Demographia

Consolidation of New Jersey Towns Could Mean Higher Taxes

2010-05-21T16:16:00.001Z

Comment in Response to "Consolidation is Key to Save NJ"

http://njtoday.net/2010/05/20/consolidation-is-key-to-save-nj/

Consolidating local governments makes sense only in ivory towers, not in the real world.

In the last few years, Pennsylvania and New York started initiatives to consolidate their governmental structure. They took to heart the usual mantra that there are hundreds, even thousands of governments in the state and that they must be consolidated to save money. In both states, the efforts were clothed in promises that local government consolidation would improve competitiveness relative to other states.
However, the proponents never bothered to look at the data.

We did and the results were stunning. In both states, an equivalent “market basket” of spending was compared. In Pennsylvania, the largest local jurisdictions spent (including a per capita allocation of county expenditures, so that Philadelphia could be included. Social service spending was excluded) 150 percent more per capita than jurisdictions with between 5,000 and 10,000 population. The largest jurisdictions — those over 250,000 people — spent 200 percent more than jurisdictions with under 2,500 residents.

Moreover, it is not a matter of urban versus rural. Our work for the Pennsylvania Association of Township Supervisors showed that in both the Philadelphia and Pittsburgh areas, there are literally hundreds of suburban jurisdictions that spent at less than one-half the per capita rate of the central cities.

The story was little different in New York. Our report for the Association of Towns of the State of New York indicated that the largest jurisdictions (those over 100,000) spent nearly double per capita as jurisdictions with between 5,000 and 10,000 population (this would have been even greater if it had been possible to include New York City). The big governments spent even more (more than 150 percent) compared to jurisdictions with between 1,000 and 2,500 population. The differences were even greater within metropolitan areas, where smaller jurisdictions were even more efficient relative to the largest jurisdictions.

The reality is that there are few, if any economies of scale in local governments, except for the special interests that can influence them more readily, for less cost, as the town hall is moved farther away from citizens.

The Flawed CNT Housing & Transportation Index

2010-04-23T18:49:00.001Z

The Center for Neighborhood Technology (CNT) has produced a housing and transportation index (the "H&T Index"), something that has been advocated by Secretary of Housing and Urban Development (HUD) Shaun Donovan and Secretary of Transportation Ray LaHood. The concept is certainly worth support. Affordable housing and mobility are crucial to the well-being of everyone, which translates into a better quality of life, more jobs and economic growth. Surely, much of the internationally comparatively high standard of living enjoyed by so many middle and lower income households in the United States has resulted from inexpensive housing (often on the urban fringe) and the ability to access virtually all of the urban area by quick and affordable personal transportation.

CNT has developed an impressive website, with "tons" of data and maps that are both impressive and attractive. But for all of its superficial impressiveness, the H&T Index is subject to serious misinterpretation and suffers from methodological flaws that neutralize the usefulness of its affordability indices.

More: http://www.newgeography.com/content/001526-the-muddled-cnt-housing-and-transportation-index

Smart Growth Encourages Land Banking and Destroys Housing Affordability

2010-03-20T03:37:00.001Z

Re: Huge Land Bank Puts Squeeze on
Buyers<http://www.theage.com.au/victoria/huge-land-bank-puts-squeeze-on-buyers-20100317-qflq.html>-
The Age (Melbourne)

Land banking is a normal market reaction to a regulatory regime in which
land for new housing is severely rationed. Like any business, developers
must ensure that they have sufficient inventory to operate. With arbitrary
planning policies that ration land, it would be easy for a developer to be
driven out of business because competitors have cornered the market (for
land). Yes, it is outrageous that a block of land for a house costs
$180,000, but do not blame the land bankers, blame the government policies
that have unnecessarily made housing unaffordable for the average
Australian.

In Atlanta and Dallas-Fort Worth, the high-income world's fastest growing
metropolitan areas, finished (serviced) land for new housing is at least 75%
lower than in Melbourne. This is because these metropolitan areas have not
implemented the destructive urban consolidation (smart growth) policies that
have been imposed in all of Australia's largest cities.

The result, of course, is that residents of Dallas-Fort Worth and Atlanta
spend far less on housing and have more discretionary income to spend on
other goods and services.

CARS: THE ALTERNATIVE TO POVERTY

2010-03-12T14:56:00.001Z

How Cars Are Killing Us Around the World

http://www.infrastructurist.com/2010/03/11/how-cars-are-killing-us-around-the-world/comment-page-1/#comment-13611

CARS: THE ALTERNATIVE TO POVERTY

Of course, traffic deaths are regrettable and great progress has been made in their reduction. Traffic deaths in the United States today are about the same as in the late 1950s, despite the fact that driving has increased to 5x the rate at that time.

Virtually everyone who uses a car recognizes the risks. The connection between the superior personal mobility provided by cars and the eradication of poverty could not be more clear. That is why car ownership expands as fast as people can afford cars, whether in the United States, Europe, China or the Democratic Republic of the Congo.

A more revealing and relevant graphic would show traffic deaths compared to gross domestic product.

A Quarter Floor in a High-Rise Block? The Dreadful State of Australian Housing Affordability

2009-08-07T11:53:00.005Z

A Quarter Floor in a High-Rise Block?
The Dreadful State of Australian Housing Affordability
By Wendell Cox

A new report by Bankwest shows that housing affordability for the nation’s “key workers” (nurses, teachers, police officers, fire fighters and ambulance operators) has become worse than desperate. The Bankwest report, BankWest_Key_Worker_Housing_Affordability/index.aspx> Key Worker Housing Affordability Report compares 2007 median house prices in the 8 capital cities to average annual earnings, using a standard that requires house prices to be 5 times or less the average (mean) annual earnings for each of the key worker classifications.

Rampant Unaffordability: In seven of the eight capital cities, the median house price was unaffordable for all of the five key worker classifications. The situation was only marginally better in the remaining capital city, Adelaide, where housing was deemed to be affordable for police officers. But even that sliver of light may have been extinguished, since house prices have rose so much Adelaide between 2007 and 2008 that police officer affordability may be a thing of the past.

Unaffordability by Local Government Area: The lack of housing affordability is pervasive down to the local government area (LGA) level.

• In Sydney, 100% of LGAs are unaffordable to nurses, teachers, fire fighters and ambulance operators. Things are not much better for police officers, with 93 percent of LGAs unaffordable.
• In Melbourne, 100% of LGAs are unaffordable to nurses. Other key workers face unaffordability in 71% and 84% of LGAs.
• In Brisbane, 100% of LGAs are unaffordable to nurses and ambulance operators. From 67% to 89% of LGAs are unaffordable to other key workers.
• In Adelaide, between 63% and 89% of LGAs are unaffordable to key workers.
• In Perth, 100% of LGAs are unaffordable to nurses, teachers, fire fighters and ambulance operators. For police officers, 93% of LGAs being unaffordable.
• In Hobart, between 50% and 83% of LGAs are unaffordable to key workers.
• In Darwin, 100% of LGAs are unaffordable to fire fighters and ambulance operators. Other key workers face unaffordability in 67% of LGAs.
• In Canberra, all LGAs are unaffordable to all key worker categories.

In all of the capital cities combined, housing is unaffordable for nurses in 96% of LGAs, for teachers and firefighters in 91% of LGAs, for ambulande operators in 90% of LGAs and for police officers in 81% of LGAs.

Unnecessary House Price Escalation: It was not always this way. Bankwest reports that since 2002, median house prices have increased at double the rate of key worker average earnings. Similar trends have been shown and concerns raised in our Demographia International Housing Affordability Survey, now in its fifth year of publication (Reference: http://www.demographia.com/dhi.pdf).

The problem, which has been increasingly acknowledged by economists in Australia and abroad is the stingy land use policies that have driven residential land prices through the roof in virtually all of the capital cities. At least one government understands. In its welcome relaxation of these destructive regulations, the Victorian government cites housing affordability as a principal justification. Often going under the name of “urban consolidation,” intention of these policies is to stop the expansion further into the plentiful land of the nation and force people to live closer to the urban cores --- this in a nation with less than 0.3 percent of its land area under urban development.

Other Workers are Key Too: The problem goes well beyond key workers. While the nation needs key workers living closeby to provide quality service to life, limb and mind, their salaries depend on the taxes and fees paid by other workers, many of whom have even lower earnings. Thus, as devastating as the affordability problem is to key workers, the crisis goes much deeper. An Australian household purchasing a house will pay, on average 70 percent more today relative to income than in the early 1990s. Virtually all of the difference can be attributed to the regulations that seek to remake cities to match a radical vision that is already well on its way to the Hong Kongization of some Sydney neighborhoods.

Giving Up on the Great Australian Dream? The Bankwest report notes that key worker housing affordabilty is somewhat less dire with respect to units. Police officers cannot afford units in 41% of capital city LGAs, while other key workers cannot afford units in from 59% to 78% of LGAs.

That is precious little comfort. The Great Australian Dream is about a house on a quarter acre block, not a quarter floor in a high-rise block.

Globat.com Consumer Warning

2009-07-06T21:00:00.003Z

Recommend not using this service. I had used it for a few years and there were a number of service breakdowns. Worse, however, the company billed me a couple of times for services I did not order. I managed to get these incorrect charges credited once I discovered them on my credit card.

I canceled the account more than a year ago and switched my website to another firm. Now, more than a year after cancelation, I have been billed $95.40 for a years service that I did not received.

The billing agent insisted that I send a copy of my credit card bill to her before she refunds me, despite the fact that they knows have wrongly billed me.

The problem has not been resolved and I remain on the phone with this company as this blog is finished.

I have never had such a bad experience with a company.

http://www.globat.com/

Sound Transit Horror Stories: Letter from Seattle

2009-06-26T11:32:00.005Z

Sound Transit's Rail Projects
Sounder Commuter Rail and Link light Rail as of 2008
12 years into its Sound Move Ten Year Plan (1996-2006)

By Emory Bundy
Sounder commuter rail

Sounder commuter rail

Although it absorbs the smaller portion of Sound Transit's funds--which mostly are allocated to Link light rail--Sounder commuter rail has the merit of having actually been put into operation. So there's a functioning entity to measure and evaluate. Its performance anticipates that of Link light rail.

Sound Transit's promises for Sounder commuter rail in the Sound Move Ten Year Plan tax package of 1996:

*82 miles in length, Everett to Lakewood
*Completed and fully operating in 2002, with 15 daily trains, 9 between Lakewood and Seattle, 6 Everett to Seattle
*Capital cost, $650 million
*Annual operating cost as of the benchmark year 2010, $10 million
*Ridership in 2010, 3.8 million boardings
*Farebox recovery, 27.5% of operating costs.

The record to date:

*75 miles of track completed
*10 of the15 daily trains are in operation , 7 from Tacoma to Seattle, 3 from Everett to Seattle
*Capital cost: $1.25 billion projected through 2010, with $1.1 billion more to follow via Phase 2 funds (second tax package, adopted 2008). The components to complete the Phase 1 $650 million capital development plan will cost approximately $1.8 billion, a $1.15 billion, 177% cost overrun.

*Completion of the 82 miles, promised by 2002, now is targeted for 2012-13.
*Operating costs exceed $30 million, triple the original projections--absorbed by only two-thirds of the promised daily trains.
*Annual ridership is 2.67 million, 70% that projected
.*Farebox recovery is 13% of operating costs, half the target

Most of the additional capital cost for Phase 2 is allocated to develop parking facilities added since the original Sound Move Ten Year Plan. Whereas much was made of "transit oriented development" at the outset--with images of people strolling, or perhaps biking to their handy train stop--virtually all Sounder's patronage is dependent on free, handy parking. People are enabled to live hither and yon, drive their SUVs and pickups to Sound Transit's far-flung parking lots and structures, and park free, in order to benefit from an enormously subsidized rail trip. Doug MacDonald, former Washington State Secretary of Transportation, and former Sound Transit board member, aptly dubbed Sounder, "Sprawl Rail."

"Transit-oriented development," doesn't mean live near your rail transit stop and get rid of your automobile. Were that the case, huge sums for parking facilities would be unnecessary. Rather, it means subsidies for commercial development near the stations, in addition to subsidies for the train system and its operations. E.g., there's a "transit-oriented development" in Kent, Kent Station. The municipality purchased the real estate for $15 million, spent $2 million for environmental remediation, and sold it to the developer for $5 million. Sound Transit then relocated its planned 800-stall parking garage to the opposite side of the tracks--where it brings traffic closer to downtown Kent--so the Kent Station developer could use the parking garage, free, for its customers.

The arrangement works because the clientele of Kent Station has virtually no relationship to that of Sounder. This is dramatized by the anchor tenant, a 13-screen cineplex. Since Sounder operates only during work day commuting hours, and people go to the movies evenings and weekends, Sounder patrons and movie-goers drive to and from the garage servicing Sounder's station and Kent Station without competing for parking spaces. Kent Station has almost nothing to do with transit, save the coming of Sounder provided a rationale for subsidizing the mall developer.

Central Link light rail

The vision of Link light rail was that of a 125-mile network linking all the major centers in the Central Puget Sound region (Snohomish, King, and Pierce counties). After several losses at the polls, a scaled-back 21-mile ten year "starter rail" plan was proposed, and the taxing authority was approved by public vote in 1996.

Central Link light rail was to run from the University District in north Seattle to South 200th, a short distance south of Seattle-Tacoma International Airport, at a cost of $2.3 billion. It was to be completed and operating in ten years, 2006, and demonstrate how well Sound Transit could build and operate a rail line. With this "test drive," the public could kick the tires and have confidence in approving additional, Phase 2 taxes for the rest of the 125-mile network, to completed and operating in 2020.

With great fanfare and bragging, a so-called Initial Segment of Central Link light rail (i.e. the "initial segment" of the "starter rail"), from downtown Seattle to Tukwila, will go into service in the summer of 2009, and be extended a short distance to the Sea-Tac Airport in 2010. Sound Transit then hurried to obtain its Phase 2 taxing authority, negating the public's opportunity to evaluate its Phase 1 performance. Initial Segment covers the cheapest, easiest portion of the promised Central Link segment, will cost as much as the proffered price of all Central Link, and is projected to have one-quarter the ridership promised in 2010. Also, four stations have been eliminated, and only 12 will be completed--four of them stations in the Downtown Seattle Transit Tunnel, originally built and financed nearly two decades ago.

For an additional $1.9 billion, Sound Transit plans to add two more of the Central Link stations by 2016, and reach the University of Washington's football stadium. At that point the $2.3 billion project, to be completed in 2006, will have reached neither end of the Central Link line (NE 45th in the U District and South 200th, south of Sea-Tac), it will have cost $4.4 billion, and be missing 7 promised stations. That will have exhausted the Sound Move Phase 1 taxes, even though extended for 10 years in addition to the original 10 years. Reaching the NE 45th and South 200th termini, now targeted for 2020, will add well over $1 billion, supplemented by Phase 2 taxes. As of 2020, for roughly $6 billion, Sound Transit's Central Link light rail is now scheduled for completion, 14 years late, absent 5 of the promised 21 stations, with a $3.7 billion cost overrun.

The Central Link ridership promised in 2010, 32 million boardings, won't be approached by 2020, with a system that will cost at least 2.6 times as much. Operating costs will be multiples of those projected, and the share covered by the farebox--forecast at 53%--will be but a small fraction.

As for the Phase 2 additions, which was supposed to complete the 125-mile light rail network by 2020, if all goes according to the current plan, only 50 miles will be completed by 2030. The cost per-station for that Phase 2 is projected at $650 million. For Phase 1, Central Link, the cost-per-station will be roughly $300 million, versus an original estimate a tad higher than $100 million.

In sum, the introduction of the two rail systems in the Central Puget Sound counties, is a slow, disruptive process, costing huge sums to build and operate. The bottom-line effect will be to degrade the already inadequate productivity of the public transit system. The time, money, effort, and distraction will add so little to transit ridership that the effect on the region's mobility will be indiscernible--save for the immense "opportunity costs," the resulting inability to make productive use the financial resources.

The attached graphs illustrate the trajectory of transit ridership, and the share of the region's entire transportation funding allocated to transit from local, state, and federal sources. Forty years ago transit received 29% of the funding, and delivered 6% of the transportation market share. If Sound Transit performs as well as it hopes to, and if the idealized smart growth land uses are fully adopted, by 2030 transit will serve 4% of the transportation market share, and absorb more than two-thirds of the region's transportation dollars.

Seattle Three County Transportation Tax Revenues
Seattle Transit Market Share: 1965-2040

Las Vegas Monorail Bonds: Default Imminent or Inevitable?

2009-06-22T22:24:00.006Z

Bloomberg News reports today (20090622) that $450 million of municipal bonds that provided most of the funding for Las Vegas Monorail had their credit rating further reduced today by Fitch Ratings. Bloomberg indicated that this action implies “default of some kind appears imminent or inevitable.”

This apparently impending financial embarrassment was predicted in our 2000 Public Purpose report on the Las Vegas Monorailbefore the bonds were issued. The problem, as we predicted, is that ridership has fallen far short of projections, which is a fairly standard occurance with respect to large transit infrastructure projects.

Las Vegas Review Journal Article

Tags:

Las Vegas Monorail: Bond Default Imminent?

Las Vegas Monorail: Bond Default Inevitable?

Slumdog Millionaire: The Movie and the Book

2009-06-20T21:54:00.002Z

I had the pleasure of watching the movie on a flight from Dhaka to Bahrain. I had just been inside three separate slums in Dhaka and have seen slums or shantytowns in many places, such as Kolkata, Sao Paulo, Rio de Janeiro, Manila, Jakarta, Soweto and Cape Town. I have also been to Mumbai’s Dharavi, where much of the movie takes place.

I don’t watch many movies, but Slumdog Millionaire was well worth the time. When I got home I ordered the book. It was written by Vikas Swarup and was originally published under the name Q and A. The book was as different from the movie as the difference in titles.

Only the broadest outline of movie’s story resembles the book. Jamel is not Jamel, he is Ram and he has no brother. His love, Latika appears in the book but is not his love. She appears for the first time in the 11th of 12 chapters. The program is not Who Wants to be a Millionaire, but is rather Who Will win a Billion?. The top prize is not 20 million rupees, it is rather 1 billion rupees ($20 million).

There are the murders, but none of them resemble those in the book. Finally, there is some consistency in geography. Mumbai is the scene of most action in both, Agra appears, but Delhi, which is important in the book does not appear in the movie.

Finally, in the greatest inconsistency of all, Jamel/Ram is not a lifelong slum dweller. He actually lives in lower middle class housing, above that of the shantytowns. He does spend part of his time, however, in Dharavi.

However, there is much to be gained from reading the book. It provides another, almost completely different perspective on urban living in India. Both the movie and the book are highly recommended.

===

Note: Dharavi is often called the world's largest slum, with 1,000,000 people in approximately one square mile (2.5 square kilometers). However, I believe that another area, to the north of Dharavi, bordering on the east side of Mumbai International Airport is larger. This “airport east slum” covers about twice as much land area as Dharavi and may have 2,000,000 residents. For more information see Rental Car Tour of Mumbai.

Mitsubishi 60 Gram Car

2009-06-13T23:43:00.008Z

Mitsubishi has announced development of a lithium battery driven car, to be sold within two years. The car, the "MIEV Plug-In Electric First Drive" would travel as much as 100 miles (160 kilometers) between charges.

United States Data and Comparisons: GHG Emissions per Passenger Mile/Passenger KM are indicated below (From power plants - variation is due to mix of fuel sources used in producing electricity)

Average United States: 61 grams/37 grams
Lowest (Vermont): 1.4 grams/0,7 grams
Highest (North Dakota): 102 grams/62 grams

The average GHG reduction compared to the current US automobile and sport utility vehicle fleet average would be 83 percent.

European Union Comparison The MIEV would be 40 percent less GHG intensive that is required by the newly adopted European Union fuel economy requirements for 2020 (the equivalent of 101 grams per passenger mile or 62 grams per passenger kilometer).

The above calculations assume the US national vehicle occupancy rate of 1.6. The comparison to the present fleet includes upstream production and transport activities.

Mitsubishi MIEV Site

Edmunds Review

Regulation breeds seizure in the two-speed housing market

2009-06-11T22:22:00.003Z

REGULATION BREEDS SEIZURE IN A TWO SPEED HOUSING MARKET

Originally Posted March 7, 2007 (On the Heartland)

Summary

Much has been written about the housing industry slowdown in the United States and the “housing bubble” evident in overvalued house prices. In fact, only part of the US market is experiencing overvalued housing prices, with the rest of the nation enjoying historic housing affordability ratios in what has become a two-speed housing market. National Association of Realtors data indicates substantial reductions in existing house sales year-to-year in a number of states, most of which are characterized by highly regulated land markets (principally so-called “smart growth” policies). These policies ration the land available for residential development and, not surprisingly inflate land and housing prices. The costs are substantial, with many years of housing expense (including mortgage interest) being added to the budgets of households now purchasing homes. In the longer run, it seems likely the “bubble” will deflate or even “burst” in the highly regulated markets. This could occur in various ways. Until the necessary correction occurs, the highly regulated markets can be expected to experience laggard population and economic growth (as is already occurring).

The Housing Slowdown

Perhaps the most covered economic story in the nation in recent months has been the housing slowdown. National Association of Realtors data indicates that in 2006, existing house sales fell 8.5 percent in the United States compared to 2005.

The Two-Speed Housing Economy

Much has been written in recent years about the “housing bubble.” However, national data mask some very significant differences. Others are doing just fine. New York Times economic columnist Paul Krugman noted more than a year ago, that the “bubble” is concentrated --- in what he called the “zoned-zone” The “zoned-zone” is the highly regulated states in what has developed as a two-speed housing market. There is not a national housing slowdown, so much as there is a slowdown in some areas.

Sales volumes have generally plummeted in markets where land use regulation is strongest, where zoning and restrictions are the most severe. Conversely, where land use regulation is less stringent, sales volumes are steady or even increasing.

Market Seizure in Highly Regulated Markets

Housing market seizure --- akin to heart seizure --- has hit the most regulated markets in the United States according to an analysis the state data by Demographia. The strong land use regulations include land rationing policies, such as so-called smart growth, large-lot zoning and insufficiently rapid government land sales where there is insufficient privately owned land left for development. All 19 states with strong land use regulations experienced sales declines, with a minimum loss of 4.5 percent between 2005 and 2006. The largest losses were in Nevada (minus 28.9 percent), Arizona (minus 28.2 percent), Florida (minus 27.6 percent) California (minus 23.5 percent and Virginia (minus 22.9 percent), all states where government policies have stood in the way of sufficient land supply. Overall, the highly regulated states experienced a housing sales decline of more than 17 percent from 2005 to 2006.

At the same time, median house prices in the metropolitan markets of the highly regulated states held steady. This is to be expected, given the artificial shortage of supply that land use policies have created in these states.

Market Strength in Liberally Regulated Markets

Conversely, in the states without excessive land use regulation, annual existing house sales rose nearly one percent. Gains of more than six percent were posted in Alaska, Arkansas, North Carolina, Texas, and Indiana. Existing house sales rose three percent in fast growing Georgia, home of the high-income world’s fastest growing large metropolitan area, Atlanta.

It is the Law of Supply and Demand

Some analysts have blamed low interest rates and high demand for the bloated housing prices in some markets. This view is disproven, however, by the fact that the same interest rates have been available in markets that have experienced housing cost escalation and those that have not. Moreover, the unaffordable markets do not have the greatest demand. The fastest growing metropolitan areas with more than 4,000,000 in the high-income world are Atlanta, Dallas-Fort Worth and Houston, and each of these has remained affordable --- with Median Multiple (median house price relative to median household income) below 3.0. Economics is governed by the “law of supply and demand,” not the “law of demand.”

Uncharted Unaffordability Territory

Finally, virtually all of the unaffordable markets were nearly as affordable as the liberally regulated markets just a decade ago. In recent years, government policies have driven housing prices to unprecedented unaffordability in many highly regulated markets. In a number of highly regulated metropolitan areas, such as San Diego, Los Angeles and San Francisco, housing costs have escalated so rapidly in recent years that the Median Multiple is more than three times the historic standard of 3.0.

In highly regulated San Diego, the escalation in the median house price housing and financing (at today’s low rates of interest) relative to incomes in just 10 years has been the equivalent of 14 years of median household income. This has imposed $800,000 more in costs for each household buying a median priced house and is making San Diego extraordinarily uncompetitive. The same is true, to a greater or lesser degree in other highly regulated markets.

These unnecessarily higher prices are likely to translate into lower rates of home ownership. This will disproportionately affect lower income households, which are minority to a larger degree. Today, African-American and Hispanic home ownership rates hover at or below 50 percent compared to the half-again higher 75 percent among White-Non-Hispanic households. The gap has been narrowing in recent years, but smart growth is likely to reverse that.

Irrelevant Solutions

There is no point in proposing the conventional housing affordability programs to solve the problem. “Inclusionary zoning” and home buyer give politicians the appearance of doing something, but their impact reaches little beyond headlines. Such programs are simply irrelevant to housing affordability. The depth of the housing affordability crisis in California, the Northeast and other highly regulated markets is far beyond the ability of any conventional housing affordability program to correct. The problem is that smart growth, urban planning and regional planning have manipulated the price of land so high that nothing short of a structural correction will solve the problem.

Regulation Associated with Less Economic Growth

However, the price of regulation is being paid in a housing market seizure that has seen sales volumes plummet. This is not surprising. United States Federal Reserve Board research indicates that metropolitan areas with more stringent land use regulation can expect to grow less quickly than would otherwise be expected.

Demographic Reversals

This research is validated by US Bureau of the Census migration data. The excessive over valuation of residential property appears to be a major factor in driving more than 2,500,000 residents from the high cost coastal markets to more affordable inland markets since 2000. This represents virtually a complete reversal from the demographic trends from World War II to the early 1990s. There is no reason for it to have occurred other than that housing affordability has been destroyed in the formerly strong but now highly regulated markets. Shockingly, previously fast growing San Diego is now losing domestic migrants at twice the rate of Pittsburgh.

Deflating the Housing Bubble in the Highly Regulated Markets

Housing prices have reached uncharted territory relative to incomes. Some analysts have suggested that housing affordability was nearly as bad when interest rates were high, especially in the late 1980s. But those interest rates passed and nearly all high-interest rate mortgages were replaced with lower-rate loans. Thus, the affordability crisis was “transitional.” This housing affordability crisis is “structural.” Buyers are stuck with the high prices they paid and the costly mortgages. It seems likely that, in the longer run, the bloated prices in highly regulated markets will be subject to correction. This could occur in various ways. For example:

Slower Economic Growth:

Inflating Away Windfall Profits from Bloated House Prices:

The Bubble Bursts:

A correction could occur by other means as well and the future is always impossible to foresee. However, the overvalued prices in over-regulated markets are not likely to be sustainable. The price of smart growth and excessive regulation is already being paid by some households. The next question is the extent of damage that the increasingly expensive mortgages created by smart growth will inflict upon regional economies, if not the national economy.

----
Data
US Existing House Sales: 2005-2006.

The American Dream: For 300 Million

2009-05-21T20:20:00.000Z

The American Dream: For 300 Million

This week the United States celebrates its 300 millionth resident. Never in human history has one nation achieved such a high standard of living for so many people. Today, American average incomes are a third higher than that of the EU-15, the European Union before expansion to Eastern Europe.

All of this has been achieved as our people have pursued the American Dream of homeownership and personal mobility. Since World War II, home ownership rates have increased 75 percent and now more than 90 percent of households have access to cars. Home ownership has made it possible to build up capital, through equity, that funds new business start ups and finances university for the kids.

The car has made it possible to work nearly anywhere in our now larger urban areas and still spend a minimum of time traveling to and from work. Despite the frequent publicity accorded traffic congestion, American urban areas are the least congested in the world. Even in the most congested urban area, Los Angeles, average work trip travel times are a quarter less than in Paris or London, despite the clear superiority of their mass transit systems. It is not surprising that virtually every first-world nation has followed a suburbanization model similar to that of the United States (though it is not obvious to tourists whose foreign visits tend to be limited to historic cores)

Moreover, the American Dream is spreading throughout the population. African-American and Hispanic home ownership rates are growing faster than the White-non-hispanic rate and there is the potential that they will continue to converge. A Swedish research institute found that average African-American incomes are as high as average Swedish incomes.

Once smog ridden urban areas have seen massive improvements in air quality --- so much so that mountains hidden for much of the year by pollution before can be seen much of the time in Los Angeles. American urban areas are among the cleanest in the world, and will continue to get cleaner as more efficient air pollution reduction technology plays a greater role.

In short, the modern American urban area is an “open city” in which individuals, communities and the nation have prospered as households have been permitted to live and work where and how they like.

Regrettably, many urban planners are threatened by this success --- out of a misguided fear for the future or perhaps a compelling urge for control. The result is imposition of authoritarian planning policies and practices (mislabeled “smart growth”) that would circumscribe the growth of urban areas into carefully confined spaces, so as not to occupy any more of the more than 97 percent of the nation’s land that is not in urban development.

But there is a bigger reality than a compulsion to hem in the growth of urban areas. The result is clear from places where authoritarian policies have been imposed with the greatest vigor. It all has to do with a simple economic concept --- that rationing raises prices. And so, in places like Portland (Oregon), San Francisco and San Diego, authoritarian planning policies have severely rationed land for development, driven the price of land through the roof and seriously retarded housing affordability. For example, in the San Francisco area, the cost of a median priced house has gone up so much that the average household would have to pay an additional $600,000 over a 30 year mortgage. Not even Hugo Chavez or OPEC can compete with this --- their price increases over the past five years would add little more than $10,000 to the average household’s budget over 30 years.

Authoritarian planning policies and practices are robbing many households, present and future of the potential for home ownership and joining the economic mainstream. Because of their disproportionately lower incomes, this burden will be born most by African-American and Hispanic households.

Fortunately, most of the nation has not opted to destroy home ownership through short sighted authoritarian planning. In places like Kansas City, Indianapolis, Atlanta, Dallas-Fort Worth, Houston, Cincinnati and many others, the open city prevails and housing remains affordable. Thus, for most, the American Dream remains alive and well. It is not surprising that recent census data shows a strong out-migration from metropolitan areas with authoritarian planning and high housing costs to metropolitan areas with lower prices. The American Dream is still alive, though not as widely available as before.

Census Bureau projections indicate that sometime around 2025, the nation will celebrate its 350 millionth resident. The nation will be far stronger and more socially cohesive if most of those new residents live in suburban houses they own and have the mobility only the car can provide to employment, shopping and other destinations they find make their lives more rewarding.

Originally posted to On the Heartland 2006.10

Serious Questions About “A Heavy Load” Report

2009-05-21T20:19:00.001Z

Serious Questions About “A Heavy Load” Report

A report by the Center for Housing Policy relies on data that is at odds with consumer expenditure data as reported by the US Department of Labor, Bureau of Labor Statistics. The report modeled transportation data that was readily available in consumer expenditure reports. The Center’s report generally puts the cost of transportation at more than double the figures reported by the Department of Labor. As a result, it would appear that the report, A Heavy Load is of dubious value.

Recently, the Center for Housing Policy issued a report on the costs of housing and transportation to American households in metropolitan areas (A Heavy Load: The Combined Housing and Transportation Burdens of Working Families. The report found, among other things, that transportation represents a larger share of household income in a number of metropolitan areas. Moreover, a thesis of the report seems to be that people who move farther away from their jobs to obtain less expensive housing end up spending most of the savings on additional transportation costs.

It is worthy of note that the figures developed by the Center for Housing Policy are considerably at odds with the Consumer Expenditure reports of the U.S. Department of Labor Bureau of Labor Statistics. For example, among the seven metropolitan areas that the Center singles out for detailed analysis, the share of household income committed to housing averages 28 percent, while the share committed to transportation amounts to 31 percent. Data from the 2004 Consumer Expenditure report indicates rather more moderate figures --- 22 percent for housing and 12 percent for transportation.

What is the difference. To start, the Center used 2000 Census information (1999 data) for consumer expenditures on transportation. It is fair to suggest, however, that the authoritative source for consumer expenditures is the Consumer Expenditures report and its data is five years more current. The Center used a modeling technique to estimate the transportation expenditures, which it notes was “peer reviewed.” This was a wholly unnecessary exercise, since 1999 transportation expenditure data was directly available from the Consumer Expenditure report for that year.

Moreover, the Center notes that lower income households spend a larger share of their incomes on housing and transportation. True enough. The Center estimates that households with incomes from $20,000 to $35,000 spend from 54 percent to 70 percent of their income on housing and transportation. The 2004 Consumer Expenditures report shows that households with incomes of $20,000 to $30,000 (the closest approximation to the Center’s $30,000 to $35,000 classification) have total household and transportation expenditures of 49 percent --- below the low range estimate in the Center’s report.

None of this is to dispute the fact that housing and transportation costs are a burden for lower income households. It is simply to point out that the data in A Heavy Load is at considerable odds with the Consumer Expenditure report and may not be appropriate for serious consideration.

A Heavy Load makes a very useful recommendation: “Policies to encourage car sharing or make car ownership more accessible and affordable (through subsidized loans or insurance, for example) could go a long way to reducing the transportation cost burdens of Working Families.” Amen to that. Research by the Brookings Institution and the Progressive Policy Institute has come to similar conclusions.

However, A Heavy Load slips into the usual hopeless rhetoric about improving mass transit for commutes to suburban areas. If mass transit could be made competitive with the automobile for employment locations outside downtown areas, then people would use it for such commutes. Nearly three years ago, we issued a challenge to the transit industry to propose an automobile competitive transit service design for an entire urban area. Not a a single serious reply has been received. There is good reason for the silence. Automobile competitive mass transit service cannot be provided for a price that can be afforded, except to downtown. Even the Center’s report finds average transit commutes to approach or even double average car travel times. Working households choose cars because they minimize their transportation burden, by providing far more time for household activities and leisure.

However, whatever the reality, the fact is that people often move farther away from their jobs to obtain better housing at a lower cost. They do so in the full knowledge that their commuting costs will be higher. In the longer run, many may change jobs and restore lower commuting costs by working closer to home, a choice made possible by the dispersal of employment locations. This factor is an important reason why American urban areas have such short average commute times by international standards.

Finally, A Heavy Load uses 1999 data that does not reflect the huge runup in housing prices that have occurred, principally in areas that have adopted authoritarian planning practices, such as the more draconian “smart growth” measures. Perhaps the greatest threat to the future expenditures of lower and middle income households is the escalating housing prices that have been generated by these opportunity destroying policies. For example, the average household buying the median priced house in 2004 in the San Francisco area will pay, at least $600,000 more in mortgage payments and capital costs than if the house had been bought in 1999. This is a price not even Hugo Chavez or OPEC can match. Over the same 30 years, the average household can be expected to pay less than $11,000 more on gasoline due to the gasoline price increases over the same 1999-2004 period.

Originally posted to On the Heartland: 2006.10.14

Coordinating Land Use & Transport

2009-05-21T20:17:00.000Z

One of the most enduring urban planning mantras is coordinating land use and transportation. While no one can dispute the desirability of coordinating land use and transport, the current strategies do exactly the opposite. That is because urban planning has been captured by an anti-automobile dogma that has the equation backwards. The idea is to locate as much as possible and densify adjacent to existing transportation infrastructure. The result, of course, is to significantly increase transportation demand.

However, the demand side is never addressed. When densities are intensified, more intense roadway systems are required. Failing to expand the roadways means that traffic congestion gets worse and that transport and land use have demonstrably not been coordinated. The planners may try to address the heightened demand by adding transit service or rail lines, but that is like attempting to reduce traffic congestion by increasing the frequency of garbage collection --- one has nothing to do with the other. The reality of the modern, large urban area is that people need to travel throughout to undertake their activities and to spur the economic growth that has produced an unprecedented expansion of jobs and affluence, while making poverty less of an issue than ever before. That cannot be done on transit.

Coordination of land use and transportation requires that sufficient practical transportation capacity be provided to support the land uses. If an area, such as Portland, seeks to densify, then it had better be prepared to expand and intensify its roadway system to maintain or improve reasonable traffic flows. Of course, Portland has failed to do that, has some of the worst traffic congestion among urban areas of its size and is losing businesses because of it.

Before today’s planners set about trying to coordinate land use and transport, they need to understand what it means.

Winnipeg Toys with Planning Disaster

2009-05-21T20:13:00.000Z

Winnipeg Toys with Planning Disaster

In a Winnipeg Free Press commentary today, I argue that the city of Winnipeg’s slow development approval processes have the potential to do as much damage to housing affordability as radical smart growth policies. Our Demographia Second Annual International Housing Affordability Survey had ranked Winnipeg as one of the most affordable housing markets out of 100 in six nations in 2005. The bottlenecks now occurring at Winnipeg city hall could, if not corrected, destroy housing affordability just as surely as the anti-suburban policies that have been adopted in places like Vancouver, BC and Portland, Oregon.

Time Lost in Transit: Drag on Canadian Economy

2009-05-21T20:11:00.002Z

Time Lost in Transit: Drag on Canadian Economy

It’s time to stop pretending about transit. That is the message of the new Statistics Canada data that shows the average transit commuter spends three hours more time weekly traveling between home and work than the average automobile driver or rider. The complete story is outlined in my National Post oped Travel Times Prove Transit a Non-Starter. The National Post is Canada’s second largest national newspaper.

School Buses: Most Used Form of Mass Transit

2009-05-21T20:08:00.002Z

Most people, if asked, would probably respond that buses or subways are the most frequently used method of mass transit in the United States. They would be wrong. One of the best kept secrets in transportation statistics is the extent of school bus ridership. Part of the reason is that statistics are not as readily available as for school buses as they are for other modes of transport. Every school day, school buses carry 65 percent more travel than the nation’s transit buses, subways (metros), light rail, trolleybuses (electric buses), commuter rail and dial-a-ride services combined.

Of course, many school buses are operating in rural areas. Yet, even in urban areas, school buses carry a huge volume of travel. On school days, school buses operating in the nation’s urban areas carry 85 percent as much travel as all transit bus and rail services combined.

Sometimes it is suggested that school buses services should be merged into transit agencies, to save money. However, that would hardly do, since transit expenditures per passenger mile are approaching three times that of school buses. Transfering transit services to school districts would make more sense.

Originally posted to On the Heartland: 2006.07.15

Improved Transport Infrastructure a Necessity

2009-05-21T20:06:00.002Z

UPS Chairman and CEO Michael Eskew recently addressed the Philadelphia World Affairs Council on the importance of transportation infrastructure to the nation’s economy. Eskew is in a good position to talk about that subject, since his company is one of the largest trucking companies in the world, runs the world’s 9th largest airline and is the nation’s largest user of freight railroads.

Eskew notes that the nation’s freight transportation system --- its highway, navigable waterway freight rail and air system --- has received poor or even failing grades in an American Society of Civil Engineers 2005 review. This is just the beginning of his concern. China, increasingly America’s most dynamic competitor, is building new seaports, expanding its rail system and is in the process of developing an interstate standard highway system more extensive than our own Eisenhower system.

There is no doubt that globalization is going to make the world a richer place. That does not mean, however, that nations, like the United States, that are on top now will continue to occupy such positions. Continued investment is required. Traffic in urban areas is frequently congested. This means that it takes longer to move freight, which means it is more costly. It also impedes productivity. Studies in Portland and Vancouver, where public officials have systematically discouraged highway expansion, demonstrate the importance of expanding urban highways and keeping the traffic moving.

A University of Paris study showed that as urban travel improves --- as people are able to access more jobs in a fixed period of time (such as 30 minutes) --- there is an increase in economic output.

Texas Transportation Institute data shows that the share of urban travel in congested conditions has risen from 20 percent to over 50 percent in just 20 years. This has occurred principally because urban highways have not been expanded sufficiently to meet the demand. As a result, the nation loses more than $60 billion in congestion costs every year. However, that will only get worse. Many urban areas intend to spend few of their resources on the highway capacity improvements that are the only hope for addressing traffic congestion.

There is an important exception, however, The state of Texas, at the direction of Governor Rick Perry, is undertaking the nation’s first serious program to reduce traffic congestion. The program, arising out of the Governor’s Business Council plan of 2003, is to reduce traffic congestion by up to one-half in the state’s metropolitan areas. Metropolitan planning organizations have developed traffic congestion reduction objectives and the necessary strategies. With Dallas-Fort Worth and Houston being among the fastest growing large metropolitan areas in the high-income world, this will not be easy. Amazingly, however, the modeling is showing that the goals are achievable and that they will not break the bank. Atlanta, the high-income world’s fastest growing metropolitan area has now followed suit, under the direction of Governor Sonny Perdue.

The Texas and Georgia programs represent a first --- transportation agencies actually implementing traffic congestion reduction objectives. It is astonishing that such objectives were not already the rule throughout the country. If the nation is to respond to the need for a sustainable, competitive transport infrastructure, no less than the Texas and Atlanta programs will be require in every metropolitan area in the nation. Such a beginning needs to be expanded to include all segments of the freight transportation system, from air cargo to navigable waterways and freight railroads.

Wendell Cox is a public policy consultant in St. Louis, a Senior Fellow at the Heartland Institute, and a visiting professor at the Conservatoire National des Arts et Metiers in Paris.

Originally posted to On the Heartland 2006.07.13

Vancouver: Containing Opportunity, Not Sprawl

2009-05-21T20:02:00.003Z

Vancouver: Containing Opportunity, Not Sprawl

It is probably too much to expect The Economist to make sense in assessing suburbanization, which it and those inclined toward fashionable urban planning dogma call “urban sprawl.” In an article on page 53 of the 8-14 July issue (“Growing Pains”), the magazine characterizes Vancouver as having had “relative success in containing sprawl.”

Of course, like the urban planning priesthood so quick to damn suburbanization from their academic pulpits, The Economist does not bother to justify its assessment with anything remotely resembling quantitative analysis. Like the proverbial US Supreme Court Justice Potter Stewart who could not define obscenity, but knew it when he saw itThe Economist apparently “knows sprawl when it sees it.”

In fact, by various measures, Vancouver has suburbanized as much as many other urban areas. For example, by the ultimate indicator of suburbanization, urban population density, Vancouver trails Los Angeles by 40 percent (1,650 persons per square kilometer, compared to 2,350). True enough, Vancouver is more dense Portland, but then so is Phoenix (1,300 and 1,400 respectively).

The anti-suburban dogma claims that urban areas with less suburbanization have less traffic congestion, which is predictably untrue. In the case of Vancouver, the intensity of road traffic (kilometers driven per square kilometer) is more than Atlanta, which is by many accounts the most suburbanized major urban area in the world (700 per square kilometer).

The Economist bemoans the fact that Vancouver has been slow to build urban railways. Actually, Vancouver is one of the better served urban areas in North America in this regard. The problem is that urban railways feed little beyond downtown. Downtown in Vancouver represents less than 15 percent of employment and most employment growth is in the suburbs.

The anti-suburban movement speaks with platitudes about housing affordability, yet housing affordability tends to be the worst in urban areas that adopt its policies. This is because anti-suburban policies tend to ration land, raise its price and thereby make housing less affordable. Vancouver has been, like Portland, among the world leaders in anti-suburban policy. Like Portland, its housing affordability has paid the price. Vancouver has, by far, the worst housing affordability of any large urban area in Canada and ranked 86th out of 100 international urban areas in housing affordability in the Second Annual Demographia International Housing Affordability Survey.”.

Anti-suburbanites claim that air pollution is less intense in urban areas that adopt their policies. Again, no one ever bothers to consult the data. Yet, an international database indicates that the intensity of air pollution emissions in Vancouver is similar to that of Houston, Phoenix and Atlanta, which are considered to be highly suburbanized (and have lower densities).

None of this is to discount Vancouver’s attractiveness. However, much of what makes Vancouver attractive is not due to urban policy. Its downtown area has been invigorated by unprecedented immigration by highly affluent residents of Hong Kong in recent decades. It has an incomparable physical setting. Yet, its suburbs extend far into the countryside, just like in any American or Western European urban area.

Perhaps it is that The Economist is blinded, like the priesthood, by Vancouver’s “chic” core. Cutesy cores do not negate suburbanization. They occur with and without it. It also helps that Vancouver, unlike Phoenix and other younger urban areas, had a strong pre-automobile core to work with. No one builds them anymore, though they can expand and be converted into residential areas (as is occurring throughout North America, regardless of anti-suburban policy). Nonetheless, most growth continues in suburban areas, whether in Vancouver or Phoenix.

The fact is that, by the criteria that can be deduced from the anti-suburban literature, virtually all urban areas sprawl. Some are more suburban than others. But those that are more compact and less suburban are not necessarily better places to live. Just ask the young people no longer able to afford to live in Vancouver, Portland or Sydney, who are being driven away by housing prices that force them to choose a less favored urban area as the price of achieving and maintaining middle income status.

Thus, The Economist would have been more accurate to have noted Vancouver’s “relative success” in preserving and improving downtown. However, Vancouver’s “relative success” has been in containing opportunity.

Originally posted to On the Heartland 2006.07.10

Europe: Commuting Faster in Suburbs than Cities

2009-05-21T19:56:00.003Z

EUROPE: COMMUTING FASTER IN SUBURBS THAN CITIES

There are few public policy issues more driven my myth than land use and the currently fashionable strategies of “smart growth” or “urban consolidation.” Virtually all of the arguments made in support of smart growth’s densification and land restriction policies melt away when subjected to the light of scrutiny.

Further evidence of this is provided by an analysis of Western European work trip travel times. The anti-suburban smart growth theorists often suggest that cities should artificially constrained in their expansion because suburban areas put people farther away from their jobs and thus force people to spend more time traveling to work.

Estimates based upon data from the European Union Urban Audit indicates that commutes by suburban residents are faster than commutes by city (core) residents. that the average work trip travel time for suburban residents is 23 minutes, one-way. This is five minutes less each way that the central city estimate of 28 minutes. Of course, the reasons that suburbanites can get to their jobs more quickly are that lower densities mean less traffic congestion (contrary to smart growth claims) and that jobs have followed people to the suburbs. Doubtless, urban planners who are more inclined to believe their conceptions than the data will be surprised that this improved jobs-housing balance has occurred with little or no direction from the planning profession.

Land use policy needs to be based upon fact, rather than the myopic perceptions of a small urban elite. The data could not be more clear. Smart growth --- the compact city --- means more traffic congestion, more intense air pollution and longer travel times. This, of course, is just the beginning. Smart growth also means significantly reduced housing affordability, a redistribution of wealth from lower and middle income households to the more affluent and, as a result, the likelihood of future greater poverty and less economic growth.

Note on the methodology: The Urban Audit provides commute time estimates for central cities and metropolitan areas (Larger Urban Zones). The suburban estimate has been developed using a population based ratio supplied by the Urban Audit. This must be considered an estimate. A more precise figure could have been calculated with employment data, which is not available.

If central city labor participation rates are higher proportionally in the central cities than in the suburbs, then the extend to which suburban commute times are shorter than central city commute times has been somewhat underestimated.. If central city labor participation rates are lower proportionately, then the reverse would be true.

Nonetheless, the data shows that, generally, metropolitan area travel times are less than central city travel times, which means that suburban travel times are lower yet, which is indicated by the estimates above.

Originally posted at On the Heartland 2006.10.04

An Urban Planning Driven Recession?

2009-05-21T19:52:00.001Z

An Urban Planning Driven Recession?
By Wendell Cox

Recent national economic news has focused on the softness in the housing market. Last month, downward price pressures in new housing were noted as having contributed to less than expected economic growth. This week, the National Association of Realtors issued its third quarter report showing a 12.7 percent decline in existing house sales compared to last year.

All of this, of course, will refuel the debate on the “housing bubble.” Is there one? If there is, will it burst? Columnist and economist Paul Krugman of The New York Times has it right --- there is a bubble, but it is geographical. The Krugman thesis is that the “zoned-zone” is the home of artificially inflated housing costs.

The zoned-zone is the areas of the nation that have embraced land-rationing policies, usually under the misleading title of “smart growth.” These policies include restrictions on suburban development, such as Portland’s urban growth boundary and requirements for excessively large lots, which reduces the supply of land for residential development. There is little argument in economics about this dynamic --- rationing raises prices.

Rationing raises prices with a vengeance. Take “smart growth” San Diego, where today the median house price is more than 10 times the median household income (a measure called the “median multiple”). The historic median multiple norm has been 3.0 or less. In San Diego, the median multiple was 3.6 times in 1995. Over just 10 years, the total cost ---including interest --- of the median priced house in San Diego has risen more than $900,000. It is no wonder that nearly 100,000 domestic migrants --- people who move from one metropolitan area to another --- have left San Diego in just the first half of the decade. Huge housing cost increases and outward domestic migration has generally occurred in the metropolitan areas that have adopted “smart growth” land rationing policies.

Meanwhile, in the metropolitan areas that have generally allowed the supply of land for development to keep up with the demand for housing, prices have remained fairly constant relative to incomes. Atlanta, Dallas-Fort Worth and Houston, which as three of the high-income world’s fastest growing large urban areas, have managed to maintain a median multiple of 3.0 or less. Midwestern metropolitan areas, long losers of residents to the two coasts, have generally resisted the temptation to ration land and are now gaining domestic migrants. This includes places like Kansas City, Indianapolis and Columbus.

The state level existing house sales tell a stark story. In the states with stronger smart growth or other land rationing policies, the fall off in existing house sales has been by far the greatest. Over the last year, existing house sales have fallen an average of 20 percent in the highly regulated states. All 18 highly regulated states experienced declines, such as historically fast growing California, Oregon, Washington, Florida, Nevada and Arizona. By contrast, in the less regulated states, the annual loss was just 4.0 percent, while one-third of these states experienced sales increases, such as Texas and Georgia.

It is too early to tell for sure, but the signs are worrying. The housing bubble may be bursting in those areas where it was inflated by urban planning policies that took no account of their economic consequences. The nation could be headed toward a “smart growth” induced recession.

The economic and social consequences are ominous. The hundreds of thousands of additional dollars that must be paid to own a home in California, Oregon, Florida or other smart growth states will mean less money for other needs. Fewer consumer products will be purchased. Fewer jobs will be created. However, worst of all, there will be fewer homeowners. Lower income and many middle-income households will find their way to the mainstream of economic life blocked by artificially high prices that are the result of naïve urban planning policies. The cost of this urban design extravagance will fall most significantly on minority households, whose income is generally lower and whose home ownership rate remains a full one-third below that of White-Non-Hispanics. In the longer run, none of this is good for the economy or the people on whose enterprise and wealth creation the economy relies.

Wendell Cox is a Senior Fellow with the Heartland Institute and co-author of the “Demographia International Housing Affordability Survey,” which analyses housing affordability in 100 markets in six nations.

Originally posted on On the Heartland 2006.11.21

The EU Sprawl Report: Rewrite Needed

2009-05-21T19:45:00.001Z

The EU Sprawl Report: Rewrite Needed

For any who perceive that “urban sprawl” (a pejorative term for suburbanization) is an American phenomenon, the new European Environmental Agency report Urban Sprawl in Europe: The Ignored Challenge provides a radically new perspective. Yes, there is suburbanization in Europe, and plenty of it. Regrettably, Urban Sprawl in Europe is far from an objective, comprehensive review of urban trends. It blindly repeats dogma and, most importantly, fails to consider the momentous advantages that the land use developments of the last one-half century have provided in Europe.

The Positive: Hysteria is Absent

Starting with the positive, Urban Sprawl in Europe generally uses muted language and is devoid of the hysterical theology so often found in anti-suburbanization reports in the United States, Canada and Australia.

Repeating the Dogma

Nonetheless, there are serious problems with Urban Sprawl in Europe. Predictably, the report finds all manner of problems with suburbanization and no benefits. The report repeats the dogma that has misled planners and public officials in the United States, Canada and Australia. For example:

Urban Sprawl in Europe

More compact urban areas --- what the European Environmental Agency would like, have more traffic congestion.

lower

San Francisco illustrates the greater traffic congestion that is evident in central cities compared to suburbs.

published by the Heritage Foundation

The European Model: Los Angeles

The report applauds Munich and Bilbao for being the only two urban areas studied that since 1950 increased their populations than their land areas. In effect, this means that Munich and Bilbao “sprawl” less in relation to their populations than they did in 1950.

The European Environmental Agency might be surprised to find out which urban area is the champion in that regard. It is Los Angeles, which managed to increase its population at more than double the rate of its increase in land area from 1950 to 2000. Moreover, during that period, urban development in Los Angeles was largely market, rather than planning driven.

The European Environmental Agency acknowledges that suburban low-density lifestyles are more attractive to people (so much for the theory that Europeans like high rise city living, while Americans, Canadians and Australians like the suburbs). Nonetheless, the report implies that it would be better for bureaucrats to make lifestyle decisions, not the people who are living the lives.

The Usual Absent Public Transport Vision

Predictably, the report complains about Europe’s automobile oriented culture. Just as predictably, the European Environmental Agency offers no vision that would get people out of their cars without seriously hobbling their mobility and quality of life. There is, of course, good reason for this. No such vision could be financed by any economy in the world (see The Illusion of Transit Choice).

Ignoring Economics

However, the most serious problem with Urban Sprawl in Europe is not what it says. The principal problem is rather what the report ignores.

Somehow, over the past 60 years, the Western European (and other high-income world nations) have suburbanized as never before and have embraced the personal mobility of the automobile. These developments that anti-suburbanites and the European Environmental Agency view as negative have in fact been associated with the greatest expansion of affluence in history --- what I call the democratization of prosperity.

Urban Sprawl in Europe simply ignores the important issues of economics. Research indicates that personal mobility is associated with greater economic growth and the reduction of poverty. There is plenty of evidence that development of housing on less expensive land on the urban fringe has created wealth and played a major role in producing a comfortable middle class. These are issues that an intellectually honest and comprehensive discussion would include.

The Risks of Ignoring Economics

The failure to consider these issues is already taking a toll in urban areas that have blindly followed the anti-suburban pied pipers. Some urban areas have consciously sought to limit personal mobility and seen businesses locate to other urban areas. The urban areas of Australia and New Zealand, along with Portland and a number in California have so strangled their land markets by development controls that the (see Second Annual Demographia International Housing Affordability Surveyhistoric relationship to incomes has been shattered. The result is that millions of future households will not be able to own their own homes or will have to pay hundreds of thousands of dollars more. This translates, at least in part, into consumer spending that will not occur, jobs that will not be created. United States Federal Reserve Board has published research showing that metropolitan areas with more stringent land use control experience less economic growth than would have been expected.

Revisions are Needed

Urban Sprawl in Europe would best be thought of as a preliminary working draft. Serious revision is required. The dogma needs to be replaced with objective research. Most importantly, the missing elements of economic impact need to be added.

War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life

Australian Analysts Sells Oranges as Apples

2009-04-23T05:51:00.004Z

Re: http://www.businessspectator.com.au/bs.nsf/Article/House-price-to-income-ratios-pd20090421-RAV6W?OpenDocument

Christopher Joye of Australia's Business Spectator blog objects to comparisons of international house price indexes in his zeal to deny that Australian house prices are over-valued. He goes on to use what he refers to as an OECD international comparison of “house price to income” ratio. In so doing, he violates his own dictum.

That is just the beginning. What Joye calls a “house price to income” ratio is no such thing. As the OECD source document indicates (Reference: http://titania.sourceoecd.org/upload/1208051etemp.pdf, Table 1.2), the cited index measures the latest level “price-to-income ratio” relative to the “long-term average,” and that in comparison to the United States. This is not remotely the same thing as a price-to-income ratio, such as the Median Multiple (median house price divided by the median household income), which we use in the Demographia International Housing Affordability Survey. Calling something an apple does not make it an orange.

Canada Residential Study: Greenhouse Gas Omissions

2009-04-16T03:30:00.004Z

Suburban Housing More GHG Intensive?

Researchers at the University of Toronto estimated differences in GHG emissions between a typical low density detached house in the suburbs and a 15-story high rise apartment or condominium building in the central city. The study covered the impact of GHG emissions from “embodied energy” in the construction materials and day to day operations. The conclusion was that, on a per capita basis, the detached house produced 75% higher GHG emissions than the high-rise unit. Conversely, measured on a square footage basis, the detached house produced 6% less in GHG emissions than the high-rise unit. This research does not include energy used in construction.

All of the Difference is in House Size

The differences in house size were substantial, with the detached house being approximately 2,600 square feet and the high rise unit less than approximately 825 square feet. The square footage per capita in the detached house was approximately double that of the high-rise unit. Again, the apparent differences in energy consumption are a function of the size of the house. To achieve the apparent energy savings would require households to “downsize” their living space and standards of living.

Study Excludes Common Energy

Again, more importantly, the Canadian government data source cited in this research does not include common energy consumption, as in the case of the US RCES (See Below: Common Energy Consumption), which would be typical for a high-rise building. Thus, based upon the Sydney research (below), it is possible that the much smaller high-rise apartment produces more GHG emissions per capita than the detached house.

Common Energy Consumption

Residential energy surveys often fail to allocate common energy usage to housing units in multi-unit buildings, especially high-rise condominium or apartment buildings. Common energy includes living unit and building usage that that does not appear on energy bills, but rather is charged to buildings and included, in rents, mortgages or management fees.

According to the Sydney Water study, common energy consumption includes:

• Lighting (exterior, lobbies, stairs, hallways, parking lots)
• Elevators
• Centralized hot water supply including circulation pumps
• Centralized heating and air conditioning.
• Parking lot ventilation
• Common exhaust fans
• Pool and spa areas (including water heating, pumps, heating, ventilation, air conditional and lighting)
• Saunas
• Cooling tower pumps and fans

The Sydney Water research cited indicates that common energy consumption in multi-family buildings exceeds the amount used per capita in single family residences.

Research covering residential buildings in Sydney indicated that GHG emissions per capita are higher in multi-unit condominium buildings (high-rise, mid-rise and low-rise) than in single family detached or townhouses (attached houses). Unlike the US and Canadian data cited above, the Sydney study includes common energy use, which is shown to equal approximately two-thirds of direct household consumption in high rise condominium buildings (Box: Common Energy Consumption). These estimates do not include GHG emissions from construction of buildings or the embodied energy in building materials (Figure 1).

The Sydney research, which includes both energy on residential bills and common energy, indicates that lower density housing (detached and townhouses) tends to have less in GHG emission that multi-unit housing, both low rise and high rise.

Conclusion

Residences: Missing data on common energy consumption makes it impossible to draw any reliable conclusions on GHG emissions based upon residential building type from the Canadian research. Even with the incomplete data, the energy consumption advantages reported for the US and Canadian multiple-unit housing simply reflects smaller housing unit sizes. On the other hand, the Australian research, which includes common energy consumption, indicates that multiple unit buildings have greater GHG emissions per capita than the lower density detached houses and townhouses. The Canadian findings on embodied energy and the Sydney findings on common energy consumption suggest that, generally, high rise condominium living produces more in GHG emissions than single-family suburban residences.

There are, however, research gaps. There is only incomplete information on embodied energy in construction materials and virtually no information on the GHG emissions produced in constructing the various kinds of housing. Any definitive research would need to include these issues.

Additional Discussion on Common Energy

Publication Announcement Demographia World Urban Areas & Population Projections

2009-04-03T20:05:00.005Z

This 5th comprehensive edition includes:

• Ranking of the largest world urban areas (over 2,000,000 population).

• Population, urban land area and density estimates for all 763 identified urban areas with more than 500,000 population, comprising 49 percent of the world urban population.

• Population, urban land area and density estimates for 1,370 urban areas of all sizes, comprising 53 percent of the world urban population.

• Population projections for the world’s largest urban areas in 2025 & 2030 (over 2,000,000 population).

• Summary of United Nations world population projections and summary by gross domestic product, purchasing power parity (from 4th Edition)

• Charts on urban density and prosperity (from 2nd Edition)

• Documentation

Demographia World Urban Areas & Population Projections: 5th Comprehensive Edition

Phoenix:Smart Growth & State Destroy Housing Affordability

2009-02-07T20:44:00.001Z

The Phoenix metropolitan area is sometimes erroneously characterized as having a responsive (traditional or liberal) land use market. In fact, the Phoenix market is highly prescriptive, as a result of the combination of strong land use regulations (“smart growth”) and the large share of developable fringe land by the state of Arizona, which has been restricting sales to maximize revenues.

The state of Arizona owns a large share of the developable urban fringe land in the Phoenix urban area. The state has been auctioning land at a rate well below what the market could accommodate. This is illustrated by the large increase in prices per acre and in a comparison with agricultural land values.

In 2002, the average auction price of urban land was $32.600. By 2006, which was the peak of the Phoenix housing bubble, urban land sales reached an average auction price of $190,800. Rising land prices are the principal element of house price escalation in the Phoenix area over the period. As median house prices have declined in Phoenix (median house prices declined 39 percent in the year ended November 2008), average auction prices fell back to $68,600 in 2008.

Agricultural land in Maricopa County (the core county of the Phoenix metropolitan area) had a value per acre of approximately $8,500 according to the 2007 United States Census of Agriculture. Further, there was plenty of agricultural land, an amount in Maricopa County alone nearly equal to the entire urbanized land area of Phoenix in 2000. At the 2006 peak state auction prices, “raw” land was being sold at more than 20 times the value of agricultural land per acre. Moreover, the land ownership was highly decentralized, with nearly 1,800 farms. If “raw” agricultural land had been freely available for development, purchasers would not have paid such high prices for the land sold by the state.

Brookings Institution Land Use Planning Rating: In addition, the Phoenix metropolitan area is rated as “growth management” by the Brookings Institution in From Traditional to Reformed: A Review of the Land Use Regulations in the Nation’s 50 largest Metropolitan Areas. This is further indication that the metropolitan area has converted from responsive (traditional or liberal) land use regulation to prescriptive land use regulation.

Prescriptive Land Use Regulation and Price Volatility: Not only does prescriptive land use regulation artificially increase house prices, but it also makes prices more volatile. Prescriptive land use regulation brings more chaotic “boom and bust” cycles to housing markets. They convert what would have otherwise been modest price bubbles into extreme price bubbles. This is noted by Glaeser and Gyourko, who summarize the findings of a number of studies:

Recent research also indicates that house prices are more volatile, not just higher, in tightly regulated markets.

…price bubbles are more likely to form in tightly regulated places, because the inelastic supply conditions that are created in part from strict local land-use regulation are an important factor in supporting ever larger price increases whenever demand is increasing.

The mortgage meltdown has hit the Phoenix area about as hard as any in the country. Prices have reached approximately $163,000, down approximately 40 percent from the peak of $268,000. But, given the insufficient land sales rate and the excessive exurban land preservation provisions, it is likely that house prices in the Phoenix metropolitan area will again escalate once the economy recovers.

Phoenix provides an example of how land rationing, from both “smart growth” policies and insufficient government land sales can lead to far higher house prices and reduced housing affordability.

http://www.demographia.com.db-phxland.pdf

2009.02.09

2007 Consumer Expenditures on Transportation & Housing: US Metropolitan Areas

2009-02-05T00:08:00.003Z

It is popular for analysts to use the US Consumer Expenditures data to make points about the costs of living between metropolitan areas, especially with respect to transportation and housing. This is not a completely valid exercise, because the Consumer Expenditure report does not principally measure the cost of living. The Consumer Expenditure report is more a measure of preferences.

This is illustrated by considering the transportation sector. The Consumer Expenditure report divides transportation expenditures into four categories --- (1) vehicle purchases, (2) gasoline and motor oil, (3) other vehicle expenses and (4) public transportation.

The vehicle purchases category is reflective of the problem. This category reports the net cost of new and used vehicle purchases. The price a household pays, however, is not necessarily reflective of the cost of living with respect to vehicles. Some households might be happy with a new economy car with a base price of $10,000. Others may want a mid-sized car that may have a base price over $20,000, while still others may want a luxury car costing over $50,000 or even $200,000. All of these purchases are recorded as consumer expenditures. The $10,000 purchase may be reflective of the cost of living, the $20,000 to $200,000 purchase is reflective of a preference that exceeds the base cost of living. The same argument can be made with respect to houses. Many people buy houses that are more expensive, which skews the housing figure upward.

The only transportation expenses that are generally reflective of reflective of the cost of living are gasoline and motor oil and other vehicle expenses.

The following discussion outlines the situation with respect to Consumer Expenditures in Houston, which has often been the target of discrediting efforts by organizations hostile to the suburban lifestyles that now prevail throughout all metropolitan areas in the United States. The following data is calculated from the 2006-2007 Consumer Expenditures report, which is the latest and which contains information for 18 metropolitan areas.

Finally, the public transportation category is also misleading, because it includes airline travel and is not limited to local transit use. For example, in Houston, Federal Transit Administration data indicates that transit fares are at a level that would correspond to about $30 annually per household, leaving more than $450 for other expenses, principally airline fares.

Sources:
Data
United States Department of Labor, Bureau of Labor Statistics, http://www.bls.gov/cex/ .
Metropolitan data: http://www.bls.gov/cex/#data

5th International Housing Affordability Survey Released

2009-01-25T15:32:00.002Z

5th Annual Demographia International Housing Affordability Survey
265 Markets in 6 Nations

Dr. Shlomo Angel, of Princeton University and New York University, one of the world's leading experts in urban planning writes in the preface to this 5th Annual Demographia International Housing Affordability Survey that ...the current efforts to contain the pace of the outward expansion of cities for one reason or another are, at the very least, open to serious question. Referring to land use regulation, he continues: The more stringent the restrictions, the less is the housing market able to respond to increased demand, and the more likely house prices are to increase. And when residential land is very difficult to come by, housing becomes unaffordable., This report describes the economic connection between that "smart growth"/"urban consoldiation" policies (prescriptive land use policies) and the unprecedented house price escalation that has occured in recent years in some markets. Moreover, the consequences have expanded well beyond housing. Without prescriptive land use regulation, the housing bubble in the United States would have been less severe; without a severe housing bubble, the US mortgage meltdown would not have occurred and without the US mortgage meltdown, the international financial crisis might not have occurred. It will be important to reform land use policies to prevent similar damage from occuring in the future

Report:
http://www.demographia.com/dhi.pdf

INITIAL MONDAY PRESS COVERAGE FROM “DOWN UNDER” NEWSPAPERS

SYDNEY
http://www.smh.com.au/news/national/housing-severely-unaffordable/2009/01/25/1232818248039.html
PERTH
http://www.watoday.com.au/national/housing-prices-its-all-relative-20090125-7pgu.html
MELBOURNE
http://www.theage.com.au/national/housing-prices-its-all-relative-20090125-7pgu.html
AUCKLAND
http://www.nzherald.co.nz/property/news/article.cfm?c_id=8&objectid=10553540

Demographia International Housing Affordability Survey

Las Vegas: Smart Growth & Feds Destroy Housing Affordability

2009-01-11T22:48:00.001Z

The Las Vegas metropolitan area is sometimes erroneously characterized as having a responsive (traditional or liberal) land use market. In fact, the Las Vegas market is highly prescriptive, as a result of the combination of strong land use regulations (“smart growth”) and the large share of developable fringe land by the US federal government, which has been restricting sales to maximize revenues.

Federal Government Drives Up Housing Prices: Doug French, a bank executive writing for the Nevada Policy Research Institute noted that the federal government’s failure to sell land for residential development at a rapid enough pace had led to substantial increases in house prices in the Las Vegas area (the fastest growing metropolitan area in the United States with more than 1,000,000 population). As a result, builders and developers had bid up the land price in period auctions to ensure their supply of land for construction --- a practice called “land banking” (it is also a form of speculation).

The federal government owns 90 percent of the land in Clark County, which contains the entire Las Vegas urban area and private land for development has been in short supply for some time. According to French, the price of land for housing generally sold for $40,000 to $50,000 per acre in the late 1990s. By the time French was writing (2000), the price at auction had risen to $250,000. Over the past two years, the average price has been $563,000. Rising land prices are the principal element of house price escalation in the Las Vegas area.

From his 2002 vantage point, Feds Drive Up Nevada Home Prices, French noted that the median house price in Las Vegas was $124,000 in 1995 and had risen to $187,000. He noted that if this rate continued, the median house price would be more than $280,000 by the end of the decade. He was far too conservative. By the end of 2006, the median house price had reached nearly $320,000.

The federal government has been auctioning land at a rate well below what the market could accommodate. This is illustrated by the large increase in prices per acre and in a comparison with agricultural land values.

Agricultural land in the Las Vegas metropolitan area had a value per acre of approximately $3,000 according to the 2007 United States Census of Agriculture. At the 2008 federal government auction prices, “raw” land was being sold at more than 175 times the value of agricultural land per acre.

There is no shortage of developable land in the Las Vegas area. Within 40 miles of the city center, there is enough rural flat land to accommodate a population of more than 10,000,000 at Los Angeles urban area densities.

If land had been freely available for development, purchasers would not have paid such high prices for the land sold by the federal government.

Excessive Regulation in Boulder City: The problem is more than insufficient federal sales. Boulder City, at the southern end of the urban area, has a strong growth management act. Moreover, the city is effectively prohibiting development in more than 150 square miles of open desert land, some of which would be appropriate for developing new housing. Given Boulder City’s unique position, south of a pass between Henderson and Boulder City, the desert preserve represents the equivalent of an urban growth boundary to the south of the urban area.

Brookings Institution Land Use Planning Rating: In addition, the Las Vegas metropolitan area is rated as “containment lite” by the Brookings Institution in From Traditional to Reformed: A Review of the Land Use Regulations in the Nation’s 50 largest Metropolitan Areas. This is further indication that the metropolitan area has converted from responsive (traditional or liberal) land use regulation to prescriptive land use regulation.

Prescriptive Land Use Regulation and Price Volatility: Not only does prescriptive land use regulation artificially increase house prices, but it also makes prices more volatile. Prescriptive land use regulation brings more chaotic “boom and bust” cycles to housing markets. They convert what would have otherwise been modest price bubbles into extreme price bubbles. This is noted by Glaeser and Gyourko, who summarize the findings of a number of studies:

Recent research also indicates that house prices are more volatile, not just higher, in tightly regulated markets.

…price bubbles are more likely to form in tightly regulated places, because the inelastic supply conditions that are created in part from strict local land-use regulation are an important factor in supporting ever larger price increases whenever demand is increasing.

The mortgage meltdown has hit the Las Vegas area about as hard as any in the country, and median house prices have since reached $185,000, a decline of more than 40 percent. But, given the insufficient land sales rate and the excessive exurban land preservation provisions, house prices in the Las Vegas metropolitan area are again escalate well beyond historic norms once the economy recovers.

Las Vegas provides an example of how land rationing, from both “smart growth” policies and insufficient government land sales can lead to far higher house prices and reduced housing affordability.

http://www.demographia.com.db-lvland.pdf

2009.02.09

Australia & USA Have Largest Houses

2009-01-10T09:33:00.002Z

According to national reporting agencies, the average new house constructed in Australia or the United States is approximately 2,200 square feet (over 200 square meters), including both detached houses and multiple units. New house sizes are nearly as large in New Zealand (1,900 square feet or 175 square meters), while new detached houses average 1,900 square feet (175 square meters) in Canada. However, new average house sizes are less than one-half that size in United Kingdom, (815 square feet or 76 square meters). This is only 15 percent larger than the hundreds of thousands of standardized flats built in tower blocks before 1990 by the East German government (700 square feet or 65 square meters). Irish new house sizes are, like their UK counterparts, also comparatively small, at 945 square feet (88 square meters). Moreover, new UK houses are the smallest in the former EU-15, while new Irish houses rank ninth out of 15 (Figure 7).

New house sizes have dropped more than 30 percent in the United Kingdom since 1920. Ireland’s smallish houses are built at the same time that the nation emerges as the most affluent in the European Union excepting Luxembourg. At the same time, houses in Australia, Canada, New Zealand and the United States have continued to increase in size. Meanwhile, over the last 20 years, the average new detached house in Australia and New Zealand has increased by an amount to the average total size of a house in United Kingdom.

There appears to be a general unawareness of these differences, at least in the United Kingdom. For example, Richard (Lord) Rogers, who chaired the UK Government Urban Task Force has written:

In fact, average house lots are much larger in the United States (and Australia, Canada and New Zealand) than in the United Kingdom. In the United States, new detached houses are built at 2.7 per acre (6.6 per hectare). In Australia, new detached houses are being built at 5.5 per acre (13.3 per hectare). By comparison, in the United Kingdom, new houses were built at an average of 16 per acre (40 per hectare) in 2005. Future lot sizes are likely to be even smaller in Dublin, where present zoning calls for 20 houses per acre (49 per hectare) an increase of 35 percent in just four years. Seven Dublin houses or six United Kingdom houses could be built on the average new house lot in Australia.

Indicating a similar misunderstanding, the Times of London wrote that an objective of an Essex County plan was:

In fact, much of recently built housing stock in many continental (Western Europe) markets is detached. For example, single family houses comprise two-thirds of new house construction in France. The United Kingdom has some of the most tightly packed suburbs in the high-income world, nearly double that of Western Europe and one-half greater than in Japan.

Value for Money: New houses, adjusted for size differences, are more than twice as costly relative to incomes in Ireland and the United Kingdom compared to Australia and New Zealand. New houses in Ireland and the UK are four to five times as costly compared to affordable markets such as Indianapolis and Winnipeg (Figure 8).

Suzhou: All of China in One Place

2009-01-10T01:25:00.002Z

Full Article + 444 Photos

INTRODUCTION

If you only have time to visit one place in China, it should be Suzhou (pronunciation: SOO JOE). Suzhou provides a sampling of virtually all that China has to offer. Suzhou is Old China, from its temples, pagodas and canals to its tastefully designed and attractive gardens. Suzhou is also modern China, ringed by light industrial and commercial development. Suzhou also has elements of Italy, with canals like Venice and a leaning tower like Pisa (Yunyan Pagoda). Like other large urban areas in China, there are expanses of massive multiple building high-rise condominium development as well as lower rise townhouse developments and detached housing (called “villas” in China). Finally, Suzhou has a freeway and road system which is more comprehensive than most in North America.

GETTING TO SUZHOU

There is another reason to visit Suzhou --- it is conveniently located close to Shanghai, so a Suzhou is only a quick train, bus or taxi ride away from China’s principal urban area. Suzhou is on the new high speed rail line (CRH) from Shanghai to Nanjing. Air service is by the Shanghai airports.

LOCATION

Suzhou is located 45 miles (70 kilometers) west of Shanghai’s Hongqiao International Airport and 50 miles (80 kilometers) west of Puxi, Shanghai’s commercial core. It is another 20 miles (32 kilometers) to Pudong International Airport, which serves most international flights. Suzhou is in Jiangsu province, which, along with the provincial level municipality of Shanghai, occupies the south bank of the Yangtze River Delta. Suzhou city (the regional government) is bounded on the south by the Huzhou city (regional government) in Zhejiang, on the east by the provincial level city of Shanghai and to the west by Taihu and Wuxi city or regional government (Slide 2).

GENERAL DESCRIPTION

Suzhou sits at the gateway to China’s lake country. There are a number of lakes within the urban area. The west side of the urban area reaches into Taihu (Tai Lake), China’s third largest natural lake, at 900 square miles (2,250 square kilometers).

The topography is generally flat, however there are some hills in the urban area, including Tiger Hill, on which Yunyan Pagoda stands. The urban area extends to three islands in Taihu.

The Suzhou urban area now has 2.6 million people and is expected to increase to 3.2 million by 2025. The urban area covers 245 square miles (635 square kilometers) and a population density of 10,600 per square mile (4,100 per square kilometer). Suzhou is one of the least dense urban areas in China, principally because core densities are lower than elsewhere. The most dense core district (qu) reaches less than 50,000 per square mile (20,000 per square kilometer), well below Shenyang’s 80,000 (30,000) and Shanghai’s more than 100,000 (40,000).

However, as is the case in virtually all of the urban areas in China, the pattern of density is very uneven. Population densities are very high in the core or old city and fall off precipitously in the peripheral areas.

THE GRAND CANAL

The most unique feature of Suzhou is its canals. The most famous is the Grand Canal, or the Beijing-Hangzhou Canal, which is more than 1,100 miles (1,700 kilometers) long. The canal was started more than 2,500 years ago and completed 1,500 years ago. It is the longest canal in the world.
The Grand Canal courses through Suzhou. It carries considerable commercial traffic (Slides 3-24).

THE URBAN FORM

The Old City: The core, or old city of Suzhou covers approximately six square miles (15 square kilometers) and is surrounded by a broad canal, which forms a rectangle (called the Peripheral Canal in this Rental Car Tour). Parts of this “ring” canal have parks and well manicured green spaces on the old city side. This is particularly evident in the southwest section of the Peripheral Canal (Slides 419-444).

Boat cruises are available from the western side of the canal. The boat route goes to the north and continues into smaller canals further north toward Tiger Hill and the Yunyan Pagoda (Slides 25-104). The cruises provide a view of Yunyan Pagoda at their northern terminus. However, the terminus is well south of the pagoda. The rest of the canal toward Tiger Hill is closed to tourist traffic.

There are a number of additional canals within the old city. Many of these canals are also closed to tourist traffic. It would seem that Suzhou could increase tourist traffic by taking the necessary steps to open more of the canal system and making it possible to travel around the area by canal. Suzhou would appear to have greater potential as a tourist destination than it is now experiencing.

The old central business district is located in the middle of the old city (Slides 127-166). The central business district contains major shopping areas, but does not have much in the way of high rise commercial buildings. The population density of the core area appears to be somewhat lower than usual for the such an area in a Chinese urban area. In the older areas, the mid-rise multi-unit developments so typical in China appear to be up to five stories instead of six to nine. Like many Chinese core areas, the old Suzhou has many tree lined streets.

The old city is home to the Humble Administrator’s Garden (Slides 167-186).

The Emerging Western Center: Approximately three miles (five kilometers) the west of the old city a newer, bustling commercial core is emerging. This area contains a number of shopping centers and the tallest buildings in the urban area. As is the case with Chinese urban areas, the large commercial buildings are somewhat dispersed, rather than being concentrated as would be the case in North American or Australian urban areas. The Grand Canal divides this core, running north and south within walking distance of some of the largest buildings in the urban area (Slides 4-16). Just to the east of the Grand Canal is Suzhou Henghe Plaza, which is 48 floors and 600 feet high or 180 meters high (Slides 11, 120) . Suzhou’s tallest building, the Suzhou Xindi Center is located just to the west of the Grand Canal. The Suzhou Xindi Center is 54 floors, 761 feet and 232 meters high (Slides 203 & 205).

The Eastern Sector: To the east, there is a large number of new and under construction luxury condominium developments. These are both high-rise and mid-rise residential developments. There are also shopping centers.

Western Industrial Area: The western industrial area is to the west of the western core. This area has a grid of wide streets, which are up to eight lanes in width. The generally light industrial buildings are low rise, as would be expected in a similar area in Europe or North America. In addition, the area also includes some large luxury condominium developments.

Southwest: The southwest includes two older suburbs that have been engulfed by the expanding Suzhou urban area, Xiukou and Mu Du. These areas have older housing, much of it multi-unit and commercial districts. This area also includes much of the older industrial base of the urban area. There is a new area of more sparse development between these suburbs and the mainland shore, which includes commercial areas, hotels and housing, both multi-unit and detached.

Taihu (Tai Lake): The Suzhou urban area continues into Taihu, over a causeway that connects three islands to the mainland. The first island, Changsha, is nearly fully developed with detached housing. The second island, which is the smallest, is covered on its eastern half by detached housing and undeveloped in its western half. The third island, which is the largest, includes at least one older village that has been engulfed by the urbanization of Suzhou and contains commercial areas, some multi-family housing and considerable detached housing. Most of this island is rural.

Southern Sector: The southern sector, located to the south of the old city’s southern canal appears to be an older extension of the urban area. There is a variety of principally multi-unit housing, both mid-rise and high rise. Some of the developments are somewhat older, while others are new or still under construction. The Grand Canal crosses the southern sector (Slides 17-24)

Northern Sector: Tiger Hill and Yunyan Pagoda are located in an attractive park in the northern sector (Slides 70-85). Like the leaning tower of Pisa, Yunyan Pagoda leans, but not as far. Good views of the urban area can be seen from the top of Tiger Hill. Tiger Hill can be climbed from both the south and the north sides, though the climb from the south side is more gentle and more interesting. Like the rest of Suzhou, Tiger Hill and the northern sector also have their share of canals. The rest of the northern sector has residential buildings, principally multi-unit buildings, with some new high-rises. There are also older light industrial activities (Slides 251-269).

Small Businesses: As is the case in virtually all Chinese urban areas, many major streets are lined by small businesses (Slides 212 & 220)

HOUSING

Generally, older residential housing is lower rise in Suzhou than in other major Chinese urban areas. There are fewer of the old standard design apartment/condominium buildings that are found throughout Chinese urban areas (Slides 136 & 156).

As in other Chinese urban areas, there are many outdoor advertising signs for new luxury condominiums, town houses and detached housing (Slides 225, 289, 295, 306, 320 & 352)

TRANSPORT

Suzhou is well served by high-quality roads. There is a freeway ring road (Slide 315) and freeway connections to the west, east and south. In addition, there are various freeways within the urban area itself. Suzhou is well served by freeways, with nearly 100 route miles (160 route kilometers). At nearly 0.4 route miles per square mile (0.25 route kilometers per square kilometer), Suzhou has a higher freeway density than any major urban area in the United States, Canada, Australia and New Zealand other than Montreal and San Antonio.

Similarly, virtually all of Suzhou is served by a grid of wide arterial streets, as is typical of Chinese urban areas (Slide 230).

Most urban transport in Suzhou is by bus. A metro line is under construction, which will extend from near the eastern periphery of the urban area, through the old city core, the newer western center and continue well out into the western

THE YANGTZE DELTA

Suzhou is one of the principal urban areas on the Yangtze River Delta, which includes Shanghai, Nanjing, Wuxi, Hangzhou, Ningbo and a number of smaller urban areas. This is one of China’s two “mega-regions,” --- areas of large adjacent metropolitan areas. The other is the Pearl River Delta, with a somewhat smaller population but much higher population density (see Rental Car Tour: Pearl River Delta Overflight).

QUALITY OF HOUSING

China has been successful in housing its large urban population, which includes the registered population --- people with the right to live in a particular urban area --- and the unregistered, or floating population. The unregistered population is legally permitted to live in the urban area only temporarily, but the reality is that they have become a permanent fixture, staffing the many growing businesses. In all of our travels in China, which now cover more than 15 urban areas, we have seen no “shanty towns” or informal housing. This is unusual for a nation of China’s economic status. Nations that are rated as much more affluent, such as Mexico and Brazil have significant shanty towns, which cannot be missed in traveling through the urban areas. Moreover, China has every bit as big an urban housing challenge, since the strong movement of people from the rural areas to the urban areas continues. China will add more urban residents in the next quarter century than the population of the United States (more than 360 million).

EATING IN CHINA

The local food is superb. My rule in China is to never frequent a restaurant that takes credit cards. That way, there is a good chance of getting genuine local food. The experience is a happy one, though language difficulties make it virtually impossible to enunciate any recommendations. There are, along all business streets in the urban areas of China, a plethora of good local restaurants. Ordering can be difficult, since few such establishments have menus in English (though rather more than have Mandarin menus in Western Europe or the United States). Moreover, given the humble status of these restaurants --- low prices, good food, they will not be found in any of the tour guides.

It is recommended, however, that tap water be avoided. The hotels provide bottled water. Generally, bottled water should be relied on in all but the most affluent nations. This is my unfortunate advice after having contracted Montezuma’s revenge on every continent but Australia and Antarctica.

TRAVELING IN CHINA

China has one of the world’s most advanced air transport systems and has built many new airports. The new Beijing Terminal 3 and Guangzhou Baiyun International Airport are among the most impressive in the world. Other large and medium sized urban areas also have new airport terminals, such as Chengdu, Wuhan, Xi’an, Shenyang, Shenzhen, Taiyuan and a new terminal is under construction at Hongqiao International Airport in Shanghai.

Passenger rail is a very inexpensive and comfortable way to travel, especially over shorter distances. China has developed the fastest intercity train in the world, which operates between Tianjin and Beijing. It reaches nearly 220 miles per hour (350 kilometers per hour). Rail travel is very inexpensive. For example, second class travel between Hangzhou and Shanghai has an approximately cost of $15.

China has developed the world’s second longest freeway system, but it is largely inaccessible to foreign drivers because China has not ratified the international drivers license treaty. When and if they do, anticipate a rental car tour covering thousands of miles of Chinese intercity freeway.

“CITIES” IN CHINA

Analysts are often confused by the “city” (“shi” in Chinese) terminology used in China. All of the Suzhou urban area is contained within the city or municipality of Suzhou. Similarly, most (if not all) Chinese urban areas are contained within a single city. While Chinese “cities” are municipalities, they are far different from municipalities in the western world, by virtue of their geographical size and vast rural territories. A better rendering of the Chinese word “shi” would be region.

These cities or regions routinely include large areas of agricultural land, which keeps their density relatively low and leads publishers and analysts to report density data that is so low that it belies a complete misunderstanding of urban geography. For example, the largest municipality in the world is Chongqing, which has more than 30,000,000 people. Its land area is more than 30,000 square miles (more than 80,000 square kilometers) --- nearly as large as Austria or the state of Indiana. The urban area of Chongqing, however has a far more modest population of 4,000,000

http://www.rentalcartours.net
http://www.demographia.com
http://www.publicpurpose.com

Nanjing: Intermittent Capital

2009-01-10T01:20:00.003Z

Full Article + 354 Photos

LOCATION

Nanjing (formerly called “Nanking” in western parlance) is the capital of and largest urban area in Jiansu Province. The Nanjing urban area straddles the Yangtze River (Chiang Jiang) , however nearly all of the urban area is on the south or east bank of, which curves from north to west at Nanjing (Slides 1-4).

Like Nanjing, the province straddles the Yangtze River and the Yangtze River Delta for all but the last few miles toward its mouth. Like the province of Jiangsu, Shanghai also straddles the Yangtze River. Nanjing is 190 miles (300 kilometers) west of Shanghai, 750 miles (1,400 kilometers) south of Beijing, 700 miles (1,100 kilometers north of the Pearl River Delta (Guangzhou and Hong Kong) and 300 miles (500 kilometers) east of Wuhan.

GENERAL DESCRIPTION

Nanjing means “south capital” and the city served as China’s capital during much of the republican period (1912 to 1949) and under some historical dynasties. The urban area is located on relatively flat land, though there are hill and small mountains in the area, including the Purple Mountain (Zhong Shan), which is just to the east of Nanjing’s core. Urbanization now surrounds Purple Mountain, which rises more than 1,100 feet (350 meters) above the urban area.

The Nanjing urban area has nearly 3.2 million people and is expected to increase to 4.0 million by 2025. The urban area is one of China’s least dense, covering 330 square miles (855 square kilometers), for a population density of 9,600 per square mile (3,700 per square kilometer). Overall, Nanjing is nearly as sparsely populated as a Western European urban area, principally because of the new, expansive residential and commercial development that has occurred in recent decades.

Even more than other urban areas in China, densities are highly variable in Nanjing. Core districts (qus) are somewhat less dense than in some other large urban areas. The most dense is Gulou Qu, at more than 65,000 per square mile (25,000 per square mile). This compares to nearly 110,000 per square mile (40,000 per square kilometer) in Shanghai, 85,000 per square mile (33,000 per square kilometer) in Shenyang and 80,000 per square mile in Beijing (30,000 per square kilometer. However, it is in the fringe areas that Nanjing reveals its less dense character. Large sections outside the urban area of 30 years ago are very low density, with large condominium projects and industrial estates that are widely spread.

TRAVELING TO NANJING

Airport access to is by Nanjing Lukou International Airport, which is located approximately 20 miles (35 kilometers) southeast of the core. The new CRH fast train from Shanghai station takes slightly more than two hours. Nanjing is also connected to the rest of the nation by the modern “7918” expressway system, which radiates in six directions from Nanjing’s freeway ring road. Six toll expressways connect Nanjing to Shanghai and Suzhou to the east, Wuhan and Hefei to the west, Beijing to the north, Hangzhou to the southeast, Nantong to the east and Wuhu to the south.

By 2006, the 7918 expressway system had reached 27,000 miles by the end of 2006 (45,000 kilometers) and will eventually exceed the United States interstate highway system in length.

THE URBAN FORM

Old Nanjing is surrounded by what is reportedly the longest city wall still standing in the world. The wall is approximately 20 miles (32 kilometers) long and encloses approximately 17 square miles (44 square kilometers). The wall was completed in the 15th century, at which time the population (inside the wall) was approximately 500,000. There is a moat to the outside of the wall, except where Xianwu Lake provides the moat.

The Core: Unlike some river urban areas, the core of Nanjing is not on the river. Nanjing’s core is located 3 miles (5 kilometers) east of the Yangtze and to the southwest of Xianwu Lake (Slides 5-170). The core of Nanjing is enclosed by the city wall. The main intersection in the central business district is Xinjieko. The tallest skyscrapers tend to be in the core, somewhat more in a concentrated pattern than is usual for a Chinese urban area. There are a number of buildings of 45 to 55 stories in the core. Currently, the tallest building is the New Century Plaza Tower (Slides 32 & 84), at 52 floors and 840 feet (255 meters). This building is just to the east of Xinjieko and sits across a central plaza from the Presidential Palace. There is a Carrefour hypermarket under the park.

Somewhat north of Xinjieko, there is an 89 story tower (1,500 feet and 460 meters) under construction, the Nanjing Greenland Financial Complex (Slides 63, 68, 69, 76, 77, 127), which will be the tallest in the urban area. It will also exceed the height of America’s tallest building, the Sears Tower in Chicago.

Like virtually all large Chinese urban areas, substantial office building development has occurred in recent decades, at the same time that there are many residential buildings. These include new condominium towers as well as the seemingly standard six to nine story bay-windowed apartment buildings that date back at least to the 1970s (see “Housing,” below). There are also a number of enclosed shopping centers.

Hunan Road is a popular restaurant area, located to the north of the principal concentration of office buildings (Slides 56, 59-62).

There are a number of public buildings built during the years that Nanjing was the national capital, under the Nationalist republic. The most significant is the Presidential Palace. In addition, the Zhou Enlai Museum is located near the Presidential Palace (Slide 80). Zhou Enlai was China’s premier from 1949 to 1976 and second in command to Mao Zedong. The museum includes two of Zhou’s cars, including a 1941 Buick and a Chrysler (Slides 81, 82). It is said that Zhou Enlai’s favor for Buicks led to that General Motors brand being the first and principal one manufactured in China.

Most of the streets of the core are lined with trees, which appear to be maple, from the shape of their leaves. Local people refer to them as “French trees,” however they look just like the maples that dominate so much of the middle of the United States and Canada (Slides 9, 10, 12 and others).

The railway station is located outside the city wall, across Xianwu Lake to the northeast of the core (Slide 107).

Core: Nanjing Massacre International Safety Zone: Nanjing was the site of the “Rape of Nanking,” which occurred when the Japanese army invaded the city in December of 1937 and continued until February of 1938. This is described in a The Rape of Nanking: The Forgotten Holocaust of World War II, by Iris Chang. She reports that “more than 300,000 Chinese civilians and soldiers were systematically raped, tortured and murdered.” It is estimated that approximately one-half of the population left in the city at the invasion died. The events are also chronicled in a 2007 movie, Nanking.

During this time, perhaps as many as 300,000 people were saved in what was called the “International Safety Zone,” which was established by resident westerners, including missionaries and businessmen. The zone’s southeast corner was at the city’s present core, Xinjieko and covered 2.15 square miles (Slides 38-62). The leader was a German, John Rabe, who was also a member of the National Socialist (Nazi) Party. Rabe and the others persuaded the Japanese to respect the zone, though there were reportedly frequent unauthorized incursions that resulted in rape, death and abduction. Virtually all of the area has since been redeveloped and looks no different from the rest of the core of Nanjing. Hunan Road is in the International Safety Zone.

There is a memorial hall dedicated to the Nanjing Massacre, located outside the wall, in the southern area (outside of the International Safety Zone).

North of the River and the Yangtze Bridge: Nanjing has one of the oldest bridges over the Yangtze River, Nanjing Yangtze Bridge Number 1. This bridge, with approaches is more than 4 miles (7 kilometers) long. The top deck has four road traffic lanes and has bus stops just to the outside of the statues that mark the river bank at each end of the span. The lower deck has two tracks for trains (Slides 171-176, 187-207).

Like Yangtze Bridge Number 1 in Wuhan, Nanjing Bridge Number 1 has good pedestrian access and is recommended for walking. Chairman Mao Zedong was pleased to swim across the Yangtze at Wuhan. I was sufficiently pleased to walk across the bridge there and was determined to again cross the Yangtze on foot in Nanjing. There are now other crossings of the Yangtze in Nanjing, but they are freeways and not pedestrian friendly.

The bridge leads to the north and west bank portions of the urban area, which are developing rapidly. This area includes substantial commercial and industrial activity, many large condominium developments and some single family (villa) housing (Slides 177-185, 208). It is also evident that former agricultural and rural housing uses are being displaced by urbanization (Slides 183-184)

Southern Area: There is considerable older development to the south of the city wall. But most of the southern area development is relatively new. Metro line 1, the only line open at this point, serves the southern area, and ends at the Olympic Stadium, which is one of a number of such facilities built around China for the 2008 Olympics.

The area closer to the city wall contains a large number of new high-rise condominium developments, each with multiple buildings. This type of development continues well to the south, where becomes much more sparse. There are also a large number of manufacturing facilities. It is in this area that the physical expanse of Nanjing’s urbanization is most obvious. Overall, the density of population and development in this area is far below that of the rest of the urban area.

One new villa development is named “Rotorua Town,” after the New Zealand volcanic resort town.

Eastern Area: The eastern area is a mixture of older and newer condominium developments. Generally the newer developments do not appear to be as desirable as in the southern area. Much of the eastern area is also in the process of being converted from rural living to urbanization (Slides 297-302). The eastern area also has a number of commercial developments that resemble the strip malls of western nations.

Western Area: The western area is to the west of the city wall and extends to the east bank of the Yangtze River. This area has many high quality high rise condominium developments. There are also a number of the standardized, older apartment buildings (see “Housing,” below), with industrial activities toward the river.

Northern Area: The northern area (east and south of the Yangtze River) has virtually all types of residential land uses. More significantly, the northern area is home to the urban area’s heaviest industries.

Small Businesses: As is the case in virtually all Chinese urban areas, many major streets are lined by small businesses (Slides 52, 213, 214, 316)

Industry: Nanjing has a number of large industrial parks, generally with exceptionally wide streets, often 8 lanes (Slides 226, 229, 276, 295).

Housing: China has been successful in housing its large urban population, which includes the registered population --- people with the right to live in a particular urban area --- and the unregistered, or floating population. The unregistered population is legally permitted to live in the urban area only temporarily, but the reality is that they have become a permanent fixture, staffing the many growing businesses.

Classic Apartment Housing: In Nanjing, as in other Chinese urban areas, there are many “classic” multi-unit residential buildings (Slides Below), located throughout the older parts of the urban area. These were originally built by the government and made available, generally as rentals to households. We are told that many of these units have been sold. The “classic” buildings are up to ten floors. Most of the units have bay windows and are fairly attractive given that they were built as public or social housing and are aging. It is unclear when these were built. They appear to date at least to the late 1970s and perhaps even before. Much of the older parts of Chinese urban areas are covered by these “classic” buildings, which are spaced close together within urban blocks.

Classic Apartment Housing Slides: 45, 49, 51, 53, 64, 86-89, 103-105, 214

Newer Condominium Developments: As throughout China, an increasing number of Nanjing households are moving into the newer, privately developed condominiums, most of which are at least 20 floors and often exceed 30 floors. A large number of high-rise residential buildings are under construction. These buildings are being developed in virtually every part of the urban area and often a number of near-duplicate buildings constitute a development (Slides ###).

Newer Condominium Development Slides: 6, 74, 95, 98, 114, 177-178, 181-182, 184-185, 210-212, 215-220, 223, 225, 227, 228, 230, 232-242, 233-252, 257-257, 283, 287-288, 291-292, 304-309, 311, 315, 325-327, 331-333

Older Housing: Toward the south end of the core, near the south wall, there is an area of older, perhaps sub-standard housing that is typical of the prerevolutionary era (Slides 151-169). The houses tend to be one or two floors and attached. The streets are far too small for motor vehicles. However, the area is clean and safe (as is all of urban China). There is also an area of similar housing near the Presidential Palace (Slides 91-92)

The Absence of Shanty Towns: In all of our travels in China, which now cover more than 15 urban areas, virtually no “shanty towns” nor informal housing has been seen. Even the sub-standard housing area near the south gate (above) is by no means a shanty town. The lack of “shanty towns” is unusual for a developing nation. Nations that are rated as much more affluent, such as Mexico and Brazil have significant shanty towns, which cannot be missed in traveling through the urban areas. Moreover, China has every bit as big an urban housing challenge, since the strong movement of people from the rural areas to the urban areas continues. China will add more urban residents in the next quarter century than the population of the United States (more than 360 million).

Villas: Single family (villa) housing is located in developments in every sector of the urban area. Generally, these developments are highly secured and it is generally not possible to obtain photographs except from the outside or satellite photographs (Slides 208, 265, 268, 277, 354).

TRANSPORT

Nanjing is well served by high-quality roads. The urban area has very wide streets, which is typical of China. There is a ring road, built to freeway standards. The ring road is a toll facility and built to freeway standards. Most public transport ridership in Nanjing is by bus. Like many Chinese urban areas, Nanjing is expanding its Metro.

THE YANGTZE DELTA

Nanjing is one of the principal urban areas on the Yangtze River Delta, which includes Shanghai, Hangzhou, Wuxi, Suzhou, Ningbo and a number of smaller urban areas. The Yangtze Delta is one of China’s two “mega-regions,” --- areas of adjacent large metropolitan areas. The other is the Pearl River Delta, with a somewhat smaller population but much higher population density (see Rental Car Tour: Pearl River Delta Overflight).

MAPS AND BOOKS IN CHINA

In Taiyuan and most Chinese urban areas, the largest and most comprehensive bookstores are a part of the Xinhua Bookstore chain, which is owned by the government. Xinhua bookstores generally have the best assortment of local and regional maps and include a small selection of English language books. Any one serious about touring China or Chinese urban areas will need good, detailed maps and they are generally available only in Chinese. However, there is no difficulty in developing a touring route to see an urban area using a Chinese map.

EATING IN CHINA

The local food is superb. My rule in China is to never frequent a restaurant that takes credit cards. That way, there is a good chance of getting genuine local food. The experience is a happy one, though language difficulties make it virtually impossible to enunciate any recommendations. There are, along all business streets in the urban areas of China, a plethora of good local restaurants. Ordering can be difficult, since few such establishments have menus in English (though rather more than have Mandarin menus in Western Europe or the United States). Moreover, given the humble status of these restaurants --- low prices, good food, they will not be found in any of the tour guides.

It is recommended, however, that tap water be avoided. The hotels provide bottled water. Generally, bottled water should be relied on in all but the most affluent nations. This is my unfortunate advice after having contracted “Montezuma’s Revenge” on every continent but Australia and Antarctica.

TRAVELING IN CHINA

China has one of the world’s most advanced air transport systems and has built many new airports. The new Beijing Terminal 3 and the Guangzhou Baiyun International Airport are among the most impressive in the world. Other large and medium sized urban areas also have new airport terminals, such as Chengdu, Wuhan, Xi’an, Shenyang, Shenzhen, Taiyuan and a new terminal is under construction at Hongqiao International Airport in Shanghai.

Passenger rail is a very inexpensive and comfortable way to travel, especially over shorter distances. China has developed the fastest intercity train in the world, which operates between Tianjin and Beijing. It reaches nearly 220 miles per hour (350 kilometers per hour). Rail travel is very inexpensive. For example, second class travel between Hangzhou and Shanghai has an approximately cost of $15.

China has developed the world’s second longest freeway system, but it is largely inaccessible to foreign drivers because China has not ratified the international driver’s license treaty. When and if they do, anticipate a rental car tour covering thousands of miles of Chinese intercity freeway.

“CITIES” IN CHINA

Analysts are often confused by the “city” (“shi” or 市 in Chinese) terminology used in China. Most (if not all) Chinese urban areas are contained within a single city (“shi”). While Chinese “cities” are municipalities, they are far different from municipalities in the western world, by virtue of their geographical size and vast rural territories. A better rendering of the Chinese word “shi” would be region.

Within the municipality or shi is the “shixiaqu” (市辖区), which encompasses the urban districts (referred to as “qu”). Much of some urban districts is actually rural, especially those on the periphery of the urban area.

These cities or regions routinely include large areas of agricultural land, which keeps their density relatively low and leads publishers and analysts to report density data that is so low that it belies a complete misunderstanding of urban geography. For example, the largest municipality in the world is Chongqing, which has more than 30,000,000 people. Its land area is more than 30,000 square miles (more than 80,000 square kilometers) --- nearly as large as Austria or the state of Indiana. The urban area of Chongqing, however has a far more modest population of 3,000,000

http://www.rentalcartours.net
http://www.demographia.com
http://www.publicpurpose.com

Taiyuan: Rust Belt Recovery

2009-01-10T01:17:00.002Z

Full Article & 192 Slides

LOCATION

Taiyuan (pronounced TY-U-ANN) is approximately 250 miles (400 kilometers) southeast of Beijing, slightly less than one-half the way to Xi’an. Taiyuan is the capital of Shanxi Province (SHAN = mountains, XI= west). Taiyan is south of Shanxi’s other large urban area, Datong, which is 150 miles (205 kilometers) away. The urban area is in a valley with mountains on the east, west and north sides. The urban area rises from the Fen River, which flows north to south through the middle of the valley and empties into the Huang He (Yellow River or Huang Ho). Taiyuan is located in China’s arid north, which is illustrated by the barrenness of the nearby mountains.

GENERAL DESCRIPTION

Taiyuan is a historic coal mining, steel producing and industrial urban area. The Taiyuan urban area has a population of 2,730,000 (2007 estimated). The urban area covers 120 square miles (310 square kilometers). The population density is 22,800 per square mile (8,800 per square kilometer). Taiyuan is comparatively dense, at about 30 percent greater than the average of urban areas in China over 500,000 (17,000 per square mile or 6,800 per square kilometer). Taiyuan is one-third as dense as world leader Hong Kong and one-third less dense than Manila. On the other hand, the Taiyuan urban area is 2.5 times as dense as the Paris urban area, 3.3 times as dense as the Los Angeles urban area, 4.3 times as dense as the Sydney urban area and 6.7 times as dense as the Portland urban area (Chart).

Like Shenyang and Fushun, Taiyuan has been the home of some of China’s largest heavy industries. As a result, as reforms have reduced the size of the state sector and heavy manufacturing has declined, Taiyuan has suffered economic downturns and can be considered a part of China’s “Rust Belt.” However, there is plenty of evidence of economic vibrancy in Taiyuan.

GETTING TO TAIYUAN

There is convenient airline access to Taiyuan from all over China. Taiyuan Wusu Airport is located less than 10 miles from the historic core (less than 16 kilometers). It takes less than one-hour to fly to Beijing.

Taiyuan is also served by China’s “7918” toll expressway system. Currently, interstate or motorway standard roads connect Taiyuan to the rest of the nation in four directions. Bus and rail service is also available. The high speed rail link to Taiyuan from Beijing will be completed early in the next decade, with travel times of less than three hours.

THE URBAN FORM

Perhaps one-third of the Taiyaun urban area is located on the east side of the Fen River. Much of the urban area has a grid street system, with the main east-west street being Yingze Xidajie. Yingze Xidajie begins in the east at the Taiyuan railway station and crosses most of the urban area, ending at western portion of the Ring Expressway. At least five bridges cross the Fen the river in the central area. The main north-south street on the west side is Heping Bailu.

The Historic Core: The main commercial center is located to the west and south of the railway station on the east side of the river. It is appropriate to label this the “historic” core, since core activities, such as major shopping centers and office buildings are increasingly found throughout Chinese urban areas, including Taiyuan. Taiyuan boasts a number of high rise office towers, the tallest being more than 40 floors. As is typical of Chinese urban areas, however, office buildings are widely spread. Most of the office towers are within two miles (three kilometers) of the railway station, are not concentrated, as would be the case in a North American or Australian urban area. The core contains many shops and residential buildings.

East Side: South of the core, the east side becomes predominantly residential. There are office buildings, but they are very sparsely spaced and there are many smaller shops. The east side also includes many new high-rise residential buildings. Even to a greater extent that offices, the new high rise residential buildings are spread throughout the urban area. Interspersed between the offices, residential towers and shopping facilities are the “classic” multi-unit residential buildings, similar to what is seen throughout China (see “Housing,” below). The south side is also home to Taiyuan’s “automobile row,” a concentration of new automobile dealerships (Slides 89-91)

The West Side: The west side is similar to the east side, except that it does not contain many office towers. There are many dispersed high-rise residential towers and many shopping facilities. Some of the newest residential towers are located on Yingze Xidajie, near the west end of the urban area, near the ring road, more than 6 miles (10 kilometers) from the railway station (Slides 131-133).

The South: Toward the south, Taiyuan is not as prosperous. Much of the area is given to industry, including a major power plant on the southwest side. There are fewer high-rise residential towers, however, toward the airport, on the southeast side, there are some new towers. The south side contains the kind of less attractive uses that must attend to every urban area, such as repair shops, junk yards, trucking facilities, etc.

The Northeast Side: Toward the north, principally on the east side, there is also considerable industry, coal fired power plant and a large steel mill (owned by Taiyuan Iron and Steel Corporation, the largest corporation in Shanxi and it is reported will become the largest stainless steel producer in the world). Housing in this part of the urban area is more modest and there are few high-rise residential towers. Like the south side, the north side has some of the typical but necessary unattractive urban uses.

Shopping: Shopping is also very dispersed, which is a necessity since a low automobile ownership share requires people to shop relatively close to home, by walking, bicycle or motorcycle. Modern shopping centers are located throughout most of the urban area. Like other Chinese urban areas, there are many convenience stores and some are open 24 hours (Slides 46 & 57). Indeed, there are “7-11” stores in China. Thus convenience shopping opportunities in China are similar to the United States. However, in the United States the “7-11” and other similar stores have largely been replaced by convenience stores at petrol stations.

Housing: China has been successful in housing its large urban population, which includes the registered population --- people with the right to live in a particular urban area --- and the unregistered, or floating population. The unregistered population is legally permitted to live in the urban area only temporarily, but the reality is that they have become a permanent fixture, staffing the many growing businesses.

In Taiyuan, as in other Chinese urban areas, there are many “classic” multi-unit residential buildings (Slides 189-192) in the older areas. These were originally built by the government and made available, generally as rentals to households. We are told that many of these units have been sold. The “classic” buildings are up to ten floors, though in medium sized urban areas, like Taiyuan, they tend to be six or fewer floors. Most of the units have bay windows and are fairly attractive given that they were built as public or social housing and are aging. It is unclear when these were built. They appear to date at least to the late 1970s and perhaps even before. Much of the older parts of Chinese urban areas are covered by these “classic” buildings, which are spaced close together within urban blocks (Slide 192, additional Slides are noted in the footnote ).

As throughout China, an increasing number of Taiyuan households are moving into the newer, privately developed condominiums, most of which are at least 20 floors and some exceed 30 floors. A large number of high-rise residential buildings are under construction. These buildings are being developed in virtually every part of the urban area and often a number of near-duplicate buildings constitute a development (Multiple Slides, see footnote ). People stand at intersections handing out flyers to passersby, whether in cars or on foot, advertising new residential buildings, complete with floor plans and sale prices. The main Xinhua Bookstore, in the core, has a large billboard advertising a new condominium development (Slide 50).

In all of our travels in China, which now cover more than 15 urban areas, virtually no “shanty towns” nor informal housing has been seen. This is unusual for a nation of China’s economic status. Nations that are rated as much more affluent, such as Mexico and Brazil have significant shanty towns, which cannot be missed in traveling through the urban areas. Moreover, China has every bit as big an urban housing challenge, since the strong movement of people from the rural areas to the urban areas continues. China will add more urban residents in the next quarter century than the population of the United States (more than 360 million).

Small Businesses: As is the case in virtually all Chinese urban areas, many major streets are lined by small businesses (Slides 35, 42, 61, 75, 94, 112 & 159)

TRANSPORT

Taiyuan has a public transport system that relies on buses and trolleybuses. As in other Chinese urban areas, there is a growing volume of car and motorcycle traffic. There is a freeway ring road and some limited access road within the urban area. The urban area is generally served by a grid of wide streets.

MAPS AND BOOKS IN CHINA

In Taiyuan and most Chinese urban areas, the largest and most comprehensive bookstores are a part of the Xinhua Bookstore chain, which is owned by the government. Xinhua bookstores generally have the best assortment of local and regional maps and include a small selection of English language books. Any one serious about touring China or Chinese urban areas will need good, detailed maps and they are generally available only in Chinese. However, there is no difficulty in developing a touring route to see an urban area using a Chinese map.

EATING IN CHINA

The local food is superb. My rule in China is to never frequent a restaurant that takes credit cards. That way, there is a good chance of getting genuine local food. The experience is a happy one, though language difficulties make it virtually impossible to enunciate any recommendations. There are, along all business streets in the urban areas of China, a plethora of good local restaurants. Ordering can be difficult, since few such establishments have menus in English (though rather more than have Mandarin menus in Western Europe or the United States). Moreover, given the humble status of these restaurants --- low prices, good food, they will not be found in any of the tour guides.

It is recommended, however, that tap water be avoided. The hotels provide bottled water. Generally, bottled water should be relied on in all but the most affluent nations. This is my unfortunate advice after having contracted Montezuma’s revenge on every continent but Australia and Antarctica.

TRAVELING IN CHINA

China has one of the world’s most advanced air transport systems and has built many new airports. The new Beijing Terminal 3 and the Guangzhou Baiyun International Airport are among the most impressive in the world. Other large and medium sized urban areas also have new airport terminals, such as Chengdu, Wuhan, Xi’an, Shenyang, Shenzhen, Taiyuan and a new terminal is under construction at Hongqiao International Airport in Shanghai.

Passenger rail is a very inexpensive and comfortable way to travel, especially over shorter distances. China has developed the fastest intercity train in the world, which operates between Tianjin and Beijing. It reaches nearly 220 miles per hour (350 kilometers per hour). Rail travel is very inexpensive. For example, second class travel between Hangzhou and Shanghai has an approximately cost of $15.

China has developed the world’s second longest freeway system, but it is largely inaccessible to foreign drivers because China has not ratified the international drivers license treaty. When and if they do, anticipate a rental car tour covering thousands of miles of Chinese intercity freeway.

“CITIES” IN CHINA

Analysts are often confused by the “city” (“shi” in Chinese) terminology used in China. All of the Suzhou urban area is contained within the city or municipality of Suzhou. Similarly, most (if not all) Chinese urban areas are contained within a single city. While Chinese “cities” are municipalities, they are far different from municipalities in the western world, by virtue of their geographical size and vast rural territories. A better rendering of the Chinese word “shi” would be region.

These cities or regions routinely include large areas of agricultural land, which keeps their density relatively low and leads publishers and analysts to report density data that is so low that it belies a complete misunderstanding of urban geography. For example, the largest municipality in the world is Chongqing, which has more than 30,000,000 people. Its land area is more than 30,000 square miles (more than 80,000 square kilometers) --- nearly as large as Austria or the state of Indiana. The urban area of Chongqing, however has a far more modest population of 4,000,000

http://www.rentalcartours.net
http://www.demographia.com
http://www.publicpurpose.com

Melbourne 2030 Plan: Good Riddance

2008-12-03T15:38:00.002Z

Note

This piece was originally posted in March 2005 as an issue of “The Public Purpose,” at http://www.publicpurpose.com/pp86-m2030.pdf.

It is republished here today on the occasion of the virtual abandonment of the plan by the state of Victoria as reported in The Age. This was written before my extensive direct involvement in the issue in Australia, and when the piece talks about having new home owners pay for infrastructure, it was not envisioning the kind of confiscatory and intellectually dishonest infrastructure fees charged by some Australian jurisdictions, the best example of which is the state of New South Wales (Sydney, etc).

MELBOURNE 2030: A VISION FAR TOO TIMID

Premier Bracks Swallows L.A. Fish Story

March 2005

By Wendell Cox

The State of Victoria’s Melbourne 2030 plan is a vision far too timid. Over the next 25 years, it is projected that another 1,000,000 residents will be added to this urban area of approximately 3,500,000. In times past, the urban area would have been permitted to expand to provide the next generation with a better lifestyle.

But not now. Across Australia, and to a lesser extent in urban areas outside, there is a rush to make the city more compact --- urban consolidation it is called in Australia. The plan is simple. Instead of allowing the city to continue to expand geographically, the government intends that more people should be piled into the same space already occupied by those who already live
there. Why, one might ask, does a country as large as Australia need urban (consolidation) densification? Is there a fear that without it, some day, as much as a total of 0.5 percent of the land might ultimately become developed? Is it that the food supply is threatened as land is taken for urban development? Or is it that public officials have heard the siren call to the effect that suburban development costs more --- so much more that we can no longer afford to live as we have? Or is it, as some suggest, that Australian cities might begin to sprawl like Los Angeles? Premier Steve Bracks even talks about Los Angeles as having “house after house without any
services provided.”

The facts demonstrate that positive answers to any of these questions would be absurd. Australia has plenty of land, and even if future growth were permitted to take up as much space as past, little of the nation’s plentiful supply of land would be used. As for the food supply, agriculture has become so productive that over the past quarter century an area the size of Victoria has been taken out of farming production. Indeed, all of the urban land that has been developed or might be in the future could be fit into an area the size of Victoria many times over. As for the suburban cost myth --- and it is a myth --- even if it were true, the answer would be simple. Make
the people who move into the new areas pay for their services. If it costs too much, they won’t move there. If doesn’t, then those who want will move there. But to the high priests of urban planning, letting people do what they want would be far too radical. Who knows better what is good for people and families than the university based planners thousands of kilometers distant?

As for Los Angeles, that’s where it really gets hilarious. If Australian cities sprawled like Los Angeles, they would be more compact, not less. The secret is that the most densely settled urban area in the former colonies (Australia, New Zealand, Canada and the United States) is Los Angeles. This inconvenient fact is often either missed or even ignored. Los Angeles also has the worst traffic congestion and probably the worst air pollution. But it is the Premier who has proven the most gullible. Somehow, despite living 20 years in Los Angeles serving more than eight in public office, the service-less houses that Premier Bracks talks about escaped me. In fact,
public services in the Los Angeles area are among the best in the nation, or for that matter in the high-income world. Indeed, across the United States the least costly and highest quality municipal services are to be found (to the horror of urban planners) in the suburbs. But that does not keep the urban planning fundamentalists from making up stories.

And, as for the higher density of Los Angeles, at least planners there had the good sense to allow the city to continue to expand. Never did they come back, as the Victorian planners have, and try to force higher density onto lower.

And that’s where it will probably all fall down, along with the Bracks government. Melbourne is not alone. Other urban areas have headed down this dead end. Portland, Oregon is the best example. It is in Portland that one finds the most fundamentalist urban consolidation rhetoric, yet its plans were never as radical as Melbourne’s. Nonetheless, when densities began to increase, as authorities forced high density development into low density neighborhoods, the people said “enough.” Under an initiative passed 2-1, densification of Portland neighborhoods is now prohibited. As a result, Portland expanded its urban growth boundary in two years more than it had planned for 2040. But all of this occurred after things had already gotten worse. Portland lost housing affordability at a greater rate than any other major US urban area during the 1990s, according to US Census data.

All of this is the result of urban planning fundamentalism --- a view that we are running out of land (wrong) and that we use cars too much. The solution is a philosophy that densifies and seeks to get people out of their cars. But the problem is that the urban planning fundamentalist have never “penciled” out the costs. Why does one need analysis when there is ideology. In fact it all
simply does not add up.

Already the Portland style housing affordability losses, and more, are being experienced in Australia’s “consolidating” urban areas, urban planning fundamentalism makes land scarce and when land becomes scarce housing prices rise. That part of Economics 101 is not required for urban planners. And with Portland’s neglect of, and indeed hostility toward automobile capacity improvements, traffic congestion has increased to become the worst of any similar sized urban area in the nation, according to data from the standard source for such information, the Texas Transportation Institute.

Like Portland, Melbourne’s housing affordability has tanked --- even worse. Now, according to the Demographia international rankings, Melbourne has a “severely” unaffordable housing market, ranking ninth worst out of 88 urban areas in the four former colonies. Much of this appears to be the result of the urban growth boundary and the attendant fundamentalist policies.
There are those who claim that there is a housing “bubble” caused by low interest rates. If that were true, then one would expect Melbourne’s nearly 6.9 to 1.0 median household inc ome to median house price multiple to be repeated in other places where interest rates are low, such as Atlanta, Dallas-Fort Worth and Houston. These urban areas rank first, third and fourth in the
high-income world among urban areas with more than 3,000,000. Yet, the combination of very strong growth and low interest rates have produced a housing affordability multiple not of 6.9, but rather 2.6, 2.6 and 2.7 respectively. What is missing? The gospel of the urban planning fundamentalists has thus far been rejected in Atlanta, Dallas-Fort Worth and Houston.

Fortunately some are watching. Monash University’s Bob Birrell, Kevin O'Connor, Virginia Rapson, and Ernest Healy have evaluated the 2030 plan in their book Melbourne 2030: Planning Rhetoric versus Urban Reality and found it severely wanting. Because I am in Paris for two months and have not yet been able to arrange for my own copy, I don’t know the criticisms. But, if Birrell et al have managed to cram a complete critique of the Melbourne 2030 plan into just a couple of hundred pages, then it is quite an accomplishment.

One of the intentions of the 2030 plan is to get people to give up their cars and ride public transport. The problem, of course, is that public transport is not a viable alternative to the automobile, except for trips to downtown. Even the public transport improvements proposed by the government would not begin to change that. What is needed is a public transport system that is as convenient as the car and takes people from their origins to their destinations when they want and at a speed as fast or nearly so. It is indeed possible to construct such a public transport system in Melbourne. All that’s needed is money, and a populace prepared to live through
construction disruptions that would make US urban freeway construction in the 1960s look like a Sunday afternoon picnic. To achieve the automobile competitive public transport service specification --- and attract a material share of trips from automobiles would cost more than the annual income of the Melbourne area --- every year.

The government’s objective, could, however, be met by another means. All it takes is a bit more strident commitment to densification. If the government could force everyone --- all 4.5 million people in 2030 to live within five kilometers of Flinders Street Station. This would achieve the density necessary (at least as high as Hong Kong) to afford the public transport system that could make the automobile a viable option for most trips. But the government is too timid for that.

The modest densification proposed by the government will only make things worse. Traffic congestion will get worse. Air pollution will be more intense, because traffic will be slower and more subject to stop and go conditions. Even so, traffic congestion will never get so bad that the less than adequate improvements the government intends to make in public transport would make it more convenient to switch from cars except for a small number of trips.

It can be expected that the urban consolidation policies will keep housing prices well beyond the ability of young households and others that have not yet purchased their own homes. Melbourne, which has long been a place where most people own their own homes is poised to become a city of renters. This will not be a fairer or more prosperous city. Unless the government plans are
reversed, Melbourne is poised for a yesterday of less affluence and greater social division.

But there is hope, and it is inherent in the government policies themselves. Densification may well be the sword on which the Bracks government falls. When serious densification begins and neighborhoods start to be ruined, the people are likely to forget other issues and vote to throw the urban planning fundamentalists out.

Wendell Cox is principal of Wendell Cox Consultancy, an urban policy firm that sponsors www.demographia.com. He also serves as a visiting professor at the Conservatoire National des Arts et Metiers in Paris. He was a three-term member of the Los Angeles County Transportation Commission.

Griffith University Misrepresents Research

2008-11-27T13:57:00.004Z

(Based upon an email commenting on a report by Griffith University, Queensland, on GHG emissions in Australia.)

The Griffith University researchers have really stretched on this one, having charged us with saying far more than we said. They painstakingly point out that correlation is not causation and then basically say that we found a causal relationship between urban consolidation and higher GHGs.

We did no such thing. Virtually exclusively we used the word "association" (or lack of it) to note the relationship between the studied variables and urban consolidation (the word appears 32 times).

Our report simply took the Australian Conservation Foundation (ACF) analysis to its logical conclusion. It is fine for ACF to do a report that identifies GHGs by local authority area --- and indeed their work so far as it goes is by far the best I have seen in the world. Since they did not complete the job, however --- to increase the size of the analysis zones so that a more "macro" view could be obtained, we did. In light of the causal relationship that urban consolidation proponents have liked to suggest between inner city living and lower GHGs, this was important and their failure to put this data out there was a serious omission. One can only wonder why the research was not completed (imagine the headlines in the Courier-Mail, Sydney Morning Herald, etc.).

We did offer conclusions, none suggesting cause. Our most important conclusion was that, given the strong association that seems to be in opposition to the widely held views of the urban consolidation agenda, policy should not leap before looking much more closely.

In my view, our research stands (along with that of the Australian Conservation Foundation, which is its data source), unscathed and has been criticized principally for something that it did not do. We noted association, not causation.

Specifically, the conclusions of our report are (page 14):

1. Lower GHG emissions are associated with locations farther from the core.
2. Lower GHG emissions are associated with more detached housing.
3. Lower GHG emissions are associated with greater auto use.
4. Lower GHG emissions are associated with lower population density.

What the ACF data says is that before “sleepwalking” into GHG reduction policies based upon preconceived (and even ideological) notions, it is essential that reliable data be developed so that policies can genuinely address the objective.

ACF Australian Conservation Atlas
Housing Form in Australia and its Impact on Greenhouse Gas Emissions
Griffith University Paper

Ways to Work Program: A Nobel Prize?

2008-11-24T19:51:00.002Z

Ways to Work Program: A Nobel Prize?

The national Ways to Work program has improved the employment and education opportunities of low-income households across the United States. The model is similar to that used Mohammed Unus, who recently won the Nobel Prize for his small loan program in Bengladesh.

WAYS TO WORK PROGRAM

Economist Mohammed Yunus recently won the Nobel Prize for his groundbreaking project that makes small loans available to the low-income residents of Bengladesh. In making the award, the Nobel Committee noted the importance of finding ways for people to break out of poverty. Unus’ Grameen Bank has developed an impressive record of assisting poor households to enter the mainstream of economic life in Bangladesh.

The applicability of the Unus model is not limited to low-income nations. The national Ways to Work program has been working for more than 20 years to bring low-income households across the United States into the economic mainstream. A principal strategy has been to provide loans, like Unus, to low-income households. Ways to Work helps households buy cars.

Why cars? Simply because in modern urban areas, whether in the United States, Western Europe or the low-income world, cars expand exponentially the geographical area in which people can search for employment. Research at the University of California, the Brookings Institution and the Progressive Policy Institute demonstrates that cars are crucial to obtaining better employment. The problem is, of course, that despite the romantic affection for transit, it is simply unable to provide mobility to much more than the downtown area, and that’s not where most of the jobs are.

A recent evaluation report looked at a representative sample of Ways to Work borrowers, and found the following:

It may be time for the Nobel Committee to honor the model Ways to Work program.

(Originally published 20061130)

Tata's One Lakh Car

2008-11-24T19:38:00.002Z

A growing body of research indicates a strong relationship between mobility and household income. Throughout the high-income world, the automobile and other motorized forms of personal mobility (such as the motorcycle or the auto-rickshaw) provide the greatest mobility, making it possible for their users to travel from their residences to jobs throughout the urban area. This works best in high-income world urban areas where there motorized personal mobility are much more widely available. Non-motorized transport (such as walking and bicycles), despite its romantic appeal to some, simply cannot provide mobility throughout the modern urban area because it is too slow.

Medium-income and low-income urban areas will need much better mobility for their incomes to increase (along with the even more important issues of rule of law and property rights). It thus comes as good news that India’s Tata Motors is developing a “1 lakh” ($2,200) car. “Lakh” is an Indian term meaning 100,000. Thus a 1 lakh car is a 100,000 rupee car. This translates into approximately $2,200. Currently, Tata’s lowest price car is approximately $7,000.

Obviously the 1 lakh car will not have all of the features that would be expected of a Japanese, American or European economy car. However, it will provide the same basic need --- mobility throughout the urban area. It is expected that the 1 lakh car will be on the market by 2008. This revolutionary development has great potential to facilitate the economic advance of millions of households in India and in low-income and middle-income export markets.

Fushun (Liaoning, China) Rental Car Tour Released

2008-11-23T18:21:00.002Z

Fushun (Liaoning, China) Rental Car Tour Released

Urban Tours by Rental Car announces release of a rental car tour on Fushun: Rust Belt But Hopeful

The article can be downloaded at this address.

The tour includes 142 photographs, including an array from throughout the urban area.

Alphabetical List of Rental Car Tours
Geographical List of Rental Car Tours

Shanghai Rental Car Tour Update Released

2008-11-23T15:49:00.001Z

Shanghai Rental Car Tour Update Released

Urban Tours by Rental Car announces release of an updtated rental car tour on Shanghai, subtitled “Big Changes Ahead.”

The article can be downloaded at this address.

The tour includes 198 photographs, including an array from throughout the urban area with particular emphasis on The Bund, the new Shanghai World Financial Center and the new high-rise condominium, townhouse and detached house developments.

Alphabetical List of Rental Car Tours
Geographical List of Rental Car Tours

Ho Chi Minh City Rental Car Tour Released

2008-11-23T15:45:00.000Z

Ho Chi Minh City Rental Car Tour Released

Urban Tours by Rental Car announces release of a rental car tour on Ho Chi Minh City, Viet Nam, subtitled “Mobile Urban Area.”

The article can be downloaded at this address.

The tour highlights the continuing economic advance of Viet Nam, which is following China’s market reform path and achieving similar results.

The tour includes 234 photographs, including an array from throughout the urban area and pictures of the burgeoning new high-rise condominium, townhouse and detached house developments.

Alphabetical List of Rental Car Tours
Geographical List of Rental Car Tours

Seattle’s Expensive and Ineffective Rail Tax Proposal

2008-10-23T22:48:00.007Z

Rail tax advocates are at it again in a number of US metropolitan areas, including Seattle. A recent story in the Seattle Post-Intelligencer caught our attention because of claims being made proposed rail expansions that would be financed by a proposed tax increase. Two issues stand out:

Greenhouse Gas Emissions: According to the article, the proposed plan will reduce greenhouse gas emissions (GHG) in the Seattle area by nearly 100,000 metric tons annually. Sounds like a big number. It isn’t. Based upon previously announced Sound Transit spending announcements (an equivalent increase of $1.1 billion annually, including capital and operations costs), the cost of this reduction would be about $11,000 per metric ton. That is 220 times the United Nations International Panel on Climate Change ceiling of from $20 to $50 per ton (the amount of spending per ton is the maximum amount necessary to accomplish deep reversal of GHG concentrations between 2030 and 2050). The Sound Transit plan is not only expensive in general terms, it is profligate in the amount of spending required to reduce GHG emissions. This is illustrated by the fact that at $11,000 per metric ton, it would cost more than double the Gross Domestic Product each year to reduce US GHG emissions by 50 percent --- an often cited goal.

Traffic Reduction: The article also cites a Sound Transit report indicating that the expanded rail system could reduce driving by 30 percent. Never before has there been a forecast of such a reduction in traffic in any urban area in the world and surely it won’t happen in Seattle. Indeed, it would be charitable to call the 30 percent reduction prediction “laughable.” In other rail projections, the expected traffic reduction rarely exceeds 1 percent, and even then is not achieved. Despite having studied transportation investments for decades, never before have we seen such absurdity. If Sound Transit were subject to the same regulations as apply to used car salesmen, heavy fines and even jail terms might be in the offing.

Wendell Cox is principal of Demographia (St. Louis) and a visiting professor at the Conservatoire National des Arts et Metiers in Paris. He was appointed to three terms on the Los Angeles County Transportation Commission by Mayor Tom Bradley.

This Bubble was Easy to See

2008-10-17T14:01:00.002Z

Re: http://online.wsj.com/article/SB122420268681343047.html?mod=djemITP
Fed Rethinks Stance on Popping Bubbles (October 17)

Dear Mr. Lahart (The Wall Street Journal):

A very useful article. You are right that identifying bubbles is difficult. However, this is hardly the case with the housing market. The bubble was obvious and completely predictable.

We have (at least) six decades of good data on the relationship between household incomes and housing prices. The historic norm has generally been 3 --- a median price at 3 or fewer times that of median household incomes. That ratio was greatly exceeded --- for the first time --- over the past decade. Moreover, its increase was very geographically focused. As Paul Krugman has pointed out... there was not housing bubble in much of the country. If the Fed and others had bothered to look at the geographical distribution of the bubble and then asked questions about why, the answer would have been very obvious. Areas with very strong land use regulation were unable to accomodate the increased demand, and the regulation constrained supply worked to explode housing prices --- a tripling of the ratio for example in the Los Angeles area and at least a doubling in most of the other highly regulated markets. Meanwhile, where the more traditional, liberal land use regulation that had characterized virtually all parts of the country until about 20 years ago, there was little change in the ratio. These markets include Atlanta, Dallas-Fort Worth, and Houston, which are the three fastest growing metropolitan areas over 5m population in the developed world.

It is not as if people were not watching the inflating bubble. Real estate and market analysts were falling all over themselves, cheerleading the "performance" of the housing market. tt should have been obvious. One of the lessons of this affair is that to simply look at the economy (or specifically the housing market) from a macro-economic perspective is not enough. All of this could have been predicted (and perhaps avoided) if those whose job it is to encourage economic stability had simply been watching.

We have dealt with these issues in four annual editions of the "Demographia International Housing Affordabilty Survey," the fifth edition of which will be published early in 2009. The current edition is available at http://www.demographia.com/dhi.pdf.

Best regards,
Wendell Cox
Co-Author, Demographia International Housing Affordabiltiy Survey
Principal, Demographia (St. Louis)
Visiting Professor, Conservatoire National des Arts et Metiers (Paris)

Levittown & the American Dream: Still Alive Some Places

2008-10-09T12:40:00.002Z

Re: Why We Can't Build an Affordable House, by Wytold Rybczynski

Rybczynski rightly points the finger at overly zealous regulation as a principal reason for the escalation in housing prices. Missing, however, is the fact that the American Dream as embodied in Levittown is still alive where regulatory excesses have been avoided. Rybczynski notes that Levittowners could be purchased for three times the average wage. The average wage in 1950 was virtually the average household income, since there was rarely more than one worker in a household.

In much of the country median house prices today remain at or below three times median household incomes. Notably, these are areas where smart growth style land restrictions have not taken hold and it includes metropolitan areas like Atlanta, Dallas-Fort Worth and Houston --- the three fastest growing metropolitan areas in the developed world over 5,000,000 population. In all, at the peak of the housing bubble, 46 of 129 US markets had house prices at or below the Levittown ratio (see 4th International Demographia Housing Affordability Survey, http://www.demographia.com/dhi.pdf) --- such as Kansas City, Columbus, Des Moines, Indianapolis, Louisville and other metropolitan areas that are generally recipients of domestic migrants from the more highly regulated and unaffordable markets. Moreover, the median sized house is at least double the size of the Levittowner. Finally, new starter homes can be found at or below the Levittown ratio in many of these markets.

Wendell Cox
Co-Author, Demographia International Housing Affordability Survey
Demographia, St. Louis &
Conservatoire National des Arts et Metiers, Paris

California High Speed Rail: Service Unlikely to Livermore-Pleasanton-Dublin

2008-10-01T16:12:00.001Z

California High Speed Rail: State Agency Misleads State Senate & Public

2008-10-01T16:02:00.001Z

California High Speed Rail: Big Losses & Huge Taxpayer Subsidies

2008-10-01T15:58:00.000Z

2008-10-01T15:56:00.003Z

California High Speed Rail: Projections Attacked by Senator Mills & UC Berkeley Professor

The Project California voters will be asked to approve a nearly $10 billion bond issue in the November election as the beginning of funding for the a high-speed rail system intended to serve San Francisco, Los Angeles, San Diego, Sacramento, Fresno, Riverside-San Bernardino and points between. Promoters claim that the remaining necessary funding (from $45 billion to $71 billion, depending upon who you believe) would come from the federal government and private investors. There is no federal program to provide such massive funding and private investment seems highly unlikely given the overwhelming prospects for financial failure.

The Issue Even before the much higher 2030 ridership projections were released, the CHSRA’s forecasts had come under unusually provocative criticism. University of California professor and transportation textbook author William Garrison characterized claims of massive ridership and low fares as “outrageous statements and lies,” which echoed the evaluation of the world infrastructure research previously cited.

Additionally, Former State Senate President James Mills, who is also considered the “father” of the San Diego Trolley, served on the CHSRA board. He expressed similar views. It is reported that Mills resigned from CHSRA at least partially because he “couldn’t get the truth” out of staff. He is reported to have “described the entire project as ‘based on a fallacy’ of wildly exaggerated ridership projections. It stems, he said, ‘from hiring a consulting firm (and) letting them know what you want them to say.” This is an extraordinary statement from a long-time and continuing rail supporter, who nonetheless, points to a significantly flawed planning process.

Both of these statements were made on the basis of earlier ridership projections, which were far less aggressive than are being currently used by CHSRA.

There are multiple indications that the CHSRA ridership projections appear to be absurdly high. Ridership inflation is consistent with the experience of demand exaggeration that has been identified in the world infrastructure research. As a result, it can be expected that CHSRA fare revenue will be far less than anticipated, leading to financial difficulties.

Adapted from The California High Speed Rail Proposal: A Due Diligence Report By Wendell Cox & Joseph Vranich

Additional information

California High Speed Rail: Projections Attacked by Senator Mills & UC Berkeley Professor

2008-10-01T15:56:00.001Z

California High Speed Rail: The Exorbitant Cost of Greenhouse Gas Reduction

2008-09-30T15:41:00.001Z

Adapted from The California High Speed Rail Proposal: A Due Diligence Report By Wendell Cox & Joseph Vranich

Additional information

California High Speed Rail: Only Gilroy to Palmdale May be Affordable

2008-09-30T15:37:00.001Z

The Project California voters will be asked to approve a nearly $10 billion bond issue in the November election as the beginning of funding for the a high-speed rail system intended to serve San Francisco, Los Angeles, San Diego, Sacramento, Fresno, Riverside-San Bernardino and points between. Promoters claim that the remaining necessary funding (from $45 billion to $71 billion, depending upon who you believe) would come from the federal government and private investors. There is no federal program to provide such massive funding and private investment seems highly unlikely given the overwhelming prospects for financial failure.

The Issue Should insufficient funding be available, the Phase I San Francisco-Los Angeles line could be scaled back to new HSR infrastructure limited to the section between Gilroy and Palmdale (a skeletal system). This would make it possible for high-speed trains to complete the downtown San Francisco to downtown Los Angeles route by operating at lower speeds over the existing-but-upgraded commuter rail and freight tracks between San Francisco and Gilroy and between Palmdale and Los Angeles (and perhaps to Anaheim).

Given the difficult financing situation, and considering how HSR construction costs vary for different segments, such a skeletal system could well emerge. For example, it appears that approximately one-half of Phase I construction costs are attributable to the San Francisco–Gilroy and Anaheim–Los Angeles–Palmdale segments. Hence, it is possible that the Gilroy–Palmdale section of the line could be built for between $15 billion and $22 billion, depending on the extent of capital cost overruns. It would be possible to fund such a truncated line from the currently hoped-for financing sources (state bond, matching federal funding and private investment). However, as indicated in Due Diligence Financial Projections obtaining this even this amount of funding is likely to be difficult.

Further, the Authority has indicated that the earliest segments to be built will be in the San Joaquin Valley. The first segment includes “development of a test track from Bakersfield to Merced, regardless of whether the Altamont or Pacheco Alignment is selected. Thus, the Central Valley is served between Bakersfield and Merced for either alternative.”

Consequently, events could develop in such a way that genuine HSR service would operate only between the peripheries of the Los Angeles and Bay Areas, namely Gilroy and Palmdale, meaning that California would have the form but not the substance of high-speed rail. The speeds on such a skeletal system would be faster than current rail services, but would fall far short of HSR standards and would provide little or no competition to airlines between the two major markets.

Because the existing Bay Area and Los Angeles rail lines are heavily utilized, the CHSRA would need to add track capacity, electrify the lines, and enhance grade-crossing protections. Even with such upgrading the HSR trains would need to mesh with the operating schedules and travel times of the commuter trains.

The skeletal system would be able to provide service between San Francisco and Los Angeles on a non-stop schedule of up to 5 hours and 30 minutes and between San Francisco and Anaheim with a stop in Los Angeles on a schedule of up to 6 hours and 15 minutes.

Another factor relevant to the Palmdale–Los Angeles segment is that the Southern California Association of Governments (SCAG) envisages construction of a maglev train system. Plans include maglev lines from the Los Angeles International Airport to the Palmdale airport. Such a development could exacerbate financial challenges for the HSR line, resulting in truncating even the Phase I operation into Los Angeles. This could result in Palmdale being the southern terminus for the HSR system with passengers transferring between it and the maglev system.

Adapted from The California High Speed Rail Proposal: A Due Diligence Report By Wendell Cox & Joseph Vranich

Additional information

California High Speed Rail: Exaggerating the Impacts on Modal Alternatives

2008-09-30T15:28:00.005Z

California High Speed Rail: Service to Pomona Unlikely

2008-09-30T15:23:00.002Z

California High Speed Rail: Service to San Gabriel Valley Unlikely

2008-09-30T15:22:00.001Z

California High Speed Rail: Service to Ontario Unlikely

2008-09-30T15:21:00.003Z

California High Speed Rail: Service to Modesto Unlikely

2008-09-30T15:20:00.004Z

California High Speed Rail: Service to Temecula-Murrieta Unlikely

2008-09-30T15:20:00.003Z

California High Speed Rail: Service to Stockton Unlikely

2008-09-30T15:19:00.001Z

California High Speed Rail: Service to Riverside-San Bernardino & Inland Empire Unlikely

2008-09-30T15:18:00.002Z

California High Speed Rail: Service to Oakland & East Bay Unlikely

2008-09-30T15:16:00.001Z

California High Speed Rail: Service to San Diego Unlikely

2008-09-30T15:15:00.003Z

California High Speed Rail: Service to Sacramento Unlikely

2008-09-30T15:13:00.001Z

California High Speed Rail: They Don’t Even have a Qualifying Train Design

2008-09-30T15:10:00.002Z

California High Speed Rail: They Don’t Even have a Qualifying Train Design

The Project California voters will be asked to approve a nearly $10 billion bond issue in the November election as the beginning of funding for the a high-speed rail system intended to serve San Francisco, Los Angeles, San Diego, Sacramento, Fresno, Riverside-San Bernardino and points between. Promoters claim that the remaining necessary funding (from $45 billion to $71 billion, depending upon who you believe) would come from the federal government and private investors. There is no federal program to provide such massive funding and private investment seems highly unlikely given the overwhelming prospects for financial failure.

The Issue No existing HSR trains capable of meeting the speed and capacity goals of the CHSRA system can legally be used in the United States. The CHSRA’s intention to share tracks with commuter and freight trains complicates designing a train to meet Federal Railroad Administration safety standards that are considered the toughest in the world. Currently, no European or Asian HSR train meets U.S. crashworthiness standards. The necessary regulatory approvals of an overseas train are unlikely to be achieved without substantial changes in design and weight.

The CHSRA has yet to decide on basic design specifications for a train and has based studies on inconsistent seating capacities of 450-500, 650, 1,175, 1,200 and 1,600 per train. Also, a train redesigned for the U.S. will become much heavier and is thus unlikely to reach promised speeds. In short, the Authority does not have a usable train design and the eventually required modifications could substantially impair operating performance. Lower performance would negate the CHSRA’s assumptions on which it has based travel times, ridership projections, revenue forecasts and profits.

While builder specifications for the CHSRA’s train do not exist, because of the above circumstance it is fair to state that the CHSRA’s design may become the world’s longest and heaviest HSR train—yet be expected to operate at the highest speed current technology permits. It is likely that a series of designs, tests, prototypes and safety reviews never before achieved anywhere in the world must succeed for the CHSRA’s train to become a reality.

Adapted from The California High Speed Rail Proposal: A Due Diligence Report By Wendell Cox & Joseph Vranich

Additional information

California High Speed Rail to Operate Far Slower than Advertised

2008-09-30T15:07:00.003Z

California High Speed Rail to Operate Far Slower than Advertised

The Project California voters will be asked to approve a nearly $10 billion bond issue in the November election as the beginning of funding for the a high-speed rail system intended to serve San Francisco, Los Angeles, San Diego, Sacramento, Fresno, Riverside-San Bernardino and points between. Promoters claim that the remaining necessary funding (from $45 billion to $71 billion, depending upon who you believe) would come from the federal government and private investors. There is no federal program to provide such massive funding and private investment seems highly unlikely given the overwhelming prospects for financial failure.

The Issue Based upon international HSR experience, it appears that the CHSRA speed and travel time objectives cannot be met. As a result, HSR will be less attractive as an alternative to airline travel and is likely to attract fewer passengers than projected. Notably, the CHSRA’s anticipated average speeds are not being achieved anywhere in the world, including on the most advanced systems. Incomplete consideration has been given to California’s urban and terrain profiles where HSR trains must operate more slowly than circumstances allow in, for example, France. This study, by assuming realistic speeds, estimates that a non-stop San Francisco–Los Angeles trip would take 3 hours and 41 minutes—59 minutes longer than the statutory requirement of 2 hours, 42 minutes. In the future, the CHSRA’s travel times may be further lengthened by train weight and safety issues and also by political demands to add stops to the system.

The proposed HSR system appears unlikely to provide travel time advantages for long-distance airline passengers. It is likely that HSR door-to-door travel times would be greater and there would be considerably less non-stop service than air service. Moreover, HSR would be unattractive to drivers in middle-distance automobile-oriented markets because little or no door-to-door time savings would be achieved and costly local connections would often be required (rental cars or taxicabs). Another convenience factor is that California urban areas lack the extensive local transit infrastructure that connects with HSR systems in dense Asian and European urban areas. The HSR system will experience disadvantages and commercial challenges in competing with air and auto travel that have been understated in CHSRA documentation.

Adapted from The California High Speed Rail Proposal: A Due Diligence Report By Wendell Cox & Joseph Vranich

Additional information

California High Speed Rail: Phony Climate Change Claims

2008-09-30T15:02:00.002Z

California High Speed Rail: Phony Climate Change Claims

The Project California voters will be asked to approve a nearly $10 billion bond issue in the November election as the beginning of funding for the a high-speed rail system intended to serve San Francisco, Los Angeles, San Diego, Sacramento, Fresno, Riverside-San Bernardino and points between. Promoters claim that the remaining necessary funding (from $45 billion to $71 billion, depending upon who you believe) would come from the federal government and private investors. There is no federal program to provide such massive funding and private investment seems highly unlikely given the overwhelming prospects for financial failure.

The Issue One of the principal proponent’s claims about high-speed rail is that it will reduce greenhouse gas emissions. In fact, high-speed rail’s environmental benefits have been greatly overstated.

California HSR will do little to reduce CO2 emissions (greenhouse gas emissions). Based upon California Air Resources Board projections, HSR would ultimately remove CO2 emissions equal to only 1.5 percent of the current state objective. This is a small fraction of the CHSRA’s exaggerated claims of “almost 50 percent” of the state objective. The Intergovernmental Panel on Climate Change (IPCC) has indicated that for between $20 and $50 per ton of reduced greenhouse gases emissions, deep reversal of CO2 concentrations can be achieved between 2030 and 2050. A McKinsey report indicates that substantial CO2 emission reductions can be achieved in the United States for less than $50 per ton. Yet the cost per ton of CO2 emission removal by HSR is far higher. ---.between 39 and 201 times the international IPCC ceiling of $50. The reality is that HSR’s impact on CO2 would be inconsequential while being exorbitantly costly.

Adapted from The California High Speed Rail Proposal: A Due Diligence Report By Wendell Cox & Joseph Vranich

Additional information

England's Mortgage Bailout: The High Cost of Town Planning

2008-09-28T22:54:00.003Z

The Daily Telegraph in London reports that the government bailout of mortgage lender Bradford and Bingley will raise the exposure of the United Kingdom taxpayers to £150 billion (nearly $300 billion). Overall, this is approximately $5,000 per capita, considerably more than the $3,000 per capita United States taxpayer exposure likely after the nearly $800 billion in bailouts, including AIG and the proposed congressional package.

It may be surprising that the cost in the UK would be competitive, much less higher than in the United States, until the causes are analyzed. Surely, US lenders appear to have been more profligate with their (and now taxpayers’) money than UK lenders. Yet the bloated prices have started to fall, as prices begin to return to reality.

Lending profligacy was only the start of the problem. Blame town planning, or what is called “smart growth” in the United States. Elsewhere, we have documented the fact that the excessive price increases that led to the US mortgage meltdown were concentrated in markets with strong land use regulation (smart growth). In these markets, land use policies limited the amount of land available for development, interfered with the competitive pricing of land for development and otherwise increased costs. The smart growth markets, while accounting for only 30 percent of the population, represented more than 85 percent of the housing price increases. Without smart growth, the financial crisis might well have been handled in the United States without government intervention.

The British are not so lucky. Because of the Town and Country Planning Act of 1947 and its subsequent administration, the entire nation is victimized by smart growth style policies that simply do not allow enough houses to be built. Last year, British house construction fell to the lowest level since World War II, and has dropped 30 percent just since 1992. This is barely one-third of the level required in the nation according to James Hearfield, in Let’s Build: Why We Need Five Million New Homes in 10 Years.

For all the good it has done, the Blair government has made the housing market a “dog’s breakfast.” By requiring an untenably high share of new housing to be built in brownfield sites, the government has raised the price of housing and discouraged its development. It is not as if housing has not attracted the attention of the government. Indeed, it seems as if the more it has talked, the less has been built.

But there is much more than national policy. Local authorities have long since caved to property owners who think that their rights to property they can see is no less than their rights to property they own. The result is a nation that is saying no to the next generation. Never mind that the UK is among the most poorly housed nations in the developed world.

It is not, therefore surprising, that housing prices have risen with a vengeance. Owner occupied housing costs have doubled in the last decade relative to incomes. This means that the value of the owner occupied housing stock stands at nearly £3.5 trillion, when historic norms would place it at £1.7 trillion. The £150 billion (£0.150 trillion) may just be the beginning.

The Sub-Prime/Smart Growth Mortgage Market Bailout

2008-09-21T14:40:00.005Z

The impending federal bailout of mortgage markets has a principal cause --- lax lending standards, such as sub-prime mortgages and an exaggerating cause --- excessive land use regulation, which drove house prices up beyond any precedent. More than 80 percent of the housing cost increase since 2000 occurred in markets with excessive land use regulation (also called "smart growth"). Without this excessive increase, the financial crisis would have been far less intense or may not have occurred at all.

These policies, often referred to as "smart growth," create a scarcity of land, artificially raise the price of housing, and, again, have increased the exposure of the market to risky mortgage debt. When more liberal loan policies were implemented, metropolitan areas that had adopted these more restrictive policies lacked the resilient land markets that would have allowed the greater demand to be accommodated without inordinate increases in house prices.

For more detail see:
How Smart Growth Exacerbated the International Financial Crisis (Heritage Foundation web memo)

How Smart Growth Exacerbated the International Financial Crisis (report)

Google Chrome: A Step in the Right Direction (Review)

2008-09-12T21:38:00.001Z

I was happy to be one of the first to download Google Chrome, a new web browser, within minutes of its being made available on the internet. Somehow, Unlike, Microsoft, Google has managed to bring products to the market that are generally well tested and I have been pleased to use G-Mail and Google Earth, almost without any difficulty, from the beginning. That is not to say that their products are without difficulties. There are design problems with G-Mail, for example, but these are not program bugs, but rather software architecture issues --- I would have designed them differently.

This, of course, is much unlike Microsoft, whose products I find so infuriating that I even briefly switched to Apple, in an expensive failed experiment.

My haste in downloading Google Chrome was due to an associate's bad experience with the latest version of Firefox, which I had intended to download, but had not pressed all of the necessary buttons. He had, and lost hours because of design glitches. This put me in the market for an alternative not only to Internet Explorer, but also Firefox.

Google Chrome is generally an improvement on the other browsers. It has a clean look and more of the page is available for web page display. Some of the features are a bit unusual (as in the case of G-Mail), but the program passed my one-half hour test --- I must be up and running pretty well with any software within 30 minutes or it is removed from the registry. Google Chrome seems to be faster than Firefox and its display of tabs is more attractive and user friendly.

The import of bookmarks from Firefox was not completely successful, but the 5 percent that was missed I will add as it becomes necessary.

There are two problems, neither of which is sufficient to require a return to Firefox or, God Forbid to Internet Explorer:

All in all, however, Google Chrome is a significant step forward, despite being a “beta.” One can only hope that someone from the Chrome product will have coffee with someone from the G-Mail product and there will be “peace in the valley” again.

Transit Use Captures Only 3% of Road Use Decline

2008-09-09T13:26:00.004Z

Based upon 2008 Second Quarter data from the United States Federal Highway Administration and the American Public Transportation Association, it is estimated that the increase in transit use accounted for only 3 percent of the decline in urban roadway travel.

Small Town America

2008-09-08T01:14:00.002Z

With all of the discussion in the presidential campaign about small towns, it is well to review the situation of local governance in the United States.

According to the 2002 United States Census of Governments

Small town America appears to be alive and well.

Valley to West LA Monorail or Subway: A Real Loser

2008-08-26T14:52:00.002Z

I was a member of the Los Angeles County Transportation Commission from 1977 to 1985 (appointed to three terms by Mayor Bradley) and a resident of the Valley (Chatsworth). It was my motion that created the Proposition A set-aside for rail construction in 1980. I supported rail at that point because of consultant and staff claims that it would make a material difference in traffic congestion --- indeed, it was that concern that led me to enter transportation public policy in the middle 1970s.

Since that time, it should have become painfully clear that rail has made virtually no difference in traffic congestion in Los Angeles. This should not be surprising, because new urban rail systems have not reduced traffic congestion anywhere in North America or Western Europe. As for the Sepulveda Pass (I-405), it is a classic corridor for which there is no transit solution. The basic problem is simply that not enough people are going to the same place. The destinations of people driving on such a peripheral (as opposed to downtown oriented) corridor makes it impossible to deter anything but a very small percentage of the traffic, and that would be quickly replaced by growth.

Because transit cannot serve door-to-door travel, nearly all trips by transit are much longer than by car --- the national average is double and the data in Europe is not much different. Regrettably, proposals such as monorails, subways and even express buses are a reflection more of rhetoric than reality. They will make little difference and that is especially true in a corridor like Sepulveda Pass.

As politically incorrect as it may be, there is no way to reduce traffic congestion and improve travel times except by expanding roadways. High occupancy toll lanes can be very effective and could make a real difference, especially in light of the fact that Census Bureau estimates indicate a near stagnation of population growth in Los Angeles County (and even Orange County)

Las Vegas Monorail Bonds: More Bad News

2008-08-25T16:29:00.002Z

According to a Business Wire story, “a default of some kind appears probable” on the bonds of the Las Vegas Monorail, based upon a “CC” Fitch Rating.

The monorail was developed as a private venture and supported by tax-exempt industrial development bonds issued by the state of Nevada. Project promoters produced an “investment grade” projection of 53,500 daily riders for 2004. In 2007, the average daily ridership was 21,600—60 percent below projection. This author had produced a report during the planning process projecting between 16,900 and 25,400 daily riders for 2004, the mid-point of which, at 21,200, was five percent below the actual 2008 year-to-date ridership (www.publicpurpose.com/ut-lvmono-0006.pdf).

The eventual results in Las Vegas may be unfortunate for investors. Moody’s Investors Services has downgraded the bonds to “junk” status and has indicated that “At current ridership and revenue levels, a payment default is anticipated by 2010 once reserves are exhausted.” (www.kvbc.com/Global/story.asp?S=7797066 and www.reuters.com/article/companyNews/idUSN2959008320080129). Finally, the bond insurer, AMBAC Financial Services, has run into financial difficulties and has had its credit rating dropped two levels (www.bloomberg.com/apps/news?pid=20601087&sid=asLtTQyLRQQs&refer=home). Holders of insured Las Vegas Monorail bonds could lose their investments, along with holders of uninsured bonds.

Counterproductive GHG Policy in California

2008-08-21T13:37:00.001Z

California’s Senate Bill 375 appears likely to pass tomorrow. The bill would establish greenhouse gas emissions targets for the state’s metropolitan areas and includes financial incentives that would seek to encourage more dense development and would ultimately interfere with local zoning prerogatives. The underlying assumptions of SB 375 are at best unproven and at the worst could lead to serious economic disruption.

One of the principal concerns in reducing greenhouse gases is to do so in a manner that allows strong economic growth to continue. Strong economic growth is much more than theoretical --- it is required to minimize poverty and to preserve the quality of life. Because of this concern, considerable research has been undertaken by the International Panel on Climate Change, which has concluded that significant (and sufficient) reductions of greenhouse gas emissions can be achieved at from $20 to $50 per ton.

The problem with SB 375 is that it applies no cost test. It is simply assumed that suburban development and driving are “bad” and that they must be curbed. There has been no cost-based modeling to justify this view. Indeed, Australian research indicates that, overall, GHG emissions per capita are less in suburban areas than in higher density areas (in a process that allocates every gram of GHG to a household location). Similarly, the average new car is as GHG friendly as the average transit ride (on a passenger mile basis) outside New York.

By skipping over the issue of costs, SB 375 could do far more harm than good. It will effectively ration land for development, which is likely to substantially increase its costs. This will lead to less affordable housing and higher product costs. Further, SB 375 would increase traffic congestion. Virtually all of the evidence from around the world indicates that more dense development, which will occur as a result of SB 375, leads to greater traffic congestion. This will increase the intensity of local air pollution and thereby local health risks. It will also increase GHG emissions, because cars emit more GHGs when they operate slower and in stop and go conditions.

All of this comes at a time that California faces a financial crisis, while there is a strong out-migration of residents to other states, according to United States Census estimates (1.2 million just from 2000 to 2007).

SB 375 represents a triumph of ideology over reason.

"Ways to Work:" A Nobel Prize?

2008-08-20T22:03:00.000Z

Ways to Work Program: A Nobel Prize?

The national Ways to Work program has improved the employment and education opportunities of low-income households across the United States. The model is similar to that used Mohammed Unus, who won the Nobel Prize for his small loan program in Bengladesh.

WAYS TO WORK PROGRAM

Economist Mohammed Unus recently won the Nobel Prize for his groundbreaking project that makes small loans available to the low-income residents of Bengladesh. In making the award, the Nobel Committee noted the importance of finding ways for people to break out of poverty. Unus’ Grameen Bank has developed an impressive record of assisting poor households to enter the mainstream of economic life in Bangladesh.

The applicability of the Unus model is not limited to low-income nations. The national Ways to Work program has been working for more than 20 years to bring low-income households across the United States into the economic mainstream. A principal strategy has been to provide loans, like Unus, to low-income households. Ways to Work helps households buy cars.

Why cars? Simply because in modern urban areas, whether in the United States, Western Europe or the low-income world, cars expand exponentially the geographical area in which people can search for employment. Research at the University of California, the Brookings Institution and the Progressive Policy Institute demonstrates that cars are crucial to obtaining better employment. The problem is, of course, that despite the romantic affection for transit, it is simply unable to provide mobility to much more than the downtown area, and that’s not where most of the jobs are.

A recent evaluation report looked at a representative sample of Ways to Work borrowers, and found the following:

It may be time for the Nobel Committee to honor the model Ways to Work program.

China: Send the Western Urban Planners Home

2008-08-20T22:00:00.002Z

A cadre of Western urban planners has descended on China offering advice. Chinese officials are admonished “not to repeat our mistakes.” The mistakes, they explain are urban sprawl (a pejorative term for suburbanization) and automobile use. Chinese officials who visit the West must marvel as for the mistakes at the myopia of our planners after witnessing the high standard of living, which is something they would like to replicate. For good reason, they are largely ignoring the bankrupt advice they are receiving from the Western planners.

INTRODUCTION

China is experiencing unprecedented economic growth. Over the past two decades, living standards have risen seven fold. Gross domestic product per capita still remains below high-income world standards, at one-sixth that of the US level. Nonetheless, there is great regional disparity, with incomes in east coast urban areas up to three times that of urban areas in the central and western regions.

Like many developing nations, China remains more rural than urban. According to United Nations data, China’s population was only 40 percent urban in 2000. This compares to urban rates of over 70 percent in many high-income nations. People are moving in large numbers from rural areas to the urban areas, following the pattern of development that has occurred virtually wherever incomes have risen markedly. Opportunities are much greater in the large and expanding urban labor markets, and the standard of living is better in urban areas than in rural areas. The United Nations estimates that by 2030, 60 percent of the Chinese population will live in urban areas. This represents a staggering migration --- the movement of 340,000,000 people --- a population greater than that of the United States and Canada.

Already, China has very large urban areas. Shanghai, Shenzhen and Beijing have 10,000,000 or more residents. A number of other urban areas have approximately 5,000,000 people, such as Guangzhou, Wuhan, Tianjin, Shenyang and Dongguan. There are more than 25 additional urban areas with populations above 1,000,000 See DemographiaWorld Urban Areas.

The Western Planners

Not surprisingly, a cadre of Western urban planners has descended on China offering advice. Chinese officials are admonished “not to repeat our mistakes.” The mistakes, they explain are urban sprawl (a pejorative term for suburbanization) and automobile use.

The Reality of the West

And, as for the mistakes of the West, Chinese officials who visit the United States, Western Europe, Canada or Australia must wonder at the disconnect between the wasteland described by Western planners and the unparalleled quality of life enjoyed by people in the West.

It is not a mistake that the automobile has created mobile urban areas in which employers and employees have far greater choices and labor markets are more efficient. It is not a mistake that housing built on inexpensive land on the periphery of urban areas has made it possible for so many millions to build up financial equity in their own homes. Nor is it a mistake that nearbly inexpensive land has been developed by retailers and other businesses who are, as a result, able to provide lower prices than would otherwise be possible.

The West has achieved its unparalleled affluence because it was largely able to accomplish all of this before the planners were in a position to impose their wills that would have prevented suburbanization and the expansion of mobility. The planners would have imposed greenbelts and urban growth boundaries, making it impossible for low cost housing to be developed. Western nations would now be principally inhabited by renters rather than homeowners. Employees would be limited to those few places they could get on foot or public transport, rather than the whole urban area that the automobile has opened up. There would be less wealth and it would be less broadly distributed. The planners would not have allowed the “big-box” stores on the urban fringe, and as a result people would have had to pay higher prices with their smaller incomes.

Indeed, for any who might wish for China to stumble in its competition with the West, it is hard to imagine a more promising strategy than to export Western planning ideas, if not the planners themselves, to China. China would do well to ignore the Western planners, whose advice would retard the growth of the economy and spread of wealth. To China’s credit, the “fools gold” of Western urban planning principles is largely being ignored.

School Buses: Principal Mass Transit System

2008-08-20T21:57:00.000Z

Beware Unfair Son of Kyoto Targets

2008-08-11T17:52:00.001Z

G8 leaders agreed upon a 50% reduction in greenhouse gas (GHG) emissions by 2050. The agreement was subsequently rejected by countries of the developing world, principally India and China.

Negotiators for the United States, Canada, Australia and New Zealand need to be careful in the next round of climate agreement discussions. Each of these nations is experiencing strong population growth. Australia will grow 40% between 2005 and 2050, according to UN projections. The United States and Canada will each grow about one-third, while New Zealand will grow slightly less than 30%.

Any agreement that imposes an overall target, such as 50% below current emission rates will greatly disadvantage these nations. By comparison, Japan will lose 20% of its population, while the European Union will lose 2%.

Because of the higher growth rates, 50% national reduction from 2005 would thus translate into at least a 60% GHG emission reduction per capita in Australia, the United States, Canada and New Zealand, while requiring only a 40% reduction in Japan and 50% in the European Union.

On the Australian Housing Shortage

2008-08-11T14:00:00.001Z

On the Australian Housing Shortage

For anyone who thought that housing policy was tending in the right direction in Australia, a recent statement by ANZ Bank’s senior economist, Paul Braddick should hit like a bucket of cold water. Braddick was widely quoted in the media to the effect that the growing housing shortage is setting Australia up for the “mother of all housing booms.” Commonwealth Securities chief equities economist Craig James predicted that both house prices and rents would be driven higher by the shortage.

And then there was the BIS Shrapnel Residential Property Prospects report, which predicts huge increases in median house prices by 2011. Overall, BIS Shrapnel projects house price increases that would add nearly another year’s median household income to pay for the median priced house. Already housing is more than twice as expensive as it should be relative to historic income norms. Indeed, if the trends BIS Shrapnel projects are accurate, Sydney would become the most expensive market in the Anglosphere, as Californian markets implode due to their unsustainable cost inflation.

But wait a minute. Housing shortage? Australia? Is there not enough land? Are there not enough builders?

True, population growth is greater than in nearly two decades. However, fast population growth is nothing new in Australia. Much higher growth rates were accommodated in previous decades. In the 1950s, the annual growth rate was a full one-half greater than the present elevated rate. During the 1960s, the annual growth rate was a quarter greater. Yet, somehow, Australia was able to provide housing for this strong growth both from both domestic expansion and immigration. Thus, the higher present population growth rates, in and of themselves, do not justify a housing shortage.

There could be a problem if there is not enough land or if the housing industry is not up to the challenge. However, that is hardly the case.

Consider this:

Less than 0.3 percent of Australia is urbanized. That means there is plenty of land in Australia. There is substantial land for growth around all of the nation’s major capital cities.

Australia has, according to international studies, one of the most entrepreneurial home building industries in the world. That industry is capable of providing whatever level of new housing is required to accommodate whatever should be the number of new Australian households.

The problem is thus neither a shortage of raw land for development or a shortage of building capacity. It is policy.

The problem is the land use policies that have been adopted in the states. In every state, as well as the Northern Territory and the ACT, conscious policies have been adopted that to severely restrict the expansion of the housing supply. Arbitrary lines --- sometimes called urban growth boundaries --- have been drawn around urban areas. Generally, new housing must be built within these constraining belts. As anyone remotely familiar with economics knows, restricting supply drives up prices.

The net effect of the restrictive policies is to cartelize the market for land. Owners of land that can be developed ask a higher price. It is important to understand that house prices have not gone up much at all, indeed they have fallen relative to inflation in some areas. What has risen is the price of land. It is the escalation of land prices in a rigged urban land economy that is responsible for Australia’s housing shortage.

There are other issues too, such as huge infrastructure fees and master planning requirements that add so much to the price of housing. The stark reality is that if the urban planning policies of today had been in place in 1947, all of the efforts of Labor and Coalition governments to encourage home ownership would have failed --- as miserably as have the recent efforts.

Put in human terms, Australia’s housing shortage represents the deliberate government withdrawal of the Great Australian Dream for many households. Worse, the economists tell us that things are only going to get worse.

For all the rhetoric about housing affordability, there is a single, simple answer --- the regulations must be relaxed. There is no other affordable or sustainable way to restore housing affordability. It is truly remarkable --- and unfortunate that the “lucky country” may not be able to adequately house its hopeful and growing population.

Apples, Oranges & Transit Oriented Development

2008-08-11T12:31:00.006Z

A new TCRP report (#158, Effects of TOD on Housing, Parking and Travel) concludes that automobile trips are approximately one-half as frequent per dwelling unit in transit oriented development (TOD) apartments as in all other apartments. The report, however, raises more questions than it answers.

Based upon a quick review, it appears that the study suffers from three important biases.

What this report does not demonstrate (contrary to its claims) is that people in TODs drive less than their neighbors. Examining that question would require much more focused methodology. Rather, the report merely provides evidence transit is used more where it better connects people with downtowns. In the larger urban fabric, with its dispersed trip patterns and dispersed employment, sufficient levels of transit service simply cannot be afforded, whether in American or Western European urban areas.

The conclusion: TOD apartments and apartments in general are like apples and oranges with respect to trip generation.

More Empty Hype About Transit in San Diego

2008-08-08T18:56:00.002Z

Re:
North County Times Article

Dear Mr. Downey...

Just a quick note on your story on Wednesday. There is no doubt but that the Coaster's ridership increase is related to the increasing price of fuel. On the other hand, it needs to be undestood that the Coaster ridership increase is but a small fraction of the reduction in driving along the I-5 corridor (a quick review of the data in your article and data from the USDOT and Caltans). It appears that the Coaster ridership is about 1/8th the decline in traffic.

Best regards,
Wendell Cox

Transit Market Share Inches Up

2008-08-04T20:27:00.001Z

Transit Market Share Inches Up

Latest annual data available from the United States Department of Transportation indicates that the market share of transit rose slightly in 2006, from 1.51% of passenger miles to 1.55% in 2005. Over the same period, gas prices rose 13% in the United States.

Annual data is at US Personal Vehicle and Public Transport Market Share from 1900

Louvre Café Syndrome Strikes Neal Peirce: Misunderstanding Amsterdam and America

2008-08-04T17:06:00.005Z

Louvre Café Syndrome Strikes Neal Peirce: Misunderstanding Amsterdam and America

Tourists, journalists and urban planners are often smitten with what might be called the “Louvre café syndrome.” This occurs when Americans sit at Paris cafes in view of the Louvre and imagine why it is that the United States does not look like this. In fact, most of Paris doesn’t even look like this, nor do other European urban areas. Like their US counterparts, European urban areas rely principally on cars for mobility (though to a somewhat lesser degree) and their residents live in suburbs that have been built since World War II.

The last example of Louvre Café Syndrome comes from Washington Post Writer’s Group columnist Neal Peirce, who suggests that Amsterdam, with its bicycles, is the model for America to follow in a time of high energy prices (See Multiple Transit Options -- A Dutch Treat We'll Be Needing.

Not only is this view incorrect, but Amsterdam is not even a model for the Netherlands. The largest urban areas of the Netherlands, Amsterdam and Rotterdam, have been “stuck in neutral” with respect to growth for at least 45 years. United Nations data indicates that since 1960, 97% of urban growth in the Netherlands has occurred outside these two large urban areas. While the population of the two largest urban areas has increased approximately 10%, the urban population outside these areas has increased 120%. And how do these urbanites that have chosen not to live in Amsterdam or Rotterdam travel? Try by car. Overall, in the Netherlands, approximately 85% of travel is by car --- a figure that is nearly identical to the United States. All of the subway and light rail ridership in the Netherlands is less than the annual increase in car use. Some model.

America is a growing nation. Between now and 2030, approximately two-thirds of the urban growth in the developed world is projected to occur in the United States --- that is a considerable number given the fact that the US accounts for less than one-third of the developed world’s urban population today. The strategies that work in urban areas with stagnant growth --- such as Amsterdam --- will not work here.

As for the bicycles, one could also point to walking and the large share of travel that it represents in Manhattan or the Chicago Loop. A European felled by Louvre Café Syndrome might visit these places and imagine that the urban area looks the same all the way to the urban fringe --- that the citizens of New Brunswick, Westfield or Aurora live in residential skyscrapers and that they walk everywhere. Such a view would be as faulty as Peirce’s vision of Amsterdam.

It helps to think of things in context. Amsterdam would barely rank in the top 50 metropolitan areas of the United States. The Netherlands has a population less than that of two American metropolitan areas (combined statistical areas), New York and Los Angeles. Finally, all of the Netherlands --- urban and rural areas --- would fit into an area approximately 1.5 times that of the New York metropolitan area.

You can’t see everything from the Louve.

Wendell Cox
Visiting Professor, Conservatoire National des Arts et Metiers, Paris

Related articles: Little of Driving Decrease Captured by Transit

World Urban Areas Strong Association Between Lower Density & Higher Incomes

2008-08-03T22:15:00.001Z

The latest Demographia world urban area population estimates confirm the strong association between lower urban population densities and higher incomes (gross domestic product per capita on a purchasing power parity basis).

A linear regression analysis indicated a 0.300 “R2,” for 138 geographies (nations and separate territories), using the population density of urban areas (urban agglomerations, or urban footprints) with 500,000 or more population. This is significant at the 99% confidence level. The analysis included all of the 740 world’s urban areas with more than 500,000 population.

The data shows an association such that each percentage point increase urban density is associated with a nearly 0.8 percentage point decline in gross domestic product per capita. The data is illustrated in charts on pages 88 and 89 of the following recently report, released today.

Demographia World Urban Areas: Population & Density

Current population estimates and population projections were also released for all urban areas expected to have a population of 2,000,000 or more in 2030:

Demographia World Urban Areas: 2025 & 2030 Population Projections

"SmartMoney.com" Misses by 85% on Transit

2008-08-01T00:11:00.001Z

SMART MONEY MISSES BY 85 PERCENT

Smartmoney.com reports on the increase in transit ridership, posted at “yahoofinance.com:”

Thanks to sky-high fuel costs, public transit ridership is at its highest level in 50 years, according to the American Public Transportation Association, an industry group. In the first quarter of this year, riders took 51% more trips on subways, commuter rails, streetcars, trolleys and buses than they did during the same period in 2007.

Actually the American Public Transportation Association has reported a 3.4% increase in ridership. Smartmoney.com missed the mark by about 85%.

There is no doubt that the increase in transit ridership is due to high gas prices. On the other hand, much of a “clueless” media has missed an even bigger point --- that more than 97% of the decline in car travel has not transferred to transit.

Changing US Car Purchase Preferences Improve Fuel Economy, GHG Emissions

2008-07-09T21:06:00.003Z

Fuel prices have induced the purchase of more fuel efficient vehicles in the United States. This is the Demographia finding from an analysis of the 10 most popular automobiles and sport utility vehicles (SUVs), as reported by Ward’s Automotive.

In the first 6 months of 2008, the average fuel economy of these 20 vehicles was 23.7 miles per gallon. This is an improvement of nearly 4 percent from 2007. Over the period, the share of SUVs among these vehicles fell from 51 percent to 44 percent.

If this improvement is reflective of overall buying patterns and continues, this change in consumer preference alone would reduce greenhouse gas (GHG) emissions in the United States by approximately 43,000,000 metric tons per year.

See: US Consumer Choice in Automobiles

Car Use Expands in San Francisco Bay Area at 3-Times National Rate

2008-07-09T20:01:00.002Z

Car travel in the San Francisco Bay is rising rapidly, at more than three times the national rate per capita. Data from the Metropolitan Transportation Commission indicates that from 2000 to 2007, total daily vehicle miles traveled increased from 140,100,000 to 152,100,000. Per capita driving increased from 20.6 miles to 22.2 miles, an increase of 7.6 percent.

By comparison, the national increase in driving per capita over the same period was 2.1 percent.

United States Bureau of the Census data shows that the San Francisco Bay Area has slipped into laggard growth, having added only 0.3 percent to its population annually. This is a slower growth rate than Italy. The Bay Area has become one of the nation’s slowest growing areas, at least partially due to huge increases in housing costs.

See: San Francisco Bay Area Travel Data

Urban Driving Loss Moderated in April: Intercity Decline Expands

2008-07-09T13:54:00.005Z

New data from the US Department of Transportation indicates that driving in urban areas declined only 1.0 percent in April 2008 compared to April 2007. This is despite the continuing increase in gasoline prices.

The April figure compares to the 3.8 percent decline in March relative to the previous year.

Inter-city driving volumes appear to be suffering the largest declines. In April, traffic on urban interstate highways (motorways or autoroutes) was down 5.2 percent from the previous year. This is more than 4 times the decline in urban driving.

As was noted in a previous entry, the press has been filled with stories to the effect that people are abandoning their cars for mass transit. In the first quarter, transit replaced no more than 3 percent of the decline in urban travel by car. This is a simple consequence of convenient mass transit service not being available for the overwhelming majority of urban trips. With an urban market share of below 2 percent, it would take a 50 percent increase in transit market share to accomodate a 1 percent decline in urban travel by car. Outside the New York metropolitan area, the increase would need to be 100 percent, because of the much smaller market share.

In the longer run, it is likely that driving will stablize as households switch to more fuel efficient vehicles. In the first six months of the year, there appears to have been a nearly 1 mile per gallon increase in the fuel economy of new cars and SUVs sold in the United States compared to the previous year.

Ville de Paris to Allow Skyscrapers?

2008-07-09T11:45:00.003Z

The ville de Paris government has decided to consider allowing skyscrapers, after a more than 30 year bad (precipitated by the Darth Vaderite Tour Montparnasse).

On one hand, such a move could, in the long run, seriously retard the attractiveness of Paris as a tourist site --- the city, especially the core, is itself a museum. On the other hand, allowing the building market to develop what the customer market seeks can only make the ville de Paris more competitive in its metropolitan region, the Ile-de-France. The ville de Paris has taken serious losses in employment in the last two decades, as companies have increasingly moved or been established in the suburbs.

However, Paris will continue to have a serious competitive disadvantage with the artificial traffic constraints that have made parts of the ville a recurring traffic jam, as traffic lanes have been taken from general traffic use, in favor of buses, which have seen virtually no material increase in ridership.

High Rises in the Ville de Paris?

Gas Price Increase in Context

2008-07-08T14:04:00.002Z

Much of the increase in gasoline costs in the United States is simply the result of a weakening dollar.

If the dollar had retained its value relative to the Euro as of January 1, 2002, the price of gasoline would be approximately $2.25 per gallon today (assuming a present price of $4.00).

The strength of the Euro has shielded Europe from the huge gas price increases experienced in the United States. Gas prices are up, but by far less in percentage terms than in the US.

China to the G-8?

2008-07-08T11:56:00.003Z

It would seem reasonable for the G-8 to be expanded to include the world's second largest national economy - China.

Moreover, it would be useful to extend the invitation before China itself becomes the "G-1," by virtue of its explosive growth.

Responding to Mayor Hanneman’s Personal Attack

2008-07-07T13:55:00.006Z

It is hard to recall a more foolish expenditure than that made by Mayor Mufi Hanneman of the city and county of Honolulu in a campaign of personal invective against me.

The Situation

Here is the remarkable story.

1. The Honolulu Advertiser published a letter from the mayor in which he noted Honolulu's superior carbon footprint rating as reported in a Brookings Institution report. In the letter he made a positive reference to the proposed Honolulu urban rail project, which he supports (Note 1, below).

2. When I became aware of the letter, I sent a "tongue in cheek" letter to the editor on the subject of Honolulu's carbon footprint, the point of which was to note that Honolulu's rating was both deserved and not deserved. I implied that Honolulu would not have scored so well if it had been founded on Michigan's Upper Peninsula (where much colder conditions would require far more energy for heating, and thus more CO2 emissions). I also gave Honolulu credit for its high transit market share, which despite having no rail has often equaled or exceeded the market shares of all urban areas in the nation, except for New York. My letter suggested that this favorable situation was not likely to be made any better by building the urban rail system (Note 2, below).

The Over-Reaction

The latter casual (though correct) comment in a letter not principally about urban rail led the Mayor to take out near-full page ads in two metropolitan newspapers on Sunday, June 22. The ad was run again on Monday in one of the newspapers. This costs money. The ads were directed in part at me, but also were highly critical of local rail system opponents. In a sense I suppose that I should take pride that the Mayor is so terrified that I might bring my analysis of his rail system to Honolulu.

Cause for Concern

I have no interest in responding to the Mayor’s ad hominem attacks.

Prudent public policy is often trumped by what the Germans call "realpolitic" (policy based on power rather than the public good). Indeed, when proponents of megaprojects stoop to ad hominem attacks it often tends to mask feeble analysis and facts that do not justify the large expenditures. However, it is the facts, not the personalities that matter. Personalizing the debate makes does nothing to make a questionable project less questionable.

The mayor's over-reaction at the prospect of my entering the policy debate should give pause. Local Honolulu analysts have already pointed out the grim reality --- that this extravagant rail line is likely to require more of a share of metropolitan area income than any in US history --- and by a long shot. One can only hope that the citizens of the city and county of Honolulu will have an opportunity to decide this issue at the ballot box, rather than having substantial tax increases imposed without their consent.

Wendell Cox
Principal, Demographia (St. Louis)
Visiting Professor, Conservatoire National des Arts et Metiers, Paris
Member, Los Angeles County Transportation Commission (1977-1985)
Member, Amtrak Reform Council (1999-2002)

Note 1:

MAYOR HANNEMAN'S LETTER TO THE HONOLULU ADVERTISER

No. 1 Ranking Report Confirms City Going in Right Direction

The new Brookings Institution report that ranked Honolulu No. 1 out of 100 U.S. cities for our low carbon emissions was great news, but we will not be content to rest on our laurels.

We're moving forward aggressively on many important initiatives to further protect our environment and enhance our quality of life.

Our rail transit project is exactly what's needed to provide key improvements cited by the study to reduce pollution: Promote more transportation choices and transit-oriented development.

The study found that cities with rail mass transit systems and densely populated urban cores have far smaller "carbon footprints" per capita than sprawling metropolitan areas dependent on private vehicles. Our rail system will give thousands of commuters and visitors an alternative to private vehicles and clogged freeways, while providing important opportunities for new housing, commercial space and public facilities along the rail line.

Our 21st Century Ahupua'a Plan closely examined other environmentally friendly policies, and they are now reaching fruition. We're continually expanding curbside residential recycling, replacing buses and police cars with efficient hybrid vehicles, increasing the capacity of the H-Power garbage-to-energy plant, operating ferries from Kalaeloa to Aloha Tower and adding bicycle lanes to our roadways.

A few will always nit-pick when good news is announced, but we're confident that the Brookings report provided an honest assessment of Honolulu's ranking and made it clear that we are moving in the right direction with rail transit and other important initiatives. Our goal remains to leave Honolulu better than we found it.

Mayor Mufi Hannemann
City and County of Honolulu

Note 2

MY LETTER TO THE HONOLULU ADVERTISER (June 2)

To the Editor
The Honolulu Advertiser

The Mayor boasts about Honolulu's superior carbon footprint and some boasting is appropriate.

It is no surprise that Honolulu has one of the smaller transportation footprints in the nation. With its bus system, Honolulu often ranks second in the nation in transit market share to the New York area. It is hard to imagine that the proposed, expensive rail system will make that any better.

As for residential energy, had the city founders instead chosen a location on Michigan's Upper Peninsula, things would look much worse. Honolulu's modest residential carbon footprint is a function of Hawaii's marvelous climate, which reduces energy demand substantially.

Sincerely,
Wendell Cox
Principal, Demographia, St. Louis

World Urban Areas: Population, Density & Projections Released

2008-06-28T23:03:00.002Z

http://www.demographia.com/db-worldua.pdf

Demographia announces publication of World Urban Areas & Population Projections. World Urban Areas & Population Projections remains the only known source in the world for comprehensive and consistent estimates of urban land area and densities. This 4th comprehensive edition replaces publications released in March of 2007. The product includes:

(1) Population, land area and density estimates for all 723 identified urban agglomerations in the world with 500,000 or more in population. In all, 1,316 urban areas are included, representing 50 percent of the world urban population. Tables are provided in population, land area, population density and alphabetical order.

(2) There is also a summary of the data by the largest nations and major world regions.

(3) Population projections for all 204 urban agglomerations anticipated to have 2,000,000 or more residents in 2025. There is also a projection of the 2008 population of all such urban areas. Tables are provided in alphabetical order and population order by 2008 and 2025 projections

Consultant Memo on Houston Misleads Tauranga Council

2008-06-23T11:02:00.018Z

A Tauranga Councillor (New Zealand) raised questions about “smart growth” (prescriptive land use planning) in relation to the superior housing affordability of Houston, where no such policies exist. The resulting memorandum in response is evaluated below.

Principal Points

1. All of Texas is affordable and most of Texas is unzoned.

2. Houston’s affordable housing is not just on the urban fringe, contrary to the statement in the memo.

3. Houston’s suburbanization (or “sprawl”) is about average and not much greater than Portland’s.

4. Houston’s traffic congestion has been materially improved by road construction.

5. Houston’s traffic moves considerably faster than Auckland’s.

6. The loss of housing affordability is associated with smart growth-style land use policies.

Houston and Texas: Superior Housing Affordability

The city of Houston (local government authority) has no zoning, which the memo rightly points out. Virtually all of the other local government authorities in the Houston metropolitan area have zoning. However, most of the land in the Houston metropolitan area is unzoned, because it is outside local government authority areas and under the jurisdiction of counties. In Texas, counties have no zoning power. Thus, while local government authorities in Texas outside the city of Houston generally have zoning, they are forced to operate in a competitive environment under which housing can be readily built, without zoning, in adjacent unincorporated areas. Indeed, given this competitive environment, it is appropriate to think of the state of Texas as unzoned (environmental regulation, which is established at the state and federal level is observed).

The memo notes that Dallas (actually the Dallas-Fort Worth metropolitan area) has slightly better housing affordability than the Houston metropolitan area as measured by the Median Multiple (median house price divided by the median household income). The important point is that both metropolitan areas are below the historic maximum norm of 3.0. By comparison, the Median Multiple in Tauranga was 7.5 in the third quarter of 2007 (Auckland was 6.9). This means that residents of these New Zealand urban centres face relative home ownership costs more than 2.5 times those of Houston, Dallas-Fort Worth and a number of US and Canadian metropolitan areas that have not adopted smart growth policies.

Affordable Housing in Houston: Not Limited to the Fringe

The memo indicates that housing is affordable only on Houston’s fringe. This is absurd and betrays an acute unfamiliarity with Houston housing markets. The referenced map shows house asking prices in Harris County (which is core of the urban area). Affordable housing is to be found throughout the metropolitan area Indeed, the low bound of the highest price category is lower than the median house price in Tauranga. No one would expect the consultant to have expertise on Houston housing markets. It does seem inappropriate, however, for the consultant to be erroneously opining that affordable housing is available only on the fringe

Houston’s "Sprawl:" Like Portland

As for Houston's suburbanization, (pejoratively called "sprawl,") the urban area (urban footprint) is approximately average the density for a US urban area over 1,000,000. It is only 10 percent less dense than Portland, despite that urban area's strong smart growth policies. Houston’s density is virtually the same as that of Dallas-Fort Worth and a quarter higher than that of Boston.

Traffic Congestion: Road Building Made it Better

The memo cites Houston as having some of the nation’s worst traffic congestion. It does --- the latest data shows that Houston ranks 8th in traffic congestion, which is not surprising for the nation’s 6th largest metropolitan area. Houston has done quite well. According to the Texas Transportation Institute (leading authority in the US on the subject), Houston had the worst traffic congestion in the US in the middle 1980s (among urban areas of more than 1,000,000 population). After a strong road building program, traffic congestion was materially reduced (though has increased in more recent years, since the road construction program has not kept up with population growth). By the mid-1990s, Houston had improved to 23rd place.

Since the middle 1990s, population growth has outstripped highway expansion and Houston has risen back to rank 8th in traffic congestion (Houston is one of the three fastest growing metropolitan areas over 5,000,000 population in the high income world). Houston has done better than smart growth Portland over the past 20 years, which has seen its excess peak hour traffic delay (based on the Travel Time Index) rise from approximately 1/4 that of Houston to 3/4 that of Houston.

Houston Traffic Moves Faster than Auckland Traffic

Finally, average travel speeds on the motorway and arterial network in Houston were more than 60 kph in 2002 (latest data from the Texas Transportation Institute). By comparison, according to the New Zealand Travel Time Indicator report, the average peak period travel times on the motorway and arterial network of Auckland was 36 kph in 2007.

Smart Growth Land Use Policy: The Root of New Zealand’s Unaffordable Housing
The report misses the point that New Zealand’s housing affordability loss is the result of overly prescriptive land use planning (smart growth or urban consolidation policy). This connection has been identified by some of the world’s top economists and is detailed in our 4th Annual Demographia International Housing Affordability Survey. The situation was best summed up by former Reserve Bank of New Zealand Governor Donald Brash, writing in the Demographia report: the affordability of housing is overwhelmingly a function of just one thing, the extent to which governments place artificial restrictions on the supply of residential land.. In short, where there are no prescriptive land use policies, housing is affordable. Among the six nations surveyed in our report, there are no exceptions.

Addendum: Understanding US Urban Geography

The memo exhibits the usual (and understandable) confusion about US urban geography. The memo refers to the city of Houston (which is a local government authority or municipality of 2 million population). The referenced housing affordability measures apply to the metropolitan area, which has 5.5 million people. There is also the Houston urban area (or agglomeration), which has more than 4,000,000 people (the difference between the agglomeration and the metropolitan area is that the urban area is the continuous urbanization (or urban footprint), while the metropolitan area includes areas considered in the labor market that are outside the urban area and generally in rural areas. Urban area and metropolitan area are formal designations by the US Bureau of the Census.

On the Success of Airline Deregulation

2008-06-14T23:47:00.002Z

Missing the Point

Re: Airline Deregulation Article: April 17

http://www.nytimes.com/2008/04/17/business/17air.html

To Micheline Maynard
New York Times

Just saw your column in the New York Times.

Perhaps I missed something, but it is astounding that you could have written an article assessing airline deregulation and not have prominently mentioned the impacts on consumers --- that deregulation has been associated with a huge increase in passenger usage, that simply could not have happened in the regulated environment.

This article seems to convey a much greater concern about producers than consumers. Businesses and society, in the final analysis, exist for the good of consumers and by that standard, airline deregulation has been a huge success.

Best regards,

Wendell Cox
Principal, Demographia (St. Louis)
Visiting Professor, Conservatoire National des Arts et Metiers (Paris)

Historic Annapolis Core Threatened by New Urbanist Interloper

2008-06-03T14:42:00.003Z

A City Struggles To Find Its Niche: Competition Has Annapolis Planners Pondering How to Save Downtown

New urbanists have long claimed to admire traditional urban cores (downtowns) and sought to replicate them in new developments. However, their admiration of genuine urbanism is shown to be wanting, as revealed by the opening of the Annapolis Town Centre, which today’s Washington Post indicates is not only not in Annapolis, but could well decimate the already struggling, genuine core of Annapolis.

Thus, the contempt that new urbanists have toward how the majority of people have chosen to live, appears to extend to the very districts they claim to adore. It may be that new urbanism is more about securing fees for architects than maintaining urban cores

Transit Ridership Increase in Context

2008-06-03T14:31:00.002Z

Note to Lena Sun of the Washington Post
Re June 3 article

In context, the transit increase represents somewhere around 5 percent of the urban driving decline... which indicates that while driving is down, transit's ridership increase is up only a fraction of the decline.

Best regards,
Wendell Cox
Principal Demographia
Former Member, Los Angeles County Transportation Commission
Visiting Professor, Conservatoire National des Arts et Metiers

Lucky Honolulu Wasn't Founded on Upper Peninsula: The Brookings Metropolitan Carbon Footprint Report

2008-06-03T11:26:00.002Z

Re: Mayor Hanneman Letter
June 2, 2008

To the Editor
The Honolulu Advertiser

The Mayor boasts about Honolulu’s superior carbon footprint and some boasting is appropriate.

It is no surprise that Honolulu has one of the smaller transportation footprints in the nation. With its bus system, Honolulu often ranks second in the nation in transit market share to the New York area. It is hard to imagine that the proposed, expensive rail system will make that any better.

As for residential energy, had the city founders instead chosen a location on Michigan’s Upper Peninsula, things would look much worse. Honolulu’s modest residential carbon footprint is a function of Hawaii’s marvelous climate, which reduces energy demand substantially.

Sincerely,
Wendell Cox
Principal, Demographia, St. Louis

Alex Marshall's Delusions About Anti-Transit Bias

2008-06-03T11:23:00.003Z

Letter to the Editor
Hartford Courant

June 9, 2008

Response To 'Idealism Takes A Wrong Turn'
June 9, 2008

In response to Alex Marshall's June 1 Place article, "Idealism Takes A Wrong Turn," in which he criticized my views on cars and transit:

Marshall deludes himself about a bias toward highways and against mass transit. Indeed, government transit spending per passenger mile is nearly $0.95, while all government spending on roadways is less than $0.04. Some bias. Transit spending is 25 times highway spending. This does not consider the fact that roads carry a large share of the nation's freight. Transit carries none.

Further, government highway spending is principally from gasoline taxes on drivers, not subsidies from non-users. In contrast, more than 75 percent of transit spending comes from non-user subsidies.

Ending the bias would require transit to be funded by taxes on transit fares. This, of course, would be the end of transit.

Despite romantic notions to the contrary, we cannot replace the mobility of the automobile. This is not to deny transit's important roles in serving low-income households in city cores and its principal niche market, the 10 percent of jobs that are in downtown areas.

The unparalleled democratization of prosperity (read, poverty reduction) in Western Europe and the United States since World War II could not have happened without the mobility of the automobile and the new, owner-occupied houses on cheap suburban land.

Wendell Cox

Principal Demographia Metropolitan St. Louis Belleville, Ill.

The writer was a member of the Los Angeles County Transportation Committee, 1977-85.

GHG Emissions Less in Auto Oriented Suburbs than Urban Cores: Australia

2008-06-01T14:52:00.004Z

Deflating the Myths on Greenhouse Gas Emissions

Policy Conclusions: This report summarizes the data developed by the Australian Conservation Foundation in its Conservation Atlas. This nearly 100-page report provides detailed information by local authority area (geographical sector) of Australia’s largest urban areas. The conclusions are different than would have been anticipated.

Lower GHG emissions are associated with urban fringe locations, not the core.

Lower GHG emissions are associated with higher rates of detached housing.

Lower GHG emissions are associated with greater automobile use.

Lower GHG emissions are associated with lower population density.

Repealing the “Great Australian Dream”? Climate change concerns have propelled the issue of reducing greenhouse gas emissions to the top of the public policy agenda. For some years the urban planning community and other interests have sought to contain urban expansion (pejoratively called “urban sprawl”) and force more dense development through policies referred to as “smart growth” or “urban consolidation.” There is a presumed preference for multi-unit residential development in city cores and an aversion against low-priced detached housing on the urban fringe. An important objective of these policies has been to reduce automobile use, which it is assumed will naturally occur as a result of higher urban densities,

In Australia, these policies have seriously limited the availability of market priced land on the urban fringe and driven house prices up at a far greater rate than has occurred in international urban areas where compact city policies have not been implemented. Thus, the present dominant policies are at odds with the “Great Australian Dream,” which has been based upon detached housing on the fringe and automobile access.

Smart Growth and GHG Emissions: The urban consolidation agenda is perceived by many to be an appropriate strategy for reducing GHG emissions. Part of this is due to the fact that automobiles are an obvious example of fossil fuel use.

Generally, urban planning policy assumes that greenhouse gas emissions are higher in portions of urban areas that are more suburban, especially areas in which there is a preponderance of single-family detached housing. There is also the assumption that greenhouse gas emissions are lower in higher density areas, especially where there are more high-rise condominium and apartment buildings. And, as noted above, a parallel perception is that greenhouse gas emissions are greater in portions of the urban area that rely more on cars, and less where there is greater dependence on public transport. Finally, higher population densities are associated with lower GHG emissions.

The Reality: However, reducing GHG emissions is not so simple as to be achieved through the urban consolidation agenda. Indeed, there is considerable evidence to the contrary.

GHG emission estimates from the recently published Australian Conservation Foundation Consumption Atlas, indicates virtually the opposite of the generally held perceptions. The data shows that lower density areas, which rely more on automobiles, tend to produce less in GHG emissions than the high density, more public transport dependent areas that are favored by urban consolidation policies.

The reality, as indicated by data from the Australian Conservation Foundation’s Consumption Atlas is virtually the opposite.

The Consumption Atlas: The Consumption Atlas relies on a holistic approach, which allocates greenhouse gas emissions to final consumption at the household level. This includes not only direct energy consumption (such as household electricity use and automobile use) but also a much larger component, indirect energy consumption, which includes GHG emissions from electricity generation, manufacturing, processing, transport and otherwise producing consumer products. The Consumption Atlas provides a groundbreaking model for GHG emission analysis that establishes a model for the field, not only for Australia but also around the world.

The approach of the Consumption Atlas avoids what could deteriorate into agenda-driven approaches that focus only on the particular GHG producing sectors that are in the political sites of interest groups. Any approach that begins at any level other than allocating all GHG emissions to specific final consumption runs this risk. For example, the authors note that emphasis on direct consumption (such as automobile use and land use policy) may be “misdirected since direct energy use constitutes remarkably small portion of the total energy requirement over a range of incomes.”

The more important risk is that agenda-driven policies may fail to achieve the objective of substantially reducing GHG emissions. Any serious, good faith program for reducing emissions must be based upon comprehensive analysis that does not begin with pre-conceived notions, despite their popularity even at the highest policy levels.

Note: This report was prepared by Demographia for the Residential Development Council of the Property Council of Australia.

Windows XP Machines Still Being Sold

2008-05-24T16:09:00.003Z

For anyone resistant to converting to “Windows Vista” from “Windows XP,” there is still an alternative. Dell continues to sell new computers, desktops and laptops, loaded with Windows XP (www.dell.com). Reportedly, some other manufacturers are doing the same. The Dell prices are competitive with prices at major retailers, where only Windows Vista loaded machines are for sale.

There are also reports that “downgrades” to Windows XP can be obtained for some Windows Vista machines, however the process as described on the internet may not be as simple as some might like.

There are two good reasons for postponing the switch from Windows XP to Windows Vista.

1. There are continuing complaints about Vista. They are so intense that competitor Apple has run television advertisements about Vista.

2. Many older programs will simply not work on Windows Vista. In the longer run, people using such programs will need to migrate to the new operating systems (or to alternatives, such as Linux or Apple). However, the new 2007 Microsoft Office product, which features Word, Power Point and Excel runs on both Windows XP and Windows Vista, so that additional time can be taken to adjust to the emerging Windows environment without having to make a complete break with Windows XP and the many years of PC compatibility that Microsoft appears to value so little.

A final, less compelling reason for resisting the change is to “vote” against Microsoft’s recurrent practice of unveiling new operating systems “before their time.” Planned or forced obsolescence is in no-one’s best interests except that of a firm seeking to maximize its revenues by undermining the interests of its customers. This is why, in the longer run, Microsoft, will face market share losses that are likely to be swift and significant, if serious competition ever emerges. So far, Apple is not even a threat (regrettably).

Thus, this is no advertisement for Apple, to which I attempted to switch a few years ago in an expensive experiment. One afternoon about a month after switching, I realized that I was more productive on a French language keyboard (with its extra letters, requirements to hold down more than one key for some letters and default special character set rather than numbers on the top row) than on an Apple US-English keyboard. That realization resulted in the Apple being boxed up within minutes (as soon as I could copy the nwere files to my older PC), and I have never looked back. My sister in Alaska, who had long wanted an Apple, was well pleased.

Paris Light Rail (Tram) Increases Greenhouse Gas Emissions

2008-05-03T08:07:00.003Z

According to University of Paris researchers, the new (2007) Paris tramway (light rail or streetcar) along the south boulevards des Maréchaux has attracted, at most, 3 percent of its ridership from cars. This finding is made in a paper entitled Paris: un tramway nommé désir (Paris: A Streetcar Named Desire), published in August 2007 by Rémy Prud’homme, Martin Koenig, Pierre Kopp. The authors note that this small modal shift “once again shows the limits of modal shift strategies” (our liberal interpretation of the French).

While traffic along the boulevard has been reduced, this has been accomplished by narrowing the capacity and forcing traffic to parallel roadways. The result has been to increase traffic congestion and, as occurs when traffic becomes slower and more erratic, increase fuel consumption, which of course leads to higher greenhouse gas emissions. It is estimated the tramway has resulted in a net increase of nearly 40,000 tonnes of CO2 annually.

Finally, the social costs of the project are estimated to have exceeded the benefits.