“Economic Development”

17 thoughts on ““Economic Development””

  1. Seems to me one quick solution is to embrace the “food truck” phenomenon. i.e. allow “food trucks” access to unused lots (as well as on-street) during the business day. Many urban areas already have regulations on the books for food trucks. And if they don’t they can simply “borrow” the regulations from a neighboring or similar-sized town. Once this proves to work, then they can tweak the rules to allow semi-permanent mobile businesses such as this: https://s-media-cache-ak0.pinimg.com/originals/06/12/65/061265e75c79cd94ca850e49ed920281.png

  2. Interesting commentary, thank you for this. What passes for “economic development” is actually business development, so for those who want to promote the entrepreneur or small business enterprise, turn to the Chamber of Commerce, as this is their mission in life. They should be the small business owner’s best ally in these issues, and, they happen to have influence in City Hall.

    Secondly, “economic development” is a public term, yet our public sector acts as if they are the Chamber of Commerce; they are not. Their job, according to their official & legal “public purpose” in life, is to promote the general welfare, i.e. using public resources, leveraging private resources, to improve the standards of living & quality of life, of its tax-paying citizens. We really do not need public officials & their staff to become business development champions, as we already have these advocates in the private sector, beginning with the Chamber crowd. Who is advocating for the public’s interests?

    What we really need is to shift from the simple one-trick pony of publicly subsidized “job creation” to the multi-faceted socioeconomic paradigm, which leverages all resources to progressively raise standards of living & quality of life outcomes in real terms; this focus is true economic development. For all the public dollars spent in the name of “economic development”, which is a major expense, where are the corresponding public benefits or outcomes? No one ever seems to answer this key question.

  3. I’d love to talk about this stuff with you in person! This is a topic that bothers me to no end too.

    One thing that I can’t understand is how can these problems be solved without broad anti-regulation politics? Like you, Matthew Yglesias writes a lot about housing – here’s his latest post – but, also like you, he doesn’t seem to connect it to a broader need for laissez faire policy.

    You seem to be against the produce stand – your first example in this post – being effectively run out of business. But how exactly would you have saved it, or save others like it? Do you think all of the various laws and regulations that were enforced against it should be modified so that certain businesses are exempt? That just seems like a recipe for disaster, tho maybe a little less overall. Adding exemptions to all of the many (legion!) laws and regulations would only exacerbate the immense complexity of legally running a business. Small businesses are precisely those that are *least* capable of navigating that complexity and I imagine a lot of them would be run out of business *even if* they were technically within the legal clauses of any added exemptions.

    I think your comment – “There is no solution to the public school problem since the broad middle class doesn’t want to solve it.” – is fantastic. I can’t remember the last time anyone has said anything that I agree with to be true, but that is so likely to be considered *evil*. I think the same is true of housing in general. There are no solutions to the problems. But then maybe that frees me, and everyone else, from feeling obligated to solve those problems. I certainly don’t feel obligated to engage in local politics to try and solve them.

    More generally, I think it’s near-certain that more and more people will be excluded from the ‘formal’ economy. More and more people will engage in an even less-above-board version of the various businesses you’ve mentioned. They won’t be able to afford to do everything (or maybe almost anything) by the book, so they’ll largely operate as part of the informal economy. Sadly, this means that they, and everyone else, will miss out on the huge benefits of them participating in a formal economy.

    1. In the short term (and the short term might be another thirty years…) we will continue to see official “solutions” delivered in the form of additional layers of complexity piled on top of the already overly complex system. So – no solutions. I’ve made my peace with that. Instead, we will see work-arounds that politely ignore the rules. And in many places the people who administer the rules may turn a blind eye.

  4. As a civil servant charged with administering these often ridiculous rules, keep in mind that sometimes the bureaucrats are as frustrated as the citizens. The rules are the result of a complex system involving entrenched and specialized advocacy groups. For example, in my experience, many of the most onerous building code regulations are the result of the fire fighters lobby. Few elected officials are willing to go against fire fighters. So these rules get adopted.

  5. As a “sheepish bureaucrat” I have to admit that this hits home to me. Excellent article.

    Another factor is disability lawyer tourism. You can bet if the County didn’t enforce the accessibility requirements that a “victim” would be along conveniently soon.

  6. Thanks again Johnny for pushing forward the discussion of how otherwise progressive regulations have been used to stifle simple and smart development. Ironically, these regulations favor the complex and dumb projects that weaken local economies. Whenever someone needs to get a bank loan to pay for the “upgrades” that you describe, it means dollars are flowing out of the community and away from locals. If it’s a project like a Starbucks or a gas station from a national oil company, it further means that local money is getting funneled out of the community.

    It’s ironic that the most frequent CEQA challenges in California are not for greenfield developments by large home builders, but rather the neighbor who wants to build a duplex or the person who owns a parking lot and wants to sell it for an apartment building. It just shows how well intended laws can get used to fight against the very thing that the laws were set in place to protect in the first place.

  7. Stories like this make my blood boil. And I agree with you its not so much a liberal vs conservative thing, it’s a waste and bureaucracy thing, like this comic: http://i.imgur.com/p85fvFU.gif

    These stories are strong examples of “Orderly but Dumb” – as Chuck Marohn calls it – not being just annoying, but having real and painful effects on people who are trying to provide services to their communities.

    It’s funny (funny “ugh” not funny “haha”) that California is widely considered one of the best states to live, and as a native, it has a ton of reasons why it’s great, but our overall patterns of zoning bureaucracy across the US, multiplied with the population and money in California, have made actually trying to do things there prohibitively expensive in many regards, lowering the net living standards. Contrast this with the fly-over and rural states (like Kentucky, where I currently live) and the red tape is much less restrictive in what you can get done – I’m actually counting on this for a new old urbanism-style “startup town” I’m working on.

    1. I’ve spent a fair amount of time in Kentucky in recent years. I have to agree. Dollar for dollar you get a much higher standard of living there compared to California. And let’s be clear. The dreamy beachside towns and chic city neighborhoods of California are never a realistic option for most people. We’re not comparing Kentucky with Santa Monica, San Francisco, or the pristine suburbs of Orange County. The “real” California is more like a crappy overpriced stucco tract house or condo with a view of a Jiffy Lube on the edge of the Freeway. The trick with Kentucky is to find a place that was built before WWII. Otherwise you’re just swapping one crappy tract house for another in order to save money. What’s the point?

      1. I grew up in the fairly gorgeous but sometimes funky CA beach town of Santa Cruz, and so most of the rest of the state’s built environments – even the silicon valley – feels like a boring dump to me.

        As you said, there are some decent smaller towns in KY with good bones: nice tight grids of streets, a business district, but a number have post WW2 sprawl tacked on in the outskirts (just as Chuck bemoans of his own Brainerd).

        They *all* have too many cars though, and I know piecemeal change will end up coming to these places eventually, and be the most robust, but I shouldn’t have to wait until I’m 70 for it.

    2. heyo, another KY reader!

      This is a great blog. I stumbled on it recently with the post about Louisville and the pictures around Carrollton. I’ve been reading the other posts with pleasure since.

      Your articles seem to be something the love child of Andres Duany and Elizabeth Warren would write.

      It is impressive how precisely Duany had articulated the problem with urban sprawl already in the 80s. All his points are driven home here in a similar flamboyant style; the nefarious influence of the car, the adverse effect of the obtuse zoning regulations and the sheepish bureaucrats which administer them, the wrongful conflation of rural and urban land use, the aesthetic affront of post 50s architecture, the importance of the presence of small business.

      The other big thread seems to be the financial squeeze families find themselves in due to new big recurrent costs previous generations did not bear: that is, housing and transportation are liabilities, not investments. Warren wrote about this at length in the Two Income Trap, a full 5 years before the housing crisis. Hers is still the most comprehensive analysis of why people feel poor, even though, by all absolute measures, they should be rich ( for that reason alone, she’s deservedly an important voice in politics, thought to just chuck that in there).

      Your thesis that good urbanism promotes financial security, which in turn promotes attractive (in the many senses of the word) places is I think correct. However, we are not seeing it play out in reality. Mostly the rich are driving the resurgence of urbanism now, and the less than rich are missing out. It is precisely those who would benefit the most from city living that are pursuing it the least. This is a paradox.

      I think there’s a 3rd rail, which needs to be incorporated and – without going into a chicken-or-egg discussion – they are likely to be found around here:

      – schools are the biggest reason young families – in prime home-buying age – abandon the city. Many urban school district are pathological in their own quaint ways, but whether it is due to busing, or extreme income segregation, the neighborhood school is effectively dead in 80% of the country. Its many advantages, of which independently mobile students is the most important one, are no longer recognized, neither by school administrators, municipal authorities, or the parents trying to navigate this minefield. In fact, the national conversation is firmly pointed in the opposite direction; school choice, magnets, charters, vouchers, diversity quota; all these are anathema to local, town-centered education.
      – home ownership is a vehicle for retirement saving. It pushes people into debt and ties their long term financial well being to the whim of hundreds of unpredictable forces. It also promotes statism since any change to the built environment may be the wrong one in the long run.

      They are both political problems that needs to be solved in the legislative chambers of this country; no amount of market forces can right this ship.

      It may also begin to explain why the affluent are the primary drivers of this new urbanity. For one, they send their children to private school. Second, home values of the affluent are sufficiently high that they can withstand fluctuations in value and not jeopardize a comfortable retirement. The affluent also have sufficient other means to fall back on (e.g. company stock options, padded 401ks).

      I’ve been going on for too long..

      Anyways, great blog!

      1. There is no solution to the public school problem since the broad middle class doesn’t want to solve it. There’s a deep cultural need for exclusivity. “Good” and “bad” schools will be cultivated out of thin air no matter what. I’m happy to let that process play itself out. It’s just not a battle I’m willing to engage in.

        But here’s the thing. The majority of households don’t have school aged children. So while the 25% with kids torment themselves over the school district saga the rest of us are liberated to live wherever we want.

        1. THANK YOU, Johnny, for reminding us that most households don’t have kids in them anymore. THANK YOU.
          –JRB, raised in Bardstown KY

      2. Excellent article, Johnny, even by your high standards.

        Thomas, I agree with all your points, however I am not sure the choice movements are anathema to better urbanism. It might revitalize some neighborhood schools, even if it takes some out-of-district students to do so. The Brookings Institution has a lot of good material on it.

        If I am reading the Census Bureau’s information correctly, it looks to me like 42.8% of households have a child under the age of 18 as of 2015 (http://www.census.gov/hhes/families/data/cps2015F.html) — Table F1, line 26: 34,979,000 out of 81,716,000 total households. That would include families with kids who are too young for kindergarten, but of course they are thinking about school districts at that point. And some cities will have higher percentages than others.

        I believe educational choice would help bring many middle class families into areas they wouldn’t have otherwise gone.

    3. Yeah, the really surreal part is insisting on energy efficiency measures for a building without utilities. That’s really the point where you should say “OK, the standard need to be rewritten a bit”. Quite possibly, though, it’s not that the assorted planning folks were stupid, it’s that they didn’t want a “low-class” “inferior” business “dragging down property values”. In which case it’s not really a surprise that the business went under as that was probably their goal.

      1. The “wrong element” theory goes a long way to explain many things in our current land use regulations. But I also think the people who are paid to administer the rules are rewarded for enforcing ridiculous regulations and harshly punished for letting reasonable arrangements slide. Do you really want to risk your salary, health insurance, and future pension over some lady with a fruit stand? “Cover your ass.”

        1. Yes, there is that. But there’s a fruit stand off the major street I live on in urbanized Orange Country. It certainly doesn’t look like it’s got energy efficiency measures or a earthquake proof foundation, and it’s been there 20 years at least. It’s smaller than the pics you posted and customers don’t go inside but buy through a window. Still, the authorities have obviously tolerated it for a very long time even here. A lot of the seemingly extreme restrictions on home renovations are, I suspect, CYA, but for *this* I don’t think the A needed covering.

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