The Antiplanner

6th August 2009

Barriers to Entry

posted in Regional planning |

During a recent meeting, the Antiplanner was extolling the virtues of Houston’s land-use policies, and a home builder at the meeting said, “Of course, no one here wants our city to be like Houston,” meaning no one wanted Houston’s land-use regime.

Why not? I asked. “There is too much competition down there. My company can’t make a profit,” he said. “You have to have some barriers to entry to be able to make money.”

Those who accuse free marketeers of being supporters of big business don’t realize that big businesses (and often smaller businesses) don’t want a free market. In this home builder’s case, he wanted enough restrictions on the market to keep out some of his competitors (most likely smaller companies that can’t afford to hire lawyers and planners for every project) but not enough regulation to keep his company out.

But the goal of government is not — or at least should not be — to make sure that his particular company makes a profit. That’s his job. The goal of government should be to keep a level playing field. If it represents anyone at all, it should represent consumers, not producers. That means maximizing competition, not limiting it.

Of course, any time you give government power, you create an incentive for companies such as the one that employs this home builder to lobby government to use its power to benefit them. Urban planners who like to imagine that they can fulfill some utopian vision fail to account for the power of such lobbying. When they see it happen, they imagine they could fix it if only we gave them even more power — which in turn would simply stimulate more lobbying. That’s why we shouldn’t give government planners too much power in the first place.

This entry was posted on Thursday, August 6th, 2009 at 12:00 am and is filed under Regional planning. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

There are currently 24 responses to “Barriers to Entry”

Please feel free to submit comments. Constructive debate is welcome. Ad hominem attacks and name-calling will reveal the shallowness of the author. Foul language may be deleted. Your first comment will require moderation; after that, all comments will be approved unless they contain too many links in which case the software may hold them for approval as potential spam.

  1. 1 On August 6th, 2009, the highwayman said:

    The Autoplanner: But the goal of government is not — or at least should not be — to make sure that his particular company makes a profit. That’s his job. The goal of government should be to keep a level playing field. If it represents anyone at all, it should represent consumers, not producers. That means maximizing competition, not limiting it.

    THWM: Yet you’re a lobbyist and you always bash railroads & mass transit, just because they’re railroads & mass transit.

    So why are you(or the people paying you) trying to prevent competition?

    BTW, just so you know suburban trains are not anti-suburban.

    Also up to about ten years ago Houston did have minimum parking requirements.

    posted on August 6th, 2009 at 12:41 am

  2. 2 On August 6th, 2009, hkelly1 said:

    Highwayman – the A.P. absolutely refuses to acknowledge the “barriers to entry” that existed in Houston and the ones that exist today for certain types of development. I guess it just doesn’t fit his narrative. Street setbacks, minimum parking requirements, minimum lot sizes, etc. – all worked against many developers while supporting others. But you won’t get that reported on here – in fact, the A.P. “extols the virtues” of Houston’s policies on a regular basis. I guess the A.P. despises the free market of townhouse developers and those who wanted to create things with higher density and less parking.

    posted on August 6th, 2009 at 7:54 am

  3. 3 On August 6th, 2009, Mike said:

    THWM: Yet you’re a lobbyist and you always bash railroads & mass transit, just because they’re railroads & mass transit.

    Mike: Hasn’t that poor straw man had enough? He’s been dead for months but you keep beating him and beating him. The AP has never said any such thing, or even alluded to it. You have characterized his statements in this way because it suits the polarity of your argumentative position.

    Anyway, Houston is far from the free-market utopia it might appear to some. There are huge legal obstacles to, for example, enforcing contracts on freeway construction.

    posted on August 6th, 2009 at 9:00 am

  4. 4 On August 6th, 2009, Close Observer said:

    A level playing field, therefore, would be a city without zoning. No zoning = build what people want. Every builder would have an equal opportunity to make a profit provided that they do what consumers desire. There would be a mix of urban forms … but without the prescription from planners.

    posted on August 6th, 2009 at 9:09 am

  5. 5 On August 6th, 2009, TexanOkie said:

    Houston has no land use zoning – i.e. they do not have regulations on where residential vs. commercial uses go. They have managed to sneak in most of the things besides that that a zoning code would regulate, such as parking, lot size, setbacks/building lines, and some form elements into their subdivision regulations. In essence, Houston has “shadow zoning” from other municipal codes. As others have stated, Houston is nowhere near the free-market Mecca it is often made out to be.

    posted on August 6th, 2009 at 9:15 am

  6. 6 On August 6th, 2009, bennett said:

    “Urban planners who like to imagine that they can fulfill some utopian vision fail to account for the power of such lobbying. When they see it happen, they imagine they could fix it if only we gave them even more power — which in turn would simply stimulate more lobbying. That’s why we shouldn’t give government planners too much power in the first place.”

    1st. I think we are confusing planners with politicians here. Planners don’t have much power. Many a good planner has had their hard work and good plans die at the hands of politicians, probably due to the influence of lobbyist.

    2nd. Interesting logic. I suppose we should stop fighting terrorism because it stimulates more terrorism. We should stop regulating the likes of ENRON and Madoff because it stimulates more dishonest business practices. We should stop arresting criminals because it stimulates more crime. Again don’t confuse planners with politicians. Government planners (i.e. those who work in city/state planning and development departments) have to battle lobbyist agendas continually.

    posted on August 6th, 2009 at 9:53 am

  7. 7 On August 6th, 2009, the highwayman said:

    bennett said:
    “Urban planners who like to imagine that they can fulfill some utopian vision fail to account for the power of such lobbying. When they see it happen, they imagine they could fix it if only we gave them even more power — which in turn would simply stimulate more lobbying. That’s why we shouldn’t give government planners too much power in the first place.”

    1st. I think we are confusing planners with politicians here. Planners don’t have much power. Many a good planner has had their hard work and good plans die at the hands of politicians, probably due to the influence of lobbyist.

    THWM: This is why Mr.Karlock ran for office.

    posted on August 6th, 2009 at 12:07 pm

  8. 8 On August 6th, 2009, the highwayman said:

    Mike: Hasn’t that poor straw man had enough? He’s been dead for months but you keep beating him and beating him. The AP has never said any such thing, or even alluded to it. You have characterized his statements in this way because it suits the polarity of your argumentative position.

    THWM: Well what do you think people pay him to do?

    For that matter people even pay you to defend their interests.

    posted on August 6th, 2009 at 12:18 pm

  9. 9 On August 6th, 2009, mimizhusband said:

    Antiplanner above says that the role of government is to “keep a level playing field”. My understatement of the month in response is: keeping a level playing field in land-use issues is not easy for the planners nor for the politicians. The power that modern America has granted planners and politicians makes them exceedingly easy targets of undo influence from the usually much more sophisticated private interests.

    posted on August 6th, 2009 at 12:33 pm

  10. 10 On August 6th, 2009, Mike said:

    THWM, I WISH people paid me to post on blogs. I’m a professional writer, after all. But alas, I have to write things that can sell. Gotta put food on the table. And nobody wants to read the blatherings of paid shills on blogs, let alone pay to read same.

    My presence here is entirely out of personal interest and curiosity about the topic.

    In any case, the distinction you are missing with the AP’s position is this:

    1. You say: the AP cuts on transit and rail because they are transit and rail, whether public, private, or whatever.
    2. The AP says: criticizes transit and rail because they are economically and environmentally unsound schemes foisted by government on an unwilling and ignorant public, but has no problem with the private sector (free market) moving forward with transit or rail unsubsidized… it’s just that nobody does, because it’s not profitable.

    3. You say: So what, roads are subsidized.
    4. The AP says: Two wrongs don’t make a right. Road travel would still prevail in the absence of those subsidies. Transit/rail has never to date demonstrated that it can do the same.

    5. You say: See, you ARE cutting on transit and rail. And you’re just cutting on transit and rail because they are transit and rail, regardless of whether public, private, or whatever.
    6. The AP says: GOTO 2

    And your program loop never makes it to 9999 END.

    posted on August 6th, 2009 at 1:45 pm

  11. 11 On August 6th, 2009, C. P. Zilliacus said:

    the Antiplanner wrote:

    > But the goal of government is not — or at least should not be —
    > to make sure that his particular company makes a profit. That’s
    > his job. The goal of government should be to keep a level
    > playing field. If it represents anyone at all, it should
    > represent consumers, not producers. That means
    > maximizing competition, not limiting it.

    The above is correct.

    Government schemes that place barriers to entry into certain markets are almost always bad.

    Probably the most-egregious barrier to entry that most or all readers of this blog are familiar with is the taxicab industry, where local governments in the United States limit the number of cabs allowed in their jurisdiction, along with setting of taxicab fares, all entirely unneeded.

    Sweden got rid of economic regulation of taxicabs several years ago. They still regulate taxicabs to assure that drivers are properly credentialed, that taxes are paid (after all, this is Sweden) and that the vehicles are insured and roadworthy.

    posted on August 6th, 2009 at 8:46 pm

  12. 12 On August 6th, 2009, the highwayman said:

    Mike said:
    THWM, I WISH people paid me to post on blogs. I’m a professional writer, after all. But alas, I have to write things that can sell. Gotta put food on the table. And nobody wants to read the blatherings of paid shills on blogs, let alone pay to read same.

    My presence here is entirely out of personal interest and curiosity about the topic.

    THWM: What do mean no wants to read the blatherings of paid shills?

    You’re reading O’Toole’s blog are you not?

    Mike: In any case, the distinction you are missing with the AP’s position is this:
    1. You say: the AP cuts on transit and rail because they are transit and rail, whether public, private, or whatever.
    2. The AP says: criticizes transit and rail because they are economically and environmentally unsound schemes foisted by government on an unwilling and ignorant public, but has no problem with the private sector (free market) moving forward with transit or rail unsubsidized… it’s just that nobody does, because it’s not profitable.
    3. You say: So what, roads are subsidized.
    4. The AP says: Two wrongs don’t make a right. Road travel would still prevail in the absence of those subsidies. Transit/rail has never to date demonstrated that it can do the same.

    THWM: You don’t even realize what you just wrote!

    Bad money drives out good money.

    Mr.O’Toole is not stupid. Sleezy & crooked, but not stupid!

    posted on August 6th, 2009 at 9:38 pm

  13. 13 On August 6th, 2009, the highwayman said:

    C. P. Zilliacus said:
    the Antiplanner wrote:

    > But the goal of government is not — or at least should not be —
    > to make sure that his particular company makes a profit. That’s
    > his job. The goal of government should be to keep a level
    > playing field. If it represents anyone at all, it should
    > represent consumers, not producers. That means
    > maximizing competition, not limiting it.

    The above is correct.

    Government schemes that place barriers to entry into certain markets are almost always bad.

    Probably the most-egregious barrier to entry that most or all readers of this blog are familiar with is the taxicab industry, where local governments in the United States limit the number of cabs allowed in their jurisdiction, along with setting of taxicab fares, all entirely unneeded.

    Sweden got rid of economic regulation of taxicabs several years ago. They still regulate taxicabs to assure that drivers are properly credentialed, that taxes are paid (after all, this is Sweden) and that the vehicles are insured and roadworthy.

    THWM: Even things like copyright and patents can have time limits.

    posted on August 6th, 2009 at 9:58 pm

  14. 14 On August 6th, 2009, Mike said:

    THWM: What do mean no wants to read the blatherings of paid shills?

    Mike: “What do mean no wants?” Wow. How coherent.

    posted on August 6th, 2009 at 11:06 pm

  15. 15 On August 7th, 2009, the highwayman said:

    Mike, STFU!

    posted on August 7th, 2009 at 1:04 am

  16. 16 On August 9th, 2009, mmmarvel said:

    Well, I’ve lived in Portland (for many, many, many years) and have watched the various urban/planners policies kill the housing market for people who don’t earn at least $100K per year. I watched transportation money (granted much of it federal, but still transportation money – i.e. taxes) get spent on mass transit, mass transit and more mass transit; and it hasn’t helped congestion, it hasn’t helped much of anything in Portland.

    Now I live in Houston and couldn’t be happier. I can afford a 2000 square foot house for well under $150K (and if I play my cards right it will have a pool in the back yard). We have townhouses down here, but they don’t really sell too well, people like to have a yard. We have our own little light rail down here. Just like Portland, no one uses it (just like Portland, outside the rush hours). Our little light rail is (thank God) much shorter and took much less transportation money than what was wasted in Portland.

    As for ‘Mike’ – if light rail (and Lord knows WES) could sustain itself via the fare box, then I wouldn’t care. Money on roads support transportation of people, services and goods. Money on light rail (and projects like WES) ONLY support transportation of people – which is why mass transit projects can’t support themselves.

    posted on August 9th, 2009 at 4:25 pm

  17. 17 On August 9th, 2009, the highwayman said:

    Douchebag said: Money on roads support transportation of people, services and goods. Money on light rail (and projects like WES) ONLY support transportation of people – which is why mass transit projects can’t support themselves.

    THWM: Volkswagen even uses trams to transport auto parts in Germany!

    posted on August 9th, 2009 at 9:37 pm

  18. 18 On August 9th, 2009, ws said:

    Yes, housing in Houston is cheap, but…

    1) You can find a nice Portland bungalow for 250k. Not as big as the houses in Texas, no, but what homes are in the US. A slight jab on Houston, but it is the fattest city in the US so a bigger home may be warranted there.

    2) Portland has a slightly higher median income than Houston, housing naturally costs more in more expensive areas

    3) You have a point that housing costs are an issue in Portland and in any city, but you’re forgetting transportation costs. This study shows what percentage of people’s income goes towards housing and transportation and it’s not getting smaller:

    http://www.nhc.org/pdf/pub_heavy_load_10_06.pdf

    While housing costs have increased greatly recently in many cities, transportation costs are much more volatile and runaway than housing costs IMO.

    posted on August 9th, 2009 at 11:50 pm

  19. 19 On August 10th, 2009, mmmarvel said:

    Highwayman – what’s with the name calling??? And kudos for Germany for using trams to transport auto parts – we’re not Germany and that is not what we do (although we do use heavy rail fairly effectively).

    WS – Let’s see, Houston is the 4th largest city, Portland comes in at number 30. Portland has a wanna be soccer team and a professional basketball team. Houston has a professional football, baseball, basketball and soccer team. And all that proves what? Back to costs, gee I can spend $100K more for a house in Portland and get less – wow, lead me to it. You should see what you can buy for $250K down here. However, you forget to mention that when you buy that house in Portland, your property taxes are going to be higher than mine (for the same price of the house in each location). You forgot that in Portland, you have to ask permission and get a permit to cut a tree on your own property; not so in Houston. Portland has a slightly higher income, but it also has a MUCH higher cost of living. Our ‘traffic congestion’ down here is what Tualatin Valley Highway is at 10AM up there; it’s no comparison (I laugh when people complain about it down here and just think to myself – you really need to live in the Portland area for a couple weeks, you won’t be complaining).

    Granted my experiences are personal to me, but I can say that I’ve lived in both places and can see the discussion from that angle. Can you say the same?

    posted on August 10th, 2009 at 3:59 am

  20. 20 On August 10th, 2009, ws said:

    mmmarvel:“Our ‘traffic congestion’ down here is what Tualatin Valley Highway is at 10AM up there; it’s no comparison (I laugh when people complain about it down here and just think to myself – you really need to live in the Portland area for a couple weeks, you won’t be complaining).”

    ws:I’m just curious if traffic isn’t bad in Houston, why does the city consistently rank as one of the worst in the nation?

    mmmarvel:“You forgot that in Portland, you have to ask permission and get a permit to cut a tree on your own property; not so in Houston.”

    ws:I’m actually glad for that, because Portland actually has real trees compared to the saplings so many cities have. At any rate tree removal effects your neighbors. What if an existing tree shaded a house and the removal of that tree in turn increased cooling costs for that neighboring house? Is that fair or neighborly? What if tree removal also had an effect on your neighbors view into their house – whereas before the tree protected and screened unwanted views?

    Apparently it’s too much to ask neighbors if that is okay – every single one of my neighbors has illegally removed or pruned trees (pruned trees incorrectly that might damage huge Doug Fir and Cedar trees, I might add) that had created a negative effect on my family’s viewshed and energy bill. And yes, there is a stringent HOA regarding trees – especially for native trees.

    I don’t like the NIMBY attitude at all, but all of these behaviors decrease value for my family’s home and decrease livability for the home and the homeowners have HOA items that they are willingly violating.

    mmmarvel:“Granted my experiences are personal to me, but I can say that I’ve lived in both places and can see the discussion from that angle. Can you say the same?”

    ws:No, I cannot say I have the same experiences as you. I’m also curious where you lived in the Portland area? You might find people in a completely different position as you: having moved from Houston to Portland and actually liking Portland better. It’s all relative. I also think where you live/move in Houston or Portland definitely will sway anyone’s opinion.

    posted on August 10th, 2009 at 11:35 am

  21. 21 On August 10th, 2009, mmmarvel said:

    WS:I’m just curious if traffic isn’t bad in Houston, why does the city consistently rank as one of the worst in the nation?

    mmmarvel: Probably because they haven’t had to live and deal with Portland traffic.

    ws:… At any rate tree removal effects your neighbors. What if an existing tree shaded a house and the removal of that tree in turn increased cooling costs for that neighboring house? Is that fair or neighborly? …

    mmmarvel: Actually, I don’t CARE. It’s my property, I should be able to do certain things – like deal with trees as I see fit. Your comment included the word “viewshed” is that a real word? If you want trees for shade, view or whatever, plant them yourself on your own land. Folks like you LIKE all these government regulations until they slap you in the face for something that you want to do. Check what happened to George Lopez after he had supported all the liberal and ‘green’ causes and now he gets slapped in the face (look it up on Google).

    ws:No, I cannot say I have the same experiences as you. I’m also curious where you lived in the Portland area?

    mmmarvel: I lived in Portland for MANY years. I lived in the SW hills area. I lived in the Aloha/Hillsboro area. I lived in several of the SE areas (Laurelhurst, Lents, Hawthorne). I completely agree, there are folks who would be very comfortable moving from Houston and living in Portland. There are several folks who would find living in Houston much more to their liking than Portland (like I do). I find the government in Portland (and Oregon in general) to be far too intrusive to my life. I don’t need government to be my daddy (or in the case of Oregon – my nanny). To each their own – enjoy, I was just giving you MY perspective; your mileage may vary.

    posted on August 10th, 2009 at 6:53 pm

  22. 22 On August 10th, 2009, the highwayman said:

    mmmarvel: Folks like you LIKE all these government regulations until they slap you in the face for something that you want to do.

    THWM: Well it’s a two way street.

    posted on August 10th, 2009 at 8:58 pm

  23. 23 On August 10th, 2009, the highwayman said:

    mmmarvel: Actually, I don’t CARE. It’s my property.

    THWM: WS, it’s touchy subject.

    Look at Michael Vick with dog-fights taking place in his back yard.

    Some people view dogs as pets, others view dogs as food.

    Should statutory rape, even really be counted as rape?

    mmmarvel: To each their own – enjoy.

    THWM: Indeed, within a certain amount of give & take. So be reasonable.

    posted on August 10th, 2009 at 9:56 pm

  24. 24 On August 10th, 2009, ws said:

    mmmarvel:“Actually, I don’t CARE. It’s my property, I should be able to do certain things – like deal with trees as I see fit. Your comment included the word “viewshed” is that a real word? If you want trees for shade, view or whatever, plant them yourself on your own land. Folks like you LIKE all these government regulations until they slap you in the face for something that you want to do. Check what happened to George Lopez after he had supported all the liberal and ‘green’ causes and now he gets slapped in the face (look it up on Google).”

    ws: It’s not a black and white issue (tree removal), but I was simply bringing up the fact that one needs to recognize they just might have neighbors (ehem and HOA which they should be following) and removing trees / excessive pruning can certainly have impacts beyond your yard – especially for one’s sight lines outside. In my family’s case it means more money we have to spend for cooling.

    I also happen to be on a hill, so I cannot easily replant trees/shrubs to meet that height in which my home looks down into theirs – not to mention there is not enough property available to do so. And there are very acceptable setbacks for my neighborhood.

    Viewshed is a word:

    http://en.wikipedia.org/wiki/Viewshed

    There’s limitations to being able to do what you want with your property. I agree with your sentiments, even though it may not seem like it.

    But, should someone be able to park their clunker on their lawn and reduce surrounding home values? I certainly don’t think so! Should somebody be able to use their home as a business even if it means parking issues around the home? I think that’s okay.

    I dunno, these issues are not simple.

    posted on August 10th, 2009 at 11:29 pm

Leave a Reply

You must be logged in to post a comment.