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Taxing and Regulating the Competition

By | | Transportation, Urban areas
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Here’s a difference between government-run businesses and private businesses: when private businesses face competition, they are forced to innovate to survive. When government-run businesses face competition, they can regulate or tax their competitors out of business.

Blackberry was once the dominant smart phone. Then came the iPhone, which reduced Blackberry subscribers from 85 million to 23 million in just 18 months. In 2016, Blackberry stopped designing phones. But that doesn’t mean it is out of business; instead, it is doing other things like designing driverless-car software.

Now consider the Chicago Transit Authority, which has lost riders in every year since 2012, partly if not mostly because of the growth of Uber and Lyft. Ridesharing has also reduced car rentals (which are taxed by the city) and downtown parking (which is taxes by the city). Although Uber and Lyft also pay taxes to the city, the city estimates it lost a net of $40 million in revenues (including transit fares and vehicle taxes) in 2016. So Chicago Mayor Rahm Emanuel wants to increase taxes on Uber and Lyft to make up the difference. Continue reading →

Densification the Hammer; Cities the Nail

By | | News commentary, Urban areas
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With 560 murders this year and counting, Chicago has become known as the murder capital of the nation. Some take issue with this, noting that Chicago’s murder rate per 100,000 people is much lower than many other cities including Baltimore, New Orleans, and Newark. Yet the moniker has stuck, leading many to ask why Chicago violence is so bad.

According to Atlantic‘s CityLab and Chicago’s Metropolitan Planning Organization, the answer is urban sprawl. Both say there is a strong correlation between declining city populations and rising crime.

Of “the six U.S. cities that have earned the dubious distinction of official ‘murder capital'” over the past 30 years, says CityLab, four have had declining populations. The Metropolitan Planning Council points to a study that found, “almost all of the crime-related population decline is attributable to increased outmigration rather than a decrease in arrivals.” The solution, both CityLab and the MPO argue, is to promote gentrification and immigration.

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