a regular contributor to He earns his living by buying, renovating, and renting undervalued properties in places that have good long term prospects. He is a graduate of Rutgers University.

Report: Africa’s Demographic Transition, Dividend or Disaster?

Thu, 11/05/2015 - 21:38

A recent report published jointly by the World Bank and by Agence Française de Développement highlights the challenge of realizing Africa’s promised demographic dividend. The title Africa’s Demographic Transition: Dividend or Disaster? (see footnote 1) sums up the authors’ thesis that the dividend is not an automatic result of falling fertility ratios (TFR).

Instead, falling TFRs open a window of opportunity which can lead to a demographic dividend when governments and the public sector implement the requisite steps to capitalize on this opportunity. Lower child mortality usually leads to falling fertility ratios and improvements in women’s health. But most important among concurrent or subsequent initiatives are investments in education, and the provision of sufficient jobs to a booming working-age population.

From the report [our emphasis]:

Declines in child mortality, followed by declines in fertility, produce a “bulge” generation and a period when a country has a large number of working-age people and a smaller number of dependents. Having a large number of workers per capita gives a boost to the economy provided there are labor opportunities for the workers.

And elsewhere:

The first and perhaps most challenging step is to speed up the fertility decline in countries where it is currently slow or stalled. Reducing fertility leads to immediate gains in income per capita as youth dependency rates fall. However, achieving the full potential of the demographic dividend requires economic policies that take advantage of the opportunity. Formulating and implementing policies that strengthen financial institutions and encourage saving will channel rising incomes into domestic savings and investments that further fuel growth and development.

Empirical evidence points to three highly interactive accelerators [of fertility decline]:

  • Health, especially child health. Child health is a critical input into fertility declines. As children’s health and survival rates improve, family demand for more children declines as confidence in child survival increases. Smaller family sizes improve maternal health, which further improves child health, completing a virtuous cycle.
  • Education, especially education for girls. Female education is a critical driver of lower desired fertility and the transition from high to low fertility. Fertility decline, in turn, has a strong effect on education by allowing for fewer, healthier, better nourished, and better educated children.
  • Women’s empowerment, which is clearly related to the first two. Better educated and healthier women with more market, social, and decision-making power in the family—are likely to have fewer children (World Bank 2011). And women who have fewer children—as a result of delayed age of marriage, delayed first sexual contact, or more space between births—are much more likely to enter the paid labor market, to have higher earnings, and to be more empowered.

Further, the report provides a road map of the policies that are necessary to convert fertility decline into a first demographic dividend and a second demographic dividend. These policies are shown in Table 0.3 (all charts below are from the report).

Table 0.1 shows a correlation between each country’s total fertility ratio (TFR) and its GDP per capita. Countries with high TFRs have lower GDP per capita. Some of the most populous countries, Kenya, Ethiopia and Tanzania are in the middle ranges, while others like DR Congo are near the GDP bottom (and TFR top). Nigeria is an outlier with better than average GDP per capita but a higher than average TFR. Botswana and South Africa have higher GDP per capita and lower TFRs.

Table 0.2 shows the relation of child mortality and TFRs. Low mortality coincides with a low TFR. Nigeria and DR Congo are problematic with high mortality and high TFRs, whereas Tanzania still maintains a higher than average TFR despite relatively low child mortality.

Figure 0.5 shows the evolution of TFRs for several countries since 1960. Niger’s remained high while South Africa’s declined. Nearly all country TFRs are falling, albeit at a slower rate than previously expected in some cases.

Figure 0.6 shows the clear divide in TFRs between rural and urban areas of Ethiopia, Ghana and Kenya. An increase in agricultural productivity and the creation of urban jobs will contribute to further declines in TFRs.

Download the full report here.

Sami Karam is the founder and editor of and the creator of the populyst index™. populyst is about innovation, demography and society. Before populyst, he was the founder and manager of the Seven Global funds and a fund manager at leading asset managers in Boston and New York. In addition to a finance MBA from the Wharton School, he holds a Master's in Civil Engineering from Cornell and a Bachelor of Architecture from UT Austin.

  1. Canning, David, Sangeeta Raja, and Abdo S. Yazbeck, eds. 2015. Africa’s Demographic Transition: Dividend or Disaster? Africa Development Forum series. Washington, DC: World Bank. doi:10.1596/978-1-4648-0489-2. License: Creative Commons Attribution CC BY 3.0 IGO

How Chicago’s 606 Trail Fell Short of Expectations

Wed, 11/04/2015 - 21:38

When I was back in Chicago over Labor Day, I had to check out the “big three” new public space projects there: the Riverwalk, Maggie Daley Park, and the 606 Trail. The Riverwalk is a spectacular project I already wrote about. Maggie Daley Park, a new playground just across Columbus Dr. from Millennium Park’s Frank Gehry designed band shell, has been controversial and got mixed reviews. But I really liked it. More importantly, kids seem to love it. The place was jammed, and it appeared to be mostly locals. My cousin tells me her young daughter can’t get enough of the place. I’m not doing a post on this, but it looks like another big win.

The 606 Trail, a 2.7 mile biking and walking trail built on the embankment of an abandoned rail line, is a different story, however.

The problem with the 606 is not that it’s bad. In fact, it’s a nice, eminently serviceable rail trail. I won’t do a full writeup since Edward Keegan had a good review in Crain’s in which he asks, “Is that all there is?” that I think gets it basically right.  Numerous other reviews are also available.

What I will do is highlight three areas that I think contribute to Keegan being underwhelmed: inflated expectations, financing problems, and an odd lack of attention to design detail.

Inflated Expectations

The fact that the 606 is an elevated trail on an abandoned rail line creates an almost inevitable comparison to New York’s High Line. The city did nothing to downplay those comparisons, and in fact suggested Chicago’s trail would actually be considered superior. For example, in national urbanist web site Next City, Deputy Mayor Steve Koch said, “A lot of people are familiar with the High Line — this is a concept far beyond that truly transformative project.”  Frances Whitehead, lead artist for the project, told WBEZ regarding the High Line, “I think we’re gonna smoke them.”

It’s very clear the city wanted this to be considered a project worthy of national, not just local attention. Back to Koch, he said, “Someone will call you up and say, ‘I want to see the city’ Thisis where you’ll go; this is the way you’ll do it. And I think people are going to come from all over the globe.”

The very name speaks to the ambition level. Originally it was known as the Bloomingdale Trail, a name that technically still exists but which has been replaced for most purposes by “the 606.” The new name was taken from the first three digits of zip codes in the city of Chicago. Thus by using 606, the name itself suggests a project of citywide, not neighborhood, significance. The city also pushed for national media – and got it.

The problem is that the 606 is not even remotely another High Line, nor a project of citywide significance, nor a bona fide tourist attraction for the masses. It’s a neighborhood serving rail-trail that is elevated above the streets with some nicer features like lighting that you don’t see often. Like many other rail trails around the country, I expect it to have a significant positive development affect in the neighborhood, as well as being a great recreational amenity. All great things – if the trail had been sold that way originally.

To be fair, some like the Trust for Public Land, which was involved in the project design, were more realistic. Their CEO Will Rogers told Next City, “The High Line really reshaped the whole Meatpacking District. The Bloomingdale is going to provide parks and green space for neighborhoods that desperately need it, and bicycle access for people going downtown. It’s a different kind of investment.” But this isn’t the message that won out in shaping perceptions. The city would have been better off setting expectations much differently.

Insufficient Funds

The 606 Trail was primarily paid for using federal CMAQ transportation funds. According to DNA Chicago, the total price of the 606 is $95 million, with $50 million in CMAQ funds, $20 million privately raised, $5 million from the city, and $20 million to fill (for what purposes I am not sure, though see below).

The use of a CMAQ funding had key implications. One is that it more or less required the project to be primarily a bicycle trail. The entire edifice of obnoxious federal transport regs are in play here. Two is that it made this a CDOT project, not a Parks District one (though I believe the Parks District is now in charge of it). I believe many of the things that contribute to Keegan’s feelings come from the funding strings and a budget that was too low. In fact, this project to me brought back echoes of the CTA’s Brown Line expansion project in the way that various parts of it give off the vibe of being value engineered.

One of the things that got whacked in the Brown Line project, for example, was paint. Except for a handful of places such as over Armitage Ave, metal on the project was simply left in a raw galvanized state. I previously noted the austere results of that project give off an homage to prison yard feel. The same look is present on the 606. Consider these photos:

Mesh galvanized metal railing at the CTA Fullerton station.


Mesh galvanized railings along the 606.


There’s nothing wrong with using an industrial motif, which is very appropriate in Chicago. And obviously security for adjacent property owners is important. It’s also possible that these had to be over-engineered to meet DOT/federal standards, much like the Brown Line station railings for passengers that could stop a Mack truck. The designers may well have felt these were the best choices. But my gut tells me that, like with the Brown Line, this may have been a money issue.

A lot of people have noted the fact that the landscaping has not yet been fully planted or grown to maturity as a reason for the trail’s feel. That surely plays a role. But the preponderance of galvanized metal through much of it plays a big role in giving the 606 an austere feel.

This also demonstrates how the city’s financial problems have practical consequences. Because the city’s budget is in such bad shape, it had to turn to CMAQ, which imposed strings you’d rather not have in an ideal world. And you may not have the cash to do it right. (The Riverwalk doesn’t suffer from this, possibly because its commercial spaces generate revenues to bond against).

Design Oddities

The 606 also has some odd design misses. For example, here is what the Trail physically looks like. It’s a concrete biking path with a soft blue rubberized running path on either side.

Let’s see, where have I seen this design pattern before?

Fullerton L platform.

The CTA uses a similar blue shoulder area on its platforms. But in its case, the design pattern is used to indicate the edge of the platform and thus an unsafe area to stand. You are supposed to stand behind the blue line. Using a similar width blue area, even if a different shade, for a jogging path on the 606 violates a local design affordance, like putting a handle on a door and labeling it “Push.”

Then there’s this arch bridge:

The 606 Trail over Milwaukee Ave.

This design is dimensionally awkward, something Keegan points out too. Given that this is a rail trail, it’s also notable that the designers chose a steel arch pattern that is not idiomatic of rail bridge design, certainly not in Chicago anyway. This also makes me again wonder about the role of CDOT in the project. This arch structure is the same pattern they used for the Halsted St. bridge over the north branch of the Chicago River that Blair Kamin similarly labeled, “less than graceful.” (The Damen Ave arch bridge works much better, probably because the span is longer and higher, lending itself to more elegant design proportions).

The name “606” itself is also a bit off. Inside Chicago the reference may be obvious, but outside of its this name is likely to be parsed as an area code, particularly with the “0” middle digit from the original North American Numbering Plan. Today you frequently see people sporting their city’s main area code on shirts and such as a bit of local pride, particularly as area codes have shrunk down to city scale size in many places. The 606 area code is Appalachian Kentucky, however, not Chicago. Few people without a connection to Chicago will know that its zip codes start with 606.

These aren’t huge items, but cumulatively they add up. The little things separate great design from good, and the 606 missed some opportunities.

On the whole, this trail will be a great amenity for the neighborhoods it passes through, and also be legitimately functional for transportation given its elevated nature and the transportation lines it connects to such as Metra’s Clybourn station. It was fairly well patronized when I was on it, but with no sense of crowding. And this was on a nice Labor Day afternoon, suggesting that that chaos and safety issues of the lakefront path won’t be repeated here.

If only it had originally been sold for what it was instead of a High Line beater, had raised that last $20 million (plus a bit more, perhaps), and had a little more attention to detail in some design elements, the 606 would be probably be seen as something that significantly exceeded expectations instead of something that did not live up to the hype.

Aaron M. Renn is a senior fellow at the Manhattan Institute and a Contributing Editor at City Journal. He writes at The Urbanophile, where this piece originally appeared.

So Much For The Death Of Sprawl: America's Exurbs Are Booming

Tue, 11/03/2015 - 21:38

It’s time to put an end to the urban legend of the impending death of America’s suburbs. With the aging of the millennial generation, and growing interest from minorities and immigrants, these communities are getting a fresh infusion of residents looking for child-friendly, affordable, lower-density living.

We first noticed a takeoff in suburban growth in 2013, following a stall-out in the Great Recession. This year research from Brookings confirms that peripheral communities — the newly minted suburbs of the 1990s and early 2000s — are growing more rapidly than denser, inner ring areas.

Peripheral, recent suburbs accounted for roughly 43% of all U.S. residences in 2010. Between July 2013 and July 2014, core urban communities lost a net 363,000 people overall, Brookings demographer Bill Frey reports, as migration increased to suburban and exurban counties. The biggest growth was in exurban areas, or the “suburbiest” places on the periphery.

How could this be? If you read most major newspapers, or listened to NPR or PBS, you would think that the bulk of American job and housing growth was occurring closer to the inner core. Yet more than 80% of employment growth from 2007 to 2013 was in the newer suburbs and exurbs. Between 2012 and 2015, as the economy improved, occupied suburban office space rose from 75% of the market to 76.7%, according to the real estate consultancy Costar.

These same trends can be seen in older cities as well as the Sun Belt. Cities such as Indianapolis and Kansas City have seen stronger growth in the suburbs than in the core.

This pattern can even be seen in California, where suburban growth is discouraged by state planning policy but seems to be proceeding nevertheless. After getting shellacked in the recession, since 2012 the Inland Empire — long described as a basket case by urbanist pundits — has logged more rapid population growth  than either Los Angeles and even generally healthy Orange County. Last year the metro area ranked third in California for job growth, behind suburban Silicon Valley and San Francisco.

To those who have been confidently promoting a massive “return to the city,” the resurgence of outer suburbs must be a bitter pill. In 2011, new urbanist pundit Chris Leinberger suggested outer ring suburbs were destined to become “wastelands” or, as another cheerily described them, “slumburbs” inhabited by the poor and struggling minorities chased out of the gentrifying city.

In this worldview, “peak oil” was among the things destined to drive people out of the exurbs . So convinced of the exurbs decline that some new urbanists were already fantasizing that suburban three-car garages would be “subdivided into rental units with street front cafés, shops, and other local businesses,” while abandoned pools would become skateboard parks.

This perspective naturally appeals to people who write most of our urban coverage from such high-density hot spots as Brooklyn, Manhattan, Washington, D.C., or San Francisco. And to be sure, all these places continue to attract bright people and money from around the world. Yet for the vast majority, particularly families, such places are too expensive, congested and often lack decent public schools. For those who can’t afford super-expensive houses and the cost of private education, the suburbs, particularly the exurbs, remain a better alternative.

Even as Houston, like other Sun Belt cities, has enjoyed something of a renaissance in its inner core, nearly 80% of the metro area’s new homebuyers last year purchased residences outside Beltway 8, which is far to west of the core city.

If you want to know why people move to such places, you can always ask them. On reporting trips to places like Irvine, California, Valencia, north of Los Angeles, or Katy, out on the flat Texas prairie 31 miles west of Houston, you get familiar answers: low crime, good schools and excellent access to jobs. Take Katy’s Cinco Ranch. Since 1990, the planned community has grown to 18,000 residents amid a fourfold expansion in the population of the Katy area to 305,000.

To some, places like Cinco Ranch represents everything that is bad about suburban sprawl, with leapfrogging development that swallows rural lands and leaves inner city communities behind. Yet to many residents, these exurban communities represent something else: an opportunity to enjoy the American dream, with good schools, nice parks and a thriving town center.

Nor is this a story of white flight. Roughly 40% of the area’s residents are non-Hispanic white; one in five is foreign born, well above the Texas average. Barely half of the students at the local high school are Caucasian and Asian students have been the fastest-growing group in recent years, with their parents attracted to the high-performing schools.

“We have lived in other places since we came to America 10 years ago,” says Pria Kothari, who moved to Cinco with her husband and two children in 2013. “We lived in apartments elsewhere in big cities, but here we found a place where we could put our roots down. It has a community feel. You walk around and see all the families. There’s room for bikes –that’s great for the kids.”

Here Come The Millennials

Potentially, the greatest source of exurban and peripheral revival lies with the maturation of the millennial generation. Millennials — born between 1982 and 2002 — are widely portrayed as dedicated city dwellers. That a cohort of young educated, affluent people should gravitate to urban living is nothing new. The roughly 20% who, according to an analysis by demographer Wendell Cox, live in urban cores may be brighter, and certainly more loquacious, than their smaller town counterparts, dominating media coverage of millennials. But the vast majority of millennials live elsewhere — and roughly 90% of communities’ population growth that can be attributed to millennials since 2000 has taken place outside of the urban core.

To be sure, millennials are moving to the suburbs from the city at a lower rate than past generations , but this is more a reflection of slower maturation and wealth accumulation.

According to U.S. Census Bureau data released last month, 529,000 Americans ages 25 to 29 moved from cities out to the suburbs in 2014 while 426,000 moved in the other direction. Among younger millennials, those in their early 20s, the trend was even starker: 721,000 moved out of the city, compared with 554,000 who moved in.

This may well reflect rising cost pressures, as well as lower priced housing many millennials can afford. Three-quarters, according to one recent survey, want a single-family house, which is affordable most often in the further out periphery.

Future trends are likely to be shaped by an overlooked fact: as people age, they change their priorities. As the economist Jed Kolko has pointed out, the proclivity for urban living peaks in the mid to late 20s and drops notably later. Over 25% of people in their mid-20s, he found, live in urban neighborhoods; but by the time they move into their mid-30s, it drops to 18% or lower. In 2018, according to Census estimates, the number of millennials entering their 30s will be larger than those in their 20s, and the trend will only get stronger as the generation ages.

Some might argue that millennials will be attracted to more urban suburbs, places like Bethesda, Md.; Montclair, N.J.; or the West University or Bellaire areas of Houston, all of them located near major employment centers with many amenities. These suburban areas are also among the most expensive areas in the country, with home prices often in the millions. And a number of older inner ring suburbs, as we saw in the case of Ferguson, are troubled and have lost population — even as the number of residents in downtown areas have grown.

So when millennials move they seem likely to not move to the nice old suburbs, or the deteriorating one, but those more far-flung suburban communities that offer larger and more affordable housing, good schools, parks and lower crime rates.

Among the research that confirms this is a study released this year by the Urban Land Institute, historically hostile to suburbs, which found that some 80% of current millennial homeowners live in single-family houses and 70% of the entire generation expects to be living in one by 2020.

The Future Of Exurbia

Far from being doomed, exurbia is turning into something very different from the homogeneous and boring places portrayed in media accounts. For one thing exurbs are becoming increasingly ethnically diverse. In the decade that ended in 2010 the percentage of suburbanites living in “traditional” largely white suburbs fell from 51% to 39%.  According to a 2014 University of Minnesota report, in the 50 largest U.S. metropolitan areas, 44% of residents live in racially and ethnically diverse suburbs, defined as between 20% and 60% non-white.

And how about the seniors, a group that pundits consistently claim to be heading back to the city? In reality, according to an analysis of Census data, as seniors age they’re increasingly unlikely to move, but if they do, they tend to move out of urban cores as they reach their 60s, and to less congested, often more affordable areas out in the periphery. Seniors are seven times more likely to buy a suburban house than move to a more urban location. A National Association of Realtors survey found that the vast majority of buyers over 65 looked in suburban areas, followed by rural locales.

Trends among millennials, seniors and minorities suggest that demographics are in the exurbs’ favor. The movement to these areas might be accelerated by their growing sophistication, as they build amenities long associated with older cities, such as town centers, good ethnic restaurants and shops, diverse religious institutions and cultural centers. At the same time, the growth of home-based business — already larger than transit ridership in two-thirds of American metropolitan areas and growing much faster — increases the need for larger homes of the sort found most often in the outer rings.

Rather than regard these communities as outrages to the urban form, planners and developers need to appreciate that peripheral developments remain a necessary part of our evolving metropolitan areas. With a new generation looking for affordable homes, good schools and low crime, it seems logical that many will eventually leave core cities that offer none of the above. The future of exurbia is far from dead; it’s barely begun.

This piece first appeared at Forbes.

Joel Kotkin is executive editor of and Roger Hobbs Distinguished Fellow in Urban Studies at Chapman University, and a member of the editorial board of the Orange County Register. He is also executive director of the Houston-based Center for Opportunity Urbanism. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is also author of The City: A Global History and The Next Hundred Million: America in 2050. He lives in Orange County, CA.

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"Greenurbia is the suburbs of the future. The suburbs of the 1950s were bedroom communities for people who commuted into the city. Today, there’s much more employment in the suburbs, and the big change is the number of people working full-time or part-time at home. Having people commute from one computer screen to another doesn’t make sense."

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Kotkin has a striking ability to envision how global forces will shape daily family life, and his conclusions can be thought-provoking as well as counterintuitive. It's amazing there isn't more public discussion about the enormous changes ahead, and reassuring to have this talented thinker on the case. — Jennifer Ludden, NPR national desk correspondent

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