Urban Issues

San Jose, California: Bustling Metropolis or Bedroom Community?

Adam Mayer — Mon, 01 Jun 2009 01:57:00 -0400

Dionne Warwick posed the question more than 40 years ago, yet most Americans still don’t know ‘The way to San Jose’. Possessing neither the international cachet of San Francisco nor the notoriety of Oakland, San Jose continues to fly under the national radar in comparison to its Bay Area compatriots. Even with its self-proclaimed status as the ‘Heart of Silicon Valley’, many would be hard pressed to locate San Jose on a map of California.

More well-known American cities may try to gain population by branding themselves as interesting places, but San Jose does not struggle to attract newcomers. Sprawling over 178 square miles, San Jose sits at the southern end of the San Francisco Bay. This year the city exceeded the 1 million population mark for the first time.

So what makes this city, the 10th-largest in the United States, appealing? Unlike its precious neighbor 50 miles to the north, San Francisco, people move to San Jose primarily for jobs – especially those related to the coveted technology sector. Whereas San Francisco balances its role as playground for the independently wealthy and welfare state for the lumpenproletariat, San Jose remains favored among families and those looking for a safe environment in which to raise children – not to mention, the weather is better.

San Jose does not stimulate a sense of urban exaltation. Aside from a commercial downtown core with a collection of mediocre high-rises (limited in height due to do downtown’s adjacency to the San Jose Airport), the city is unapologetically suburban in a character.

San Jose’s pattern of development can be traced back to its origins as an agricultural community supporting early Spanish settlers who chose to settle in the fertile Santa Clara Valley. It remained a modest-size agrarian community until the end of World War II when it underwent a period of rapid expansion-not unlike that of Los Angeles to the south. During the 1950s, with the emergence of semiconductor technology derived from silicon, San Jose and the greater Santa Clara Valley exploded into a center for the evolution of computer technology.

Today, San Jose can best be understood by its ambivalent relationship with neighboring Silicon Valley cities. Mid-size suburbs such as Cupertino, Sunnyvale, Mountain View and Palo Alto, all located west/northwest of San Jose as one travels up the peninsula towards San Francisco, are very distinct and separate entities. Home to some of Silicon Valley’s heaviest hitters (Cupertino has Apple, Sunnyvale has Yahoo!, Mountain View has Google, Palo Alto has Hewlett-Packard, Facebook and Stanford University), these cities largely define the technology-focused region. To be sure, San Jose’s has its share of big players, including eBay and Adobe as well as the ‘Innovation Triangle’, an industrial area of north San Jose, home to the headquarters of large companies like Cisco Systems and Cypress Semiconductor.

Yet, despite the presence of these firms, San Jose has become ever more a residential community, with among the worst jobs to housing balances in the region. Furthermore, a whopping 59% of the city’s developed land constitutes residential use – 78% of that being single-family detached housing. In this sense, despite being the largest city, San Jose essentially serves as a ‘bedroom community’ for the rest of Silicon Valley.

This has been a burden for the city, which, unlike its neighbors, lacks enough large information technology companies to help fill their tax coffers. In contrast job rich ‘green’ cities like Palo Alto have remained staunchly ‘anti-growth’ regarding residential development and consequently have very high housing prices.

This pattern poses fiscal problems for San Jose. City officials have long been aware of the need to stimulate economic development instead of continuing to lose out to its neighbors but the city seems determined to increase further its role as dormitory for its neighbors. Indeed, amazingly the city’s development agenda has in recent years shifted to a relentless focus on high-density, multi-family residential in the downtown core and along transit corridors. In 2007, 79% of all new housing built in San Jose was multi-family – a staggering deviation from its history of low density development.

Though well-intentioned, the slant towards densification has yielded a glut of empty condo units throughout the city. Those that have purchased units in new developments often find themselves with underwater mortgages. During a recent visit to one the flashy new downtown condo buildings, The 88, I entered a desolate sales office and was greeted by a skittish sales agent. When asked how sales were, my question was deferred without a direct answer in an act of not-so-quiet desperation.

Although it’s clear most people in San Jose prefer lower density living, the city government continues hedging tax dollars against a future in which newcomers will want to live in a high-density setting. Outside of downtown, low to mid-rise multi-family housing has been built along the city’s light-rail lines in what are conceived to be ‘transit villages’. The popularity for such a lifestyle is questionable given the high price point and unreasonable HOA dues of these condo units, particularly when single-family detached houses can be purchased at comparable prices.

Despite these issues, San Jose seems hell-bent on its path towards densification. The city has major plans to develop the area around its Diridon Train Station, just west of downtown, as California High-Speed Rail and BART are projected to make their way to San Jose. Furthermore, the city government is counting on the Oakland A’s baseball team making a move to San Jose.

From the Champs-Élysées to Tiananmen Square, grand urban visions are what have defined cities historically. As a product of the Silicon Valley ethos as well as an observer of planning trends, I would argue that this is no longer valid – especially for any city with the hopes of a prosperous future. Rather, in democratic societies, it will be the idiosyncrasies of individual actors and the prospect of upward mobility that will define a sense of place.

Obsessed with density and urban form, planners don’t seem to grasp the chicken and egg conundrum – the notion that lifestyle amenities follow on the heels of economic opportunity. San Jose needs to cast its future on nurturing its entrepreneurs instead of trying to become something it is not yet ready to become.

Adam Nathaniel Mayer is a native of the San Francisco Bay Area. Raised in the town of Los Gatos, on the edge of Silicon Valley, Adam developed a keen interest in the importance of place within the framework of a highly globalized economy. He currently lives in San Francisco where he works in the architecture profession.

Project Development: Regulation and Roulette

Rick Harrison — Sat, 30 May 2009 01:02:24 -0400

The site plan logically should be the key to approval of a development project. Yet in reality, the plan is secondary to the presentation. My conclusions are based upon experience with well over a thousand developments over four decades, most in the mainland USA. And what I’ve observed is that the best site plan is only as good as the presentation that will convince the council or planning commission to vote “Yes” on it. No “yes” vote, no deal, no development.

Each presenter deals with the dog-and-pony show in his own way. There’s an endless variety of styles (or lack of styles). All of these public meetings have one thing in common: The neighbors (if there are any) will be there to oppose the new development.

Not Too Long Ago…
In the old days there were three factions: The developer presenting the plan, the neighbors opposing the plan, and the council listening to both sides. If the development was high profile, someone from the local press might also show up. The planning commission and council are fully aware that all plans will be met with neighborhood opposition, and they will have to listen to lengthy complaints along the route to approving (possibly) the plan.

In the past, the citizens sitting on these boards would most likely dismiss Elwood and Betsy Smith’s complaint about how a development in their back yard would invade their privacy, and would vote in favor of the new master planned community instead.

How It’s Different Today
Today there is often an additional audience. Televised meetings provide an entire region of neighbors. The on-screen council listens to the neighbor’s objections, no matter how absurd they may be, then answers directly to the camera, showing the general community watching at home that they really care about every citizen’s opinion. The council member must never appear too much in favor of the developer, as that could be misconstrued as not caring about the citizens he or she represents. A televised Council member hears the Smith's complaint with a very concerned on-camera look, explains how maybe we have too many new homes in this town, and proceeds to tell viewers that the developer might want to consider a buffer and a drop in density. Concerns have changed from developing economically sensible neighborhoods to “please elect me Mayor when I’m on the ballot”.

Planning Outside The USA
Our first large site plan done outside the States was in Freeport, Bahamas. In 2000, when we were first contacted to design Heritage Village, we asked about doing presentations to the city council and planning commission to help move the approval process along. We were told that the development company and the regulating entity were the same, and if they liked the plan it would be built! That is exactly what had happened.

Our next attempt outside the USA was not so easy. In Mexico City when we asked to sit down with government officials to change policy to create better neighborhoods, the developer said... No. At the time, we did not understand why it was so critical that we were not to suggest changes.

We Discover A Superior Foreign System
We wrongly assumed that all planning outside the USA could have similar problems, with restrictions that were absurdly prohibitive for designing great neighborhoods. It was only when we worked in Bogota, Columbia last year that we had the opportunity to work within a system that may not be so backwards after all. Our request to meet with the authorities to show them new ways to design neighborhoods was met, as it had been in Mexico City, with an absolute... No.

We then asked for an opportunity to present the plan, and were told that was not necessary. Being that it was Columbia you can imagine our first thoughts. Cartels? Maybe corruption? The reality was much simpler. Since our plans met the minimums (they actually exceeded them), they were automatically considered approved. Imagine that – no neighbors to complain! If everything conforms, it should be approved … right? Just plain common sense.

Zoning-Compliant Projects Should Be Exempt From Public Meetings
When you think about it, why wouldn’t this work in the USA? if the development plan being submitted meets or exceeds the zoning and the subdivision regulation minimums, why does it need to go through any public approvals at all? The American developer often faces months or years of delays, enormous interest payments, and tens or perhaps hundreds of thousands of dollars spent on consultants and legal help to re-create plans that conform. Those massive sums could go towards making better neighborhoods, better architecture, better landscaping, less environmental impacts, and more affordable housing.

We’d Still Need Public Meetings
The public would still have plenty of input on regulation and zoning exemptions, where public citizen input is valuable. If a developer is proposing something that goes below minimums or does not conform to zoning regulations, then it is reasonable to go through the more time consuming process that we currently have. This brings up the question of how the developer would introduce something different to the written law. This could be a problem under typical PUD (Planned Unit Development) regulations, which typically allow blanket changes to the minimums when alternative designs are not covered by typical zoning.

This PUD Pandora’s box, once opened, can have devastating results if the regulators and the neighbors both agree that the plan is simply not good enough. The developer thinks the plan is just dandy as is, but in reality most PUD proposals are simply too vague to be functional. A battle of wills that can last years often ensues.
In the end , these expensive delays increase lot costs, and the home buyer ultimately pays. If a special ordinance such as PUD, Cluster Conservation, or Coving was specifically spelled out in a rewards-based — instead of a minimums-based — system, developers could get benefits for great plans complete with open space and connectivity, typically density and setback relaxations.

While writing Prefurbia, we began to ask ourselves, how did we take something so simple and let it get so out of control? The third world countries are progressive enough to actually allow developers who comply with the rules to quickly build their neighborhood. Maybe they are not so far behind us after all.

Perhaps our regulations and planning approach is intended to keep the system “busy” with billable hours. Imagine if we could get a conforming plan stamped, and the next day construction could begin. How many billable hours would be eliminated, how much construction cost and land holding interest saved? That would be very hard to calculate, but it’s likely significant.

“It is difficult to get a man to understand something when his salary depends upon his not understanding it…" Al Gore, An Inconvenient Truth

The inconvenient truth won’t win us many friends in the consulting industry whose incomes depend upon generating billing time in meetings. But can we afford to continue down the path we are presently on? We need to take a hard look at the regulations. Are they written solely to provide the highest living standards? Or do they generate the highest billable hours for the consultants who propose them?

Rick Harrison is President of Rick Harrison Site Design Studio and author of Prefurbia: Reinventing The Suburbs From Disdainable To Sustainable. His websites are rhsdplanning and prefurbia.com.

The Changing Landscape of America: The Fate of Detroit

Fri, 29 May 2009 01:17:55 -0400

INTRODUCTION

During the first ten days of October 2008, the Dow Jones dropped 2399.47 points, losing 22.11% of its value and trillions of investor equity. The Federal Government pushed a $700 billion bail-out through Congress to rescue the beleaguered financial institutions. The collapse of the financial system in the fall of 2008 was likened to an earthquake. In reality, what happened was more like a shift of tectonic plates.

In 1912 a German scientist, Alfred Wegener, proposed that the continents were once joined together as one giant land mass called Pangea.

About 200 million years ago the continents began to drift apart as the globe separated into eight distinct tectonic plates. History will record that the financial tectonic plates of our world began to drift apart in the fall of 2008. They have not stopped moving and the outcome of where they will end up remains uncertain.

PART ONE – THE AUTOMOBILE INDUSTRY

Edsel, Packer, Studebaker, Hudson, Nash, AMC – the demise of these brands may have seemed tragic at the time, but were actually a sign of industrial health. In contrast, for the last fifty years the American automobile industry has been static. Despite the proliferation of Japanese, Korean and German imports, General Motors, Ford and Chrysler managed to hold on to a majority of the domestic market, with a dizzying stable of makes and models that grew to near 17 million new car sales in 2007. That epoch is now over. The tectonic plates have shifted under the automotive business and a year from now, the industry will bear little resemblance to the static structure of the last fifty years.

Fifty years ago General Motors owned more than 50% of the American market and automobile jobs made up one seventh of the US workforce. It was said that when GM sneezed the US economy caught a cold. GM shares now sell for less than a cup of coffee at Starbucks. Now GM is about to enter bankruptcy.

The brands are dissolving, Oldsmobile was the first casualty. Pontiac and Hummer have been discontinued. When they reorganize, eleven hundred dealers will be terminated. General Motors will close all its plants for three months this summer. Many will never reopen. The New GM, to be known as Government Motors, will be owned by the UAW (20%) and the Federal Government (70%). Twenty billion of tax-payer loans will be converted to ownership to make the UAW pensions liquid. The debt holders will see their senior $27 billion investment converted into just 10% of stock. The shareholders will be wiped out.

The New GM will become the platform for small fuel efficient cars, hybrids, electric vehicles and experimental technologies mandated by an ever demanding government. Its shareholders vanquished, The New GM will bear no resemblance to the car company that we have known for the last 50 years. Can the Chevy Volt rescue GM? The answer is no.

GM will continue to shrink as their SAAB and Saturn franchises are sold off to the Chinese. China’s automobile sales are up 10% this year versus declines of 23% in the US and 15% in Europe. Chinese automobile manufacturers are grabbing market share, 30% this year versus 26% in 2008, while their competitors are distracted. Chinese companies unknown to Americans like Geely Motors, Chery Automobiles or BYD Co. will buy SAAB or Saturn for their dealer network. Warren Buffett invested $230 million into BYD, a firm that has been manufacturing cars for just six years. They already provide batteries to Ford and GM and soon will be building the world’s least expensive mass produced hybrid and electric vehicles. Geely plans to triple its domestic sales to 700,000 by 2015 and Chery plans to introduce 36 new models over the next two years.

Chrysler is in far worse shape and will likely never recover. The Federal Government already forced it into bankruptcy. Seven hundred and eighty nine dealers have been told that their franchises are terminated. Its shotgun marriage to Fiat will look more like a surgical amputation of unnecessary body parts than a marriage. If Fiat remains in the game, they will do so for the Jeep brand and a portion of the dealer network. Like Oldsmobile and Pontiac, Plymouth and Dodge brands are doomed as well as most of the Chrysler line. No one will mourn the demise of the Crossfire, Pacifica, Sebring, or the PT Cruiser. Fiat should keep the new Chrysler 300, a beautiful design that deserves to be built. Chrysler has not produced many stars in the last few decades. The trail blazing design of the 300 brought the full size sedan back from the dead.

Chrysler will jettison the weakest of its dealers in bankruptcy. Fiat will retain the big dealers in the network. They will bring the stunning and iconic Fiat 500 to America, a fuel efficient small car that will enjoy the same success as Volkswagen’s retro Beetle. Fiat will also use the dealer network to bring the Alfa-Romeo back to America. The Fiat-Jeep-Alfa dealer of the future will bear no resemblance to the staid Chrysler-Dodge-Plymouth dealer of today.

The surprising winner among the American troika of manufacturers is the Ford Motor Company. Ford and Lincoln will survive because they took no government bail-out money. Mercury may not survive but Ford and Lincoln should make it through the transition. The new Ford-Lincoln will be the refuge for auto enthusiasts who want attractive fast and powerful cars. Ford will become the Apple of the auto business, doing its own thing and flaunting political correctness and conventional wisdom. Ford’s namesake CEO has been an environmentalist for many years so Ford was well into fuel economy and hybrids before the tectonic plates began to move last fall. At just $5.00 per share, Ford is a tantalizing buy for the long term.

One can no longer call Mercedes, BMW, Toyota and Honda imports as many of their cars are made entirely in the U.S. The Japanese system is different than the American counterpart although we are drifting toward their model. The Japanese government plays a heavy hand in their industry, subsidizing the encroachment into new markets until the brands have stabilized market share. But they are not immune. Toyota lost $7.7 billion in the last quarter – even more than GM.

True imports like Volkswagen will weather the storm because they were well positioned with small fuel efficient cars long before the tectonic plates began to shift. VW is making a huge bet that oil will top $100/barrel again soon and their fuel efficient and clean diesels will be accepted by American drivers.

The biggest winner is obviously the UAW and their pensions which have been bailed out with tax payer money by an administration beholden to its labor supporters. Who will be the biggest loser? Clearly, it will be America’s small towns. Our small towns will lose their local dealer and their choice in automobiles. They will be forced to buy the brand that remains in town or drive scores of miles to the next closest dealer for service. Most small town auto dealers were also the most generous members of the community. Charitable giving and support will wither as will local sales tax revenues when the big ticket automobile sales tax revenues disappear. Ironically, as the plates continue to shift, America’s small towns could be decimated by the changes in the automobile industry as they were one hundred years ago when the automobile shifted millions from rural communities to the cities.

A year from now the landscape of America will be forever changed but the plates will continue to shift. Five years from now, will American ingenuity bring about a renaissance of the American automobile industry? Or, will what is left of this industry be gobbled up by the Chinese and the Korean manufacturers as the Japanese did in the 70s and 80s? The key issue may be what role the government will play. Will Americans buy cars designed by government bureaucrats and built by the unions that own the factories? Will an administration devoted to “coercing” Americans out of their cars be able to simultaneously save the auto industry?

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This is the first in a series on the Changing Landscape of America. Future articles will discuss real estate, politics, healthcare and other aspects of our economy and our society. Robert J. Cristiano PhD is a successful real estate developer and the Real Estate Professional in Residence at Chapman University in Orange, CA.

Portland: A Model for National Policy?

Wendell Cox — Thu, 28 May 2009 01:18:54 -0400

United States Secretary of Transportation Ray LaHood and Washington Post columnist George Will have been locked in debate over transit. Will called LaHood the “Secretary of Behavior Modification” for his policies intended to reduce car use, citing Portland’s strong transit and land use planning measures as a model for the nation. In turn, the Secretary defended the policies in a National Press Club speech and “upped the ante” by suggesting the policies are “a way to coerce people out of their cars.”

These are just the latest in a series of media accounts about Portland, usually claiming success for its policies that have favored transit over highway projects as well as its “progressive” land use policies. Portland has also become the poster child for those who advocate planning restrictions and subsidies favoring higher density development in parts of the urban core.

Indeed if Secretary LaHood has his way, Portland could become The Model for federal transportation policy. So perhaps it is appropriate to review what it has accomplished.

Portland’s Mediocre Results

Portland’s record of transit emphasis began more than 30 years ago, when the area “traded in” federal money that was available to build an east side freeway to build its first light rail line. The east side light rail opened in 1986. Since that time, Portland has significantly increased its transit service, especially opening three more light rail lines (West Side, North Side and Airport) as well as a downtown “streetcar.”

Portland’s Static Transit Market Share: With these new lines and expanded service, Portland has experienced a substantial increase in transit ridership. Passenger miles have increased more than 130 percent since 1985, the last year before the first light rail line was opened. This is an impressive figure.

However, over the same period, automobile use increased just as impressively. In 1985, approximately 2.1 percent of motorized travel in the Portland urban area was on transit and it remained 2.1 percent in 2007, the latest year for which data is available.

Portland’s Declining Transit Work Trip Market Share: One of transit’s two most important contributions to a community is providing an alternative to the automobile for the work trip (the other important contribution is mobility for low income citizens). Work trip rider attraction is important because much of this travel is during peak periods, when roadways are operating at or above full capacity. In 1980, the last year for which data is available before the first light rail line opened, United States Bureau of the Census data indicates that transit’s work trip market share was 9.5 percent in the Portland area counties of Clackamas, Multnomah and Washington covered by Portland’s strong land use policies. Yet despite this, and the transit improvements, the work trip market share has not grown. By 1990, transit’s market share had dropped a third, to 6.3 percent. It rose to 7.6 percent in 2000 and by 2007 had fallen back to 6.8, despite opening two new light rail lines since 2000 (Figure 1). Remarkably, transit’s 2007 work market share was 28 percent behind its 1980 share and had fallen 10 percent since 2000.

Figure 1:

Yes, Portland did increase its transit use, but failed to increase the share of travel on transit and the proportion of people riding transit to work declined.

Driving the Portland Evangelism: GHG Emissions

Secretary LaHood’s affection for Portland appears to principally be that its policies can materially assist in the objective of reducing greenhouse gas (GHG) emissions. The data is available to test that claim.

We examined GHG emissions per capita by transit in Portland and the urban personal vehicle fleet, including cars and personal trucks (principally sport utility vehicles). Overall, including upstream emissions (such as refining and power production), transit in Portland is about 50 percent more GHG friendly per passenger mile than the 2007 vehicle fleet. If all of the increase in transit passenger miles from 1985 to 2007 replaced automobile passenger miles, then reduction of approximately 50,000 GHG tons can be said to have occurred as a result in 2007 (though as is indicated below, things are not that simple).

That sounds like a large number, until you consider that Portland traffic produces more than 8,000,000 GHG tons per year. Transit’s expansion has reduced GHG emissions by approximately 0.6 percent annually over 22 years. This pales in comparison to the 83 percent national reduction over a 45 year period that would be required by the Waxman-Markey bill being considered by Congress.

The Cost of GHG Emission Reduction

Moreover, GHG emission reduction requires a context. Not all GHG emission reduction strategies make sense. Given the widely held principle that GHG emission removal must not hobble the economy, it is crucial that costs (per ton of GHG removed) be a principal criteria. If excessively costly strategies are employed, the result will be wasted financial resources, which will translate into diminished economic growth and higher levels of poverty. According to the United Nations Intergovernmental Panel on Climate Change (IPCC), between $20 and $50 per ton is the maximum amount necessary to accomplish deep reversal of CO2 concentrations between 2030 and 2050. It is fair to characterize any amount above $50 per ton as wasteful and likely to impose unnecessary economic disruption.

Even that cost may be high. The current “market rate” is about $14 per ton, which appears to approximate the amount that figures such as former vice-president Al Gore, Speaker of the House Nancy Pelosi and California Governor Arnold Schwarzenegger pay to offset their GHG emissions from flying.

Portland Costs of GHG Emission Reduction

This $14 to $50 range provides the context for comparing the cost of GHG emission reduction through transit expansion in Portland. Annual transit costs in Portland more than tripled from 1985 to 2007 (including inflation adjusted operating costs and the annual capital costs of the light rail lines), an annual increase of more than $325 million. This figure is reduced to capture the consumer cost savings from reduced automobile gasoline and maintenance costs. The final result is a cost of approximately $5,500 per ton of GHG removed.

This is 110 times the IPCC $50 maximum and nearly 400 times the Gore-Pelosi-Schwarzenegger standard. If the United States were to spend as much to remove each ton of the likely 83 percent national reduction target, the cost would be $30 trillion annually, more than double the gross domestic product. To call the Portland GHG cost reduction figure extravagant would be an understatement.

Traffic Congestion Increases GHG Emissions

There is not a one-to-one relationship between reduced driving levels and reduced GHG emissions. As traffic congestion increases, urban travel speeds decline and “stop-and-start” traffic increases, fuel consumption is reduced (miles per gallon declines). Some or even all of the supposed gain from reduced driving can be negated by the higher GHGs from traveling in greater traffic congestion.

Portland’s traffic congestion has increased substantially since before light rail. Further, by 2007 Portland’s traffic congestion had become worse than average for a middle-sized urban area and worse than in much larger Dallas-Fort Worth, Atlanta, Philadelphia and Phoenix.

Further, according to information in the Texas Transportation Institute’s Annual Mobility Report, the amount of gasoline wasted due to peak period traffic congestion in Portland rose 18,000,000 gallons from 1985 to 2005 (latest data available, adjusted for the population increase), simply due to greater traffic congestion. The increase in GHG emissions from this excess fuel consumption is estimated to be approximately 200,000 tons annually. This is four times the estimated reduction in GHG emissions that was assumed to have occurred from the increase in transit ridership.

The bottom line: The Portland model inherently produces more congestion and increases GHG emissions. Failure to expand roadways to meet demand and forced densification increase traffic congestion.

Better Models

The ineffectiveness of Portland’s model strategies in GHG emission is in contrast to other strategies. Between 2000 and 2007, the share of people working at home in Portland rose more than one quarter. If transit and working at home should continue their 2000s rates, transit’s work trip share will be less than that of working at home by 2015. Working at home eliminates the work trip, resulting in substantial GHG emission reductions and does it at a cost of $0.00 per ton.

Another approach is the Obama Administration’s automobile fuel efficiency strategy. About the same time as the LaHood-Will debate was heating up, the President announced that automobile manufacturers would be required to increase their corporate average fuel efficiency for cars and light trucks to 35.5 miles per gallon by 2016, a 75 percent performance improvement from that of the present fleet. If this fuel efficiency could be achieved in Portland today, the reduction in GHG emissions would be more than 40 percent. This new policy would eventually close 90 percent of the gap between personal vehicles and transit in Portland.

President Obama indicated that this strategy is costless. The higher costs that consumers will pay for cars will be more than made up by the fuel cost savings. Thus, according to the President, this policy costs $0.00 per ton of GHG emissions removed, less than the IPCC’s $50 and less than Portland’s $5,500. Of course, it is not possible to achieve 35.5 miles per gallon now, but it will be (Figure 2).

Figure 2:

The best hybrid cars now achieve 50 miles per gallon, which makes them less GHG intensive than transit in Portland. President Obama has gone further, indicating the potential for developing 150 mile per gallon cars. The curtain could be rising on a future of cars that emit less GHG emissions per passenger mile than transit. People and officials genuinely concerned about GHG emissions should applaud these advances. On the other hand, people and officials who value coercive behavior modification more than GHG emission reduction are likely to resist.

The Consequences of Coercing People Out of Cars

Moreover, Portland policies ignore a crucial factor: how automobiles facilitate economic growth and employment. Generally, the research indicates that the economic performance of metropolitan areas is enhanced by greater mobility. Moreover, no transit system provides the extensive mobility made possible by the automobile, not in America and not even in Europe. Coercing people out of cars coerces some out of employment and into poverty.

Even where transit service is available, it generally takes longer than traveling by car. In 2007, travel to work by transit took 3:50 (three hours and 50 minutes) per week longer than driving in the nation’s largest metropolitan areas. With all of Portland’s transit improvements, it still takes approximately 3:15 longer per week to commute by transit than by driving. It appears that Secretary LaHood would add more than three hours (time many don’t have) to our work trip each week.

The Land Use Cost

The second plank of The Model is strong land use regulation (smart growth), which economic research shows to materially increase house costs, which would lead to a lower standard of living.

Time to Turn Off the Ideological Autopilot

The policies of The Model Portland have no serious potential for reducing GHG emissions and could even make it worse. On the other hand, the rapidly developing advances possible from improved vehicle technology, something the Administration espouses, show great promise. Behavior modification a la The Model turns out not only to be undesirable, but also unnecessary.

Wendell Cox is a Visiting Professor, Conservatoire National des Arts et Metiers, Paris. He was born in Los Angeles and was appointed to three terms on the Los Angeles County Transportation Commission by Mayor Tom Bradley. He is the author of “War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life.”

Can California Make A Comeback?

Joel Kotkin — Tue, 26 May 2009 00:17:16 -0400

These are times that thrill some easterners' souls. However bad things might be on Wall Street or Beacon Hill, there's nothing more pleasing to Atlantic America than the whiff of devastation on the other coast.

And to be sure, you can make a strong case that the California dream is all but dead. The state is effectively bankrupt, its political leadership discredited and the economy, with some exceptions, doing considerably worse than most anyplace outside Michigan. By next year, suggests forecaster Bill Watkins, unemployment could nudge up towards an almost Depression-like 15%.

Despite all this, I am not ready to write off the Golden State. For one thing, I've seen this movie before. The first time was in the mid 1970s. The end of the Vietnam War devastated the state's then powerful defense industry, leaving large swaths of unemployment and generating the first talk about the state's long-term decline.

An even scarier remake came out in the 1990s. Everything was going wrong, from the collapse of the Soviet Union and the unexpected deflating of Japan to a nearly Pharaonic set of plagues, ranging from earthquakes and fires to the awful Los Angeles riots of 1992.

Yet each time California came roaring back, having reformed itself and discovered new ways to create wealth. In the wake of the early '70s decline came the first full flowering of Silicon Valley as well as other tech regions, from the west San Fernando Valley to Orange and San Diego counties. Much of the spark for this explosion of growth came from those formerly employed in the defense and space sectors.

The '90s recovery was even more remarkable. Amazingly, the politicians actually were part of the solution. Aware the state's economy was crashing, the state's top pols--Assembly Speaker Willie Brown, Sen. John Vasconcellos, Gov. Pete Wilson--made a concerted effort to reform the state's regulatory regime and otherwise welcomed businesses.

The private sector responded. High-tech, Hollywood, international trade, fashion, agriculture and a growing immigrant entrepreneurial culture all generated jobs and restored the state's faded luster.

These sectors still exist and still excel even under difficult conditions. The problem this time is that the political class seems clueless how to meet the challenge.

Politics have not always been a curse to California. In the 1950s and 1960s, the Golden State's growth stemmed in large part from what historian Kevin Starr describes as "a sense of mission" on the part of leaders in both parties. Starr chronicles this period in his forthcoming book, Golden Dreams: California in an Age of Abundance, 1950-1963.

Under figures like Earl Warren, Goodwin Knight and Pat Brown, Starr notes, California "assembled the infrastructure for a great commonwealth." Their legacy--the great University system, the California Water Project, the freeways and state park system--still undergirds what's left of the state economy.

Perhaps the best thing about these investments was that they helped the middle class. Sure, nasty growers, missile makers and rapacious developers all made out like bandits--which is why many of them also backed Pat Brown. But the '50s and '60s also ushered in a remarkable period of widespread prosperity.

Millions of working- and middle-class people gained good-paying jobs, and could send their children to what was widely seen as the world's best public university system. People who grew up in New York tenements or dusty Midwest farm towns now could enjoy a suburban lifestyle complete with single-family homes, cars, swimming pools and drive-through hamburger stands.

"This was an epic success story for the middle class," historian Starr notes. It's one reason why, when people ask me about my politics, I proudly identify myself as a Pat Brown Democrat.

That's why California's current decline is so bothersome. A state that once was home to a huge aspirational middle class has become increasingly bifurcated between a sizable overclass, clustered largely near the coast, and a growing poverty population.

Over the past 40 years California's official poverty rate grew from 9% to nearly 13% in 2007, before the recession. Three of its counties--Monterey, San Francisco and Los Angeles--boast large populations of the über rich but, adjusted for cost of living, also suffer some of the highest percentages of impoverished households in the nation.

Most worrisome has been the decline of the middle--the increasingly diverse ranks of homeowners, small business people and professionals. The middle has been heading out of state for much of the past decade. Politically, they have proven no match for the power of the wealthy trustfunders of the left, the powerful public employee union as well as a small, but determined right wing.

The good news is that the middle class shows signs of stirring. The nearly two-to-one rejection of the governor's budget compromise reflected a groundswell of anger toward both the Terminator and his allies in the legislature.

Simply put, California voters sense we need something more than an artful quick fix built to please the various Sacramento interest groups. Required now is a more sweeping revolutionary change that takes power away from the state's most powerful lobby, the public employees, whose one desired reform would be ending the two-thirds rule for approval of new taxes and budgets.

Middle-class Californians are asking, with justification, why we should be increasing taxes--we're ranked sixth-highest in the nation--to pay for gold-plated state employee pensions as well as an ever-expanding social welfare program. Although state spending has grown at an adjusted 26% per capita over the past 10 years, it is hard to discern any improvement in roads, schools or much of anything else.

As an opening gambit, the right's solution--strict limits on state spending--makes perfect sense. However, long-lasting reform needs to be about more than preserving property and low taxes. To appeal to the state's increasingly minority population, as well as the younger generation, a reform movement also has to be about economic growth and jobs.

Not surprisingly, local leaders of the "tea party" movement gained some profile from last week's vote. Yet the right, which has exhibited strong nativist tendencies, is not likely to win over an increasingly diverse state.

In my mind, California's revival depends on three key things. First, the lobbyist-dominated Sacramento cabal needs to be shattered, perhaps turning the legislature into a part-time body, as proposed by one group. Perhaps the cleverest plan has come from Robert Hertzberg, a former Speaker of the Assembly who heads up the reformist California Forward group.

Hertzberg proposes a radical decentralization of power to the state's various regions, as well as cities and even boroughs in urban areas like Los Angeles. This would break the power of the Sacramento system by devolving tax and spending authority to local governments.

Secondly, California needs to develop a long-term economic growth strategy. Over the past decade, California's growth has become ever more bubblicious, dependent first on the dot-com bubble and then one in housing. The basic economy--manufacturing, business services, agriculture, energy--has been either ignored or overly regulated. Not surprisingly, we could see 20% unemployment, or worse, in places like Salinas and Fresno by next year.

Third, both political reform and an economic strategy aimed at restoring upward mobility depends on a revival of middle-class politics in this state. It would include building an alliance between the more reasoned tea partiers and saner elements of the progressive community.

The new alliance would not be red or blue, liberal or conservative, but would represent what historian Starr calls "the party of California." At last there could be a political home for Californians who are angry as hell but still not yet ready to give up on the most intriguing, attractive and potentially productive of all the states.

This article originally appeared at Forbes.

Joel Kotkin is executive editor of NewGeography.com and is a presidential fellow in urban futures at Chapman University. He is author of The City: A Global History and is finishing a book on the American future.

Life After Sunrail

Richard Reep — Sat, 23 May 2009 01:06:19 -0400

With their tails between their legs, Central Florida’s leaders returned from Tallahassee in early May without funding from the Florida Senate for Sunrail, the region’s proposed commuter rail system. This failure to convince the state Senate to fund Sunrail is a major political defeat for the 1.8 million people who were said to be served by this train. This failure now gives Central Florida a chance to recreate its growth scenario from scratch, without relying on commuter rail to cure the region’s ills.

Blame bad timing: In a low-tax state with a down economy, asking for that kind of money takes nerve. “The loss of Sunrail may…have implications for efforts to reconstruct Interstate 4,” stated Harold Barley, Executive Director of Metroplan Orlando, a publicly funded organization that studies and advocates transportation projects in the region. Barley’s understatement is almost droll, for the defeat signals a significant political loss, years of wasted effort, and a rejection (for the second time) of massive federal startup money. In short, the calculus of Central Florida’s growth must start again almost from zero.

The leaders now will lick their wounds, but is it really time to ask “what comes next?” Many of the arguments in favor of Sunrail echo the arguments that Wendell Cox devastated earlier in The New Geography. After their first defeat in 1999, the leaders of the region spent ten years convincing themselves of the merits of commuter rail, but without selling the same goods to others in the state of Florida. This region’s population now waits, while the leaders decide whether to sink ten more years into trains, or abandon this dream and begin writing a new story for Orlando.

It is time to find a growth vision that is viable, and can be implemented within the power of the region’s leadership. Commuter rail’s biggest claim was to take one lane off the region’s only north-south highway (Interstate 4), replacing this lane with trains on an existing track. The track runs like a twisty, bent stick right up through the center of the region, and the track’s original usage as a freight system has been largely passed by the region’s growth. Sunrail’s other claims included significant travel time savings, encouragement of transit-oriented development, and retainage of 20 percent of the region’s federal gas taxes (why aren’t we getting this money now?). These claims will never be tested against reality; meanwhile, many of the smaller towns served by the system are likely expressing quiet relief that commuter rail’s financial burden will not be turned over to them in 2017.

No doubt, this loss is disappointing to those who envision Washington DC, Atlanta, New York, Boston, or other entrained cities as a model. Yet it constitutes a perfect signal to create a unique vision for Orlando. Unlike the regions mentioned above, Orlando’s economy is shockingly monocultural, devoted mostly to tourism and supporting industries. The most significant way Central Florida can better its future is to attract and retain other forms of employment, rather than build another rigid transportation spine of questionable sustainability.

Of course, transportation choices can help, but the question of rail seems academic at this point. Diversification of transportation away from a single imagined commuter rail means, for one thing, that the regional bus system should become more effective than it currently is. Lynx currently operates one bus type (huge), and this “one size fits all” solution misses opportunities and makes for slow rides with multiple transfers. Lynx is referenced in commuter rail’s promotional literature, which vaguely promised “enhanced bus service” to feed commuter rail stops. If Lynx was indeed poised to enhance bus service, then that act is more important now than ever. What are we waiting for?

Instead of a rigid stick up the center of a dispersed, multipolar city, the new wave of commuter transportation might look more like an octopus, which has no backbone and multiple wiggly arms. No backbone means the system may resemble a network, rather than a trunk with branches. Wiggly might mean that smaller vehicles service localized neighborhood routes, and it also might mean that the routes could change depending on development and growth patterns. If either of these sounds questionable from a cost point of view, weigh them against the cost of commuter rail and they will look like amazing bargains. Whether a bureaucratic government agency like Lynx can handle this assignment may also be questionable. Perhaps the solution could involve private services, much like the commuter systems that were born in earlier times – the streetcars in San Francisco, for example – which operated for profit.

Some will argue that trains are sexy compared to buses, but it is time to look at what really is sexy: having a real choice to commute while saving money. The form of this new transportation system may be electric jitneys, rubber-tired trolleys, or lake-hopping hovercraft; what is more important than form is their functional qualities. The transportation planners, from the federal level down to the local level, need to truly understand the needs of people and respond to them in a more fine-grained way. Diversification may mean trying different ideas until one is found that works.

Diversification could also mean less transportation. If the goal of a commuter rail system was to take cars off the interstate, then perhaps the leadership could meet this goal by promoting employment-based growth, rather than growth for its own sake. Neighborhoods that support an employment center are what built the region – think Lake Eola around downtown, or Winter Park around Rollins College. Getting back to that will allow density clusters that have sustainable value, rather than be form-based simulacra of antique small towns.

Density clusters can be positive parts of a city, where residential and employment bases are intertwined, and need not drive affordability up out of reach. Orlando, as an aspirational city, is currently more affordable than most, and the multiple-center model of Orlando never seemed to quite fit the single-spine commuter rail model. Cluster spacing allows for lower-density infill regions which can appeal to both middle class and affluent families. True commuter rail serviced the late 19th century single-center city quite well, but it would be hard to effectively service the late 20th century multiple-center, edge-city conditions of Orlando. With no natural boundaries, the region will continue to grow in all directions, and continue to regenerate itself within the urban centers that collapse and renew themselves through generations.

Losing a battle could mean winning a war. The Orlando region has for too long been thought of as an ephemeral city composed of theme parks. Losing its commuter rail system will reinforce this perception, but it can also shock the region’s leadership into more profound thinking and action. By taking advantage of this loss, and shaking off the distraction of trains, the region can truly concentrate on diversification of its population and creating a flexible, cost-sustainable, multi-centered transportation system that could ably serve Central Florida’s needs for the future.

Richard Reep is an Architect and artist living in Winter Park, Florida. His practice has centered around hospitality-driven mixed use, and has contributed in various capacities to urban mixed-use projects, both nationally and internationally, for the last 25 years.

The Successful, the Stable, and the Struggling Midwest Cities

Aaron M. Renn — Fri, 22 May 2009 01:47:31 -0400

The Midwest has a deserved reputation as a place that has largely failed to adapt to the globalized world. For example, no Midwestern city would qualify as a boomtown but still there remain a diversity of outcomes in how the region’s cities have dealt with their shared heritage and challenges. Some places are faring surprisingly well, outpacing even the national average in many measures, while others bring up the bottom of the league tables in multiple civics measures.

Let us examine the health of various cities, using population growth as a heuristic proxy for overall civic health. Looking at population change from 2000 to 2008, we will classify a city as "successful" if its metro area population growth exceeded the national average growth rate of 8% during that period, as "stable" if it had a population growth rate between 3% and 8%, and as "struggling" if its growth was less than 3%. Let us also put Chicago into its own category of "global city". It is simply one of a kind in the Midwest, a colossus of nearly 10 million people, and not easily measured against the other cities. Indeed, it is really three cities in one, a prosperous urban core, an archipelago of successful upscale suburbs and edge based growth to the west and north, with a sea of deteriorating city neighborhoods and stagnant to declining suburbs surrounding them. On our scale, Chicago would be "stable" – its inner core has grown but the city overall has lost population, while the outer ring has grown strongly. As a region, it has grown somewhat below the national average.

Here are the results of our tiering, including all cities in the Midwest* with metro areas exceeding 500,000 in population:

Global City
Chicago (5.2%)

Successful Cities
Des Moines (15.6%)
Indianapolis (12.5%)
Madison (11.9%)
Columbus (9.9%)
Kansas City (9.0%)
Minneapolis-St. Paul (8.8%)

Stable Cities
Cincinnati (7.2%)
Grand Rapids (4.9%)
St. Louis (4.4%)
Milwaukee (3.2%)

Struggling Cities
Akron (0.5%)
Detroit (-0.6%)
Dayton (-1.4%)
Toledo (-1.5%)
Cleveland (-2.8%)
Youngstown (-6.1%)

These tiers, based only on a single criterion and arbitrary boundaries, nevertheless basically conform to how these cities are performing both economically and in terms of perceptions.

A few interesting things emerge:

There are a surprisingly large number of Midwestern cities that are growing faster than the US average population. This indicates pockets of strength, in its larger metros at least, seldom associated with the Midwest.
The clear dominance of the successful list by state capitals. This is so pronounced that I have put forth what I call the "Urbanophile Conjecture", which is that if you want to be a successful Midwestern city, it helps to be a state capital with a metro area population of over 500,000. The only successful city on the list that is not a state capital is Kansas City.
The 500,000 barrier seems to be important as well. The state capitals below that threshold - Lansing, Springfield, and Jefferson City – would not qualify as successful on this list. Note too that the presence or absence of the major state university does not appear to be a decisive factor. Des Moines and Indianapolis are not home to their states' flagship universities. The home of the academic powerhouse that is the University of Michigan is the Ann Arbor metro area, which was not included in this list because its population is only about 350,000. Notwithstanding, its growth rate would have put it into the stable category.
In a region in which there is such divergence between the performance of cities, a diversity of city specific policies are required. There is no one size fits all for the Midwest. There may indeed be a base of pan-Midwest policies worth pursuing – improvements in education, attractiveness to migrants, better conditions for innovative entrepreneurship, etc – but successful approaches will be those most tailored to uniquely local conditions. For example, a state capital or University town may have different needs than a place that has neither.

Some suggested areas to investigate by city tier are:

Chicago. How can it ease the gap between the thriving global city of Chicago – largely located around the Loop as well as the northern and western suburbs – and the parts of the region that are falling behind, largely the western city neighborhoods and southern edge of metropolis? How do you do this without sacrificing its overall competitiveness? Can the policies appropriate to each be reconciled?
Successful Cities. Their policy focus should be on maintaining favorable demographic and economic conditions, and dealing with decaying areas of their urban cores and the potential for decay in some inner ring suburbs. Should the civic aspiration be desirous of it, tuning the engine to attempt to shift the growth rate into high gear to target a profile closer to the Sunbelt boomtowns would be a further focus area. Each city would need to examine which specific policy levers it could pull to attempt to do this. Clearly modernizing and expanding infrastructure to keep up with growth in these places and maintain their high quality of life is a clear imperative.
Stable Cities. Their challenge is to bring growth rates up to average or above average levels. It would be worthwhile for them to study the successful areas, and ask what policies and approaches might be adopted. Kansas City offers the best encouragement here. It has managed to maintain a strong growth rate despite not being a state capital and being part of a bi-state metro region. Kansas City features lows costs, high quality of life, a relatively stable housing marketing, and a pro-business culture. It is clearly a standout and worthy of further study for that reason. It may hold the key for moving the stable cities up into the successful tier. Geographically, it is notable that Kansas City is a border state on the far edge of the Midwest, and could arguably be called a Great Plains city. Is that a factor? Some type of peer city comparison with the successful cities, and especially Kansas City, might be warranted here.
Struggling Cities. Unfortunately, there isn't a magic bullet to solve the long festering problems in these places. All of them were heavily industrialized and have borne the brunt of globalization, particularly in manufacturing. This is especially the case in cities linked to the domestic automobile industry, which is clearly in a state of crisis. Until the automobile industry completes its restructuring, and out migration right sizes some of these areas, there does not seem to be a clear path to restart growth. Youngstown, which brings up the bottom of our league table, perhaps offers the best road forward. It is trying to right-size itself to a permanently smaller, but more sustainable, future population based on an aggressive controlled shrinkage plan that has received extensive national notice. This type of plan is likely something all of these cities need to be actively considering as the large fixed costs support a population base that no longer exists will become increasingly unaffordable as the population further shrinks. These cities likely also will need special state and federal help to back this shrinkage plan.

* The Midwest is defined as Illinois, Indiana, Iowa, Michigan, Minnesota, Missouri, Ohio, and Wisconsin.

Aaron M. Renn is an independent writer on urban affairs based in the Midwest. His writings appear at The Urbanophile.

Housing Downturn Update: We May Have Reached Bottom, But Not Everywhere

Wendell Cox — Thu, 21 May 2009 01:21:59 -0400

It is well known that the largest percentage losses in house prices occurred early in the housing bubble in inland California, Sacramento and Riverside-San Bernardino, Las Vegas and Phoenix. These were the very southwestern areas that housing refugees fled to in search of less unaffordable housing in California’s coastal metropolitan areas (Los Angeles, San Francisco, San Diego and San Jose).

Yet now the prices in these hyper-expensive markets are beginning to fall. Once considered widely immune from the severe housing slump, the San Francisco area now has muscled its way into the list of biggest losers. The newly published first quarter 2009 house price data from the National Association of Realtors indicates that prices are down 52.5 percent from the peak. Only Riverside-San Bernardino and Sacramento have experienced greater losses out of the 49 metropolitan areas with a population of more than 1,000,000 for which there is data (see table below). Other metropolitan areas that have seen prices drop more than 50 percent include Phoenix, Las Vegas and, for very different reasons, that rustbelt sad sack, Cleveland.

Table 1
Median House Price Loss: Metropolitan Areas Over 1,000,000 Population
Rank	Metropolitan Area	Median House Price % Loss from 2000-2008 Peak	Median House Price Loss from 2000-2008 Peak
1	Riverside-San Bernardino, CA	-57.7%	$235,600
2	Sacramento, CA	-56.5%	$219,600
3	San Francisco, CA	-52.5%	$444,800
4	Phoenix, AZ	-51.9%	$139,200
5	Cleveland, OH	-51.5%	$74,300
6	Las Vegas, NV	-51.3%	$163,800
7	Los Angeles, CA	-48.8%	$289,400
8	San Jose, CA	-48.0%	$415,000
9	San Diego, CA	-47.5%	$291,900
10	Miami-West Palm Beach, FL	-47.3%	$185,200
11	Orlando, FL	-43.1%	$117,200
12	Tampa-St. Petersburg, FL	-42.2%	$98,800
13	Washington, DC-VA-MD-WV	-37.3%	$165,900
14	St. Louis, MO-IL	-35.8%	$56,300
15	Chicago, IL	-35.2%	$100,900
16	Atlanta, GA	-34.4%	$60,600
17	Memphis, TN-MS-AR	-34.0%	$49,400
18	Providence, RI-MA	-33.6%	$102,600
19	Boston, MA-NH	-32.5%	$140,200
20	Cincinnati, OH-KY-IN	-28.6%	$42,600
21	Richmond, VA	-27.9%	$66,800
22	Indianapolis, IN	-26.6%	$34,300
23	Minneapolis-St. Paul, MN-WI	-25.9%	$60,800
24	Columbus, OH	-24.5%	$38,400
25	Denver, CO	-24.1%	$61,200
26	Birmingham, AL	-23.2%	$39,300
27	Jacksonville, FL	-22.4%	$44,600
28	Charlotte, NC-SC	-22.1%	$48,700
29	New York, NY-NJ-PA	-21.9%	$104,700
30	Virginia Beach-Norfolk, VA	-21.2%	$54,000
31	Kansas City, MO-KS	-20.4%	$32,400
32	Seattle, WA	-20.1%	$79,500
33	Pittsburgh, PA	-19.0%	$24,300
34	Hartford, CT	-17.7%	$47,800
35	Portland, OR-WA	-17.0%	$51,100
36	Baltimore, MD	-16.3%	$47,900
37	New Orleans, LA	-15.6%	$27,800
38	Philadelphia, PA-NJ-DE-MD	-15.2%	$37,000
39	Louisville, KY-IN	-15.1%	$21,500
40	Rochester, NY	-14.5%	$18,000
41	Houston, TX	-13.6%	$21,800
42	Dallas-Fort Worth, TX	-13.5%	$21,100
43	Buffalo, NY	-13.1%	$15,000
44	Milwaukee, WI	-12.1%	$27,800
45	Salt Lake City, UT	-6.7%	$16,500
46	San Antonio, TX	-6.2%	$9,800
47	Austin, TX	-6.1%	$11,900
48	Raleigh, NC	-5.3%	$12,600
49	Oklahoma City, OK	-3.3%	$4,500

Cleveland, the newest entrant to the “over 50” club, fell largely because of the collapse of its industrial economy. It remains the only one of the thirteen mega-losers without prescriptive land use policies (sometimes called “smart growth”), which raise house prices by rationing land for development and imposing more stringent regulatory requirements. Cleveland illustrates a point made in a previous commentary: that the huge house price losses in the housing downturn have spread broadly from the original metropolitan areas that precipitated Meltdown Monday, the Lehman Brothers bankruptcy on September 15, and the Panic of 2008.

During Phase I of the housing downturn (through September 2008), the largest losses were concentrated in the “Ground Zero” markets of California, Florida, Las Vegas, Phoenix and Washington, DC. In each of these 11 markets, median house prices dropped at least 25 percent, with per house over $100,000 except in Tampa-St. Petersburg during Phase I. These markets, all with more prescriptive planning, accounted for nearly 75 percent of the gross house value loss in the nation, with other more prescriptive markets accounting for another 20 percent. The more responsive markets, where land use regulation follows more traditional market-driven lines, accounted for slightly more than 5 percent of the loss.

The Chart below and Table 1 in The Housing Downturn in the United States: 2009 First Quarter Update financial collapse, however, now has spread the losses much more generally. In Phase II, the Ground Zero markets represented 44 percent of the loss, the other more prescriptive markets 38 percent and the more responsive markets 18 percent.

As of the first quarter of 2009, prices had dropped in all major metropolitan areas. The average per house loss in the Ground Zero markets was still the highest, at 48 percent, though the overall all loss had increased to 34 percent.

There are indications that the housing downturn may be slowing. The latest data indicates that the median house price increased in March, though not enough to forestall a loss in the first quarter. Another indicator is the fact that the Median Multiple (median house price divided by median household income) has fallen to a national level of 3.1, which is slightly more than the 2.9 historic rate and well below the 4.6 peak.

The best news of all is that the Median Multiple has dropped to 3.8 in the Ground Zero markets, which is equal to the historic level and well below the peak of 7.3. In the other more prescriptive markets, the Median Multiple is at 3.5, above the 2.9 historic average but well below the peak of 4.8. In the more responsive markets, the Median Multiple has dropped to 2.6, just above the historic average of 2.5 and below the peak figure of 3.2.

Prices have fallen so much that they now stand at historic 1980 to 2000 Median Multiple levels in 18 of the 49 metropolitan areas. Critically, this includes the Ground Zero markets of Riverside-San Bernardino, Sacramento, Phoenix and Las Vegas.

Other Ground Zero markets have seen much of their price inflation whittled away, but still have a way to go. Prices need to decline $33,500 to reach the historic Median Multiple level in Los Angeles, $32,300 in Miami, $31,200 in Washington, $18,500 in San Francisco, $11,100 in San Diego and only $1,700 in Tampa-St. Petersburg.

In other markets, however, prices still have some distance to go before the historic Median Multiple is reached. The largest decrease would have to occur in New York, at $122,000, followed by Portland ($95,000), Seattle ($94,000), Baltimore ($75,000) and Salt Lake City ($74,000). Other markets, including Philadelphia, Virginia Beach, Milwaukee and Ground Zero San Jose would need to have price declines of more than $50,000 to restore their historic Median Multiples. See Table 2.

Table 2
Median House Price Reduction Required to Reach Historic Price/Income Ratio (Median Multiple)
		Median House Price Reduction Required to Reach 1980-2000 Median Multiple	Median Multiple
Rank	Metropolitan Area		1980-2000 Average	2000-2008 Peak	Current (2009: 1st Quarter)
1	New York, NY-NJ-PA	$122,200	3.9	7.7	5.8
2	Portland, OR-WA	$94,700	2.7	5.4	4.4
3	Seattle, WA	$94,400	3.3	6.2	4.7
4	Baltimore, MD	$74,700	2.6	4.6	3.7
5	Salt Lake City, UT	$73,800	2.6	4.3	3.8
6	Philadelphia, PA-NJ-DE-MD	$61,500	2.4	4.2	3.4
7	San Jose, CA	$55,400	4.5	10.2	5.1
8	Virginia Beach-Norfolk, VA	$53,600	2.6	4.7	3.5
9	Milwaukee, WI	$51,400	2.8	4.4	3.8
10	Boston, MA-NH	$41,900	3.5	6.1	4.1
11	Los Angeles, CA	$33,500	4.5	10.1	5.1
12	Miami-West Palm Beach, FL	$32,300	3.4	7.0	4.0
13	Jacksonville, FL	$32,000	2.3	3.6	2.9
14	Washington, DC-VA-MD-WV	$31,200	2.9	5.3	3.3
15	Providence, RI-MA	$29,400	3.1	5.4	3.6
16	Raleigh, NC	$26,700	3.3	3.9	3.7
17	Austin, TX	$20,500	2.8	3.3	3.2
18	San Francisco, CA	$18,500	5.0	11.2	5.2
19	Denver, CO	$18,000	2.9	4.3	3.2
20	Minneapolis-St. Paul, MN-WI	$15,700	2.4	3.6	2.6
21	Hartford, CT	$14,300	3.1	4.2	3.3
22	San Diego, CA	$11,100	4.9	9.5	5.1
23	Buffalo, NY	$10,900	1.9	2.5	2.1
24	Charlotte, NC-SC	$10,100	3.0	4.1	3.2
25	Richmond, VA	$9,500	2.8	4.1	3.0
26	Louisville, KY-IN	$8,100	2.4	3.1	2.6
27	Chicago, IL	$7,800	2.9	4.8	3.0
28	San Antonio, TX	$5,200	3.0	3.3	3.1
29	Orlando, FL	$4,000	2.9	5.2	3.0
30	Pittsburgh, PA	$3,400	2.1	2.8	2.2
31	Tampa-St. Petersburg, FL	$1,700	2.8	4.7	2.8
	Las Vegas, NV	At or Below	3.4	5.3	2.7
	Riverside-San Bernardino, CA	At or Below	3.7	6.6	3.0
	Sacramento, CA	At or Below	3.6	5.6	2.8
	Memphis, TN-MS-AR	At or Below	3.0	3.1	2.0
	New Orleans, LA	At or Below	3.1	3.3	2.8
	Phoenix, AZ	At or Below	2.8	4.7	2.4
	Atlanta, GA	At or Below	2.4	3.1	2.0
	Birmingham, AL	At or Below	3.0	3.5	2.7
	Cincinnati, OH-KY-IN	At or Below	2.3	2.8	2.0
	Cleveland, OH	At or Below	2.2	2.8	1.4
	Columbus, OH	At or Below	2.4	2.9	2.2
	Dallas-Fort Worth, TX	At or Below	2.7	2.7	2.4
	Houston, TX	At or Below	2.5	2.9	2.5
	Indianapolis, IN	At or Below	2.1	2.3	1.7
	Kansas City, MO-KS	At or Below	2.5	2.9	2.3
	Oklahoma City, OK	At or Below	2.8	2.9	2.8
	Rochester, NY	At or Below	2.2	2.4	2.0
	St. Louis, MO-IL	At or Below	2.2	2.9	1.9

Median Multiple: Median house price divided by median household income.

These price reductions may or may not occur in over-valued metropolitan areas like New York, Portland and Seattle, all of which are also experiencing serious increases in unemployment. However, given the pervasive evidence that the market is returning to the vicinity of historic price ratios, it would not be surprising if significant price reductions happen in these metropolitan areas, which were previously seen and saw themselves as immune to the fallout that hit the less well-regarded ground zero markets.

Additional information is available in:
The Housing Downturn in the United States: 2009 First Quarter Update

The Luxury City vs. the Middle Class

Joel Kotkin — Mon, 18 May 2009 01:11:55 -0400

The sustainable city of the future will rest on the revival of traditional institutions that have faded in many of today’s cities.

Ellen Moncure and Joe Wong first met in school and then fell in love while living in the same dorm at the College of William and Mary. After graduation, they got married and, in 1999, moved to Washington, D.C., where they worked amid a large community of single and childless people.

Like many in their late 20s, the couple began to seek something other than exciting careers and late-night outings with friends. “D.C. was terrific,” Moncure recalled over lunch near her office in lower Manhattan. "It was an extension of college. But after a while, you want to get to a different ‘place.’”

The "place" Ellen and Joe looked for was not just a physical location but something less tangible: a sense of community and a neighborhood to raise their hoped-for children. Although they considered suburban locations, as most families do, ultimately they chose the Ditmas Park neighborhood of Brooklyn, where Joe had grown up.

At first, this seemed a risky choice. While Joe was growing up in the 1980s, the neighborhood — a mixture of Victorian homes and modest apartments — had become crime-infested. The old families were moving out, and newer ones were not replacing them. Yet Joe’s Mom still lived there, and they liked the idea of having grandma around for their planned-for family.

In a city that has been losing middle-class families for generations, the resurgence of places like Ditmas Park represents a welcome change. In recent years, child-friendly restaurants and shops have started up along once-decayed Cortelyou Road. More important, some local elementary schools have shown marked improvement, with an increase in parental involvement and new facilities.

Even in hard economic times, the area has become a beacon to New York families, as well as singles seeking a community where they will put down long-term roots. “There’s an attempt in this neighborhood to break down the city feel and to see this more as a kind of a small town,” notes Ellen. “It may be in the city, but it’s a community unto itself, a place where you can stay and raise your children.”

The Decline of the Urban Middle Class

The rise of neighborhoods like Ditmas Park suggests that cities can still nurture and accommodate a middle class. Yet sadly this trend continues to fight an uphill battle against a host of forces from high taxes and regulation to poor schools, highly bifurcated labor markets, and the scourge of crime.

These problems can be seen in the migration numbers. A demographic analysis conducted by my colleagues at the Praxis Strategy Group over the past decade found that New York and other top cities — including Chicago, Los Angeles, San Francisco, and Boston — have been suffering the largest net out-migration of residents of virtually all places in the country, albeit the pattern has slowed with the recession.

It’s astonishing that, even with the many improvements over the past decade in New York, for example, more residents left its five boroughs for other locales in 2006 than in 1993, when the city was in demonstrably far worse shape. In 2006, the city had a net loss of 153,828 residents through domestic out-migration, compared to a decline of 141,047 in 1993, with every borough except Brooklyn experiencing a higher number of out-migrants in 2006.

Since the 1990s virtually all the gains made in the New York economy have accrued to the highest income earners. Overall, New York has the smallest share of middle-income families in the nation, according to a recent Brookings Institution study; its proportion of middle-income neighborhoods was smaller than any metropolitan area, except for Los Angeles.

Much the same pattern can be seen in what has become widely touted as America’s “model city,” President Obama’s adopted hometown of Chicago. The city has also experienced a rapid loss of its largely white middle class at a rate roughly 40 percent faster than the rest of the country.

Although there has been a considerable gentrification in some pockets around Lake Michigan, Chicago remains America’s most segregated big city. In contrast to the president’s well-integrated cadre of upper-class African Americans, Chicago’s black population remains among the poorest, and most isolated, of any ethnic population in America.

And like other American cities, Chicago now has a growing glut of “luxury” condos, a pattern that became evident as early as 2006 and has now, as Chicago magazine put it, “stalled” as a result of a “perfect storm” of toughened mortgage standards, overbuilding, job losses, and rising crime.

Yet there could be some good from the current crisis. Considerable drops in urban rents and residential housing prices should ease the burdens on those who struggle with extremely high prices and taxes. Younger people, including families, may now be able to consider whether a home in Brooklyn, Chicago’s Wicker Park, or Los Angeles’ Studio City might now be affordable and desirable enough to eschew the move to the suburbs.

The Cost of Being Urban

In doing scores of interviews recently for a report on New York’s middle class, my coauthor Jonathan Bowles of the Center for an Urban Future and I ran into many people who were considering moving out of the city or had friends who had recently left. This seems particularly true in the remaining middle-class enclaves in the outer boroughs.

“Almost all the friends I grew up with have moved to Mahopac or Yorktown [in the Hudson Valley],” says Jimmy Vacca, a member of the City Council who represents communities in the Northeast Bronx such as Throgs Neck and Pelham Parkway. “There’s a flight out by many middle-class people because of the schools. A couple gets married and by the time their children gets to age five, they move.”

Costs, particularly relating to child-raising, are killing the urban middle class. Urban residents generally pay higher taxes and more for utilities, insurance, trash, and sewer than those living elsewhere. Manhattan is by far the most expensive urban area in the United States, with an average cost of living that is more than twice as much as the national average; San Francisco, another city that has seen large-scale middle-class flight, ranks second. The Washington, D.C. area, Los Angeles, and Boston also suffer extremely high living costs.

These costs are most onerous on the middle class, particularly those with children. This can be seen in the rapidly declining numbers of students in most urban school districts, including such hyped success stories as Chicago, Seattle, Portland, Washington, and San Francisco. Over the past seven years, for example, Chicago’s school system, which was run by new Education Secretary Arne Duncan, has declined by 41,000 students.

America’s core cities — including the borough of Manhattan in New York — boast among the lowest percentage of children under 17 in the nation. Although Manhattan had a much discussed “baby boomlet” (the borough’s number of toddlers under the age of 4 grew 26 percent between 2000 and 2004), once children over 5 are taken into account, Manhattan’s under-age population is well under the national average. This indicates there may be a process of exhaustion — both mental and financial — as the costs of raising children drain family resources.

The real issue for the urban middle class is not having babies but being able to sustain their families as the children age and as families expand. One reason: many middle class urbanites spend tens of thousands of dollars a year in additional expenses that those in other cities as well as surrounding suburbs often avoid. For instance, since most middle-class families in big cities today need to have two working parents just to get by, child care becomes a necessity for those without grandparents or other relatives to look after young children. In places like Chicago, Washington, Boston, San Francisco, New York, or Los Angeles these costs typically run from $13,000 to $25,000 per child annually.

Later many of these same families, if they choose to stay, must then contemplate shelling out considerable sums to send their children to private schools, particularly after the elementary level. This can add from a few thousand dollars to $30,000 a year to their annual costs — and with no tax benefit.

Do Cities Need a Middle Class?

Ultimately, in good times or bad, cities have to want a middle class to have one. And politicians, if asked, will genuflect to the idea of maintaining a middle class, yet their actions — on taxes, regulations, schools, development — suggest otherwise.

Indeed, in reality most urban areas have focused on creating what New York Mayor Michael Bloomberg famously dubbed the “luxury city.” To pay for often inflated public employee costs, the luxury city can only survive off the wealthy and on other groups — empty nesters, singles and students — who demand relatively little in the way of basic services like schools and public health facilities.

City planners and urban developers favor the unattached: the “young and restless,” the “creative class,” and the so-called “yuspie” — the young urban single professional. Champions of the unattached suggest that companies and cities should capture this segment, described by one as “the dream demographic,” if they wish to inhabit the top tiers of the economic food chain.

Another key group coveted by cities are the legions of baby boomers who have already raised children. No longer cohabiting with offspring, they are expected to give up their dull family existence and rediscover the allure of a fast-paced, defiantly “youthful” lifestyle. The new retirees, suggests luxury homebuilder Robert Toll, “are more hip-hop and happening than our parents.” They are more interested in indulging “the sophistication and joy and music that comes with city dwelling, and doesn’t come with sitting in the ’burbs watching the day go by.”

A Demographic Dead End?

This whole approach has severe limitations. Despite an enormous amount of publicity about empty nesters moving back to the city, surveys conducted by the housing industry find that most aging boomers — upwards of 70 percent — are aging in place, mostly in the suburbs. The numbers moving back into the urban core remain negligible, except in the pages of urban booster publications like The New York Times.

The young singles provide a more promising demographic for cities. But even here time may be running out. This will be even more evident between 2010 and 2020, when the millennial generation hits their 30s and early 40s and enter the prime years for family formation. Surveys of the cutting edge of this group — the other large age cohort in the population — show that most prefer a single-family home and, like their parents, seem most likely to head to the suburbs.

But perhaps most troubling of all is what this means in terms of the historic role of cities as incubators of upward mobility. Back in the 1960s, Jane Jacobs could still predict that Latino immigrants to New York, mainly from Puerto Rico, would inevitably make “a fine middle class.” Yet four decades later in the Bronx, the city’s most heavily Latino county, roughly one in three households lives in poverty, the highest rate of any urban county in the nation.

On the other extreme, in Manhattan, where the rich are concentrated, the disparities between the classes have been rising steadily. In 1980 it ranked 17th among the nation’s counties for social inequality; today it ranks first, with the top fifth of wage earners earning 52 times that of the lowest fifth, a disparity roughly comparable to that of Namibia.

The University of Chicago’s Terry Nichols Clark, one of the most articulate advocates for this new urban pattern, says cities should focus on acting not so much as vehicles for class mobility, but as “entertainment machines” for the privileged. For these elite residents, the lures are not economic opportunity, but rather “bicycle paths, beaches and softball fields,” and “up-to-the-date consumption opportunities in the hip restaurants, bars, shops, and boutiques abundant in restructured urban neighborhoods.”

In this formulation cities become the domicile primarily of the young, the rich (and their servants), as well as those members of the underclass who persist in hanging around. What emerges, in the end, is a city largely without children, particularly of school-age, and with a diminishing middle class. Ironically, these are places that, despite celebrating diversity, actually could end up as hip, dense versions of the most constipated suburb imaginable.

This shift will also limit the economic functions of certain elite cities. Cost pressures, for example, have already helped Houston to replace New York and Los Angeles as the nation’s energy capital; in the future, although now humbled by the collapse of Wachovia, more middle class-oriented Charlotte, as well as other cities, could continue to gain jobs in the post-bust financial sector. Charlotte real estate developer John Harris suggests the city can compete against an expensive metropolitan region not only at the top levels of management but across the board. “It’s hard to be a mass employer in San Francisco,” he notes.

Joe Gyourko, a real estate professor at the Wharton School, suggests this elite model of urbanism will spread to other favored places such as Portland, Seattle, and possibly Austin. In all these places, we may be seeing the emergence of a European-style pattern of elite urbanism in the core, with a growing concentration of low-wage workers in the least favored parts of the urban periphery.

The City of Aspiration

Even if such a model proves sustainable, it certainly means a major change for American urbanism. Unlike most urban cultures, that of the United States has been dominated not by the dictates of princes or priests, but by the efforts of ambitious entrepreneurs and migrants.

American cities have been driven by a protean, ever-shifting commercial and middle-class culture, willing to break the bonds of tradition. As the great sociologist E. Digby Baltzell noted, the population in New York and other American cities has been “heterogeneous from top to bottom.” Social mobility, Baltzell said, constituted the fundamental reality of American urbanism.

In this country, cities emerged as the principal North American bastion for those who sought to improve their lives. As historians Charles and Mary Beard noted, “All save the most wretched had aspirations.”

Such cities often were not inherently pleasant or culturally edifying. Although its wealth would propel it to one day become the world’s cultural capital, visitors from more genteel Philadelphia and Boston often regarded 19th-century New Yorkers as crass and money-oriented.

The new cities on the opportunity frontier — Chicago, Cleveland, Cincinnati — were, if anything, even more egalitarian. After two years in Cincinnati, British writer Frances Trollope deplored how “every bee in the hive is actively employed in the search for honey…neither art, science, learning, nor pleasure can seduce them from their pursuit.” Chicago, a Swedish visitor commented in 1850, was “one of the most miserable and ugly cities” of America.

Yet these places were ideal for taking advantage of new technologies from mass manufacturing to trains and the telegraph. They created dynamic societies that provided huge opportunities for vast waves of immigrants, who by 1890 accounted for as much as half of the nation’s urban dwellers.

The newcomers were joined by others from rural America, including, by the early 20th century, many African Americans. The “Great Migration” of African Americans from the rural south, noted Gunnar Myrdal in 1944, created “a fundamental redefinition of the Negro’s status in America.” Urban life had its horrors, but in the cities it became increasingly difficult to restrict a person into “tight caste boundaries.” African-American migrants from the South may have been different in many ways from newcomers from Italy, Ireland, or Russia, but their fundamental aspirations were often very much the same.

The Key to a Middle-Class Comeback: The Power of Plain Vanilla

Compared to the dismal decline in the 1970s and early 1980s, urban prospects have improved, particularly in primary urban areas such as Chicago, New York, and San Francisco. Yet, if these and other cities are to sustain their momentum, they need to look beyond “the luxury city” to the potential of less glamorous neighborhoods that can attract the middle class and people with families.

These “plain vanilla” neighborhoods include many places that managed to resist the urban decay of the 1970s and in many cases have begun to enjoy a steady resurgence. These include, for example, large swaths of Brooklyn and Queens, as well as the lovely, park-blessed sections of south and west St. Louis, or scattered Los Angeles neighborhoods in places like the San Fernando Valley.

But these communities can only grow if cities focus on those things critical to the middle class such as maintaining relatively low density work areas and shopping streets, new schools, and parks.

This would require a massive shift in urban priorities away from the current course of subsidizing developers for luxury mega-developments, new museums, or performing arts centers. To maintain and nurture a middle class, cities need to look at the essentials that have made great cities in the past and could once again do so in the future.

The New Urban Middle Class

Perhaps the other key question is what constitutes the economic base for the people who might settle and remain in cities. It’s clear that many traditional industries — heavy manufacturing, warehousing — as well as middle-management white collar jobs will diminish in the future. But it is possible to imagine the rise of a new kind of urban economy built around people working in small firms, or independently in growing fields such as information, education, healthcare, and culture, or as specialists in a wide array of business services.

These are professions that continued to grow in many older cities, even as other fields declined. In San Francisco, for example, by 2006 there were an estimated 70,000 home-based businesses and a thriving culture of self-employed “Bedouins” working in post-industrial professions. These self-employed people, noted one study, were critical to helping the city withstand the ill effects of the post-2000 dotcom collapse.

Similarly, the close-in communities of the San Fernando Valley of Los Angeles are home to large contingents of entertainment industry workers, many of them self-employed. According to studies by California State University’s Dan Blake, up to 60 percent of all L.A.-area workers in this highly dispersed industry reside somewhere in this sprawling urban region made up largely of post–World War II single-family houses. Workers in media, graphic arts, and other specialized services have also been among the few groups of middle and upper-middle income earners to see rapid growth in New York’s outer boroughs.

These post–industrial age artisans — along with more traditional parts of the middle class such as civil servants, teachers, nurses, and other service workers — could provide the critical residential base for the plain vanilla urban neighborhoods’ work. Neither rich nor poor, these artisans could use the new telecommunications net to access clients who may exist in the sprawling suburban rings, throughout the United States, or overseas.

Cities of the Future

You can see this emerging reality in places like Ditmas Park, Brooklyn. Nelson Ryland, a film editor with two children who works part-time at his sprawling turn-of-the-century Flatbush house, suggests that the key to an urban revival lies not in the spectacular but in the mundane. “It’s easy to name the things that attracted us — the neighbors, the moderate density,” he says over coffee in a house close to that occupied by Ellen and Joe. “More than anything it’s the sense of community. That’s the great thing that keeps people like us here.”

This “sense of community” will become the key currency of sustaining urban communities. Such middle-class sensibilities get short shrift by urban scholars such as Richard Florida, who argue that in the so-called “creative age” places of residence should be “leased” like cars. In his mind, single-family homes, the ideal of homeownership, should be replaced “by a new kind of housing” that embraces higher forms of density without long-term commitment to a particular residence or location.

In fact, the sustainable city of the future will depend precisely on commitment and long-term residents. It also will rest on the revival of traditional institutions that have faded in many of today’s cities. Churches — albeit often in reinvented form — help maintain and nurture such communities. Similarly, extended family networks will be critical to future successful urban areas. As Queens resident and real estate agent Judy Markowitz puts it, “In Manhattan people with kids have nannies. In Queens, we have grandparents.”

The modest and mundane ties between people that exist in such places represent the key to reviving America’s urban regions in the coming generation. It is in our urban neighborhoods — not in the glamour zones and high-end downtowns — that our country’s cities can find a new life and purpose in the 21st century.

This article originally appeared at American.com.

Suburbs and Cities: The Unexpected Truth

Wendell Cox — Sun, 17 May 2009 00:12:29 -0400

Much has been written about how suburbs have taken people away from the city and that now suburbanites need to return back to where they came. But in reality most suburbs of large cities have grown not from the migration of local city-dwellers but from migration from small towns and the countryside.

It is true that suburban areas have been growing strongly, while core cities have tended to grow much more slowly or even to decline. The predominance of suburban growth is not just an American phenomenon, but is fairly universal in the high income world).

This is true in both auto-oriented and transit oriented environments. Suburbs have accounted for more than 90 percent of growth in Japan’s metropolitan areas with more than 1,000,000 residents, both those with high transit market shares and those with high auto market shares, The same is true in Canada, Australia and New Zealand.

In Western Europe, where vaunted transit systems carry a far smaller share of travel than cars, all growth and then some has been in the suburbs, as overall core city populations have declined. Indeed, the same trend is well underway in middle and lower income world urban areas. In such places as Mexico City, Sao Paulo, Buenos Aires, Manila, Shanghai, Kolkata, and Jakarta, nearly all population growth has occurred in the suburbs, rather than the core cities.

As the world faces a more expensive energy future and as efforts are intensified to reduce greenhouse gas (GHG) emissions, it is sometimes suggested that people need to “move back” to the cities. This is a dubious and needless strategy, which reveals a fundamental misunderstanding of the dynamics of metropolitan growth.

Most suburban growth is not the result of declining core city populations, but is rather a consequence of people moving from rural areas and small towns to the major metropolitan areas. It is the appeal of large metropolitan places that drives suburban growth.

Larger metropolitan areas have more lucrative employment opportunities and generally have higher incomes than smaller metropolitan areas. This is particularly the case in developing countries. As a result, the big urban areas attract people seeking to escape what are often the stagnant or even declining economies in smaller areas.

There are, of course, significant individual exceptions. Virtually all of the first world core cities that have achieved a population of more than 400,000 – if they have not expanded their boundaries and did not have substantial empty land for development – experienced losses to 2000. Yet even in most of these cases, the majority of suburban growth was from outside the metropolitan areas, rather than from the core cities. For example:

St. Louis is a champion among the ranks of population losers, having lost the greatest percentage of its population of any large municipality in the world, (dropping from nearly 860,000 in 1950 to 350,000 in 2000). Indeed, it may be fair to say that St. Louis has lost more of its population than any city since the Romans sacked Carthage. Yet, even in St. Louis, 60 percent of suburban growth was from outside the metropolitan area, rather than from the city.
Few core cities have lost the nearly 1,000,000 residents that have fled Detroit since 1950. Yet, even in Detroit, 65 percent of suburban growth was from outside the metropolitan area, rather than from the city.
The city of Chicago lost 725,000 residents between 1950 and 2000, yet 82 percent of the suburban growth was from outside the metropolitan area.
The city of Philadelphia lost 550,000 residents between 1950 and 2000, yet 76 percent of the suburban growth was from outside the metropolitan area (See lead picture of Philadelpia downtown).

The central city of Paris lost approximately one-quarter of its population from 1965 to 2000 (675,000), while the suburbs gained nearly 3,850,000 residents. More than 80 percent of suburban Paris growth came from outside the region.
The central city of Lisbon experienced a 30 percent population decline from 1965 to 2000. Yet suburban Lisbon’s growth was 80 percent from outside.
Stockholm was another losing core city, yet more than 90 percent of the suburban growth came from smaller towns and cities.
Despite Zurich’s nearly one-quarter population loss 83 percent of the suburban gains derived from outside the region.
The core city of Tokyo (which really doesn’t exist except as 23 separate subdivisions or kus of a city abolished during World War II) lost more than 700,000 residents from 1965 to 2000. Tokyo’s suburbs, however, attracted more than 90 percent of their growth from region.

In some metropolitan areas, smaller towns and rural areas contributed less to suburban growth. In Amsterdam, 50 percent of the suburban growth was from outside the metropolitan area. In Copenhagen, the number was 40 percent of the suburban growth while in Birmingham (UK) only 30 percent of the suburban gain was from outside.

In a few cases, both the core city losses were greater than the suburban gains, such as in Pittsburgh, Liverpool and Manchester. In these cases, it is fair to attribute all of the suburban gains to core city losses.

Unlike the cases above, however, most core cities gained population. This includes all in Canada, Australia and New Zealand and many in the United States. As a result, none of the suburban growth in the corresponding metropolitan areas can be attributed to an exodus from the city, because there, on balance, was no exodus.

Suburbanization is often characterized as reducing densities, but in fact it has done just the opposite. Most suburbanites come from smaller places; they may prefer suburbs because they are less dense, safer, or simply more manageable than the core cities. But they are also, almost invariably, more dense than where they lived before. Suburbanization is thus a densifying dynamic, albeit one that is less dramatic than preferred by many planners and architects.

In this sense, suburbs have to be seen not as the enemies of the city, as just a modern expression of urbanization. They are neither the enemies of the city, nor are their residents likely to move “back” there. You cannot move back to someplace you did not come from.