After the 2003 Preserving the American Dream conference in Washington DC, we had a series of annual conferences in a different city each year: Portland, the Twin Cities, Atlanta, San Jose, Houston, Bellevue, and Orlando. Although I invited most of the speakers and knew what they were going to say in advance, I found them very educational, especially on housing and land-use issues.
The highlight of the Portland conference was a speaker from England named Stephen Town, who was an expert on policing neighborhoods of different densities and designs. In fact, he was a policeman.
It so happened that, in 2001, the American Planning Association published a book titled SafeScape, which purported to show how neighborhoods could be designed to reduce crime. “At last a book that tells us exactly what we have to do to make our cities safe!” enthused a cover blurb written by a Portland police chief.
In fact, the book told no such thing. Instead, it gave the standard New Urban prescriptions for neighborhood design: high-density, mixed-use, gridded streets, alleys in back of homes and businesses. The book offered no data to show that these prescriptions would reduce crime. Instead, it relied entirely on a phrase taken out of Jane Jacobs’ Death and Life of Great American Cities. That phrase was “eyes on the street.”
New York City wanted to demolish Jacobs’ neighborhood of 1880s and 1890s tenement buildings and replace them with high rises. Under New York law, the city needed to declare her neighborhood a slum in order to use eminent domain, so much of Death and Life was aimed at showing that it wasn’t a slum. That meant, among other things, demonstrating that crime wasn’t a problem.
Setting a precedent that would later be followed by the authors of SafeScape, Jacobs didn’t bother using any crime data to make her point. Instead, she argued that the design of the neighborhood protected it against crime. First, many of the buildings had ground-floor shops. Second, the pure residential buildings had front porches and people did a lot of their entertaining on these porches. Between the shops and the porches, Jacobs argued, someone always had their eyes on the street, which discouraged would-be muggers and burglars.
SafeScape also quoted an architect named Oscar Newman, who became interested in the subject when the Pruitt-Igoe low-income high-rise towers in St. Louis were torn down because the high crime made them uninhabitable. “Newman took the ‘eyes on the street’ concept and applied it to public housing,” the book’s authors wrote. “He argued that the reason ‘eyes on the street’ provide safety in urban, mixed commercial and residential areas is because there is a visible link between residents and the street.”
That was an outright lie and the complete opposite of Newman’s conclusions. Newman, unlike Jacobs, actually did look at crime data, comparing crimes with the architectural features found on tens of thousands of city blocks. What he found was that many of the design features of Pruitt-Igoe were criminogenic, meaning they attracted crime. What the authors of SafeScape didn’t want readers to know, however, was that those same design features were found in New Urban neighborhoods.
Newman used the term defensible space to describe design features that would create an effective shield around homes and businesses. One important feature was private property. In multifamily and mixed-use developments, no one could tell if someone walking through a common area was planning a shopping trip or breaking and entry. But in a neighborhood of single-family detached homes, anyone walking across a private lot who wasn’t associated with the owners of that lot could immediately be identified as a potential criminal.
Another important feature was a limited number of entry points. The yards around single-family homes typically back up to the yards of other single-family homes, so the only public entry point would be the front doors. Alleys made back doors into a second, relatively hidden entry points and increased vulnerability. “The easier it is to get to the rear of houses, the more burglaries you get,” Stephen Town told our audience.
Cul de sacs also reduced entry points into a neighborhood, while gridded streets increased them. When Dayton, Ohio, asked Newman to reduce crime in a neighborhood, he recommended closing one end of many of the streets, effectively turning them into cul de sacs. This reduced crime by 25 to 50 percent without increasing it anywhere else. New Urbanists hated cul de sacs.
SafeScape included numerous case studies, but only one of them actually had before- and after- crime data. That study was of a Miami neighborhood that followed Dayton’s example of closing streets, effectively turning a gridded street network into cul de sacs — the exact opposite of the New Urbanist recommendations elsewhere in the book.
Researchers in England replicated Newman’s work there and confirmed his conclusions. The findings were so impressive that every police department in England trained one of its officers to be an architectural liaison to developers, helping them design neighborhoods that met what the English police called secured-by-design standards.
I invited Oscar Newman to speak at our second American Dream Coalition conference, which took place in Portland in 2004. Unfortunately, he wasn’t well enough to attend; he died of cancer a couple of days before the conference took place.
Before then, he had sent an email to Peter Knowles, one of the architectural liaison officers in England. “I am not very impressed with the work of the New Urbanists,” he wrote. “The residential environments they are creating are very vulnerable to criminal behavior unless, of course, they are occupied exclusively by high-income groups.” His email also specifically referred to “the unsupported hypotheses of Jane Jacobs.”
Knowles had put together his own critique of New Urbanism. He calculated that developments built to New Urbanist principles would have five times the crime and cost police departments three times as much to deal with as neighborhoods that followed secured-by-design policies.
I invited Knowles to speak at our conference, but he couldn’t attend either. However, he recommended another liaison officer, Stephen Town, who worked for the West Yorkshire Police Department. Town turned out to be a brilliant choice and his presentations — he came to more than one conference — were some of the most important ones we ever heard.
Town told us many stories of neighborhoods that had been altered according to secured-by-design principles and others according to New Urbanist principles. In one case, a large common field in a neighborhood had been parceled out to each home and made into private yards. This greatly reduced crime. In another case, a cul de sac was breached by a pedestrian and bikeway, supposedly to give residents easy access to a nearby supermarket without having to drive their cars. Instead, it turned a neighborhood that had virtually no crime into one suffering fourteen times the national average rate of crime.
Town noted that the Congress for the New Urbanism’s charter contained the statement, “the design of streets and buildings should reinforce safe environments, but not at the expense of accessibility and openness.” He argued that safety, not accessibility and openness, should be given top priority. Most families probably agree, which is why single-family homes on large lots, cul de sacs, and other things reviled by the New Urbanists have become so popular.
I turned one of Town’s presentations into prose and submitted it to Reason magazine, which published it in February, 2005. Although both our names were on the article, he had done all the research and I only organized the writing, so I gave him all of the money that Reason paid for the article.
After the Portland conference, I gave Stephen a tour of the Columbia River Gorge. A few of the other speakers joined us, but the tour was really for his benefit. We ended up having dinner at Timberline Lodge, whose timber-framed construction used techniques similar to many older buildings in England.
Years later, when I went to England, Stephen and I met up in York where we visited the National Railway Museum and York Minster cathedral. I knew more about trains than he did, but I was astounded to discover that he was a top-notch amateur historian of England and the English language. I remember him giving lessons on linguistics to a docent who was getting her Ph.D. in the English language. Perhaps I was guilty of stereotyping, but I wouldn’t have expected someone who had spent much of their life as a constable on patrol to have such expertise.
Our 2005 conference was held in Bloomington, Minnesota, near the Mall of America, the largest shopping center in the United States. As usual, the first day of the conference featured a tour of the area, including visits to some New Urban developments. We went to one suburban area that supposedly followed New Urban principles. The area had large homes with two-car garages on large lots. “What’s so New Urban about this?” I asked. “Homebuyers in Minnesota expect three-car garages, so this is considered a radical departure,” I was told.
This is kind of typical of the Twin Cities, which has an urban-service boundary but remains pretty affordable because people can just drive to the next county beyond the boundary to buy homes. When pro wrestler Jesse Ventura ran for governor on a Reform Party ticket in 1998, he seemed to favor small government, but after he was elected, he appointed Ted Mondale, a big-government Democrat and son of the former vice president, to chair the Metropolitan Council, the region’s metropolitan planning organization (MPO).
MPOs were created to hand out federal transportation and housing funds to cities in their regions, thus saving the federal government the trouble of having to apportion the money between various suburbs. Mondale, who firmly supported planners’ density goals, realized that this money could be held hostage to force suburbs to promote high-density housing. “What’s the point of having this power if you don’t use it?” he said, applying the same logic used by just about every tyrant who ever lived.
The result was a lot of subsidized high-density developments, but most people still preferred to live in low-density neighborhoods. We heard about the effects of some of these programs from a local developer named Dan Hunt, who specialized in high-density housing projects. He was completely up front about the fact that all of his projects depended on government subsidies to pencil out. Someone asked him what motivated him to do a particular development. “The $4 million we received from the city was a big help,” he said.
He noted that almost none of the residents of his developments had children. “We’ve had one child in all of our developments, and that was a couple who signed a lease and then discovered they were pregnant. As soon as the lease expired, they moved out.”
During our tour, he showed us some of his developments, which were mostly occupied by young urban professionals. I noticed there was a bus stop in the middle of one of them and asked if he was sorry it wasn’t a light-rail stop. “No, we’d just as soon not have a transit stop at all,” he said. “It just brings in vandals.”
He also showed us his plans for his first development that wouldn’t be subsidized, a mixed-use high-rise building consisting of residences and offices. Predictably, it went bankrupt a few years later and was never completed.
The 2006 conference was in Atlanta, where we heard from Leslie Bunte, the deputy fire chief of Austin, Texas. Bunte told us that skinny streets, traffic calming, and other New Urban street designs slowed down emergency service vehicles. He had calculated that such delays would kill more than 30 people for every pedestrian whose life might be saved by slower traffic.
Ironically, we had received a graphic example of this on the tour before the conference. We were visiting a New Urban neighborhood and Kathleen Calongne, one of the nation’s major critics of traffic calming, asked the developer if there were any problems with delays to emergency service vehicles. The developer swore that the largest fire trucks would have no problem negotiating the narrow streets. Just about that time, our bus got stuck trying to turn a corner and we ended up having to take a different route.
After four conferences that I had essentially organized by myself, I was getting pretty tired. It didn’t help that I had made a mistake in negotiating our contract with the hotel in Atlanta, which ended up costing us some money. One of our donors, a commercial office developer from the DC area named Chris Walker, suggested that I hire Kathleen Calongne, who I had worked with in Denver on the FasTracks campaign, to organize the conferences. She ended up doing most of the work of selecting hotels, planning conference sessions, and preparing handouts for the audiences.
Chris was an interesting guy. A mountain climber and amateur astronomer, he was a major promoter of the Dark Sky movement, which sought to minimize light pollution. He was upset that his office buildings were going to be taxed to pay for the Silver Line in suburban DC even though none of the offices were near a Silver Line station. So he became heavily involved in transportation politics and went so far as to build a 1,000-square-foot library next to his home that he filled with transportation books and reports.
Chris also made another suggestion to me: he thought I should work for the Cato Institute. He was a Cato donor, he said, and he thought we would be a good fit. In running two non-profit organizations — the Thoreau Institute and the American Dream Coalition — I had been doing all my own fundraising, publication design, and marketing. Cato could take over some of that work.
I contacted Cato director Ed Crane, and he wasn’t too interested. He knew what I did as I had been a Cato adjunct scholar (an unpaid title) since 1995, but he wasn’t sure I would be a good full-time employee. Instead, he offered me what was essentially a quarter-time position, something he said they offered people who worked full time in various universities. He noted that their full-time employees all worked in their Washington office, which helped keep the organization on its mission.
I wasn’t interested in a quarter-time position and told Chris I was going to turn them down. Chris evidently twisted their arms — he must have been a big donor — and Ed relented and agreed to hire me full time. I was only the second full-time policy scholar on their staff who didn’t work in the Washington office, which Ed said was full anyway.
Chris turned out to be right that Cato and I were a good fit. Cato let me work on anything I want to work on, never once asking me to do a particular study or project. Occasionally Cato would object to a particular policy proposal, usually when I suggested that the federal government do something, reminding me that Cato opposed expanding the federal government. I usually realized they were right and modified the proposal. Even when we disagreed, Cato had no objection to me asking someone else, usually a state think tank, to publish my work.
Soon after I started working for Cato in early 2007, Cato held an event in Portland to present its new hire. I spoke about Oregon’s urban-growth boundaries and their effects on housing affordability. I also noted that my parents, both liberal Democrats, were in the audience. “They helped put me through college and now they are so proud that, a mere 33 years after graduating, I finally have my first real job!”
I quickly became one of Cato’s most prolific writers. Cato had about 50 policy scholars when it hired me, but I was writing more than 10 percent of its work by word count in the form of books, reports, and op-eds.
When I was writing my book about transportation issues, Gridlock, I realized that driverless cars were going to be the next big transportation revolution. Spending billions on rail transit made no sense when transit itself would soon be rendered obsolete by self-driving cars. To ease the transition to self-driving cars, I suggested that the federal government write standards for roads that could be used by such vehicles.
Of course, Cato objected to federal involvement, but the real objection was more visceral. “People think Cato is nutsy enough as it is,” someone said. “We can’t be associated with crazy ideas like driverless cars.” They asked me to remove the entire chapter from my book.
For once, I dug my heels in, saying we needed to be in favor of something, and not just opposed to things. I changed the proposal for federal standards to one that the Association of State Highway and Transportation Officials should write the standards. I then made my case directly to Ed Crane, and he begrudgingly allowed me to keep the chapter in the book.
Two years after the book was published, Google brought its driverless car to Washington DC and invited Cato staff for a ride. I happened to be in DC at the time and got a ride through DC traffic one afternoon. This gave me the reputation of being a visionary, and a few Cato staffers later sheepishly apologized to me for demanding that I remove that chapter from the book.
Sadly, Chris didn’t get to go on a ride in Google’s car as he died of cancer in 2011. Perhaps his best epitaph was given by Ed Crane, who said, “Chris was weird even by Cato standards, and all Cato people are weird.”
In the meantime, the 2007 American Dream conference was in San Jose. One of ADC’s backers there, Lowell Grattan, objected to both light rail and urban-growth boundaries. He happened to own land in Santa Clara County and was disappointed that San Jose’s growth boundary effectively rendered his land worthless even as housing prices in the city were climbing through the atmosphere.
On our tour, Lowell took us to Coyote Valley, an agricultural area inside the city limits but outside of the urban-growth boundary (because the slow-growth city council that drew the boundary in 1974 had objected to the valley being annexed in 1968). By 2007, the landowners were eager to develop their property, but California courts said that an environmental impact report would be required to change the growth boundary. The property owners and developers paid $17 million for a draft report and the Sierra Club told them that it would support the boundary change only if they gave $100 million for land purchases elsewhere to mitigate the planned development. The developers gave up.
We also went to a neighborhood that the city had declared a slum so that it could use the power of eminent domain to buy properties and turn them into high-density, transit-oriented developments. The neighborhood was actually quite wealthy; one of the homes was owned by a member of Congress. The city had said that the homeowner’s failure to rake the leaves in the private tennis court in the backyard was an indication that it was a slum.
During the conference, we heard from Joseph Perkins, an African-American who had a radio show in the Bay Area and who had been hired by the Northern California Association of Homebuilders to represent them in public debates over land-use regulations. (He has more recently worked as a writer for the Orange County Register.)
“Smart growth is the new Jim Crow,” he told our audience. He recalled hearings in Marin County, north of the Golden Gate Bridge, where residents would testify that they supported the county’s growth boundary because they didn’t want “those people” to move into the county. “I felt like I was back in the South in the 1960s.”
Our 2008 conference was in Houston and the tour took us to Sienna Plantation, a 10,500-acre development in Fort Bend County, a little southwest of Houston. Housing here was very affordable, with new four-bedroom, two-and-a-half bath homes selling for under $200,000. The development was gorgeous, with generous greenspaces, a giant water park, and an outdoor theater. Looking at local real estate ads, I realized there were dozens of such master-planned communities in Fort Bend County alone, offering tens of thousands of lots suitable for immediate home construction, which is how the Houston area remained so affordable despite growing by more than 100,000 people per year.
Houston in general and Sienna in particular are also well integrated communities, with 18 percent of Sienna residents being black and black populations in the Houston area growing much faster than the population as a whole. It’s ironic and a little sad that regions such as the San Francisco Bay Area, which consider themselves to be so progressive, are driving blacks out while regions in the South, with their long history of racism, are welcoming them.
One of the speakers at the conference was Lolita Buckner Inniss, a black graduate of the UCLA law school who taught at the Cleveland State University (and currently teaches as Southern Methodist University). She related her research showing that New Urbanist zoning codes made housing expensive and effectively discriminated against black and other low-income minorities.
We continued to cover land-use and housing affordability issues at conferences in Orlando, Denver, and other cities. But we also devoted a lot of time to transportation issues, which I’ll describe in the next chapter.
The Housing crash was caused by speculators/advocates demanding that banks/lenders give more loans to people with no credit/financial means so when the real estate bubble burst the zero down they were promised meant they PAID NOTHING on a home. The second participants were the federal government who created the laws and the loopholes but also because they made banks and lending institution lend to unqualified people including people of color at the behest of public advocates who argued banks were racist. Like Maxine Waters that forced the banks to start making subprime loans through the CRA.
That’s why the big banks will never be prosecuted despite what political candidates promise…their defense would be to point out what govt made them do.
The housing bubble was caused by the Federal Reserve’s ultra low interest rate policy. This fueled speculation and moral hazard. The Fed with ZIRP has reinflated the bubble.
I can’t believe we are still arguing this. If speculators or the Federal Reserve caused the bubble, there would have been a bubble everywhere, but some markets bubbled and others did not. The bubbles were caused by supply constraints on home production resulting from growth-management policies.
The crash resulted when bond rating agencies realized the bonds they had been rating AAA were actually B+. Downgrading the bonds required banks like Lehman Brothers to come up with billions in cash overnight to cover their reserve requirements. When they couldn’t, they went out of business. The federal government rescued Citibank and AIG as “too big to fail.”
Without growth management (which not only made housing more expensive, it made it more volatile) there would have been no bubbles. Without the bond rating agencies being ignorant of the effects of growth management on housing price volatility, there would have been no overrating of the bonds. All of the problems can be traced back to urban planners.
“If speculators or the Federal Reserve caused the bubble, there would have been a bubble everywhere”
There is no doubt that artificially low interest rates where the root cause. There were bubbles in the stock market, in the housing market, and in commodities. Central banks are the root cause of boom/bust cycles.
https://mises.org/library/housing-bubble-4-easy-steps
“Low rates caused borrowing and lending to explode, particularly in real estate. For example, commercial banks more than doubled the amount of real-estate loans they made.”
Without ultra low rates, demand would have been substantially lower. There is no question the Federal Reserve caused the housing bubble–and had reinflated it. This is obvious to anyone who has researched the issue and looked at monetary policy closely.
Antiplanner, please research the Austrian business cycle theory (ABCT). Economist Fredrick Hayek won a Nobel Prize in economics for his work on this theory. Then write an article debunking the ABCT. If you can.
Everyone’s got their pet peeve manifesting as their pet “cause”.
Shit happens.
The boomers are getting ready to retire and there’s stupid amounts of money in the market. It weant pear shaped.
They haven’t retired yet and the whole thing – housing, stocks, and all – is spilling over from all the froth. It’s going to be messy. But they’re retire and we’ll be back to the normal for the capital markets.
Y’ll are like these anti-human greens, ignoring the sun.
“Y’ll are like these anti-human greens, ignoring the sun.”
Wut?
You’ve offered no coherent analysis.
Telling somebody to research your opinion on a topic and then refute it is a laughable tactic. If you have an opinion to support, you need to support that opinion.
I’m sure a number of factors contributed to the housing bubble, but until somebody can explain to me why although it only occurred in heavily regulated housing markets housing regulation wasn’t the crucial factor I have to agree with the Antiplanner on this.
Builder, it’s not a “tactic.” What’s laughable is the willful ignorance displayed here. Support has been provided both in this thread and others for the past 13 years.
Artificially low interest rates were a necessary precursor for the housing bubble.
The bubble was most pronounced in high-demand and heavily regulated markets, but it also existed in other markets.
Foreclosures would not have been as high as they were in 2010 without very cheap credit. Three of five states that accounted for half of the foreclosures in 2010 were Arizona, Illinois, and Michigan–hardly the UGB bastions of WA and OR.
Nearly 10% of housing units in NV received a foreclosure filling in 2010. A look at the house price index in Nevada shows a massive bubble from 2003-07, a correction from 2007-12, and the bubble reinflated from 2012 to today. There’s no UGB in Vegas.
Please research the ABCT…or remain willfully ignorant.
I’m not denying that monetary policy was one factor leading to the housing bubble. I just find it strange that others deny than land use regulation was an important factor.
“I just find it strange that others deny than land use regulation was an important factor.”
I’m not denying regulations increase housing costs. They most certainly do.
They were likely not *the* root cause of the housing bubble. If they were, there would have been no correction/contraction in markets with a high level of regulations and/or UGBs unless those markets abolished regulations/UGBs.
What happened is that cheap credit was funneled into hot markets. Those hot markets had supply limited by regulations, so that’s where a lot of the credit and demand would go for the highest “return.” This is termed “malinvestment.”
”
Wut?
You’ve offered no coherent analysis.
” ~ Frank
You wouldn’t know common sense if you bit you in the ass when it comes to this. You have a religion and reality be damned if it doesn’t comport with your faith.
“You wouldn’t know common sense if you bit you in the ass when it comes to this. You have a religion and reality be damned if it doesn’t comport with your faith.”
Still no analysis? Only personal attacks?
The analysis is there – the single biggest driver by far is capital from the baby boomers. You disagreed with it. And now you want to act like there is none. #FFS
“the single biggest driver by far is capital from the baby boomers”
That’s not analysis. That’s a bare assertion.
Here’s a relevant article based on data and logic that shows that cheap credit is indeed responsible for the housing bubble and the business cycle.
Love this response in the comments; pretty much applies to the comments made on this blog for the past 13 years:
[Enter mainstream economist]
Don’t listen to that extremist. Of course, his theory can’t be true, or else we would find similar examples of other prices that rely heavily on loans also being more inflated than CPI. Like…college education…stock markets…particularly bank stocks…ummm…
[Quickly crumples paper notes were written on]
…Never mind that, but we would also find things that rely heavily on government funding, the ultimate first user of new money, to show this trend…like…oh wait, here’s education again…and healthcare…road [or transit] construction…[mumbles to self]…hold on a sec…what’s that over there!
[Throws capsule at feet, flash of smoke, disappears from sight]