Ten Principles for Regional Sustainability
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by Sherman Lewis, draft of September 16, 2000
The Bay Area Alliance for Sustainable Development has a membership of business, environmentalist, social justice, local government, and other entities. The Alliance has adopted a Draft Compact to guide growth in the Bay Region, coordinating economic, equity, and environmental goals. The Alliance supports research on a livability footprint to analyze how the Compact can be achieved on the ground.
This discussion of ten principles, summarized above and discussed below, deals with the commitments of the Compact most related to the livability footprint. Other Compact commitments are difficult or impossible to model in the footprint exercise. Of the ten commitments, this discussion of principles deals primarily with commitments 1. Economy, 2. Housing, 3. Transportation, 4. Bay and greenbelt, 6. Poor neighborhoods, and 9. Fiscal reform. It does not deal in detail with 5. Pollution and waste, 7. Education, 8. Health and safety, and 10. Civic engagement. This discussion is a draft for the environmental caucus to use as the basis for policies and assumptions for a sustainable scenario in the livability footprint research.
The Alliance is also working on defining indicators to measure progress towards achieving the ten commitments. Some indicators will use data from the livability footprint. This discussion of principles also needs to keep in mind how to measure progress, so that the kind of data the environmental caucus feeds into the livability footprint research is consistent with the data needed for indicators.
Sustainability has several dimensions. One meaning is that this generation should leave the world undiminished for future generations. Our consumption and pollution should not imperil their survival or lower their quality of life. Other meanings depend on value judgments about what is the quality of life. For some, sustainability can accommodate many more people at the expense of nature and quality of life; the Bay Region could grow towards a Japanese density of population and be sustainable. For others, it means protecting nature and preserving a high quality of life, not just survival. We will use this definition.
The impacts of the human population result from the number of people multiplied by technology and consumption. Technology influences sustainable population more than does consumption. Technologies that use fewer natural resources, less energy, water, and land, and that pollute and waste less can sustain more people.
A stable population alone will not achieve sustainability. Sustainability, however, probably cannot be achieved without a stable population. It remains to be discovered, because there is so much we are still learning about technology and economic feasibility, how much population is consistent with sustainability. Sustainability could allow more people, but could require fewer.
The issue of total population is world-wide, and is affected by many policies such as, broadly, the status of women, or, more specifically, legal protections for women, their educational and economic opportunities, and health care including family planning services and teen health services. These policies affect regional growth by influencing regional natural increase. Regional institutions play important roles in carrying out various relevant policies, but they are rarely assessed or integrated in terms of natural increase and sustainability.
The issue of total population has equally important questions about the distribution of population regionally: by groupings of nations, nations, regions within nations, metro areas, cities, and even neighborhoods. Some regions are attaining population stability, affluence, and wider opportunity before others. They are exporting sustainability instead of importing people.
Regional growth has three sources-native population natural increase, migration, and migrant population natural increase. Regions can gain population from any of the three sources, it doesn't matter which: the population goes up and thus the impacts go up. From 2000 to 2020 the Bay Region grows by 1,415,610 people according to the State Dept. of Finance, or by 1,096,300 according to ABAG. The differences are not explained. The Dept. of Finance estimates 59 percent of growth will be by natural increase and 41 percent by migration. (ABAG does not show natural increase. There are no statistics on the role of demographic momentum, but, given the age of the Region's population, it should be fairly small.)
Policies affecting either natural increase or migration are controversial, yet need to be discussed as they relate to sustainability. In both cases, the policies that make sense also work to achieve other goals, and could well be undertaken independent of their population impact.
First, concerning natural increase, government at all levels should support health programs providing family planning and teen health services for everyone in a region regardless of income or ethnicity. These policies are closely linked to many issues concerning the status of women. It would, obviously, be racist to pressure a particular racial or ethnic group to have fewer children, but it would also be racist to deny them the same services that have allowed affluent women to improve their education and training, to get jobs, and to invest more in raising a smaller number of children. Sustainability is helped when education and productivity, not family size and low wages, are the keys to success. If services now reaching the affluent are not reaching all of the disadvantaged, they should be expanded to do so for equity and opportunity reasons as well as for sustainability.
Second, we need policies that focus on migration, not immigration. Immigration, while it gets the most attention, is only a subset of migration, the movement of people across international borders. Immigration is controlled by national governments. It is beyond the reach of local or metro regional government, so it will not be discussed here. Our discussion will look only at policies available to regional and local governments that might affect migration in a context of prosperity and justice.
Migration is now one of the world's most controversial topics. Migrants are favored variously for their entrepreneurship and investment, for their technical skills, and for their low wage labor. They are variously opposed for their ethnic and racial differences from the native population, labor competition, and anti-social and criminal behavior. Rarely, however, is migration discussed in terms of sustainability, of real economic progress, and of social justice for both contributing and receiving regions.
Compelling arguments support economic growth from free movement of labor, and migrants generally do contribute to growth. Are there equally compelling contrary considerations? There are indeed, most obviously that excessive migration is regionally unsustainable. More specifically, we need to consider arguments: a) about costs created by migration that are not currently measured in regional accounts, b) about alternative growth that avoids the costs, and c) about the potential for growth based on educating and training people already in the Region.
a) Concerning the costs of migration which are not in regional accounts, the problem is created not by migration as such, but by people. Generally, the more that migrants contribute to regional economic growth, the greater their environmental impacts. The Bay Region, in the process of becoming enormously wealthy with great contributions by migrants, has also suffered costs caused by people: the air is polluted, commutes are terrible, housing prices are astronomical, and open space is rapidly being lost. The assumption of public benefit from growth is made by the media and self-interested beneficiaries, not rational analysis. Under "good jobs" in part 2 below, a quantitative study on the costs and benefits of various kinds of jobs is proposed.
There are also unquantifiable, emotional reactions to the sheer numbers of unsustainable growth. Those who feel comfortable with a Bay Region population of four million may be uneasy about six million, and the Region is still growing. Those who accept six million-it's already happened-want to plan for a million more because it is inevitable, cannot be stopped, and trend is destiny. ABAG was projecting a gain of 950,168 people in the Bay Region from 2000 to 2020, to 7.8 million but has revised its estimate to up to 8 million. Some people have no problems moving to ten million; it's just a question of time and we'll find a way to manage; the "doomsters" are always wrong. However, for most people, at some point, a gut feeling kicks in: no, this just isn't right, there has to be a better way. Some bury the feeling, not knowing where to go with it in a media opinion climate supporting hypergrowth. Others are ready to talk, if only to speculate about what seems politically impossible.
b) Alternative growth could avoid the costs. Generally, the more migrants contribute economically, the greater the contribution they could have made in their region of origin. A review of economic growth around the world shows that the vast majority of those becoming prosperous have not migrated out of their regions. The Bay Region has been the source of the technology for much of the alternative growth. The Bay Region economy has not suffered, and has probably benefitted, from having the extra growth occur elsewhere. Alternative growth may compete with our exporters, but it also creates more customers and thus can help growth here, with net gains.
The issue, really, is not the feasibility of alternative growth, but whether we are willing to discuss it as a policy rather than simply allow it to happen accidently and unconsciously. There are, obviously, places of violence, abuse, corruption, and governmental incompetence that mitigate against alternative growth, but the much larger story has been the broad expansion of the world's economy over the long run and many success stories.
Migrants are not only enterprising but also educated. Growth in a receiving region is partly built on depriving the giving region of the investments it has made in the education of its citizens. The growing region can even under-fund local education because it can use migrants for economic growth, and they are cheaper to employ. Brain drain is, then, a hidden social inequity behind policies which draw workers to a region while the disadvantaged already living there struggle to get ahead. The inequity is both to the contributing region and to local people denied adequate education. Alternative growth is not just feasible, it's fair.
Alternative growth avoids impacts in a receiving region, but does not guarantee reduction of impacts in a giving region. Reduction can occur, for example, if the would-be migrant can live in an existing house instead of requiring a new subdivision, and can get to work by not driving alone, and is engaged in a sustainable business. However, these outcomes are not guaranteed and it is primarily up to each region to advance its own sustainability.
c) The benefits possibly provided by migrants may be achieved by those already in a region who could improve their productivity. See "3. Growth" below for more discussion. Education and training can qualify them for jobs now going to migrants, thus reducing migration in a way that advances social equity.
Certain regional and local policies can affect future migration. Most migration into a region is caused by jobs growing faster than the local labor supply, so polices which dampen excessive job creation would help stabilize population. Logically, a stable population has a stable number of jobs, and the trick is to preserve growth and social equity.
Job growth is strongly influenced by, if not fully controlled by, city decisions on land use plans, zoning, and building permits. Land use policies usually have been used to promote unsustainable growth. Almost universally, commentators assume all job growth is good and that housing should be increased to meet it.
On the flip side, land use controls have been used to stop growth completely, with an impact on growth and jobs that is not just a possibility but accomplished fact. Land use policies have dramatically lowered growth rates in some areas. Even whole counties like Marin have restricted growth so much that their population is stable or close to it. Similar growth management exists in Northern Napa, Western San Mateo, and most of Santa Cruz counties. These policies have affected the distribution of the population, in other words, migration.
Restrictive land use policies have been motivated by environmental protection and by social and economic exclusivity with little consideration for growth and justice. They have mostly ruled large areas off-limits to growth. While the incidental restriction on job growth may be helpful for sustainability, the resulting elitism and lack of equity give them a bad name in the context of social justice. The question is, then, can growth controls affecting jobs be part of a larger policy that also achieves social equity? The next two sections discuss this issue in more detail.
Using land use policies for sustainability can not and should not aim at migrants, but can deter excessive future migration by controlling the amount land available for new jobs, the primary magnet for migration. Land use policies designed to stabilize population, achieve growth, and provide more opportunity for existing residents will be called "regional job management."
Regional job management is not an entirely new idea. Santa Barbara in the 1970s reduced land area zoned for industry for purposes of stabilizing population with a target of 85,000 people, a plan approved by the voters and in the city charter. New zoning cut residential potential and land zoned for industrial and commercial development. Santa Barbara County voters reinforced the city growth limits by rejecting water from the state water plan. From 1967 to 1989 voters approved 13 of 16 measures restricting growth, and slow growthers controlled city and county governments. (1) A severe drought complicated the use of restricted water capacity, and in any event the city grew to 90,000 even by 1990, so it is difficult to judge the success of the plan.
The Bay Region is already losing growth due to incredible housing costs and impossible commutes. The media and business sometimes claim, therefore, that the Region is losing its competitive edge. Yet the Bay Region has already won the economic race at the risk of losing its environment and its soul. Is the average resident better off because one million more people live here than before? Will he or she be better off as a million more come? We need to give some of the growth away on purpose. Regional job management would simply replace an irrational, costly, unintentional, partially if accidentally successful "policy" with one that could largely solve regional problems.
While sustainability is facilitated by a stable population, some ways of getting there are not acceptable. Two problems should be prevented, externalizing population and fiscal advantage. Natural increase may be greater than permitted job growth, and localities should be required to accommodate their own growth. Localities may also try to get a fiscal advantage from disproportionate retail or employment, and they should be required to share revenues.
A balanced policy would affect both migration and natural increase in ways that advance economic growth and social equity. Sustainable local and regional land use policies do not mean "pulling up the drawbridge," but helping others already building their own sustainable castles. The issue of sustainable population has never been posed this way before. The anti-equity effects of migration have not been recognized, nor the equity potential of giving some growth away, nor the need to shift from investing in growth to investing in overcoming inequity. While conceptually logical and clear, the details of how to make these new ideas work have yet to be discussed by the Region. There are risks in this uncharted policy territory, but what is the point of all our wealth if we do not have leadership?
We should not drain brains from elsewhere, but invest more in our own brains, especially in educating the disadvantaged. We should not import people; we should export sustainability. Increasing labor productivity is much more important for growth than the region where it occurs.
Regional job management necessarily must distinguish among jobs. All jobs are not necessarily "good;" some jobs are better than other jobs. Twelve dimensions are listed below. To achieve sustainability, we should promote some jobs and prevent others.
First and most obviously, regional job management needs to focus on stopping an increase in the most damaging jobs. Many jobs are already prevented by concern for the pollution they would cause. The smoke of the smoke stack has shifted from being a sign of prosperity to a symbol of dirty industry. Those "bad jobs" are already being stopped so completely it's not an issue.
However, jobs can also be bad because of their location. Commonly recognized benefits of a job in a severe job surplus area needs to be judged against usually unmeasured costs, and compared with the pros and cons of the same growth in an area contributing migrants.
There is no established methodology for doing such analysis. The benefit estimate could be the annual total compensation for the job and profit expected by the employer, ignoring multiplier effects. Costs are more complicated.
The cost estimate requires quantification of air pollution and other commute-related external costs per year created by the job surplus area, both from length of commute and from congestion. Silicon Valley, for example, has more long, congested drive-alone commutes than San Francisco, so each job is associated with more air pollution. The estimate requires gauging the annual value of time lost by these commutes compared to a median commute time. It requires an estimate of the increase in housing costs within a reasonable commuting area of the job surplus area. For example, home prices in Silicon Valley can be compared with prices in an average metro region for a similar house, with the difference being the increase in price due to the failure of local cities to build enough housing.
These three costs-environmental externalities, lost time, housing price-need to be allocated fairly to the longest, most congested commutes that dramatically slow down freeway traffic. The impacts are not just the one employee, but the systemic costs that occur at the capacity tipping point on freeways, when a few cars cause a big slowdown. The point can be quantified. It occurs when throughput drops at speeds below about 35 miles per hour and when flow reaches volumes of about 1800 to 2000 vehicles per freeway lane per hour. The numerator is the three costs generated by the severe job surplus area, and the divisor is the number of surplus long distance commuters to the area.
If the annual per driver costs were something like $30,000 in pollution, $10,000 in wasted time, and $40,000 in housing costs, the cost per job could total $80,000, more than the compensation of the average job in the job surplus area. (These numbers offer a generic illustration, not actual costs.)
These three costs are not considered by any policy makers today. The company creating the job in the severe surplus area has no responsibility for the problems it creates. The company only benefits, because it externalizes the costs. The city approving the land use where the job exists has no responsibility either. The city reaps sales tax and real estate tax revenue while avoiding the expenditure of serving worker housing. The regional agencies are run by locally elected officials who know little about economic analysis and are more committed to local power than to local responsibility. They are elected by developer and business contributions from an affluent class committed to the myths of unsustainable growth. The media and the economists also seem to have no interest in these questions. The problem at this point is not so much the lack of an answer as the lack of asking the question.
Just how big are the job surpluses? The Region has 100 cities, too many and too diverse to study easily. MTC divides the Region into 34 superdistricts of roughly comparable size. Each superdistrict usually has a reasonable commute shed of itself plus adjacent superdistricts, depending on distance and transportation connections. Table 1, "Job Surpluses by MTC 34 Superdistrict 2000," uses ABAG's Projections 2000, the latest available. The Table lists the superdistricts, their employed residents, employment, worker surplus, adjustments of worker surpluses based on allocations from adjacent superdistricts, adjusted surplus as a percent of workers, and a description of the adjustments. Superdistricts with job surpluses after adjustment are bolded.
Adjustment is needed because the job/resident balance alone is too simplistic; we need to consider reasonably short commutes from adjacent areas with surplus employees. The adjustment mostly allocates employed residents from an employed resident surplus superdistrict to an adjacent employee deficit superdistrict. However, to deal with certain big deficits, the adjustments include cascade flows. A cascade flow starts with allocation to adjacent superdistricts but allows even an employee deficit superdistrict to pass its workers to another deficit area. For example, Daly City/San Bruno has an employee deficit which can be considered more than covered by San Mateo/Burlingame, allowing some of its employed residents to be allocated to San Francisco. Similarly, workers can flow from St. Helena to Napa to Vallejo to Richmond to Oakland to San Francisco, all with reasonable commutes. The adjustments do not describe what happens; they are a "what if" approximation of how short commutes might work.
Twelve of 34 superdistricts have job surpluses, but eight disappear when adjusted for short commutes from adjacent superdistricts. Four have serious job surpluses. Superdistrict 15 Livermore/Pleasanton is recent and, at 10,000 jobs, is smaller than the other three. Data on Tracy, if treated as an adjacent superdistrict, might show the Livermore/Pleasanton imbalance is covered by surplus employed residents in Tracy.
Two superdistricts constitute Silicon Valley (Superdistrict 8 Palo Alto; Superdistrict 9 Sunnyvale, Mountain View, Santa Clara). Their four cities stick out like sore thumbs in the statistics. The fourth superdistrict is downtown San Francisco. Because "the city" reasonably draws from several superdistricts, its adjusted surplus is 66,000 workers, while Silicon Valley, also after using nearby superdistricts, has a surplus of 108,000.
Silicon Valley and San Francisco have imbalances many orders of magnitude bigger than any others and must be the focus of any serious discussion. Not surprisingly, they have colossal housing prices and horrible commutes. Silicon Valley is the bigger problem because of its larger size, predominance of drive-alone commutes, dispersion of destinations, and lack of transit infrastructure. San Francisco has lower environmental and commute externalities making it easier to meet housing supply or transit access goals.
ABAG Projections 2000 estimates that current trends will make matters more difficult. See Table 2. The four superdistricts with adjusted job surpluses in 2000 get worse. The adjusted deficit in Livermore Pleasanton goes from 11,000 to 17,000 jobs. The City job surplus goes from 66,000 to 145,000 jobs. Silicon Valley goes from 108,000 to 133,000 jobs.
Second, after careful study, regional job management requires a regional consensus that the already severe housing/commuting/polluting crisis should not be allowed to get worse. Regional job management, based on research results, would place a moratorium on local land use decisions in the five or six cities that cause costs greater than benefits until regional burdens are alleviated. The moratorium would be performance based, using quantified, objective criteria that can be specifically stipulated ahead of time. The cities could build more housing and improve non-drive-alone commutes, and freeway performance could be used to measure the results. Since it is very difficult to overcome a long history of irresponsible land use planning, these cities would probably have job growth limited for some time.
How many jobs could be affected by regional job management? The maximum number is the projected increase over 20 years in the three superdistricts, which is 139,000 jobs, or about three percent of the 4.4 million jobs in the nine county Region in 2020. The actual figure needs to be adjusted downward for housing build in 2000-2020 in nearby superdistricts, downward again for jobs which can be created without land use decisions, and downward again for jobs which move to other cities in the Region. The probable number, then, is likely to be under one percent of the regional total, so small it could be lost in the noise of the multitude of factors affecting job creation.
In short, a very small number of possible future jobs in rich cities will aggravate already severe regional problems. A very small number of jurisdictions can impose these costs with impunity. There is no evidence that low to moderate income people benefit, as their job gains are overbalanced by increases in housing costs, and they are not getting the better paying jobs.
Third, after analysis and consensus, we need a regional or state agency to impose a moratorium on land use decisions that create jobs which cost the Region more than they benefit. Severe surplus cities could escape the controls by behaving responsibly: building enough housing, or providing enough transit from close-in housing, so that housing costs, commute durations, and air pollution fall to acceptable norms.
Regional job management as described above would probably not achieve population stability. We are not, here, going to worry about that, as it will be difficult enough to get any job management at all. Still, the proposed policy is "robust" in the sense that it not only helps sustainability, but also helps environmental, traffic, and housing problems while affecting a very small number of jobs.
Stabilizing population should not be achieved in isolation from economic growth or social justice. To reconcile stable population with economic growth, we need to distinguish between that part of aggregate economic growth due to population increase from the part of aggregate economic growth due to per capita productivity gains. To simplify the terminology, we will call the first "aggregate growth" and the second "per capita growth."
|"Aggregate growth"||That part of economic growth attributable to population increase|
|"Per capita growth"||That part of economic growth attributable to per capita productivity|
These concepts are commonly confused in the media and political rhetoric. Aggregate growth and per capita growth historically have been inextricably mixed together. We could have less aggregate growth but not less per capita growth; we just have not thought about how to do it. The challenge to policy is to find a way to do it.
Policy would only be following what the market economy has been doing for two centuries. The market economy has not grown because of increasing labor, but because of increasing productivity. Labor shortages met by more labor do not increase wealth; labor shortages met with innovation and capital investment get more product from fewer hours of work. Such investment dislocates old-technology workers but in the long run, through much dislocation but also increasing productivity supporting increased income, more people have become better off.
A major potential source of increased productivity are workers at middle levels. Education and training could help middle levels moving up to something more productive. The importance of the middle levels has been under-emphasized. California has almost 3.5 million unemployed people whose skills are clearly above entry level work, yet below requirements of high tech jobs which are going begging. (2) About one fifth of these unemployed have a college degree and more than half have had some college. Most have been employed within the last three years and they average more than 15 years work experience. The biggest group is Anglo, 42 percent.
To reconcile stable population with social justice, we need to incorporate the disadvantaged into the economy. They are the less educated and less skilled, and disproportionately minority. . Current hypergrowth policy uses the poor as a permanent excuse for aggregate growth that does not really benefit them. Incorporation includes health services, education, and jobs using, to some extent, resources now going to support aggregate growth. Research is needed to identify more specifically those resources and how they might be shifted.
Private industry developments and base closings in the Bay Region since the 1980s have restructured the economy, increasing wealth for the competitive, both migrants and natives. Recently, unemployment in California is low and most workers are getting pay raises and job advancement. (3)
Other analyses, using different parameters and time periods, show that many people of all races, especially the less educated, stagnate and slip in income. The Region reflects national trends; the United States has the greatest poverty and greatest inequality of income distribution of the 17 industrial counties. (4) In this sense, the U.S. is not an advanced country. The gains from the booming economy in the U.S., in California, and in Silicon Valley have gone to the already affluent; the bottom 60 percent by income lost ground. Two-thirds of poverty level workers lack health insurance, and 84 percent have no pension plan. (5)
Race, Income, Education, Health
|Household Income below $20,000||Education High School or less||Education col- lege graduate||Health fair or poor|
|Asian (English speaking)||7%||11%||64%||8%|
|Source: Janet Wells, "Racial divide in boom time, study reports," S.F. Chronicle, Sep 5 00 p. A1, quoting from a survey by the University of California San Francisco, Institute for Health Policy Studies and the Field Institute.|
In California, African Americans and Latinos are more likely to be unemployed, to lose jobs, and to have low income, low education and poor health. (6) In the Bay Region, Latinos are under-represented in high tech employment (23 percent of population, 7 percent of high tech employment). (7)
Education, health care, and enforcement against racial discrimination are needed. Education is highly correlated with low income, and is the major expensive policy needed to improve earnings of the disadvantaged of all races. Lack of health insurance is also correlated with low income and likely to be costly. While not as expensive as education and health, policies fighting overt racial discrimination deserve support. These policies help current residents qualify for and get employment that employers might otherwise give to new migrants. Thus, the policies could reduce would-be migration while helping the disadvantaged, including migrants already here.
Per capita growth is economic growth that is sustainable, avoiding the cancerous "more is better" ideology of aggregate growth. Per capita growth focuses on individual productivity as the basis for growth. Labor shortages should be seen as opportunities for investment in new technologies, not as reasons to import more workers.
If a private company owns a tree, cuts it down, and sells it for lumber, the company records the income from the sale. The company also makes a corresponding reduction in the value of its tree assets to equal the value of the tree. Such is the elegance of double entry book keeping. If the Forest Service owns a tree, cuts it down, and sells it for lumber, the Service records the income but makes no entry on a balance sheet. The federal government, the world's biggest business, has no balance sheet. Thus, we live off nature's capital, especially fossil capital, and are almost totally unaware of it, no different from uneducated barbarians that killed and burned treasures of civilization to steal gold and silver. Much of our income comes from using up our fortune, and we don't even know how much.
The human economy is a wholly owned subsidiary of nature. The decline, even collapse, of habitats and their carrying capacities eventually can not help but to cause economic decline, and already we have lost things we should value.
Nature sustains our economy three ways, with resources, dumps, and services.
1) Resources. Our food, energy, water, built environment, and other consumption are derived from nature. We now understand better that the application of technology and energy allows a great deal of growth without clear unsustainability for some resources, like inorganic construction materials and minerals. Other resources, however-fresh water, cultivable land, forests, ocean fisheries-are not being used sustainably. Ocean fisheries, in fact, have largely collapsed and we are strip mining the remaining ocean life at a colossal and unsustainable rate. Arable land is being lost to deforestation, over-grazing, salinization, humus depletion, erosion, and urbanization, with losses hidden by increased use of fossil fuel fertilizers, by vulnerable monocultures based on hybrid seeds, and by massive applications of pesticides. Ancient aquifers are dropping from over-pumping, as we mine fossil water to depletion.
2) Dumps. Nature is where we dump our air pollution, water pollution, hazardous chemicals, solid waste, and radioactivity.
3) Services. Nature provides many services. It is the world's biggest biochemical research and development business, producing genetic material for plants, animals, and medicines. Its bees pollinate our farms and gardens. Its good bugs eat its bad bugs. Nature provides recreation and spiritual re-creation. It provides wilderness and habitat so that we might be awed by creation and see ourselves as part of a larger whole, rather than become greedy and ignorant exploiters with only a mirror for measurement. Nature cleans the rain and stores it in plants for gradual release into streams, and its vegetation also cleans the air and reflects the heat. Worms, ants, bugs and microbes decompose organic matter providing the basis for the next round of growth. Nature takes carbon dioxide out of the air, cooling the climate. Nature is the infinite sandbox for scientists to pursue infinite questions, and their discoveries edify us all. Nature is the creation where we came from and where we are going.
Current calculations of the gross national product put the value of nature's resources, dumps and services at zero. It's not just the government; the whole country lacks a meaningful balance sheet.
Two major, new analyses light the way to better score keeping: "Genuine Progress Indicator" and "Ecological Footprint." The GDP (Gross Domestic Product) can be recalculated to subtract some "bads" and add some "goods," creating a new measure, Genuine Progress Indicator. While experimental and not yet widely accepted, GPI quantifies our declining welfare while, for the same years, GDP purports to show its rise. Once we get past the single measure of GDP per capita, or other money-based average measures, it becomes clear the U.S. is not very advanced.
We can also calculate our impact on land and water, looking at the land area needed to supply us with food, clothing, shelter, etc. What we consume leaves its "footprint" both within a region and globally as we take resources from distant corners of earth. Americans in general and of the Bay Region in particular have a huge footprint compared with all other nations and regions. Our consumption does not look equitable or sustainable.
Improved score keeping is essential for measuring the results of policy, which in turn is essential for improving policy. The industrial investor, subdivider, and city are not playing with a full deck. The cost cards are not being laid on the table. Better score keeping will tell us we are losing the game and need to change the way we play for sustainability.
Will global warming take place? Wrong question. It is already happening on such a massive and global scale that it defies our imagination. The science is conclusive. The evidence is overwhelming. The computer models work with increasing accuracy. No data are inconsistent with the views of the International Panel on Climate Change, the large international body of climate scientists. They are now essentially working on the details: on cloud formation, the North Atlantic oscillation, other ocean currents, details of climate history and backcasting, and why the process is uneven. How much agriculture will be lost in Texas? How much of Florida will be flooded?
The global average temperature is increasing slowly in human terms, but very rapidly in geologic terms. Ice cores from the Himalayas show the late 20th century to be the warmest period in 1,000 years. The 1980s and 1990s broke heat records. Seas are rising, storm events are increasing. A few years ago a piece of ice the size of Rhode Island broke off the Antarctic ice cap. The north pole now has water, not ice. Both ice caps are melting, along with the glaciers of Asia, South America, and Africa, and most of the Greenland ice sheet (some of the top of Greenland is getting thicker from increased snowfall, also due to global warming). The ice sheets are so reduced that they feed less water into their rivers. (8) In the northern hemisphere, plant and animal species are moving their northern and southern ranges ever northward, as spring comes earlier and fall starts later. Tropical disease-bearing insects are moving north, and warmer temperatures allow the outbreak and spread of more communicable diseases. The permafrost is melting, releasing more warming gases, yet also partially offsetting this with more plant growth. Coral reefs are bleaching.
The primary cause of these effects is increased carbon dioxide in the atmosphere caused mainly by our burning of fossil fuels for transportation and electrical energy. Atmospheric carbon has been increasing slowly in human terms, but very rapidly in geologic terms. The cause and effect the scientist can see so clearly is not visible to the uninformed person.
America causes more global warming that any other nation in the world, both per capita and in aggregate. In the Bay Region, fossil fuels supply 80 percent of energy. The Region emits about six tons of fossil carbon per person per year. Adding the weight of oxygen makes 20 tons of carbon dioxide per year. (9) The Region is doing virtually nothing about global warming.
We need a carbon tax, swapped with other taxes, so that as carbon tax revenues go up, other revenues come down equally, maintaining steady governmental revenues and constant aggregate demand. This is the "tax swap" idea. The price of carbon goes up relative to other prices, with no windfall for government or the oil business. The amount of carbon tax increase should be high enough to get some people to make some changes based on the relatively higher price. Technology will then change at the margins to use carbon more efficiently, without hurting the economy. The economy becomes more productive by reducing warming costs efficiently. See "Comparing Gas Costs; Elasticity Illustration" [may not be included with this essay].
Elasticity is an extremely important policy concept. Elasticity is the amount of change inspired by a change in price. A small, short-term price change causes little if any measurable change in behavior. A large, long-term change can be very disruptive and costly in the short term. An optimal increase in price can spur changes in consumer preferences and technology in ways that reduce environmental costs and support long term growth.
Market price is an equally important policy concept. Generally, the more each consumer pays directly and fully for the cost of a purchase, the more efficient the economy becomes. Such choices generally work better than governmental allocations, no matter how democratically they are arrived at or how well-intentioned. When market prices are severely distorted by indirect pricing, elasticities cannot work to improve efficiency. Ironically, government must intervene to make markets work, and reform prices at a balanced pace that avoids minimal change or excessive disruption.
Elasticity and market pricing thus involve two policy issues: figuring out the market price, and moving towards it with optimal speed. To the extent other problems are mitigated, like pollution and inefficient use of under-priced fossil fuels, the carbon tax makes the economy even more productive. It is an example of robust policy, something we should be doing for many different reasons.
There is no visible political support for these ideas yet. We need to educate people about carbon taxes, tax swaps, elasticities, and market prices that allow change without too much disruption and stimulate economic growth of the non-fossil economy. There is considerable evidence that major improvements are possible in both productivity and equally important reductions of environmental impacts across a wide range of industries. In fact, more efficient alternative technologies are on the verge of commercialization and are beginning to happen already. (10) Therefore, a properly implemented carbon tax would probably not cause too much disruption.
Of the many issues of sustainability, global warming is the strongest indicator yet that we are going in the wrong direction and may not be able to change.
The U.S. and the Bay Region are far more auto-dependent than the advanced countries. Americans use cars for 84 percent of their trips. Western European countries average about 40 percent, with England half way between them and the U.S.
American auto dependency results directly from massive subsidization that takes many forms. The major categories of indirect pricing are environmental externalities, congestion delay, parking, local government, (11) federal and state government, (12) zoning regulation, market imperfections, (13) energy (foreign dependence, dispersion costs), resources (dispersion, distance, and vehicle costs), land use, (14) other social, (15) and other economic. (16) See "Paying Directly for Driving Alone" [may not be included in this essay]. These subsidies not only favor car use, but almost dictate a dispersed urban form which then makes the car necessary.
Modal Split Distributions for Urban Travel in Europe and North America
(1990 or latest available year)
Source: Ministries of transport and departments of transport in each of the individual countries.
Source: John Pucher, "Bicycling Boom in Germany: A Revival Engineered by Public Policy,"
Transportation Quarterly 5:4 Fall 1997 p. 32.
Americans are almost totally unaware of indirect pricing. They know about many of the problems but don't connect them and don't see a common cause. As a result, pricing reforms are seen as "punishing drivers," and most parking is perceived as "free." Carism is an ideology of defending indirect pricing. It is not use of cars as such, but a way of thinking that imposes costs of car use on non-drivers.
American carists look only to increasing capacity as the means to respond to congestion. The highway lobby focuses exclusively on reducing vehicle emissions, which has, in fact, been very productive for some pollutants, but not carbon dioxide. The lobby ignores pricing measures and plays down the potential for transit. "In fact, probably the greatest threat we have to future air quality improvements is the traffic congestion that is snarling our cities." Environmentalists "want to force people out of their cars ... they still want to do everything they can to make it so miserable for us to choose to drive that we have to get out of our cars. That's a terrible thing for America's working mothers. I think that's a terrible thing for people that are struggling to try to go from welfare to work because, in most cases, they are going to try to get to work using a vehicle," said William Fay. (17) The rhetoric of subsidized carists must necessarily ignore many facts, but environmentalists have not yet found a rhetoric supporting pricing reforms.
American carism uses "the capacity model" to understand traffic. It treats road supply as a public good with public benefit which should be free to the user. There may be some point when even more free supply will not be met with more demand, but since roads are expanded mainly when there is some congestion, there is evidence of demand at the zero price. One carist idea is to make sure people can travel to work in a "reasonable" commute time using more road capacity, but all that has happened is that commutes are longer, faster, and more drive-alone dominated than before. The political concept of reasonable time is shorter that what the public wants, so people just move even further away from work to find better housing values. Then, to justify more pavement, policy makers project quite unrealistic trend lines about current congestion to predict long duration commutes in the future
People are willing to spend a certain amount of time getting to work, typically about 26 minutes, and make locational decisions accordingly. Once that decision has been made, the value of commute time is essentially zero. If a commute would be too long, a person does not look for work or a home in the distant area, or is willing to move or change jobs. The media pay attention with great sympathy to certain outer margins: the very small number of long distance commuters who cause most of the congestion and long commute problem, and an even smaller number of "welfare-to-work" cases when the dominant reality for the disadvantaged is short distance walk trips and bus trips to work. Carist solutions just yield more traffic.
The European model is "the congestion model," in which roads are not expanded because they only encourage more driving, resulting in serious congestion. The third model, partially used in Europe, is "the pricing model" in which drivers are charged directly for the cost of their behavior. Implementation is partial, despite seeming high by American standards, because, according to economists, the prices are still much too low, the governments are more oriented to gas taxes for revenue rather than sustainability, and there is little effort to understand and to educate the public about market pricing, tax swaps, and elasticities. (18)
Pricing reforms generally have common characteristics: they impose costs directly on drivers, reduce costs on others, and improve economic efficiency. When the prices are right, drivers pay their own way. Pricing reforms shift from indirect to direct payments for all kinds of subsidies. They make car travel a market good, like most goods in our society, instead of a social good, like national defense, police, education, health, and welfare.
From a market point of view it is difficult if not impossible to have efficient allocation of resources when demand is subsidized. Those benefitting from the subsidy will always demand more than they pay for, so others have to pay, and they naturally resist tax increases. There thus always must be a lack of adequate supply, called congestion, and a lack of adequate revenues. See "Better Roads Cause More Driving." [may not be included with this essay].
Transportation facilities and subsidies do not create growth, but they almost dictate where and how growth occurs on the land. In the 1950s Caltrans made two decision, on financing and alignments, that determined the next fifty years of land use in California. One, Caltrans decided that old drivers should subsidize new drivers. The gas tax on drivers using existing roads, rather than tolls or other direct charges, would finance new roads. The new roads would be free of charge to new users, The gas tax would cover all of the state's costs, but only a small part of local costs. Local governments had to use local sales and property taxes for local roads and road services. Thus, the subsidy flowed from local taxpayers and local drivers on existing roads to new long-distance drivers on freeways.
Two, Caltrans laid out the alignments of the state freeway plan. The developers then knew where to buy land to build neighborhoods, shopping centers, industrial parks, and office complexes. Next, the developers told the cities how to change their land use plans, and the cities did so. Almost all these decisions (San Francisco and Berkeley the exceptions) were very politically successful. People got "solutions" without understanding why they would not work, elected officials got campaign contributions to persuade the voters they were right, and suburbanizers and Caltrans prospered.
The challenge now is to persuade people-voters, officials, media, developers-that the costs of sprawl that the accounting system failed to measure are too great and that there is an economical alternative that actually works better. It just can not complete on a playing field tilted toward cars. Part of the problem is that driving is so cheap that substantial price changes are needed for elasticities to kick in. The cost of driving a new car 25 miles has fallen from $4 in 1929 to $1 in 1989 (1986 dollars). (19)
There are as many ways to reform prices as there are subsidies. Each reform needs to be carefully tailored to the problem it is trying to solve. Surprisingly, a lot of quantitative research remains to be done. Who is hurt now by subsidies to drivers? How much, for example, are non-drivers, low mileage drivers, non-parkers, non-peak hour travelers, etc., paying for drivers, high mileage drivers, parkers, and peak hour travelers, etc.? In a given case, should we use a tax swap or spend the money? How much extra boost do the efficiency and productivity effects of pricing reforms give the economy? How can we get people to see the benefit when their eyes are fixed only on a new cost?
One example of a reform is the carbon tax swap mentioned above, which might push the price of gasoline above bottled water, maybe even milk. Other pricing reforms include parking cash-out of "free" employee parking, market parking charges at BART, and variable congestion charges on gridlocked highways. In the Bay Region a survey found that 67 percent of commuters drove alone mostly to free parking and 80 percent of them drove because of free parking. (20) BART charges nothing for parking, yet at the West Oakland station a private lot charges $5 a day. If the value of parking at work is about $4 a day, then we are paying people about $1,000 per year to drive their cars to work and, in the process, causing congestion, long commutes, and air pollution. See "Market Economics and Social Justice in BART Parking" [may not be included with this essay].
Hourly parking charges rely on a comparatively ancient technology, the parking meter, and more experimentation is needed with more convenient methods and with less risk of draconian fines. Treating a neighborhood grid of street parking like a parking garage should be fairly easy, with kiosks for entry tickets and exit payments, and display of ticket required in parked cars. The system could be further automated with kiosks that use credit cards or electronic tags with stored value read by a reader, a technology already widely implemented on bridges.
Yet so far we have not even been able to stop the proposed Foothill Freeway in Hayward, to be paid for by the sales tax, which wipes out the homes of a thousand people and crosses the face of the hills while competing directly with a parallel BART line. Meanwhile, Germany is taxing cars to pay for alternatives and is reducing the share of auto trips.
The initial adjustments to pricing changes will be modest and easy to make. Cars can easily become more fuel efficient and can be used more efficiently. Fuel efficiency can be dramatically improved by more aerodynamic design, cutting weight by half to two thirds using lighter materials, and using hybrid electric motors or, longer term, fuel cells. (21) Commute modes can shift from incentives created by just two pricing reforms: cash-out, and congestion pricing. More effective use of existing land use balances can take place by household moves among existing dwellings, i.e., moves closer to work.
As this slack in existing car use and land use is taken up, urban system change kicks in, the change to smart growth. See Smart Growth below. While difficult short term, long term rebuilding of cities is always going on. Pricing reform, after the initial elasticity responses, would be a profound incentive for improving our urban system.
Optimal elasticity for urban system change can be estimated based on the net moving rate. The total moving rate is the number of people who move to a new location in a region in a given time period, mostly into existing dwellings. The net moving rate counts only moves into new or rehabilitated dwellings. The net moving rate is about equal to the number of new and rehabilitated units created in a given time period. The rate of change of the urban system depends on the location and number of these units.
Since World War II, the net moving rate has grossly favored suburbia. Pricing reform, in short, reverse that process and creates market demand for dwellings which are closer in, denser, mixed use, and transit-served. Pricing reform makes suburbia more expensive and reduces negative impacts of cars in central areas. Suburban housing demand would decline as the commute becomes too expensive in time and money. Pricing reform provides a non-disruptive incentive to supply new and rehabilitated units closer to jobs and stores. Pricing shifts can be pushed to the point where smart growth dominates the net moving rate.
Increasing demand for units closer to jobs tends to increase the price of such units, which in turn stimulates the supply of such units until a new market price is reached. The new market price is the one created by pricing reforms, which increase the cost of car travel and thus increases the value of closer in housing. The equilibrium is such that the buyer saves more by avoiding the carbon tax than he or she pays in the increased price of the dwelling.
There is also incentive for new jobs to move toward housing surpluses, e.g., Tracy, thus improving imbalances from the job side. Over fifty years, the change would become substantial, even shrinking the urbanized area.
Another pricing reform is "traffic calming," which deals with a non-monetary pricing problem. Drivers impose social costs on non-drivers on local streets and shopping streets. They go too fast to be compatible with the social uses of streets, and their parking often preempts space needed by others for transportation and social purposes. Traffic and parking degrade the aesthetic qualities of neighborhoods and shopping areas. Drivers can be prevented from imposing these externalities if they slow down. The regulatory cost of policing is too high if it is going to be effective, and policing is ineffective at a lower cost. The solution has been to change the architecture of the street to change driver behavior and make it compatible with other needs. Most German streets have a speed limit of 19 mph, enforced by narrowing streets, which has also been implemented in a few places in the U.S. ("skinny streets"). Germans have also increased the sharpness of curves, built bottlenecks (chicanes) and wider sidewalks, and installed speed bumps, speed humps, ornamental posts (bollards) and big planters (to block illegal parking). Slower traffic alone increases safety and comfort for walkers and bikers, making streets usable as bicycle lanes whether marked or not.
Where pedestrian access is great enough, typically on shopping streets in town centers, cars may be banned altogether, with strong support for walk, bike, and transit access.
Parking supply similarly involves a mix of pricing and design considerations. German cities have made parking more expensive toward centers ($3 per hour in 1997), and reduced supply. Parking in residential neighborhoods is limited to residents with official permits.
Despite their climate Germany, Denmark, and the Netherlands have substantially increased bicycling with strong bicycling programs. German cities have built bicycle lane networks, expanded bike racks and bike lockers, and increased rental services. Muenster, which used the bicycle as an official symbol, is building a 3,000 space parking garage to deal with excessive parking demand-by bicycles (over 10,000 per day at that location, a train station). The city has even converted car lanes and parking lots to bicycle use. Bicycles line up at stop lights in front of cars and get their own, early, green light. Cyclists can use bus lanes, make turns prohibited to cars, and, on some streets, can go both ways, but cars, one. Some car routes go the long way around while the bike route is direct. Education, festivals, awards, and police enforcement supplement the design measures. Switzerland, Sweden, and Austria are not far behind. In the U.S. bicycles have .2 percent of person travel miles and 2.0 percent of traffic deaths.
Carism is the single most important reason for unsustainable global warming. About half of carbon dioxide comes from transportation. Carism is also the major cause of a host of other problems related to indirect pricing. Given the lack of awareness, education is the critical first step toward eventual stronger political action and sustainability.
Smart growth means ending dispersed auto development in open space, freeways, and free parking lots, and redeveloping urbanized land to mixed uses and higher densities near transit. It includes more transit, bicycling, and walking, and disincentives to auto use through such means as reduced parking, parking charges, and traffic calming. Tight urban limit lines and smart growth design are essential to meet housing needs in a way consistent with sustainability. The design of smart growth has been best articulated by the Congress on the New Urbanism, a organization of the nation's leading architects, designers, and town planners.
The preceding discussion of carism implied that reformed market forces would automatically lead to smart growth. In practice, traditional land use planning is equally important. Urban systems result, rightfully, from a combination of market forces and public policy.
The phrase "smart growth," however, is being appropriated and misused by powerful forces to include parking structures, "free" parking, and a lack of support for car-free life styles. ("Car-free" means much less dependency, not "no cars.") Already, too much smart growth has been pretty dumb in terms of sustainability. It has problems on three fronts.
1) Environmentalists are being asked to support pseudo-smart growth as a way to save the greenbelt while meeting the "housing need." The Bay Region might be able to accommodate ten million with smart growth, more than if we had sprawl. Smart growth is better than sprawl, but alone it is just one more hyper-growth housing program. The smart growth ecological footprint within a region is much smaller than sprawl, but the impact is similar to sprawl outside a region. More density seems like a good idea, but more and more and more density, ultimately, does not work. Environmentalists should consider fighting every housing project and every highway in sight until there is some deal to control job growth, the underlying problem. Mega-commutes and sky-high housing prices at least dampen aggregate growth.
2) Most "smart growth" is too automobile oriented, bringing auto dependency into the city where it destroys what we are trying to save. The Fruitvale Transit Village in Oakland California, for example, is not transit-oriented. At the end of the redevelopment around the Fruitvale BART station, there will be more free-to-the user parking, and thus more traffic, than at the beginning. So called "transit-oriented" developments, such as at Hayward and Castro Valley, build parking under the residential structure, creating street-level platforms as foundations for the residential part of the structure. Increased traffic displaces pedestrians, everyone has subsidized and easy access to cars, the ground level of many buildings cannot be used for homes and businesses, and the street dies. The result is as much, or more, traffic and auto-dependency than when "transit-oriented" development started. We must blow the whistle on "transit-oriented" fraud and fight parking structures that don't completely pay their own way.
3) Smart growth is being corrupted by those who support sprawl. Smart growth requires redevelopment around transit, but some proponents claim development in the greenbelt qualifies. The Alameda County Planning Dept. claims that sprawl on North Livermore ranch land is smart growth. Smart growth requires density, but lower density projects are often called smart. Smart growth requires transit and non-drive-alone access to transit using higher densities. It is not smart growth to have huge parking lots around BART stations accessed by drive-alones from low density subdivisions. It is not smart growth to build "high density" of ten units per net acre merely because the suburban mind knows nothing about real density. These various distortions of smart growth are just one more way for the car servant to become the master.
Smart growth should not just cram more people, cars, and pavement into less space, which is just suburbia smashed into less area. We need systemic change: both better design and transportation pricing reforms to reduce auto use, so that higher densities have less traffic and better street life with no loss of access.
In a dense setting, cars just gum up traffic. When they must pay their own way, their numbers shrink, and walking and transit have travel times comparable to suburbia. A five minute walk down a tree-lined walkway may lead to nearby shops and frequent transit. Demand for transit increases, supporting greater frequency and lowering subsidy. "Free" parking is the problem, not the solution, and density (well-designed) is a solution, not a problem.
Such a neighborhood would have convenient car rental when needed, but generally the rules for cars have to be radically different from what we are used to. To make life work on the street for pedestrians and transit, cars must be more expensive and less convenient. The tables would be turned, so that cars are disadvantaged the way walking and transit are now.
There is room for much infill housing in the Region, but not enough to meet hypergrowth projections at current densities. ABAG Projections estimate about 722,000 new housing units are needed for a regional balance of jobs and housing. At a density of 5.1 persons per acre about 142,000 net acres are needed, which is doubled to 283,000 gross acres for additional land for roads, parks, and schools. The urbanized area, however, has only 139,000 acres of potentially redevelopable land. Redevelopable land was defined as vacant and minimally improved parcels, further screened to eliminate flood plain, wetland, steep sloped, superfund, public institution, condominium, and heavy industry uses. If 283,000 acres are needed and only 139,000 are in urbanized areas, then that leaves a need of about 144,000 acres of open space. This need would substantially expand the existing urbanized area, which has 539,000 acres. (22)
The land need can be reduced by increasing density and reducing jobs, but how much of each is very controversial. Smart growth means different things to different people. Pro-growth advocates assume projected job increases, redevelopment falling short, new open space developed, and some increase in density. Sustainability assumes job growth conditioned on housing supply, reduced job growth, no new open space being developed, and even higher densities where redevelopment occurs.
A major problem is that true smart growth is a big investment. It takes a large number of people in one place to make it work. Many people in the Bay Region are probably ready to pay top dollar for a high quality, mostly car-free life style, but the banks don't know that the demand is there. The market research has not been done. This research requires a sketch plan of interiors, exteriors, and floor plans for a specific area, a calculation of costs and sale prices and profitability (a pro forma), marketing materials to show to prospects including a detailed description and graphics on how mobility changes, and interviews with prospects with the demographic profile likely to be interested. The market research firm may get more than answers; many people may be ready to put money down.
The banks are not the only problem. In addition to gentrification, neighborhoods may object to smart growth because of concern it will create even more traffic and parking problems, or fear about the kind of people who will live there based on race, class, and fear of crime. Some high density projects (Atherton Place, Strobridge Court) succeed, but many proposals near transit are blocked. Greater effort needs to be made to alleviate the street parking issue using parking charges and neighborhood parking permit programs. With effective education and enforcement, there is a more reasonable basis for car-free development which can increase local business without adding to traffic or parking. Then neighbors can see a benefit and do not have to be told they are no-good NIMBYs because they object to housing to meet a crisis they did not create.
The frames of reference of regional planners and neighborhoods are very different. The planners want to save open space and to meet housing needs, so smart growth is the only way to do it. Neighborhoods do not see any need to increase housing in the neighborhood; everybody there has a house. The planners are telling them there is a legal housing needs determination by ABAG. From the neighborhood perspective this comes from another planet. The planners, not the neighbors, are at fault. The planners need to focus on a more common-sense set of ethics and responsibility. The folks who create the housing need-the businesses and cities that increase jobs ahead of housing-should have the responsibility to meet the need, or forgo the job increase.
Neighbors should support well-designed smart growth because, done right, it will improve their neighborhood. If a project does not make parking and traffic better, it's not smart. Other problems may need to be worked though with the people who know the most, care the most, and will have to live with the project longer than the developers or the city. Even though the negotiating process is difficult, it should not be impossible, which brings us to the issue of defining who are the neighbors. Sometimes an approval process becomes dominated by a few activists with deeply held but not widely shared views, and City Councils may have to decide that most neighbors are happy enough with a negotiated project to proceed.
At the risk of contradicting the above, some developments may have so many virtues that NIMBY vetoes should themselves be vetoed. We should allow intervention by the State Office of Planning and Research to approve a few projects that meet quantified criteria of density, closeness to transit, less parking and car use, affordability, and identifiable open space saved by avoiding sprawl. If a city does not act within a reasonable time frame, OPR could step in. We should also empower and fund the State Housing Agency to make a few criteria-meeting project proposals to cities and to support the environmental review, so that developers can reduce risk and start with permits in hand. Some modest experiment in smart growth and sustainability, bringing environmentalists and builders together, should be politically possible.
Smart, car-free growth may initially occur in only a few key places close to transit, but they will develop and demonstrate a way of life better than suburbia. We can have the same spacious housing interiors, the same travel times, a more attractive streetscape, and do all of this with more health and safety, less pollution, resources and energy use, and at a great economic savings. The evidence is that urbia at gross densities of about 40 to 100 persons per acre can be more livable, more economical, and more sustainable than suburbia. A lot of people are going to be excited by these ideas and make them happen.
While Americans admire European transit, few understand that its success depends on much more than the transit itself. Four other factors are at work: high auto ownership costs, high auto operating costs, high levels of auto congestion, and dense land use. Having a car is about three times as expensive for a German as for an American. Taxes on gasoline equaled $3 per gallon and the pump price was $4.20 in 1997 compared with $1.22 in the US. People are pulled into transit because it is good, but they are also pushed out of their cars. The congestion is deceptive, based on "inadequate" roads which prevent more traffic just because they are so congested. By policy, most of these road will not be widened. Traffic, even though congested, on a small capacity network produces less air pollution than less congested traffic on a large network that encourages car travel.
In the U.S. bus transit mostly serves lower income people, who must often tolerate slow and infrequent service on zig-zag routes, or over-crowded peak service. There are few timed transfers. Car traffic, collecting tickets, low sidewalks, high bus floors, narrow doors, and climbing bus steps slow buses down. Improved bus service needs barrier-free ticketing, wider doors, lower floors, raised sidewalk stops, signal preferences, intersection lane innovations, more powerful motors, frequent direct service on main corridors, special bus and HOV lanes, and transit oriented land development.
It is uneconomic to try to blanket suburbia with some bus service. Bus transit must be tied to smart growth land use; pricing reforms, transit and density need to reinforce each other. All transit, in fact, does very little on its own; it works as part of a larger system. Once the elements of the rest of the system are there, transit become both necessary and cost-effective.
Cost-effective transit is not cheap, but is also not worthy of too much subsidy. It is worthy of some subsidy compared to cars, but needs less subsidy as direct pricing of cars increases and as land use improves. Fares must rise to recover more and more operating costs. We need to remember that walking and bicycling are even more sustainable than transit.
To recapitulate much of the above, cities which create the need for housing should have primary responsibility to supply it. A few cities-Palo Alto, Sunnyvale, Mountain View, Santa Clara, and San Francisco-have huge job surpluses stressing the Region. No other cities come even close to their surpluses. They derive fiscal benefits while imposing severe costs on the Region. Regional job management should prevent them from making the situation worse, and fiscal reform should reduce perverse incentives.
The state's housing needs determination law, by contrast, seems to have no rational or legitimate basis. ABAG implements the law, which assumes nothing will be done about job growth and assigns large housing responsibilities to cities based on a method few people understand or accept. ABAG, for example, assigned Pleasanton 4,947 units, but the city's plan allows only 2,881. The Bernal property, once proposed to develop to 1,900 units, is likely to get only 581, further reducing the potential. Pleasanton protested the ABAG number as an "unfunded mandate" because there was no money for infrastructure and mitigation of traffic, sewer, and water issues. Pleasanton said housing is a regional problem. (23) These arguments apply equally to job-creating developments, yet are never mentioned in this context. In 2000 Pleasanton's superdistrict was a job surplus area, with over 10,000 more jobs than employed residents, even after adjustments. ABAG should determine that a regional approach to housing needs meant that Pleasanton would not approve more job developments until the housing need is met. It would be interesting to hear the city's response.
ABAG, to its credit, is paying new attention to job surplus areas, a step in the right direction that needs to be greatly strengthened.
There needs to be a wider perception that businesses and cities creating the problem are simply unethical, not neighbors, environmentalists, or cities with housing surpluses. The job surplus cities should increase their housing supply or transit access to solve the problem. Is it feasible for the job surplus cities to meet their need? There is no real physical impediment to serious rezonings and increases in density using new urbanist and smart growth concepts. Such changes, however, are foreign to the psychology of suburban local government, and not even very well understood in San Francisco. So the solutions are not clear to local leaders, but the ethical framework of responsibility is needed for sustainability, to turn off the job-housing hypergrowth treadmill.
Tax incentives are major causes of a regional housing affordability crisis. While this crisis is real, it can be exaggerated. The great majority of Bay Region residents are adequately, or more than adequately, housed. Americans are generally far better housed than most people in the world. The market generally works. Most people who can't afford to live in the Bay Region don't live here. High housing prices are their own solution; supply meets demand. Those who do afford housing would of course like to spend less, but most of the concern comes from housing advocates, the developers, and the media.
Just like the demand for free roads can hardly be met, so also the demand for affordable housing cannot be satisfied if the definition is too generous and goes beyond basic needs of the disadvantaged. Most statistics on affordable housing are political, not economic, and have unrealistic notions about affordability. Focusing exclusively on increasing housing supply totally ignores the role of excessive job growth and any notion of sustainability. Housing may be unnecessarily elevated as an absolute good to the detriment of other values, similar to highways.
We need a coherent definition of what is meant by a "house." A house in 1950 was often 800 square feet on a cement slab on a small lot on a narrow street. This house was better than the "street car suburb" house in the 1920s, and in the 1930s and 1940s not much housing was being built. A house in 2000 can easily mean a monster home of over 3,000 square feet for two people on a big lot on a wide street, with many technological advances and features over the 1950 house. Statistics based on a constant value home for the same size of family dramatically reduce the estimate of housing need, and focus on basic housing rather than the enhancements and investment value.
Similarly, the history of home ownership reveals there used to be many more renters. Purchase of a home typically came later in life than now, and to house bigger families. For a few years of the early suburbanization boom of the 1950s, things were different, but that is an unrealistic base line for understanding housing. The big picture shows big success. Nationally, as a result of the Home Mortgage Disclosure Act, the Community Reinvestment Act, and vigorous enforcement by the Clinton administration, loans to low and moderate income home buyers rose 80 percent from 1993 to 1998. Home ownership is now 68.8 percent, the highest in U.S. history. (24)
The true housing crisis, where the disadvantaged suffer deprivation, affects a small percent of the population. The problem is to define carefully where markets result in social inequities that government should correct, and to fix the problem in a way consistent with sustainability. There is a middle ground between unsophisticated advocacy of unending building and blind faith that the market will solve everything.
The affordable housing problem falls primarily on lower income people faced with rising rents from job growth while their incomes are kept in check by lack of skills, by globalization of low skill work, and by very low income migrants. The migrants are both a factor in keeping wages down and in pushing housing prices up, but are generally better off than in their impoverished areas of origin. The crisis falls secondarily on middle income workers with jobs in job-surplus centers like Silicon Valley and San Francisco.
Local tax incentives encourage 1) gentrification and 2) unbalanced land use planning.
1) Smart growth may cause gentrification, and local tax incentives reward cities for encouraging dislocation at the expense of the working poor. Cities have always had some neighborhoods with dislocation, both decay pushing middle income people out and reinvestment pushing lower income people out. The problem is that sometimes the pace of dislocation is inequitable.
The Community Capital Investment Initiative of the Bay Area Alliance is looking for ways to invest in low income neighborhoods so as to benefit disadvantaged residents. The program does not always need to be concerned with more affluent people moving in. There is often room for them in new building on vacant lots, converting old non-residential buildings to housing, and other developments that do not affect those with lower incomes.
Moderate income owners generally welcome gentrification. It means retail improvements, crime reduction, and restoring the neighborhood to the higher quality the old-timers remember. They are better off if they keep living there, and better off if they sell. At the bottom of society are highly transient people who generally have many problems. Their turnover is so high they are hard to help with housing programs. They are the first to disappear when a neighborhood starts to come up. Some disadvantaged are looking to move out regardless of gentrification, with turnover similar to the rest of society.
The upshot is that there is a fairly specific population that needs help dealing with dislocation: working poor renters with roots in the neighborhood. They can be subject to evictions above normal levels and great stress in finding alternatives. Through no fault of their own, their world gets turned upside down.
How can they be helped? Education and training of the disadvantaged will help their incomes and thus their housing, but more focused efforts are also needed. Welfare (TANF, SSI) and minimum wage floors need to be high enough to pay for adequate housing without undercutting incentives to work. More money for section 8, tax credit, and other financing of projects by non-profit agencies like Bridge Housing and Eden Housing can help. Also, many redevelopment agencies have accumulated large surpluses they must somehow spend on affordable housing. Requirements for ten percent affordable units in larger building projects can help.
Rent control has some role. Circuit-breaker policies might be needed, so that when evictions rise too far above normal rates, rent moderation policies would kick in until supply catches up with demand. Overly strict rent controls, however, usually cause a reduction in the supply of rental housing, and often favor politically skillful sitting tenants over those of comparable income who are willing to pay more to live in a neighborhood. It generally is more effective in the long run to push incomes up rather than hold investment returns down.
2) Tax incentives drive unbalanced land use planning, which increases the cost of housing. Smart growth housing and job moderation are undermined by local sales and property tax inducements. The legislature has created a game only a few cities can win. The problem is "fiscal balance," which is how some land uses produce more revenues than expenditures, and others drain the treasury. Housing costs more to service than it produces in taxes, so job rich areas have no incentive to provide housing, and, in fact, have good reasons to provide none. The lower the income of households served by proposed housing, the greater the potential fiscal deficit, minimizing political support for affordable housing. High income housing and business uses are rewarded with lower service expenditures.
"Fiscal zoning" or "zoning for dollars" is endemic despite cities getting only one cent of a sales tax of eight cents or more. The penny goes to the city where the sale occurred, not necessarily where the city where the purchaser resides. The property tax has similar incentives. Local governments, acting like small businesses in response to income opportunities, are rewarded for more retail, office and industry.
Property and sales taxes need to be distributed more rationally to meet service needs. This is, unfortunately, easier said than done due to the multiplicity of services, fragmentation of governments, and diversity and complexity of revenue sources and transfers. Local officials, naturally, usually define "fiscal reform" as "more money for my local government." The public is blissfully unaware of how things work and, surprisingly, is generally satisfied with local services.
With so many vested interests at stake, great complexity, and public disinterest, local taxes will only be reformed if the state government puts significant new money on the table (devolution) which local governments would get only if they agreed to reform their tax structures. Reform means county-wide compacts among cities and counties to share property and sales revenues and, in the process, simplify and make more uniform the system of accounts, transfers, taxes, fees, and fines. Revenue sharing would start with a small percent of the total tax and small amounts of money, but phase in over a period of years to comprehensive sharing. These agreements will be impossible to negotiate without the carrot of new money.
County governments, which provide county service county wide and city services in unincorporated areas, would apply revenue sharing to the city service parts of their budgets. Taxes would be distributed mostly by residency, adjusted to favor lower income households. Lesser amounts would be distributed by land uses like retail, office, and industrial based on reasonable and uniform service costs.
Since the state robbed local governments of needed revenues during the Pete Wilson Administration, and since the economy and state revenues have recovered, there is ample reason for, and room for, reform. Governor Davis has shown little interest, but many new legislators come from local government and are sympathetic to sounder funding.
While justified in its own right, fiscal reform would also remove the major stimulus to bad land use planning. Cities would lose their reasons for excessive zoning for industry, office, and retail, and be more rewarded for converting that zoning to residential. In the best of worlds, the bias towards unending job growth and beggar-thy-neighbor fiscal land use planning would become balanced planning for jobs and housing and for sustainability.
In theory, everyone claims to support fiscal reform and affordable housing. In practice, many other values get in the way, e.g., the desire of each government to keep and increase its revenue regardless of gentrification and unbalanced land use. However, there are ways to gradually solve the problem and be sustainable, and we need to develop and build consensus for such policies.
Concerning sustainability, Americans are ignorant, arrogant, selfish, and self-indulgent. We are destroying the earth for future generations and we have lost any right to claim moral leadership in the world. We are rich, but not an advanced country. When we buy commercial fish from Lake Victoria we are causing the malnutrition of the children of the subsistence fishermen. When we buy old growth redwood we are destroying the forest primeval. We no longer buy cod from the North Atlantic, or from many other fisheries; it is all gone. Our beef consumption is denuding the forests of Central and South America, as well as causing massive soil erosion in Australia. Our oil consumption is degrading the land of the Ibos in Nigeria, and, in Venezuela, salinizing water that once produced fish for local villagers near Lake Maracaibo. Our clothing purchases too often throw Americans out of work and exploit cheap labor from Saipan to China, labor that does not know freedom, labor that does not have the right to organize.
Many crises loom just out of sight of our daily life: the extermination of more species than in any geologic era since the end of the dinosaurs, pollution by compounds with chlorine from the stratosphere to the ocean, the loss of fixed nitrogen and humus from soil due to lack of organic fertilizer, dwindling supplies of clean water, burgeoning populations, and above all, global warming.
The problems are not only global and environmental but also local and social, hurting the life chances of people just a few blocks away because the richest nation in the world can't quite afford to provide health care, or dental care, or a safe neighborhood, or a good education for our less fortunate children. Our educational system in poor neighborhoods failed many years ago, and the population in our prisons has never been higher, at exactly the same time we are draining the talent of other nations to work in our high tech industries. We are thus, compounding the problem of population growth at the same time we fail to provide real opportunity for low income families.
We must radically change the way we think about our economy, our cities, and ourselves. We must learn to think about sustainability, to think green. -Sherman Lewis Santa Barbara Planning Task Force, The Effects of Urban Growth: A Population Impact Analysis, Praeger, 1976, by Richard Appelbaum et al. The Santa Barbara City Council, based on a range of choices documented in the task force report, chose a eventual size of 85,000 people and approved job zoning consistent with that number. Voters overwhelmingly approved the plan in a citywide advisory referendum. See also Kee Warner and Harvey Molotch, "Growth Management in Three Areas: Use and Exchange Values in Political Practice," paper for Western Political Science Meeting, Newport Beach, March 22-24, 1990, 19 pages. Covers Santa Barbara, Santa Monica, and Riverside. Janet Wells, "California's workers in a crunch," S.F. Chronicle, Sep 4, 2000, p. 1, quoting from a survey by the University of California Institute for Health Policy Studies San Francisco and the Field Institute. Janet Wells, "California's workers in a crunch," S.F. Chronicle, Sep 4, 2000, p. 1, quoting from a survey by the University of California Institute for Health Policy Studies San Francisco and the Field Institute. Poverty: Human Poverty Index based on survival to age 60, functional illiteracy, population below poverty line, and long-term unemployment. "World Poverty." S.F. Examiner, Sep 9 98, p. C-18. Income distribution: Kevin Danaher, Globalization and the Down Sizing of the American Dream, S.F.:Global Exchange, 1996. both in Nikhil Anand and Henry Holmes, Failed Promises...," SAGE, Earth Island Institute, San Francisco, April 2000. See also OECD, Income Distribution in OECD Counties, Social Policy Studies No. 18, Oct. 1995. U.S.: Ronald Dugger, "Real Populists Please Stand Up, " in Globalization, cited above. CA: Deborah Reed, California's Rising Income Inequality, S.F.: Public Policy Institute of California, 1999, p. xxv. Silicon Valley: Chris Benner, Growing Together or Drifting Apart? Working Families and Business in the New Economy, San Jose: Working Partnerships and the Economic Policy Institute, 1988, p. 22, all from Anand and Holmes. Jennifer Coleman, "Study: California leads nation in dead-end jobs, S.F. Examiner, date missing, based on California Budget Project: more earn poverty wages than ten years ago, and median California four person family income declined. Cost of living goes up faster than compensation. Janet Wells, "Racial divide in boom time, study reports," S.F. Chronicle, September 5, 2000 p. A1, quoting from a survey by the University of California Institute for Health Policy Studies San Francisco and the Field Institute. "Latinos in Silicon Valley: The Digital Divide, The Economist, Apr 17 99 p. 33. AP, "Himalayas heating up, sample finds," SF Chronicle, September 15, 2000. Peter Lydon, "The climate change issue and Bay Area metropolitan planning," personal communication, Jul 20 '00. Paul Hawken, Amory B. Lovins, L. Hunter Lovins, Natural Capitalism : Creating the Next Industrial Revolution, Little Brown, 1999. Road capital projects and maintenance not from user fees; local road user services: police, fire, ambulance, hospital, legal, liability costs; municipal revenues forgone to ROW. Road capital projects and maintenance not from user fees, Strategic Petroleum Reserve, petroleum subsidies in tax code, petroleum research and development subsidies, export financing subsidies, Army Corps of Engineers subsidies, Dept. of Interior Oil Resources Management Programs; car share of Mideast oil military expenditures, moral jeopardy and turpitude in supporting violent, non-democratic governments, regulatory costs for oil pollution oversight, monitoring, inspection, enforcement, clean up, and liability not paid for by polluter, Coast Guard and DOT Maritime Administration uncompensated protection services, mortgage subsidies. Bundling of property rents and sales to include parking, new road capacity impact on localities competing for commercial and industrial development to raise revenues, "fiscal zoning," impact on downtowns, old industry, lack of car rentals in dense neighborhoods, lack of location efficient mortgages (LEM); lender bias toward sprawl houses, construction liability costs for condos. Land consumption, shadow effects on agriculture, nuisance lawsuits, land value and opportunity costs of ROW and parking, decline of older neighborhoods, industrial areas, and downtowns, land inefficiency of low density, increased cost of freeway-served land for open space protection, hindering acquisition. Quality of life along streets, in neighborhoods, driver externalities, costs to pedestrians and bicyclists, increased walking distances, barrier effects, decreased amenity, increased danger, pedestrian intimidation, sedentation, costs to non-drivers, costs to drivers as chauffeurs, driver social isolation and loss of neighborhood networks , diminished choice of modes, aesthetic degradation costs, impacts on historical and cultural heritage. Induced demand, economic inefficiency, inequity of externalities among income levels, gas tax cross-subsidy from local road users to state and federal road users, gas tax cross-subsidy from present, unbenefitted payers to future, benefitted, but non-paying, users of new capacity, cross-subsidy from those who drive less or not at all to those who drive more, cross-subsidy from those who pollute less, pay to park, don't drive during peak hour, to the opposites, economic risks of auto dependency (dependency on imported oil, monoculture instabilities). William Fay, President, American Highway Users Alliance, quoted by Jim Burns, CNS Senior Staff Writer, "Transportation Group Criticizes Environmentalists On Highway Construction," September 13, 2000. The AFFORD Project, www.vatt.fi/afford/, urban transport research by a consortium of 11 European partners coordinated under Concerted Action on Transport Pricing Research Integration (CAPRI) conducted for the General Directorate for Transport, DG VII Research and Technological Development Programme (DGVII), Commission of the European Communities 4th Framework Programme, Jul 2 00 (last update). See also European Conference of Ministers of Transport, Internalising the Social Costs of Transport, Paris: OECD, May 1994 and Efficient Transport for Europe, Policies for Internalisation of External Social Costs, Paris: OECD, 1998. See also European Federation for Transport and Environment, Getting the Prices Right, A European scheme for making transport pay its true costs, T&E 93/7, May 1993. Hawken et al, p. 40. Carl Nolte, "Driving force for many - Parking survey finds 67% are alone at the wheel," San Francisco Chronicle, Sep 4 00. This article has a rare violation of the media black out on the role of free parking. Hawken, chapter 2. John Landis and Ness Sandoval, table given to the Technical Advisory Team, Regional Livability Footprint Project, Bay Area Alliance, Sep 8 '00 at ABAG. One table, however, shows 662,579 available acres. Assuming 101,000 are within the urban area, that leaves 501,579 in open space, which would almost double the urbanized land in the Region. "Pleasanton takes aim at ABAG numbers," Valley Times?? Sep 28 '00. Neal Pierce, "Disclosure: Key Weapon for neighborhoods," Washington Post Writers Group, Jul 23 00