"In other words, if we eliminated every passenger automobile in the U.S. in favor of a transit alternative and use completely unrealistic assumptions, the total estimated reduction would be barely out of the margin of error for total estimated GHG emissions. ...
I believe we need an efficient and effective transit system as part of the basic social safety net. Providing some mobility for those who cannot afford to own and operate their own vehicle and those who are physically not able to operate one is the right thing to do. It also helps the local economy by providing a way for employees to get to their jobs.
But transit does little to relieve traffic congestion and virtually nothing to improve air quality. We need to start having an honest conversation about the purpose of transit and what we can reasonably expect it to accomplish. And we need to stop lying to the public and voters about fanciful, non-existent benefits."
NYT: Olympics Precautions Failed to Halt Rail Sabotage. One of the issues I've pointed out in the HSR vs. planes debate is the near impossibility of securing hundreds of miles of HSR rail from sabotage or terrorism.
WSJ: The Smart, Cheap Fix for Slow, Dumb Traffic Lights - Most cities can’t afford smart traffic signals. Fortunately, data from new cars—and even drivers’ smartphones—can make old-fashioned traffic lights work a lot better. "the system yields a 30% reduction in stop-and-go traffic at intersections" Can we get this for Houston please?!?
NYT: Colorado’s Bold New Approach to Highways — Not Building Them. I really disagree with this. Studies have shown that highways are the great enabler of opportunity and upward social mobility for the working class to get access to better jobs and newer, more affordable, higher-quality housing in better school districts. Massive transit expansions, like LA, have not increased rideshare and don't work. Environmental solutions focused on reducing vehicle miles traveled (VMT) will be an economic disaster. Instead, gas stations should be required to charge at the pump for the necessary carbon capture to offset the gas, currently ~$1 per gallon.
Houston's mini-kaihatsu, sinking false alarm, annexation history, shrinking population, school choice, and more
Several smaller items this week:
Report: Houston is one of the fastest sinking cities on Earth, could 'disappear'. Let's check the math folks. Houston elevation is 79' = 2408cm. Losing 2cm/year x 100 years = -200cm. Sea level rise of 1cm every 5 years for 100y = 20cm. New elevation in 2122 = 2188cm, almost 72ft! Doesn't sound anywhere close to 'disappearing'...
Big NYT fail on road safety: the clear inflection point in the graph is the rise of distracting smartphones, yet they're NOT EVEN MENTIONED ONCE. Instead it's anti-car, anti-SUV, anti-speed, and anti-rideshare. All agenda instead of real problem-solving.
Kinder: Houston, Dallas led metro area growth in 2021 even as their urban cores lost population (news story, hat tip to Oscar). Harris County declining a bit even while the metro grows. I think a lot of people used the pandemic to move out to the nicer newer suburbs (commutes less of a worry in a remote work world), and the backfill immigration into the city wasn’t there as it usually is, especially from international immigrants. Crime spike hasn't helped either. Harris County really has to turn it around before we end up in the same place as Dallas County with significant outflows. Once people and employers flee, it’s a negative reinforcing cycle :-(
Book Review: The Making of Urban Japan, by Salim Furth. The review notes similarities between Tokyo's mini-kaihatsu (a dozen townhomes fronting a small alley) and similar developments in Houston:
Mini-kaihatsu, Houston
"The concept is the same, and it’s no coincidence that both arise in places with light regulation, strong demand, and little public streets funding. As I wrote about Houston:
Houstonians achieve privacy by orienting many new townhouses onto a share courtyard-driveway, sometimes gated, which creates an intermediate space between the private home and the public street…
The courtyard-driveways also provide a shared play space, as evidenced by frequent basketball hoops. Despite what Jane Jacobs may have told you, city streets are not viable play spaces for 21st-century children. But cul-de-sacs can be. Houston’s courtyard-and-grid model may be the ideal blend, unlocking the connectivity of a city while delivering the secure sociability of a cul-de-sac to a large share of homes."
One of the common mistakes I make with this blog happens when I come across a really good, important, long article that I want to discuss more in-depth than my usual bullet points, because I usually set it aside to get back to later when I have more time, and sometimes later ends up being a year and a half, as is the case this week (apologies). It's a City Journal piece by Ed Glaeser titled "How to Fix American Capitalism - End insider privileges by renewing the freedoms to build, to work, to sell, and to learn." His opening:
"February 2019 Harris poll found that roughly half of younger Americans would “prefer living in a socialist country.” Millennials may not fully grasp the consequences of the government owning the means of production, but they certainly don’t like how American capitalism is working for them. They have a point. Over the past 40 years, insiders have increasingly captured the American economy—from homeowners opposed to new housing construction near them to incumbent firms that benefit from the overregulation of employment to interest groups that have transformed the federal government into the equivalent of a pension system with a nuclear arsenal. The young are usually outsiders; the bill for the insiders’ triumph has been laid in their laps. ...
What many young people today don’t realize is that socialism is a machine for empowering insiders. Few insiders have ever been rewarded more assiduously than the nomenklatura of the Soviet Union. Few governments have been as gray—in every sense of the word—as the Brezhnev regime. A vast expansion of the American government, as imagined by today’s Democratic Socialists, would create its own privileged elite.
From its inception, by contrast, capitalism was designed for outsiders. Its original apostles, such as Adam Smith, argued that entrepreneurs needed freedom from the royal regulations that limited trade and the formation of new enterprises. When the government controls decisions to work or to start a business, political pull becomes a prerequisite for success. The whole point of economic freedom is that all people—not just the connected—can use their talents to help themselves and, potentially, to change the world.
These days, capitalism’s advocates often focus more on defending the status quo than on promoting outsider opportunity. If capitalism is to win over the young, that must change—and a new freedom agenda can help make that happen. In January 1941, Franklin Roosevelt announced his four freedoms (of speech and worship, from want and fear) that helped frame his objectives for World War II, which the nation would enter before the end of that year. Our contemporary outsiders would benefit from a renewal of four key freedoms: to build, to work, to sell, and to learn. The young need fewer land-use restrictions that make it tough to provide affordable housing in productive areas. They need fewer employment rules that limit their ability to find work, as well as fewer business regulations that suppress entrepreneurial energies. And—even before these other important things—they need new educational options that liberate them from underperforming educational monopolies.
In 1981, the social scientist Mancur Olson published his magisterial The Rise and Decline of Nations: Economic Growth, Stagflation, and Social Rigidities... His thesis: nations lost dynamism when insiders managed to stack the rules against disruptive outsiders."
His classic example is how well Germany and Japan have done since their society went through a complete reset after WW2, while Great Britain has been much more stagnant. Glaeser then proceeds to focus on onerous land-use regulation wielded by NIMBYs, often with the cover story of environmentalism or historical preservation:
"As Olson suggested, collective action takes time and skill, and better-educated suburbs have proved particularly effective at blocking development. To succeed, though, antidevelopment groups need rallying cries that go beyond self-interest, and green causes have frequently provided them....
Because areas like lower Manhattan and Berkeley have enjoyed enormous economic growth, limiting construction there means that fewer people can benefit from that growth. In the past, Americans could move to booming places because it was easy, for instance, to put up cheap balloon-frame houses on the frontier or erect tenements on the Lower East Side of Manhattan. Today, starter homes in Silicon Valley go for more than $1 million, while townhouses in Greenwich Village, a neighborhood that preservationists fought to keep pristine, now routinely sell for $5 million and up."
Next, he gets into how onerous local licensing laws restrict small business and entrepreneurship.
"One of the most egregious ways that government favors insiders is occupational licensing, typically presented as a way to protect consumers. Economists Morris Kleiner and Alan Krueger documented that, in the late 1950s, less than 5 percent of American workers needed some form of occupational license. Licensing in fields with a real public-health impact—pharmacy, say—may protect some consumers, but it’s hard to see why the person selling you flowers or your eyeglass frames needs certification.
Licensing can deter someone from starting a new job or experimenting with new occupations. If you think that you might like to be a florist, you could just try it out, in a free environment. If floristry requires a long process of certification, though, you’re more likely to stick with your current job. Occupational licensing also makes it harder to move across states to seek work, since licensing requirements vary."
His next biggie is employee unions, especially public ones, as well as public entitlements that resist reform:
"Private-sector unions have weakened, but public-sector unions remain strong—and they protect older and established insiders....
Twenty-four percent of the national budget now goes toward Social Security, and another 8 percent funds benefits for retired public workers, including veterans. Another 15 percent is spent on Medicare. Altogether, spending on the elderly now makes up 47 percent of the federal budget.
Some form of old-age pension system is a matter of basic decency, and no one wants to see the elderly on the streets without decent health care. But the political might of older voters—who live disproportionately in the crucial swing state of Florida—has been strikingly effective at blocking sensible reforms that could reduce the cost of the system for younger voters. When Social Security began in 1935, American life expectancy was 61, and only 7.8 million Americans were over 65. Today, life expectancy is 79, and 49.2 million Americans are over 65. Raising the retirement age would obviously make retirement benefits more financially sustainable. Yet older voters’ power has made such a change almost impossible....
Younger Americans see the massive flow of public spending toward the old, and they understand the difficulties facing reform. They thus find themselves attracted to politicians, like Bernie Sanders, who promise more spending on them. Visions of Medicare for All seem far more plausible to young voters than proposals to cut benefits already enjoyed by the elderly. But America needs policies that will empower the young, not make them a new generation on the dole."
And the final biggie at the foundation of it all and my personal reform passion, education:
"Insiders’ power to block change has been a steady feature of the education-reform wars over the last 20 years. "
And finally, his solutions:
"An effective alternative to the status quo and social democracy must, I believe, focus on empowering outsiders... To build a political agenda around the four freedoms of learning, working, selling, and building, four specific policies would provide a good start.
Start with the right to learn, which precedes the other freedoms. Insider control over traditional K–12 education is, at present, too strong to achieve any radical reform within existing schools. Charter schools sadly remain a niche product, so pushing for their expansion—and for greater school-choice options more broadly—is necessary. Another alternative that could open up new education opportunities would be vocational training that bypasses the school system entirely. Washington could pay for programs inculcating marketable skills—from plumbing to computer programming. These programs could be competitively sourced, meaning that labor unions and community colleges and for-profit entrepreneurs could compete to offer them. But providers would get paid only if students learned real skills. Access to vocational vouchers could go not only to teenagers but also to displaced workers, or to anyone without a solid job.
Second, we should establish a stronger right to work. All employment regulations should undergo rigorous cost-benefit analysis and have automatic sunset provisions. The Social Security system should also be made friendlier to the young. The payroll taxes that fund Social Security could be eliminated for those under 30 and phased in later in life. Younger workers and their employers would initially pay nothing into the system. That shift would eliminate a large tax-related barrier to hiring the young and make it more financially attractive for young people to work. That reform would reduce revenues, true; but raising the age of retirement could offset the lost funds.
Third, Americans need greater freedom to sell and to launch new businesses, especially of the non-digital kind. The Internet’s platforms may make it easy to sell goods these days, but services and experiences are provided live and thus are often highly regulated. The next generation’s entrepreneurs should be able to create abundant opportunities outside of eBay—above all, in poorer areas. The path to liberating physical entrepreneurialism is clearer in cities, since more customers are clustered together for creative local service providers. But starting a business should be easier everywhere.
The need to ease business regulations is particularly acute as America attempts to recover from the economic dislocation caused by Covid-19...
As with employment regulations, a top-to-bottom review of business regulations, subjecting them to ruthless cost-benefit analysis, would be welcome, but that could take years. A speedier approach might be to experiment with entrepreneurship districts. They could combine one-stop permitting with shared maker spaces and targeted training programs. The permitter could be made accountable for the speed of the process.
Fourth, we need more freedom to build. Since the Clinton administration, I have regularly interacted with officials at the Department of Housing and Urban Development, and they’ve always wanted to reduce the local barriers to building that push up prices. Their wishes have had almost no influence, largely because land-use decisions at the local level are not easy to control from Washington—and the notion that HUD would preside over local building permits is a little scary, anyway. State legislatures are the natural intermediate institutions that can push localities to build more. In many cases already, state governments have reduced the power of local land-use controls. The best federal approach in this area would be to deploy financial incentives to encourage state legislatures to do the right thing. Federal transportation spending is partially meant to build the infrastructure needed by new construction. If a state isn’t allowing any construction in high-demand areas, shouldn’t the federal government reduce its infrastructure support? Use money to nudge states—and let states nudge communities.
Today, capitalism seems unattractive to the young because it is stacked against them. America’s current outsiders will have far better lives in a free system, however, than in any new socialism, which would invariably privilege connected apparatchiks (among the other failings it would bring). The cause of freedom will need to present itself as a radical break with the status quo to win the hearts and minds of a new generation.
Even with these extensive excerpts, I'm not really doing the piece justice - I really recommend taking the time to read the whole thing. I can't think of a more important agenda for America.
'“Car-oriented” and “sprawl” aren’t the same thing: the word “sprawl” is imprecise. But it surely does not apply to heavily urbanized areas where office towers mingle with multi-story apartment buildings. Easterners are accustomed to a dichotomy between “walkable urban” and “driveable suburban”. Much of Houston’s core is “driveable urban.”
...
Inspired: As a market urbanist, I was already a fan of Houston in theory. But the visit made me significantly upgrade my evaluation of Houston as a place. It is far more interesting than Austin, for one thing. And although it is automobile-oriented, it is definitively a city, with all that implies.'
“After Uptown officials spent $192 million rebuilding the street to develop the line, operated by Metro, to carry 12,000 riders per day, bus drivers are ferrying fewer than 800 on many work days.”
Our URI/COU 2022 edition of the Demographia affordable housing index has been released. Sadly, Houston's median house-to-income ratio has moved up to 4.5, earning the "seriously unaffordable" label, although still much better off than most of the country's major metros (see below).
Finally, if you missed our URI/COU webinar last week on "The Case for Suburbia", you can check it out here. Great panel, and yours truly gets a mention for my work on MUDs.
"The seeming success of compact cities and the supposed dangers of sprawl to the climate have led to pushback against sprawling, car-dominated cities. Join us as we discuss the environmental case for suburbia."
"In fact, a primary reason Texas is growing so fast is that we tend to stick around as compared to natives of other states, meaning there’s less out-migration to offset the in-migration. About 82 percent of people born in Texas still live here, making it the so-called stickiest state in the country."
American Affairs Journal: Exurbia Rising by Joel Kotkin, packed with great stats. Here's the opening paragraph:
"Perhaps nowhere is the gap between America’s cognitive elite and its populace larger than in their preferred urban forms. For nearly a century—interrupted only by the Depression and the Second World War—Americans have been heading further from the urban core, seeking affordable and safe communities with good schools, parks, and a generally more tranquil lifestyle. We keep pushing out despite the contrary desires of planners, academic experts, and some real estate interests. In 1950, the core cities accounted for nearly 24 percent of the U.S. population; today, the share is under 15 percent, according to demographer Wendell Cox. Between 2010 and 2020, the suburbs and exurbs of the major metropolitan areas gained 2.0 million net domestic migrants, while the urban core counties lost 2.7 million."
"Lessons from history and from the relative success stories of the present point to clear priorities for today’s cities:
Get the urban basics right: schools, safety, livability.
Strengthen local anchor institutions in higher education, health care, and other areas.
Invest aggressively in local quality-of-life amenities.
Rebuild and expand critical infrastructure.
Work toward openness, diversity, inclusion, and a welcoming approach to newcomers.
Ensure a high degree of economic freedom.
Emphasize housing affordability and work to build an opportunity-rich physical environment."
WSJ: People Are Going Out Again, but Not to the Office - Only a third of U.S. employees have returned to the office, as workers prefer remote and companies fear ordering them back. Companies that force employees to the office will have to pay more (including office costs) for inferior talent from a more limited local talent pool. Excerpts:
"Elected officials are imploring companies to send workers back to the office.
“Business leaders, tell everybody to come back,” said New York Gov. Kathy Hochul, in remarks before a civic organization earlier this month. “Give them a bonus to burn the Zoom app and come on back to work.”
The gap between public enthusiasm for office return and other activities underscores the wide range of factors other than health considerations that are slowing the return to work. After close to two years of working from home, surveys suggest most employees simply prefer it to the office, which often requires lengthy commutes and gives workers less flexibility in how they spend their days.
Employers have also been reluctant to insist that workers return for fear of driving employees away during a labor shortage, corporate surveys show. Many managers feel remote work disrupts efforts to promote a corporate culture and collaboration, but they aren’t applying much pressure because studies have shown that many workers are as productive—or even more productive—when they work remotely.
“They feel like remote work isn’t perfect, but it’s working pretty OK,” said Brian Kropp, chief of human-resources research for the advisory and research firm Gartner. “There’s not a real urgency to change it.”
Houston #2 for tree cover among major metros (just behind Atlanta) with 30% tree canopy coverage in the metro. Technically it shows Austin as higher (34%), but their number is from the early 90s, and we all know how much development has happened in Austin since then!
"We’re not going to double urban densities, especially when the doing so will fail to eliminate driving anyway. As urban economist Edward Glaeser once wrote (as quoted by Bertaud), the 15-minute city “should be recognized as a dead-end which would stop cities from fulfilling their true rôle as engines of opportunity.”
Finally, I'd like to end with this video on why Pakistanis are moving to Houston (hat tip to George). Although I wish it didn’t have the politics. She has some fair points about parts of rural Texas, but it muddles the video. I also think it completely misses the impact of lack of zoning and development regs that allowed those ethnic suburbs and shopping areas to develop. A lot of more regulated and zoned cities would have subtly (and not so subtly) prevented that from happening.
"Complementing sprawl has also been a long-term trend toward people driving more and taking transit less. In 1960, about 12 percent of all Americans took transit to work. By 2020, it was about 5 percent, and the decline of non-work trips on transit was even faster. Meanwhile, the number of Americans who travel to work by car, especially those who travel alone in a car, continues to increase. The miles driven by car per capita have almost doubled. This is not because of supposed subsidies to cars; according to the Bureau of Transportation Statistics, cars pay for almost all of the cost of roads through gas taxes and other charges, while transit riders pay barely a third of the cost of their rides, and that ratio is dropping as transit use declines. For decades, in fact, more and more of the gas tax has been siphoned off to pay for increasingly expensive and increasingly empty buses and trains. ...
Perhaps the most important tool for reducing the heat island effect is trees, which provide shade and absorb solar radiation. Suburbs are, almost by definition, more verdant than cities. Famously sprawling cities like Atlanta or Houston have tree cover on more than 30 percent of their landmass, while older, denser cities such as Philadelphia, San Francisco, and Chicago have under 20 percent. Besides reducing the heat island effect, nearby trees have been shown to intercept particulate matter and absorb ozone, sulfur dioxide, and nitrogen dioxide, thus reducing local air pollution as well. The personal and psychological effects of trees are real too. Studies have shown that the presence of trees decreases stress, increases attentiveness and sense of safety and comfort, and reduces the likelihood that pregnant women will have low-birthweight babies. There is no way to have the same access to trees in dense urban areas.
...
Over even a medium-term time frame, the increasing adoption of hybrid, electric, and autonomous vehicles will almost completely sever the connection between VMT (vehicle miles traveled) and greenhouse gases. Those who are attempting to redesign cities, projects that will take decades or even centuries, merely to reduce the use of gasoline-powered cars are thus engaged in a futile exercise that will only become more futile with time. It would be like attempting to redesign cities in 1900 to reduce horse manure. The technology will change faster than the city will."
'Issuing a challenge, Glock talks of the “Long Triumph of Sprawl,” describing a “clear global and long-term preference,” while the “pandemic has only made the shift toward the modern, sprawling city more rapid and obvious.”
Glock suggest that “instead of warring against sprawling cars, planners and environmentalist should recognize how the green spaces of suburbia allied to autonomous electric vehicles in green single-family houses can provide both the affordability and sustainability most Americans crave.” ...
Appropriately, Glock concludes, “environmentalists should embrace the same future that most Americans have already chosen.”
Carbon capture subscriptions, climate entrepreneurs, CA moves to HTX more than Austin, and more
Big idea of the week on Houston adapting to climate change: what if automakers sold a subscription with their cars that reported back monthly gas usage and sequestered that much carbon? Great new product for oil & gas companies to sell automakers...
Moving on to some smaller items to catch up on this week:
“Every day I meet another oil and gas guy who is now a climate entrepreneur. I think there is going to be an explosion of clean energy activity out of the O&G sector, and we’ll be stunned in the next 5-7 years by how many of these problems they handle.”
City Journal: Lone Star Waste - Two Texas transit projects embrace extravagance. Politically connected groups extract surplus from Austin LRT and Texas Central HSR.
City Journal: A Bridge Too Far - Pete Buttigieg’s remarks on Robert Moses’s “racist bridges” flatten history in service to an ideological fad. Hat tip to Jay.
WSJ: How Working From Home Could Change Where Innovation Happens - For decades, ‘superstar cities’ have been attracting talent and money. But thanks to remote work, their status is likely to change in unexpected ways, bringing tech expertise to places that have long tried to attract it. Profiles a tech exec moving from San Francisco to Houston/Katy for a better quality of life.
Aaron Renn, Governing: The Poor Places That Made Our Cities Richer - Dense, often dilapidated neighborhoods were routes to prosperity for an earlier generation of low-income urbanites. Their destruction has hurt us all. Key excerpt:
"This was cheap housing, but that didn’t just mean cheaper rents. It meant the opportunity for ownership. A key characteristic of many of these neighborhoods was what Husock labels “owner presence.” Even in crowded neighborhoods, apartment buildings like the Boston triple-decker or Chicago two-flats allowed residents to buy the building and live in one unit, while renting out the other to earn income. A surprisingly high share of people who rented in these places lived in buildings where the owner was also living. The owners accumulated wealth in the form of equity in their real estate that was a key to their ability to move up economically.
One common factor in these places was a tolerance for housing that reformers judged substandard. Tenements on the Lower East Side, for example, often lacked baths. Levittown houses were tiny, identical boxes on concrete slabs. But the policy response to the legitimate problems of some of these neighborhoods was a cure often worse than the disease. Mass slum clearance and the construction of huge high-rise public housing projects are the most infamous examples.
The replacement of “slum” housing with public housing was not only a quality-of-life disaster, it also locked its residents into permanent rentership. Detroit’s Black Bottom neighborhood may have been segregated, but it gave Black residents the opportunity to own real estate and own and operate businesses. In public housing, Black residents could do neither, cutting off critical avenues of wealth creation."
Clean energy entrepreneurship in Houston, densification, welcoming refugees, Dallas TOD failure, ADUs, population gains, rankings, and more
Continuing to clear out some backlogged smaller items. A lot of these I tweeted while I was out of town for much of the summer, but just now getting a chance to bring them to the blog:
“Every day I meet another oil and gas guy who is now a climate entrepreneur. I think there is going to be an explosion of clean energy activity out of the O&G sector, and we’ll be stunned in the next 5-7 years by how many of these problems they handle.”
"Austin isn’t the densest metropolitan area in Texas. That honor belongs to the nine-county Houston region, which increased from 1,560 residents per square mile in 2010 to 1,858 in 2020, an increase of about 19%."
"H-Town exudes Southern hospitality: The pace of life is more relaxed than many major cities, and they're welcoming, polite, and eager to share the delights of their city with visitors...make Houstonians less cliquey and more hospitable towards newcomers."
This makes me proud. Houston's doors are always open to those seeking a fresh start and new opportunity: "Volunteers from Houston Welcomes Refugees showed up with boxes of items to furnish the family’s new home." NYT: From Kabul Airport to a Houston Walmart
"In short, TOD is simply a scam. Like Portland’s light-rail mafia, which guided subsidies to favored developers who would build TODs, Dallas light rail and TODs are merely a way of transferring money from taxpayers to developers."
"There are more than 3,600 ADUs in Houston (according to HCAD data) of which the median size is 530 square feet (max allowed=900sqft). ADUs offer more housing options while maintaining the existing community character."
"Cities have historically been the gateway to America and our nation’s promise of opportunity and upward mobility. Today, however, many of our nation’s highest profile cities have become ‘luxury products’ affordable only for the highest income earners. Houston and other ‘opportunity cities’ have historically bucked this trend by embracing policies that lower the cost of living, create jobs, and enhance the quality of life for all. But a continuation of this success is under threat from an array of proposed ‘command and control’ policies that will erode our city’s dynamism. Houston’s success is no accident, and it’s future is worth fighting for.
Join the Liberty Leadership Council and the Urban Reform Institute for a vibrant discussion of Houston’s market-centered, ‘people-oriented’ approach to urban policy, planning, and development.
We’ll talk zoning, transportation, infrastructure, housing, and everything in between—all while enjoying views of downtown and toasting the Bayou City."
City Journal: End of the Road for Parking Requirements - They serve as a tax on housing. Houston should pass a plan to automatically reduce parking minimums citywide by 8%/year - enough for real impact over time w/o public blowback. Why keep building parking that autonomous taxis will make obsolete in the 2030s or even sooner?
"Texas is already known for high econ freedom and autonomy from the feds. The more I learn, the more unique it seems on this front. Counties without zoning. Toll roads galore. Limited land handed to the feds. Independent not unified school districts. Separate energy grid. Higher speed limits. And I could go on. The governance here is truly different.
A culture of exceptionalism: Texas wants to be the best, and has built an unapologetic brand around it - “everything’s bigger in Texas.” Coastal urban America used to have that bravado, but is now overcome with Nimbyism and guilt-mongering."
Forbes: Miami Just Rolled Out Its Newest Red Carpet To The Tech World. Are San Francisco And Austin Paying Attention? Hat tip to Judah. I’d heard about the Miami tech push (I think their odds are better getting Wall Street). The REEF model is an interesting one, although probably not for Houston. It seems to be taking advantage of tight zoning in most cities to create new locations for businesses using parking lots, because those businesses can’t find a real location in certain neighborhoods. Houston’s lack of zoning means real locations are readily available in most areas.
"More permits (48,208) were issued last year for new-home construction in the Houston area than anywhere else in the U.S. DFW ranked second (43,884), and Austin held the No. 5 spot (21,653)."
Drive & Listen: Wow this is super cool and mesmerizing. You can set the speed of the vehicle, street noise, music - even change radio stations while driving in 50 different cities around the world, spending as much time as you like in any one of them. Someone needs to do this for Houston!
Finally, we'll end with a little dark humor meme that makes a great point:
Ever-growing layers of bureaucracy are how societies stagnate, and it's the direct cause of increasing unaffordability in cities across the country.
Texas and HTX growth secret, what kind of Texan are you? major climate change solution, TX miracle is more than oil, and more
My lead item this week is a comment I made on the Market Urbanism Report Facebook group:
Going beyond all the usual reasons given for Texas' high growth, here's the technical overlooked one that I think is a big key: Texas does not allow unincorporated counties to regulate land use (i.e. create zoning), which creates pretty much a totally free market in development just outside cities. Combine that with MUDs (municipal utility districts) that allow private developers to float bonds to pay for master-planned community infrastructure paid back by property taxes on that development, and there is complete flexibility in the suburban/exurban housing market. And those master-planned communities compete fiercely on price and amenities (far more than incorporated cities do). That, in turn, forces the core incorporated cities to "compete" for private development dollars by not over-regulating - otherwise they'll just jump outside the city limits. It's an overall balance of forces that keeps welcoming development and newcomers with a strong value proposition (high amenities with relatively low costs).
Moving on to some smaller items this week:
I took this Threads of Texas quiz and came out a Civic Pragmatist - not much surprise there, lol. Let me know your own results and thoughts in the comments.
"Civic Pragmatists are optimistic yet pragmatic when they think about a changing Texas. Their ideal Texas is one where the state is a leader in the knowledge-economy industries, as well as a Texas where everyone feels safe and like they belong."
National Review: Biden’s Infrastructure Bill Aims to End Single-Family Zoning (hat tip to Bill). Looks like they editorialize against federal intervention to force the elimination of local SFZ, which I would agree is problematic, but not necessarily against all zoning reform:
“The zoning issue is tough and complex. It balances principled libertarian objections to zoning and the interests of developers, on the one hand, against core principles of federalism and local control, on the other.”
I’d say Houston’s secret sauce is less about not having SFZ (deed restrictions are pretty much the same) than allowing pretty much anything else everywhere that’s not single-family: apartments, towers, retail, mixed-use, offices, you name it.
The Federalist: The Texas Miracle Isn’t All About Oil - Given that oil prices remain less than half of what they were at their peak, all those arguing that the Texas model will fail are just wrong.
"In India alone, the equivalent of a city the size of Chicago will have to be developed every year to meet demand for housing. ...
Michael Ramage of the University of Cambridge told the meeting of a 300-square-metre four-storey wooden building constructed in that city. Erecting this generated 126 tonnes of co2. Had it been made with concrete the tally would have risen to 310 tonnes. If steel had been used, emissions would have topped 498 tonnes. Indeed, from one point of view, this building might actually be viewed as “carbon negative”. When trees grow they lock carbon up in their wood—in this case the equivalent of 540 tonnes of co2. Preserved in Cambridge rather than recycled by beetles, fungi and bacteria, that carbon represents a long-term subtraction of co2 from the atmosphere.
If building with wood takes off, it does raise concern about there being enough trees to go round. But with sustainably managed forests that should not be a problem, says Dr. Ramage. A family-sized apartment requires about 30 cubic metres of timber, and he estimates Europe’s sustainable forests alone grow that amount every seven seconds. Nor is fire a risk, for engineered timber does not burn easily."
"So Vyas picked another metropolis that's increasingly become young people's next-best option — Houston.
Now 34, Vyas, a tech worker, has lived in Houston since 2013. "I knew I didn’t like New York, so this was the next best thing,” Vyas said. “There are a lot of things you want to try when you are younger -- you want to try new things. Houston gives you that, whether it’s food, people or dating. And it’s cheap to live in.”
Are we entering the Distributed Age? Plus perspectives on Houston, TX #1 for infrastructure, and more
My leads this week are a couple of great quotes about Houston:
"Houston has actively deregulated, with the result that it's the only major city in the U.S. today undergoing a transformational change from suburban to urban densities. Houston makes thinkable the unthinkable."
-Mercatus Center at George Mason University, Land Use without Zoning book letter
"Once a planning pariah, Houston, with its peculiar lack of zoning, increasingly looks like the future."
-Nolan Gray in the afterword of the newly updated Mercatus edition of "Land Use without Zoning" by Bernard Siegan.
If you're curious about the recently re-released book on Houston, "Land Use without Zoning" by Bernard Siegan, you can find it here.
"Other American cities—notably Houston, Dallas, Atlanta and Miami—are challenging NYC’s supremacy in communications, legal and financial services, the arts and business. Political and economic leaders in those cities encourage inclusive growth, development and change."
"No state handles more of America’s cargo than Texas. In fact, no state comes close. According to the latest figures from the U.S. Census Bureau, the Lone Star State handles around $2 trillion worth of commodities per year. And Texas has the infrastructure to handle it. Port Houston, the nation’s second biggest, has surpassed Rotterdam as the world’s largest petrochemical complex, officials say."
NYT: Remote Work Is Here to Stay. Manhattan May Never Be the Same - New York City, long buoyed by the flow of commuters into its towering office buildings, faces a cataclysmic challenge, even when the pandemic ends. Good excerpts in this one. I wonder if the Distributed Age label will stick?...
“A year after the coronavirus sparked an extraordinary exodus of workers from office buildings, what had seemed like a short-term inconvenience is now clearly becoming a permanent and tectonic shift in how and where people work. Employers and employees have both embraced the advantages of remote work, including lower office costs and greater flexibility for employees, especially those with families.” …
Still, about 90 percent of Manhattan office workers are working remotely, a rate that has remained unchanged for months, according to a recent survey of major employers by the Partnership for New York City, an influential business group, which estimated that less than half of office workers would return by September. …
“We believe that we’re on top of the next change, which is the Distributed Age, where people can be more valuable in how they work, which doesn’t really matter where you spend your time,” said Alexander Westerdahl, the vice president of human resources at Spotify, the Stockholm-based streaming music giant that has 6,500 employees worldwide.
"As Houston prepares for unprecedented population growth in the coming decades, I predict that the versatile ADU concept will continue to help make our inner-city neighborhoods more affordable and sustainable."
"In 1976, New York Times architecture critic Ada Louise Huxtable declared that Houston was “the American present and future. It is an exciting and disturbing place,” one that “scholars flock to for the purpose of seeing what modern civilization has wrought.” In her account the city's distinctive character lay in its decenteredness, its seemingly limitless capacity for shape-shifting, and its utter lack of history. Like many observers then and since, Huxtable was struck by the experience of juxtaposition—of form, scale, type, and space—that was a consequence, in part, of the city's infamous lack of zoning regulations and its unapologetic accommodation of private real estate interests"
HTX most affordable high-growth metro, couple chooses Houston, TX winning vs CA, airport rail fail, modern innovative transit, and more
I've got a long road trip coming up so posts may get infrequent for a while. This is my attempt to clear out as much of the backlog as possible before leaving:
Houston has pretty affordable rents at the #34 metro on this list. Much more affordable than Dallas and Austin, and even more affordable rents than San Antonio. And every less expensive metro is growing much more slowly or even stagnant or declining, so we are the least expensive high-growth metro. I'd chalk it up to our lack of zoning and free market in apartment development.
Houston is home to more than 500 oil and gas exploration and production firms.
Houston houses hundreds of firms that provide supporting activities to the oil and gas industry.
Houston is home to nine refineries that process 2.3 million barrels of crude oil every day (which makes it one of the biggest crude oil producers in the world).
The Energy Corridor, which stretches for 7 miles along Interstate 10, encompasses many businesses engaged in energy operations.
Houston may soon end up with a second energy corridor due to the continuing expansion of local businesses.
Houston houses more than 4,600 energy-related companies.
The city alone employs around 1/3 of the jobs across Texas in gas and oil extraction.
Houston is the center of foreign investment in energy.
Governing on TX vs. CA: A Leg Up in the Search for Prosperity: Economic Freedom - Despite their very different attitudes toward the role of government, California and Texas have both found success. But the Lone Star State's small-government/low-tax model gives it an edge. Some excerpts:
"Texas is best understood as a place where the private sector prevails over the public sector. Among the 50 states, it ranks near the top in economic freedom, a measure of fiscal and regulatory policy, and near the bottom in overall tax burden. It's a state known for building, with Dallas and Houston routinely among the top metros in new home permits and Austin first in the nation for permits per capita since 2004. But state and local government spending per capita is the 11th-lowest of any state, according to data from the Tax Policy Center. ...
And it's not just people. Businesses are leaving California too, at an estimated annual clip of over 1,000. For 12 straight years Texas has been the biggest recipient of businesses leaving California. Texas has long sought to capitalize on and accelerate that trend, even running ads in California touting Texas' business friendliness.
More than data, though, it's the feeling of what can be accomplished in a state that emphasizes freedom versus one strangled in red tape and high taxes. Houston ended veterans' homelessness in part by cheaply building large supportive housing projects; California cities have spent billions fighting homelessness, but still have tent cities because it costs so much to build affordable housing there. Dallas has, over three decades, built the nation's longest light-rail system, and a private company is planning high-speed rail between there and Houston. California metros have struggled to add capacity to their transit systems, and last year the state's high-speed rail project lost federal funding due to ongoing delay. Perhaps most damning is an annual survey by Chief Executive magazine asking CEOs nationwide to rank state business climates. Texas has been first for 15 straight years, and California in last place for five."
CityLab: How Car-Clogged Houston Could Be a Climate Policy Leader - Houston’s infamous lack of zoning could become a climate-policy asset as the sprawling Texas metropolis attempts to steer a more sustainable course. Excerpt:
"Indeed, Houston’s infamous lack of zoning could end up being one of its greatest assets in pursuing climate goals. Without all of the anti-density baggage that comes with zoning — from apartment bans to an onerous approvals process — there is relatively little standing in the way of a rapidly densifying Houston and all of the environmental benefits it brings."
"The best-performing newer systems in our database, such as Minneapolis, Seattle, and Houston, are all compact, serving urban areas near downtown. By contrast, larger light rail systems that stretch into low-density suburban areas tend to underperform. ...
Houston has taken a step in the right direction by abolishing parking minimums in the Downtown, Midtown, and East Midtown neighborhoods, all of which are served by light rail. ...
In Houston, the cornerstone of a recently approved light rail system is a line to Hobby Airport through industrial and low-density residential areas, estimated to cost $167,000 per daily rider. ...
Another form of overexpansion comes from the tendency of light rail planners to overvalue airport service. It’s easier to form a broad political coalition for airport service than for run-of-the-mill transit improvements. City power brokers like to impress out-of-town visitors with airports, and suburban residents who do not use transit regularly imagine that a train for their occasional airport trips would be convenient.
Airport connectors, however, tend to perform poorly. Airports are usually in remote locations, so light rail to airports requires extensive capital construction; the slow speeds of light rail relative to freeways matter more for long-distance trips from airports to downtown. Moreover, businesses that surround airports, such as industrial suppliers and distribution centers, demand large amounts of land and are difficult to access on foot, making them low-value destinations for transit ridership. Finally, airport noise and pollution make the surrounding areas less desirable for the sort of redevelopment that might improve ridership."
Finally, I wanted to end with one of my most popular tweets ever about walking through a random neighborhood near Midtown and boom - this awesomeness suddenly appears. Think a zoned city would allow this?! Gotta love Houston!
"There’s a quality about Houston, though, that transcends its built pattern: affordability. For decades, Houston has been the nation’s leading example of an “opportunity city”. It has, like coastal cities, high demand—aka fast growing job opportunities and population growth. But unlike those metros, it builds lots of housing, thus stabilizing prices. The median home price is $190,000, which is just 4/5ths the national average, according to Zillow. Midtown’s median home prices are $309,000, extremely low for a centrally-located urban neighborhood. This affordability has made Houston a refuge for expats from expensive states, and for immigrants—it is now the nation’s most diverse city.
The affordability can be tied to both Houston’s density and sprawl. Rather than one being good and the other bad, both forms of growth have helped stabilize prices. But the multi-family infill housing is the most organic outcome to be found in the Houston model. If America had a more market-oriented urban approach, those aspects of Houston—the density and affordability—would be the ones most likely replicated. For this reason, “getting a bunch of Houstons” should be an urbanist goal."
This is pretty much the perfect solution to Houston - and the country's - energy woes. And it should please both the right (nationalism and the economy) and the left (increasing the cost of carbon). Coincidentally, I went to Rice with this guy!
"A farsighted leader, argued Andy Karsner, a former U.S. assistant energy secretary, “could have imposed a variable U.S. tariff or fee on imported oil, which would be easily absorbed while prices are now slumping.” Such an import fee “could dynamically and automatically kick in incrementally if prices fell below an agreed floor, say $40 to $50 a barrel — the price that U.S. producers need to stay in business and supply America. The fee would disappear if prices jump above the agreed level. Brent crude is now around $31.”
If we guaranteed U.S. oil producers a predictable price floor to enable the least indebted and most productive of them to survive, Karsner told me, it would pay multiple benefits: “It would raise money for us to invest in infrastructure; prevent job losses for skilled engineers and multibillion-dollar bailouts for U.S. oil companies; keep manageably low gasoline prices for U.S. consumers; and strengthen our energy security from predatory efforts by Russia and Saudi Arabia to wipe out our domestic oil industry.”
But, most important, it would accelerate our clean energy transition, by shielding our electric car industry from foreign-manipulated gasoline prices and our wind and solar industries from temporarily suppressed natural gas prices."
"Several experts are advancing another explanation, too: Features that have long been viewed as liabilities — the state’s solitary car culture and traffic-jammed freeways, a dearth of public transportation and sprawling suburban neighborhoods — may have been protective.
“Life in California is much more spread out,” said Eleazar Eskin, chair of the department of computational medicine at the University of California, Los Angeles. “Single-family homes compared with apartment buildings, work spaces that are less packed and even seating in restaurants that is more spacious.”
Many scientific studies have found a correlation between population density and the spread of flu and other infectious diseases, something that may exist for the coronavirus as well."
"Imagine Verizon, AT&T, and T-Mobile discovered that, no matter how much they expanded their cell-phone networks, people kept buying new smart phones and using those networks. Would they decide to stop expanding their services for fear of turning too many people into smart-phone junkies? Of course not; so long as revenues covered their costs, they would happily expand to meet the demand.
The point is that almost anyone would consider that an investment leading to increased use to be a sign of success. Yet Transportation for America sees it as a sign of failure. Would T4A have us stop building libraries, hospitals, and schools because the ones we build get used by readers, patients, and students?"
Providing additional buses and drivers to handle the additional demand of a 36% increase in ridership from going fareless could cost up to $170m a year on top of Metro's roughly $700m budget, and they simply can't afford that.
The safety risks are substantial with "problem riders", which have been an issue when other agencies have gone fareless.
I was impressed with Metro's thorough analysis of six different scenarios, and satisfied that they came to the right (albeit unfortunate) conclusions. I agree that the cost and safety concerns are just too high for most of the scenarios they analyzed. They are still analyzing additional scenarios and I have suggested it would be interesting to add a scenario with a fixed-price unlimited monthly pass, including for Park-and-Ride riders. I’m not sure what the right price point would be - maybe at the equivalent of two local rides a day? - so $2.50 x 30 days = $75/month? I think that could get a substantial boost in ridership (especially Park-and-Ride commuters) without the safety concerns or major loss of revenue. We'll see what comes back...
"Texas Monthly told a story that a lot of people wanted to hear: loosely regulated housing markets like Houston have long embarrassed ideological opponents of free markets who insist that only rent controls and massive public subsidies can provide affordable housing. There is a ready audience for the argument that Houston’s affordability is a mirage. If you ever find an argument like this tempting, though, ask yourself: is it more likely that you’re mistaken, or that the millions of Americans voting with their feet are?"
Nobody wants to leave Houston! Well, I might be exaggerating a bit, but this CityLab piece shows Houston as the 9th most popular city for inbound apartment searches, but doesn't even make the top 20 for outbound apartment searches (which does include both Dallas and San Antonio). And Houston and Miami were the only top ten metros not on the outbound list - not bad company! I think that's a really nice sign for your city when there's a lot more inbound interest than outbound, even with the oil bust.
"Even if Texas Central could manage to attract 6 million passengers a year, the annual payment on a $20 billion loan at 3 percent interest over 30 years is just over $1 billion. That means it would have to collect nearly $170 per passenger above its operating costs in order to repay loans or give funders a return on their investments. Since airfares are already far lower than that, I don’t see any way for this to ever happen."
“1,545 people per day settled in Texas last year, with Harris County seeing the greatest influx from out of state than any other region,” according to Yardi Systems."
WSJ published a chart on housing elasticity of different metros, and how it affects home prices. No surprise: the more elastic a metro, the more affordable. Houston looks pretty great here, with healthy growth both in house prices and units. High demand and we're building for it. Better price growth vs. Dallas because our urban core is more vibrant/compelling, IMHO (like Austin).
"The new code is very lean—based on the rural-to-urban Transect, it does not regulate uses, only nuisances. The thinking is that if the use creates no problem, why regulate it? There are no minimum lot dimensions or parking requirements. Shared parking is encouraged. Every lot is automatically allowed to have two accessory units. So, rather than the continuing the single-family zoning that is fiscally unsustainable as a dominant pattern, every lot can have three units. "
"California Governor Gavin Newsom was dismissive of Texas's claims, though. “They’re making false claims of being able to deliver electricity 24/7,” Newsom said, “but it just can’t be done.” Newsom was also dismissive of the Lone Star State's other claims, such as affordable housing, plenty of water, cheap gas, plastic straws, and not constantly being on fire. "
The NY Times points out that Texas' boom is uneven across the state. Well, duh. If your state has the biggest booming metros in the country, they're naturally going to pull more talent out of other parts of the state than happens in less booming states. I also don't think it's totally out of line for the Texas Triangle with 2/3 of Texas' population to be generating 4/5 of new jobs in our modern economy.
Houston Carbon Council, free transit reduces congestion, HTX #2 for STEM jobs, and more
Last week I attended the fantastic Houston Low-Carbon Energy Summit put on by the Center for Houston's Future and KPMG (story). Speaker after speaker said Houston has the assets and skills to really make difference in reducing carbon, from carbon capture and sequestration to methane reduction to biofuels to hydrogen manufacturing (a key one for anything requiring high energy densities like aviation). That extends to the energy trading world too, where carbon offsets are a natural market for us. There is a lot of pragmatic room in the middle between "nothing to worry about here" and "pure green renewables are the only answer" (lots of obstacles there that will take decades). My proposal: we need to form a Houston Carbon Council (maybe through the GHP?) to set pragmatic economic and technical goals and coordinate efforts, while also publicizing carbon-reduction efforts and improving Houston's brand as a can-do city doing its best to mitigate climate change as we transition towards a long-term low-carbon future. It could provide more realistic alternatives to the fantasyland green new deals of the world, including cost-effective solutions governments could really implement.
"The Dallas-Fort Worth and Houston metros respectively garnered the #1 and #2 overall rankings for best STEM metros. This was due to each scoring in the top 10 on all three metrics – total STEM employment, total employment growth and relative affordability for first time buyers (FTBs). ...
#2: Houston earned the number 2 spot among the 30 largest STEM employment centers by also having top ten ranking on all three metrics:
- STEM employment of 207,000 earned a 10th place ranking, just below Seattle.
- Overall employment growth of 70% since 1990 earned a 6th place ranking, more than double the national average of 33%.
- A FTB median home price to median income affordability ratio of 2.7 landed a 6th place finish.
A vibrant new home construction sector helps Houston maintain both a high rate of employment growth and FTB affordability. New construction sales accounted for 25.5% of all home sales in the 4th quarter of 2018, well above the national rate of 11.2%. For the entry-level home segment, the new construction share was 16.1%, also well above the 6.2% rate for the national entry-level home segment. In the move-up home segment, Houston’s share was 42.3%, again well above the 19.6% rate for the national move-up home segment."
An open dialogue on serious strategies for making Houston a better city, as well as a coalition-builder to make them happen. All comments, email, and support welcome.
