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Thread: What is the objection to private cities?

  1. #1

    What is the objection to private cities?

    For the past few months I have been engaged in creating the justification for abolishing the current system of cities as socialist corporations to replace them with a free market in urban property. I first responded to some confused soul who wanted to abolish all city planning by pointing out how urbanism could be done as a for-profit enterprise. I then provided empirical evidence of successful outcomes of private management of urban property, as well as evidence of irresponsibility and unaccountability for public, elected management of urban property. Finally I demonstrated how the creation of sprawl and the degeneration of the city was caused by the politicization of urban property.

    Important points to note:
    - The low incomes of city planners is a result of their inability to convert their expertise into real valuable goods for the consumer, the cause of this powerlessness being political obstruction and bureaucracy.
    - The political process of decision-making does not in any way reflect the preferences of individual people, and only their choices expressed through the free market can be assumed as such.
    - Deregulation is not what creating a free market for urban property will result in, and in fact deregulation is in part the cause of the degeneration of the city. Property must always be regulated by its owners in order to create the maximum value from it. The political process fails at regulating the city because it is limited to bureaucracy and quantitative laws, while the most important issues in urbanism are essentially qualitative.

    Now that I have made my case demonstrating the superiority of the private for-profit system, I want to turn the burden onto you and ask you to outline where your objections to this reform originate. I will then respond to these objections and elucidate the solutions. (BKM this is the thread to call me an ersatz randian feudalist.)

  2. #2
    Cyburbian jordanb's avatar
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    jaws: Prove us wrong and make your own "private city." Until then all you're doing is whining.
    Reality does not conform to your ideology.
    http://neighborhoods.chicago.il.us Photographs of Life in the Neighborhoods of Chicago
    http://hafd.org/~jordanb/ Pretentious Weblog.

  3. #3
    Aren't Private Cities called communes??????????????
    Forechecking is overrated.

  4. #4
    Super Moderator luckless pedestrian's avatar
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    I thought this was another thread about rabid homeowner's associations


  5. #5
    Quote Originally posted by jordanb
    jaws: Prove us wrong and make your own "private city." Until then all you're doing is whining.
    I would like this but it is currently impossible.

  6. #6
    Cyburbian jordanb's avatar
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    Well, there you go.
    Reality does not conform to your ideology.
    http://neighborhoods.chicago.il.us Photographs of Life in the Neighborhoods of Chicago
    http://hafd.org/~jordanb/ Pretentious Weblog.

  7. #7
    Quote Originally posted by jordanb
    Well, there you go.
    Exactly what is your point? That because the government is suppressing the creation of private cities, I'm nothing more than a whiner?

  8. #8
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    !!!!!!!!!!!!!!!

    Quote Originally posted by jaws
    Exactly what is your point? That because the government is suppressing the creation of private cities, I'm nothing more than a whiner?
    could you please send me some references of what you're talking about? i've tried very hard to imagine things here, but my imagination is very infertile today.
    i have the impression we're talking about the most ultra-conservative (feudalistic i would add) proposal on urban planning we have seen since the rationalist-modernist days... maybe you should come down to brazil, a country with 180 million people and the second worst distribution of income in the world. it's full of "private cities" down here - but let's just say, that the word CITY does not match the word private, just to start things going (citÚ, polis, township - whichever you'd like best. those are automatic opposites of anything private, ever since jericho, or šatal huyuk, if you'd like)...

  9. #9
    Quote Originally posted by felipe
    could you please send me some references of what you're talking about? i've tried very hard to imagine things here, but my imagination is very infertile today.
    i have the impression we're talking about the most ultra-conservative (feudalistic i would add) proposal on urban planning we have seen since the rationalist-modernist days... maybe you should come down to brazil, a country with 180 million people and the second worst distribution of income in the world. it's full of "private cities" down here - but let's just say, that the word CITY does not match the word private, just to start things going (citÚ, polis, township - whichever you'd like best. those are automatic opposites of anything private, ever since jericho, or šatal huyuk, if you'd like)...
    You can look up some previous thread such as this one to get a clear idea of what I'm talking about.

    I'm not familiar with the specifics of Brazilian urbanism, however I'm well aware that Brazil is a far cry from being a country where economic liberty is respected, and many of its inhabitants have been reduced to living in slums because of it. What you are referring to is probably gated subdivisions created to protect the inhabitants from the outside where law and order is nonexistent. These are also fairly common in the USA. The creation of these places is the result of the failure of the publicly owned cities to create enough security on its property. It would therefore be preferable to privatize the existing cities so that people wouldn't have to isolate themselves in islands of protection. Only the rich can afford to do such a thing, and the poor are left to suffer the inferiority of public security.

  10. #10
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    Quote Originally posted by jaws
    however I'm well aware that Brazil is a far cry from being a country where economic liberty is respected, and many of its inhabitants have been reduced to living in slums because of it.(...) It would therefore be preferable to privatize the existing cities so that people wouldn't have to isolate themselves in islands of protection. Only the rich can afford to do such a thing, and the poor are left to suffer the inferiority of public security.

    let me keep on trying to understand. then, in the brazilian case, where the poor are victims of how much our government sticks his nose into things, what we need is to create private cities so that those who were able to escape the effect of government on the economy and be rich don't need to isolate themselves. i'm sorry, it might be a language problem, i just can't figure out the reasoning here. maybe it's too complex for my 3rd world (mis)education...

  11. #11
    Quote Originally posted by felipe
    let me keep on trying to understand. then, in the brazilian case, where the poor are victims of how much our government sticks his nose into things, what we need is to create private cities so that those who were able to escape the effect of government on the economy and be rich don't need to isolate themselves. i'm sorry, it might be a language problem, i just can't figure out the reasoning here. maybe it's too complex for my 3rd world (mis)education...
    It's not very difficult to understand. In a country without economic liberty only the rich can afford to bribe their way through the system and function properly. In a nutshell "the rich get richer and the poor get poorer." For a complete elaboration of this phenomenon I recommend reading The Mystery of Capital by Hernando de Soto, which appropriately enough is focused on South America.

    The existence of gated communities is the same outcome. Security is made unnaffordable by the masses because of government interference, but small groups of the ultra-wealthy can afford to provide security for themselves in excess of what the the government taxes them for. By eliminating the interference from the urban market we can make security affordable to everyone. The quality of security will improve and everyone will come back to the city, rich and poor.

  12. #12
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    i'm an economist, i went to school down here, and we're well aware of de Soto in our urban economics departments, and it's interesting but fails to get into the political economic, it's too based on pure economic analysis, and to me that's limited to markets, and markets are just part of the whole, you can't apply pure market research and theoretical tools to the whole (the city, that is), basically speaking (if you want to get into this epistemological talk, look for karl polanyi's the great transformation for a good analysis on the limits of modern economic science/discourse).

    Quote Originally posted by jaws
    Security is made unnaffordable by the masses because of government interference, but small groups of the ultra-wealthy can afford to provide security for themselves in excess of what the the government taxes them for. By eliminating the interference from the urban market we can make security affordable to everyone. The quality of security will improve and everyone will come back to the city, rich and poor.
    the very 1st sentence i still can't reason with ([public] security is unaffordable because of govt - i'm sorry). if you really want to insist on the methodological error of applying this neoclassical stuff to city planning, let me try to shift the language then: public goods are indivisible and non-exclusive by definition (if you can ever convince any sober mind that public security is not a public good, you really need to get your stuff together and publish that, and get rich and famous for it), therefore it's impossible to turn them into (divisible, excludable) products to be sold in a market. and even if that were possible, how would the poor afford public safety, and why in the world would they pay to protect them from themselves (in your own discourse, the rich build private cities to isolate themselves, right?).

    2nd: 3rd world countries don't tax the rich. that's a fact. they tax current spending, and therefore, proportionally, they tax the poor more heavily. income tax in brazil is ridiculous compared to what you all pay (don't try to convince me this is a good thing. it's the very reason why we have such a terrible distribution of income in the 1st place).

    i'm aware there's a very strong orthodox current coming from the higher spheres of your urban ecncs depts (Mr. Edward Glaeser et al*), and I believe it is very very important that we precise those limitations of pure and isolated economic science to deal with such a complex (and hence necessarily interdisciplinary subject) such as the city. to me it's just part of a wider trend in neoclassical ecncs to get into other social scientists fields of research w/o trying to establish prior conversations with these people (and w/o stepping down from the pedestal to talk to other researchers). the book freakonomics is the clearest example. while most fields of knowledge are trying to work more closely with one another, and transdisciplinary research efforts grow all accross the globe, neoclassical economists just lock themselves further in their arrogance... and ironically, they're the ones being consulted by the highest courts (needless to appoint the degree of intelligent life which circulates in the latter).

    *who had the nerve to say, according to his numbers, that we shouldn't rebuild all the infrastructure of such an inneficient city like new orleans. it should be abandoned. people should just move elsewhere. to me, that is fascist, to say the least

  13. #13
    Cyburbian jmello's avatar
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    Quote Originally posted by felipe
    let me keep on trying to understand. then, in the brazilian case, where the poor are victims of how much our government sticks his nose into things, what we need is to create private cities so that those who were able to escape the effect of government on the economy and be rich don't need to isolate themselves. I'm sorry, it might be a language problem, i just can't figure out the reasoning here. maybe it's too complex for my 3rd world (mis)education...
    Boa tarde! What this gentleman is suggesting is an experiment where the local government (municipio) would be privately operated outside of the democratic process. He is not referring to private/exclusive neighborhoods within the municipality. At least that is what I got from it. Edit: After reading your later comments, I realize that this discussion has evolved far beyond the preliminaries.

    P.S. Belo Horizonte is a great city. I spent a wonderful night in Savassi.

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    i'm sorry to explode the subject like that. to me it all sums up in a debate around discourse (and how science is used to privilege certain political arguments over others).
    if you're right about the point being a privatization of govt itself, then i must say i'm scared crapless of telling my friends about this thread.

    savassi is where i'm heading in a few minutes for a pint. bh is a busier city when the summer ends. i'm very glad you enjoyed it here. (most ppl don't...) cheers!


    Quote Originally posted by jmello
    Boa tarde! What this gentleman is suggesting is an experiment where the local government (municipio) would be privately operated outside of the democratic process. He is not referring to private/exclusive neighborhoods within the municipality. At least that is what I got from it. Edit: After reading your later comments, I realize that this discussion has evolved far beyond the preliminaries.

    P.S. Belo Horizonte is a great city. I spent a wonderful night in Savassi.

  15. #15
    Quote Originally posted by felipe
    i'm an economist, i went to school down here, and we're well aware of de Soto in our urban economics departments, and it's interesting but fails to get into the political economic, it's too based on pure economic analysis, and to me that's limited to markets, and markets are just part of the whole, you can't apply pure market research and theoretical tools to the whole (the city, that is), basically speaking (if you want to get into this epistemological talk, look for karl polanyi's the great transformation for a good analysis on the limits of modern economic science/discourse).
    I'm not applying neoclassical economics to urbanism because neoclassical economics has large holes in its theory and it is mostly useless to explain anything. My theoretical framework is austrian-classical economics, a theory that strives to integrate the whole of human economic behavior, which I used to explain why urban degeneration has taken place, and also used to explain why De Soto's investigation matters. The poor remain poor because their economic rights are not being respected. The rich get richer because they can bribe their way through this problem.

    I read The Great Transformation some years ago, so you will have to refresh my memory on the section you are specifically mentioning. If you want a good discussion on epistemology, read Epistemological Problems of Economics.

    the very 1st sentence i still can't reason with ([public] security is unaffordable because of govt - i'm sorry). if you really want to insist on the methodological error of applying this neoclassical stuff to city planning, let me try to shift the language then: public goods are indivisible and non-exclusive by definition (if you can ever convince any sober mind that public security is not a public good, you really need to get your stuff together and publish that, and get rich and famous for it), therefore it's impossible to turn them into (divisible, excludable) products to be sold in a market. and even if that were possible, how would the poor afford public safety, and why in the world would they pay to protect them from themselves (in your own discourse, the rich build private cities to isolate themselves, right?).
    Of course security can be sold on the market. You purchase a subscription service and the security provider in return agrees to ensure your security against invasion. There are many private security companies (such as Garda) who already operate in such a way. So once again we see that when public security fails at providing enough security, the wealthy can afford to supplement this by hiring more security from the market. The poor however are stuck with the bad public security and suffer from higher rates of criminality and violence, often at the hands of government agents.
    *who had the nerve to say, according to his numbers, that we shouldn't rebuild all the infrastructure of such an inneficient city like new orleans. it should be abandoned. people should just move elsewhere. to me, that is fascist, to say the least
    New Orleans is a very interesting case for this issue. The destruction of the city was caused entirely by the government. The levies which held the water back were deficient, and all the men who worked on them were aware of this fact. The problem was that they were employed by the Army Corps of Engineers instead of the owner of New Orleans, therefore it was impossible for them to convince their superiors that urgent repairs were required. Everyone knew the levies would break when the hurricane came, but they did nothing about it, because as a rule the government doesn't care. Only a private owner who stood to lose everything in case of levy failure would have immediately made the necessary repairs.

    This is without mentioning the horrible government rescue efforts that embarassed everyone of course.

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    ok, i think you do have an interesting point of view, and maybe i┤m underestimating the general pretention not only to apply market analysis to more complex (than markets) settings, but also to generalize the market form and cast it onto the whole of society, de-politizing it. decisions don┤t need to go through the political sphere anymore, technocrats will have a ready answer for everything (which is exactly what happens to macroeconomic policy all around, i just didn┤t think that would eventually arrive to planning).


    (hope you don┤t mind the tones in my critique sometimes, it┤s just silly rhetoric.)

  17. #17
    Cyburbian donk's avatar
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    Quote Originally posted by jaws
    The political process fails at regulating the city because it is limited to bureaucracy and quantitative laws, while the most important issues in urbanism are essentially qualitative.
    I tend to avoid these types of threads, but am dealing with this point right now. The real issue is that due to legal requirements we are forced to use quantitative methods to regulate qualitative things. If all parties worked from a similar background and without a vested interest in developing a City then maybe it could be private, but when we have individuals whose only aim is to profit, we need a set of gatekeepers and that is gov't.

    As for our salary, nothing irks me more than getting jerked around by developers who will make more profit off of 1 dwelling unit in a development than I make in a year, and I am expected to be thier helper, while the people they pay don't cooperate.
    Too lazy to beat myself up for being to lazy to beat myself up for being too lazy to... well you get the point....

  18. #18
    Quote Originally posted by donk
    I tend to avoid these types of threads, but am dealing with this point right now. The real issue is that due to legal requirements we are forced to use quantitative methods to regulate qualitative things.
    That is the real issue, but you have to understand the reason this is the real issue. Why are you forced into this system? The reason is very simple. Without a free market, the only way to effectively control a scarce resource is through bureaucracy, and bureaucracy only works quantitatively by the rule of law. The urbanist's job is to apply the law, not to optimize it. How could he optimize the regulations without any scale of profit or loss? The outcome's success will be determined politically instead of economically, therefore any urbanist with a high level of regulatory discretion would be extremely controversial, no doubt becoming implicated in so much controversy that his work would be completely obstructed by it. Thus we have the current regulatory system that sacrifices quality for political control.
    If all parties worked from a similar background and without a vested interest in developing a City then maybe it could be private, but when we have individuals whose only aim is to profit, we need a set of gatekeepers and that is gov't.
    But then you have to ask the question, is the government a competent gatekeeper? Is it creating positive results? The history of the 20th century shows that it isn't.

    There is a concept I wish to introduce to you called the structure of production. The cities produce a final consumer good, the urban environment. To achieve this they need the cooperation of intermediate goods producers, the real estate developers. Now the developers obviously want to maximize their own profits, and they can achieve this at the expense of the city by corrupting the final production process. It is the role and the responsibility of the city to regulate the process so that its own profits are maximized (the value of the city as a whole is the greatest possible). If the city had a private owner it could make the correct demands from its developers that would maximize the city's profits, and the developers would then cooperate with the city in a way that maximizes their own profits. At every point in the structure of production profit is maximized, and economy is realized.

    It is perfectly good to have individuals whose only aim is to profit if the system does not allow some to profit at the expense of others. The government cannot stop people from being self-interested. The government and its employees are self-interested. You are in fact just as self-interested as the developers you deal with. The public that throws obstacles in your way when you want to make a positive reform is also self-interested. The reason there are so many conflicts is that there is no clear ownership of property. Under a single self-interested owner, this owner is very clear in his objective: to make the city as a whole as valuable as possible. This means clean, safe streets, architectural beautification, noise-reduction, etc. This means imposing regulations.

    Picture a shopping mall. The shopping mall has a single owner. However, the mall leases space to other profit-seeking businesses. These profit-seeking businesses must comply with the regulations of the mall. You have two different properties, both seeking profits. However they cooperate in order to achieve an ultimate objective, selling consumer goods. It is clear who owns the malls and who should make the rules. It is clear what the rules should be. There is no politicization of the regulatory process. If the rule makes the mall a better place, the rule is imposed and enforced. The mall owner acts as the gatekeeper. His interests are coordinated with the interests of the shopkeepers, and that of the shoppers.
    As for our salary, nothing irks me more than getting jerked around by developers who will make more profit off of 1 dwelling unit in a development than I make in a year, and I am expected to be thier helper, while the people they pay don't cooperate.
    Then you know what must be done. The market for cities must be created so that you may take your rightful place in the economy providing high-value environments free of politics.


    Quote Originally posted by felipe
    ok, i think you do have an interesting point of view, and maybe i´m underestimating the general pretention not only to apply market analysis to more complex (than markets) settings, but also to generalize the market form and cast it onto the whole of society, de-politizing it. decisions don´t need to go through the political sphere anymore, technocrats will have a ready answer for everything (which is exactly what happens to macroeconomic policy all around, i just didn´t think that would eventually arrive to planning).

    (hope you don´t mind the tones in my critique sometimes, it´s just silly rhetoric.)
    I'm not arguing for technocrats nor any policy. I am arguing for depoliticization. I am arguing for personal discretionary decision. With a free market it is possible for this to take place without creating conflicts.

    I'm not angered by your comments. I am here to educate, and assume as a general rule that people have simply misunderstood me.

  19. #19
    Cyburbian donk's avatar
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    I am going to provide some real life examples and ask a few questions to see what others think about situations I am in.

    We have a property with a "significant" natural feature on it that has been identified for preservation. It has been identified as a feature worthy of preservation for about 15 years, before the current owner purchased the land.

    However, if the natural feature is obliterated, then the owner gets another 40 DU @ $40-50K profit per unit. (8 ac @ 5du/ac) vs the 150K /ac we are going to pay for it. The purpose of preserving this feature is to allow for open space for ground percolation at the headwaters of a major river system.

    Q1 In a private city what is the owner's motiviation to preserve this feature if there are no rules and he owns no land down stream in another jurisdiction that may be impacted by flooding or reduced water quality?

    Q2 Who is going to provide services where there is no immediate or direct profit? (schools, museums, parks) I know what your answer is going to be, that citizens will choose to live in places with these things so a private city will provide them as they contribute to maximizing the profit of a place. (qualitative provision of services and defining place in a qualitative world) However, I would argue against this answer. While some people would choose to live in a better neighbourhood for scholls, others are happy enough to remain ignorant or in their position in the world.

    Q3 In a private City model how is continuity of service development done and coordinated? What happens when it goes bankrupt or the original "developer" moves on? How do you dispose of short term interests and profits vs a longer term profit of a similar value( ie $500 paid to you today or $125 per year for 5 years)

    [Q4 jaws have you looked at and considered company towns (ie resource towns like Elliot Lake Chalk River Walkerville -historic) and what happens when they are no longer needed, but the people want to stay or how people are treated in these places? Have you looked at land lease communities (ie trailer parks), for examples of how they are run and what happens in these private palces to the "poor"?
    Too lazy to beat myself up for being to lazy to beat myself up for being too lazy to... well you get the point....

  20. #20
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    Quote Originally posted by jaws
    I'm not arguing for technocrats nor any policy. I am arguing for depoliticization. I am arguing for personal discretionary decision. With a free market it is possible for this to take place without creating conflicts.

    I'm not angered by your comments. I am here to educate, and assume as a general rule that people have simply misunderstood me.

    you cannot escape politics. it's stuck to you. whatever proposal of changing society in any form has, necessarily, a political content. and yours is authoritarian, in my opinion. what we need is more democracy, more participative politics at the local level, not delivering decision making processes to privately owned corporations.
    the contemporary city, as Henri Lefebvre would put it, has re-instituted the everyday, grassroots politics as part of its own socio-spatial form - in a similar manner to what happened in the greek polis (direct democracy). what we're watching is a large demand by all sorts of different urban social movements to take politics with their own hands, and no longer leave it to the professional politician (as the representative democracy model loses legitimacy all over the west*). democracy is the greatest legacy of modern history (not the free market!), and any atttempts at de-politizing public policy (a contradiction of terms) kills it, and therefore it's authoritarian.

    regarding the shopping mall, to me that isn't part of what we can conceive as a city. it's just a big store with a bunch of little ones inside. [and it's sad to see public space reduced to that form in some countries.] stores are private corporations, and in private corporations you can't decide what you want to do, organize in groups and debate things democratically, so that a certain majority can get whatever they're aspiring for. you just have to do what you are told, just like in military organizations.

    * i don't know what's happening in the u.s. though, haven't been there in a while, but i do believe the same conditions exist in american cities.

    ps: thanks for educating me, i really need some discipline...

    just one specific point that i'd forgotten, about the levies in new orleans.
    how would a privately operated system have acted, concerning prices, and how would they sell their protection to the market??? i can't imagine such a public good being offered in a free market - the only way a private corporation could act on it is through concessions by the public sector itself. (it's a question)

    ps: i watched the documentary nominated for the academy award, enron, the smartest guys in the room, in which there's an incredible story about the deregulation of the electric sector in the u.s. and the specific story of what happened in california (and how mr. terminator had his way paved to office in the midst of all this mess - a proof that politics is always on your tail, wether you like it or not). (it's a suggestion ; )
    Last edited by NHPlanner; 19 Mar 2006 at 4:06 PM.

  21. #21
    Quote Originally posted by donk
    I am going to provide some real life examples and ask a few questions to see what others think about situations I am in.

    We have a property with a "significant" natural feature on it that has been identified for preservation. It has been identified as a feature worthy of preservation for about 15 years, before the current owner purchased the land.

    However, if the natural feature is obliterated, then the owner gets another 40 DU @ $40-50K profit per unit. (8 ac @ 5du/ac) vs the 150K /ac we are going to pay for it. The purpose of preserving this feature is to allow for open space for ground percolation at the headwaters of a major river system.

    Q1 In a private city what is the owner's motiviation to preserve this feature if there are no rules and he owns no land down stream in another jurisdiction that may be impacted by flooding or reduced water quality?
    Well this is more of a problem of property law than urbanism. Current property law is completely broken, so I understand where the confusion emanates. If someone's alteration of the environment causes your property to be destroyed by flooding, or invaded by pollution, then he is liable for the damages. You should then be able to obtain an injunction preventing him from invading your property, or he should purchase from you the right to destroy it. Whichever option is the most economically efficient will take place.

    Under the current system, there is little that you can do except purchase the property for what its current owner thinks it is worth. Since it is necessary for the proper function of your community, you can combine it with the rest of your assets.

    And one final point. The fact that the owner can develop the property implies that the city that relies on it is not providing enough development itself. In a free market of cities there would be little profit to landowners from developing their land as the city itself would have earned them first.
    Q2 Who is going to provide services where there is no immediate or direct profit? (schools, museums, parks) I know what your answer is going to be, that citizens will choose to live in places with these things so a private city will provide them as they contribute to maximizing the profit of a place. (qualitative provision of services and defining place in a qualitative world) However, I would argue against this answer. While some people would choose to live in a better neighbourhood for scholls, others are happy enough to remain ignorant or in their position in the world.
    And if people don't want schools, museums and parks, why shouldn't they have the right to make that choice? Many people already make this choice by living far out in the countryside. To them the value of the open country is greater than the value of urban amenities. However there are many people who do value urban amenities, and will choose to pay more for them.

    You make a grave mistake when you say that people must be provided with things that return no profit. That implies that you are taxing them for things that they do not want, thus that create no value. You are not producing a good, you are producing a bad.
    Q3 In a private City model how is continuity of service development done and coordinated? What happens when it goes bankrupt or the original "developer" moves on? How do you dispose of short term interests and profits vs a longer term profit of a similar value( ie $500 paid to you today or $125 per year for 5 years)
    A free market implies exchangeable private property. That means that you can calculate the value of your property by the value that it can be exchanged for. This is the root of economic efficiency calculation. Generally this exchange value is equivalent to all future discounted income. (For example, if a property generates 1000$ in income per year, and the discount rate is 10%, then the total value of the property will be 1000$ + 900$ + 810$ + 729$ + ... + 0 = 10000$) So an investment that yields only a long-term increase in real value will generate a profit immediately because it will immediately increase the exchange market value of the property.

    That creates two obvious benefits. First of all, the price of access (what is currently known as property taxes) will fall because a smaller price will bring more investment to the city, creating more value over the long-term and thus increasing the total market value of the property. Secondly if the current owner of the city is incompetent and runs up huge amounts of debts, it cannot raise prices! It will instead sell off the property to the highest bidder, because that will create more income than raising the price. In case that so much debt is run up that the owner faces bankruptcy, it cannot raise prices! That would destroy the property even further. Instead the property will be liquidated by the creditors, and a new owner will take over without the debt.

    Too many cities today are squeezing their residents with high taxes because of debts run up by previously incompetent politicians. This is not only unfair, it also slowly destroys the city as people move away to more competitive suburbs.
    [Q4 jaws have you looked at and considered company towns (ie resource towns like Elliot Lake Chalk River Walkerville -historic) and what happens when they are no longer needed, but the people want to stay or how people are treated in these places? Have you looked at land lease communities (ie trailer parks), for examples of how they are run and what happens in these private palces to the "poor"?
    First of all, a mining town cannot survive past the life of the mine. There is no income coming into the city. The city makes no exports. Therefore people must plan how long they can live there accordingly. This is true even if the town is owned democratically.

    Trailer parks are a good place for the poor to live, which is why they choose to live there. Rents are low and quality of life is comparatively higher than what they would get in apartments in the democratically-run cities. If we improved the quality of apartment life they might choose to move away.




    Quote Originally posted by felipe
    you cannot escape politics. it's stuck to you. whatever proposal of changing society in any form has, necessarily, a political content. and yours is authoritarian, in my opinion. what we need is more democracy, more participative politics at the local level, not delivering decision making processes to privately owned corporations.
    the contemporary city, as Henri Lefebvre would put it, has re-instituted the everyday, grassroots politics as part of its own socio-spatial form - in a similar manner to what happened in the greek polis (direct democracy). what we're watching is a large demand by all sorts of different urban social movements to take politics with their own hands, and no longer leave it to the professional politician (as the representative democracy model loses legitimacy all over the west*). democracy is the greatest legacy of modern history (not the free market!), and any atttempts at de-politizing public policy (a contradiction of terms) kills it, and therefore it's authoritarian.
    This is a heap of contradictions. It is not authoritarian to create property rights, it is liberty. What is authoritarian is creating a large pool of monopoly property under the control of majority-elected politicians. These politicians then impose their authority on the minority, which has no choice but to accept these rulings.

    Imagine if you could not own your home. It would be owned and ruled by a democratic national housing company. People would vote on whether or not you can put in an extra bathtub, or a pool room. You would not be able to decide this for yourself. Other people would decide it for you. This is authoritarian. That we vote for the authority does not make it any less authoritarian.

    The last thing we need is more democracy. People are already overwhelmed with too much democracy, and are losing control of professional politicians. Controversies occur in such rapid succession that nobody has any clue what is going on except the people closest to power. Accordingly these people take advantage of this power for themselves, and the electorate suffers the consequences. People only become activists when they have a strong personal stake in the issue, for example if the politicians want to use eminent domain to replace their house with an aquarium. Of course since all the other voters are suffering from democratic fatigue, the victims stand alone against the politicians, and usually they lose.

    Too much democracy has ruined the city. Nobody understands the issues that city planners deal with. Why should they be expected to make the right voting decisions about them? They can't and they didn't, and so we have seen our environment ruined by sprawl and urban decay.

    The less democracy we have, the better the democracy we do have will be, because we will be able to focus on the important issues. This is what I mean by depoliticization. The fewer decisions are taken politically, the more control we have on the remaining political decisions. I'm aware that this is a political stance I'm taking, but one whose outcome will be a reduction in politics.

    regarding the shopping mall, to me that isn't part of what we can conceive as a city. it's just a big store with a bunch of little ones inside. [and it's sad to see public space reduced to that form in some countries.] stores are private corporations, and in private corporations you can't decide what you want to do, organize in groups and debate things democratically, so that a certain majority can get whatever they're aspiring for. you just have to do what you are told, just like in military organizations.
    That is simply false. A military organization is a coercive organization. It gives out orders and forces you to obey them. A government operates the same way. A private corporation however is a cooperative organization. It exists to serve you. It can only exist so long as it succeeds at serving you. If people were to stop cooperating with this corporation (buying its products), it would immediately go bankrupt. That means that, strangely enough, people have more power with regards to a private corporation than they do with their own governments. If you are a long-time client of a business, and you have an idea or a complaint to make to this business, you can take it directly to the owner. If it is a good idea or a valid complaint, the owner will immediately act to change this situation, because the owner needs to retain you as a client in order to stay in business.

    Democracies are extremely difficult to change this way. Not only do you need to rally a large number of people behind you, a process that is extremely expensive to yourself, you then need to actually convince the politicians in charge that this large number of people is a threat to them.
    just one specific point that i'd forgotten, about the levies in new orleans.
    how would a privately operated system have acted, concerning prices, and how would they sell their protection to the market??? i can't imagine such a public good being offered in a free market - the only way a private corporation could act on it is through concessions by the public sector itself. (it's a question)
    The levies were not a public good. They were a good that profited a certain area of the city of New Orleans, the area below the water level. Someone who owned a large number of properties in this area (the city) has a direct interest in providing these levies, otherwise all of its properties become worthless. Thus it will bundle the levies with other goods that it sells on the marketplace.
    Last edited by jaws; 19 Mar 2006 at 6:15 PM.

  22. #22
    Cyburbian Luca's avatar
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    Rather predictably, this thread has devolved into pro/con. I think you can in fact find many examples on both sides of the divide that have worked well.

    Jaws: I think in practical terms what may work toward your goals is the 'privatization' of local, perhaps minor aspects like certian facilities (I'm thinkign Bryant Park). Once people see that in many cases private providers work better they may opt away from public provision of other services.

    I think Jaws makes some points that are difficult to refute: For isntance, the rise of gated communities and other enclaves speaks to the reality that some of the goods. liek security, that tradiutionally have bene provided by the municpality have been found wanting.

    But since Jaws asks for things/examples that wouldn't work, here we go:
    > What happens when one private police force disagrees with its eighboring rpivate police force? Warfare?
    > How do you maintain freedom of movemnt if all roads/land is private? If I won all the land around you, I could make you a 'prisoner'
    > I own a tonw. I make the rules. I could build it, attract people, then amke the rules so bad that you sell at a fraction of the price. Now I resell it, at cheaper prices, to poorer people with less choices. repeat as necessary.
    > Suppose I starte a new town in virgin territory. I won teh whole town, teh water supply, etc. I can obviously keep poor people out through costs. Can I keep jews out? Libertarians? People that don't go to my church? This kind of issue is abd enough if individual property owneer exercise it, but if teh whole town si taht way? Do we end up woth black towns and irish-American towns? How does that foster community? I see medieval factionf ights re-merging.
    > Do we tear down the existing towns? seel them off to the hhighest bidder/ Msot of teh property ine xisting towns IS private. Just the roads, aprks and a realtively dfew buildings. Do we seell those to one owner? Or can I own one road and you own the next one?

    I'll think of more, gotta go now...
    Life and death of great pattern languages

  23. #23
    Quote Originally posted by Luca
    Rather predictably, this thread has devolved into pro/con. I think you can in fact find many examples on both sides of the divide that have worked well.
    It has not devolved into pro/con, I intended it as such. I asked for people to list the cons so I could reply with the pros.
    Jaws: I think in practical terms what may work toward your goals is the 'privatization' of local, perhaps minor aspects like certian facilities (I'm thinkign Bryant Park). Once people see that in many cases private providers work better they may opt away from public provision of other services.
    I don't expect that the whole world will massively reform every city at the same time. If we can make it work at the margin, and demonstrate that it does work and achieves great results, more reform will follow.

    > What happens when one private police force disagrees with its eighboring rpivate police force? Warfare?
    Jurisdiction means that a provider of security can only apply the law on the territory for which it has been hired to do so. Regardless there would be no point in policemen shooting each other. They are not in the business of aggression, but in the business of defense. If they have a disagreement, they can rely either on jurisdiction to resolve it, or appeal to a third party arbitrator they trust. Shooting each other will only cause them losses. This has nothing to do with urbanism as such and I will not continue this discussion in this thread. You can make a thread about it in FAC if you are curious.
    > How do you maintain freedom of movemnt if all roads/land is private? If I won all the land around you, I could make you a 'prisoner'
    This is an extremely unlikely scenario where one would have to not only obtain all the property surrounding you (in all dimensions, including underground and airborne) without your being aware of it, but it would also have to be timed in such a way where your access rights all expire at the same time. In that case, I think you would be justified to trespass a little.

    And one more question needs to be asked. Why would someone do that? If I'm a provider of roads, I want to encourage people to travel on my roads because that is how its value is increased.
    > I own a tonw. I make the rules. I could build it, attract people, then amke the rules so bad that you sell at a fraction of the price. Now I resell it, at cheaper prices, to poorer people with less choices. repeat as necessary.
    That is ruinous. You are going to invest a considerable sum of capital then proceed to wreck your property and chase away the people you were counting on to earn back the value of your investment? This is the kind of irrational behavior I expect from politicians, but not from someone with a fortune invested in a property.
    > Suppose I starte a new town in virgin territory. I won teh whole town, teh water supply, etc. I can obviously keep poor people out through costs. Can I keep jews out? Libertarians? People that don't go to my church? This kind of issue is abd enough if individual property owneer exercise it, but if teh whole town si taht way? Do we end up woth black towns and irish-American towns? How does that foster community? I see medieval factionf ights re-merging.
    If you want to exclude certain groups of people, then you have to bear the cost of excluding a group of potentially wealthy buyers. This reduces the value of the property, but can also attract prejudiced people looking for this kind of environment. Maybe Berkeley, California would exclude Republicans, and all the residents of Berkeley would feel much safer for it, even though it limits who could buy into the town.

    Segregation can be good. The free blacks of nineteenth century American built their own communities where they were safe from the racism of the whites. Of course one of these was bulldozed to build Central Park, but that's what eminent domain gets you. Segregation can reduce conflict and reduce factional fights. Everyone knows where their territory is, and must respect the other faction's rules whilst they are on their territory. When multiple conflicting factions must share the same territory is when conflicts arise.
    > Do we tear down the existing towns? seel them off to the hhighest bidder/ Msot of teh property ine xisting towns IS private. Just the roads, aprks and a realtively dfew buildings. Do we seell those to one owner? Or can I own one road and you own the next one?
    A road is part of a network. It works essentially like the internet. You have an internet service provider which sells you access to the network. Multiple internet service providers connect to each other because the more connections they make, the more valuable their individual networks are. The city is also a network. It connects buildings together. The more buildings are connected together through the network, the more valuable the network is. We can each own a parallel road, but they will both be more valuable if connected to one another.

    One strategy for privatizing the system is to allow all the property owners facing a segment of public road to petition together in order to withdraw from the public corporation and sell their road (which they have a rightful claim to) to a private owner. That way people will leave very corrupt, dysfunctional, hopeless cities while those cities that are functioning more or less well will be able to watch the experiment's success.

  24. #24
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    Quote Originally posted by jaws
    Too much democracy has ruined the city. Nobody understands the issues that city planners deal with. Why should they be expected to make the right voting decisions about them? They can't and they didn't, and so we have seen our environment ruined by sprawl and urban decay.

    The less democracy we have, the better the democracy we do have will be, because we will be able to focus on the important issues. This is what I mean by depoliticization. The fewer decisions are taken politically, the more control we have on the remaining political decisions. I'm aware that this is a political stance I'm taking, but one whose outcome will be a reduction in politics.

    That is simply false. A military organization is a coercive organization. It gives out orders and forces you to obey them. A government operates the same way. A private corporation however is a cooperative organization. It exists to serve you. It can only exist so long as it succeeds at serving you. If people were to stop cooperating with this corporation (buying its products), it would immediately go bankrupt. That means that, strangely enough, people have more power with regards to a private corporation than they do with their own governments. If you are a long-time client of a business, and you have an idea or a complaint to make to this business, you can take it directly to the owner. If it is a good idea or a valid complaint, the owner will immediately act to change this situation, because the owner needs to retain you as a client in order to stay in business.

    Democracies are extremely difficult to change this way. Not only do you need to rally a large number of people behind you, a process that is extremely expensive to yourself, you then need to actually convince the politicians in charge that this large number of people is a threat to them.

    The levies were not a public good. They were a good that profited a certain area of the city of New Orleans, the area below the water level. Someone who owned a large number of properties in this area (the city) has a direct interest in providing these levies, otherwise all of its properties become worthless. Thus it will bundle the levies with other goods that it sells on the marketplace.

    please... if the little democracy that we have isn't working because the representative dem model itself is losing legitimacy than what we need is less democracy to save the little bit that we still have!!!!!????

    the private corporation has all those qualities you've listed only when there's a profitable market to what they're offering. you should know better about market failures. some very important things can't be simply privatized because they're of too little value (or not profitable enough) to be offered by the private corporation. the market solution for the homeless is to just sleep under the bridge... that's a fact. [and that's why cities all over the world are looking increasingly like the english industrial city described by C. Dickens, at a time when everything would just be left to markets] there's no real legitimate democracy without state intervention, to think that private companies will provide everything we need because of how nice they are (given that not all the things we need are profitable) is just as naïve as one can get...

    you need to try harder to convince me that the levees aren't public goods, really. try to go back to the handbooks in ecn101 and then come back again (G. Mankiw should be a hint)... the way you put it it's like saying that a bridge isn't public because it only serves a certain fraction of the city's pop'l that needs it everyday. you can do better than that!

  25. #25
    Quote Originally posted by felipe
    please... if the little democracy that we have isn't working because the representative dem model itself is losing legitimacy than what we need is less democracy to save the little bit that we still have!!!!!????
    That's exactly right. Too much democracy creates only confusion. That in turn results in more opportunities for corruption. If we really want the people to control their government, we have to limit democracy to its essentials and leave the rest up to personal liberty.
    the private corporation has all those qualities you've listed only when there's a profitable market to what they're offering. you should know better about market failures. some very important things can't be simply privatized because they're of too little value (or not profitable enough) to be offered by the private corporation. the market solution for the homeless is to just sleep under the bridge... that's a fact.
    The market solution to the homeless is for charitable organizations to help them. People will then pay to purchase the good "help for the homeless" from the organization that is the most successful at helping the homeless. These organizations have to operate with the maximum efficiency. When the government has taken over welfare the homeless go without help, and live under a bridge. You should know better about government failure, given that you live in a country that is so catastrophically poor. This is a topic they don't teach you in government schools, so I suggest you start reading a little about it.
    [and that's why cities all over the world are looking increasingly like the english industrial city described by C. Dickens, at a time when everything would just be left to markets] there's no real legitimate democracy without state intervention, to think that private companies will provide everything we need because of how nice they are (given that not all the things we need are profitable) is just as naïve as one can get...
    Cities all over the world are run democratically, so if they're reverting back to slums then you know whose fault that is. We've had massive reductions in economic liberty this past century, where do you get the idea that free market is responsible for all the problems that have been created?

    All things we need can be made profitable, otherwise how do we know that we need them? There is no objective measure of what we need outside of the marketplace.
    you need to try harder to convince me that the levees aren't public goods, really. try to go back to the handbooks in ecn101 and then come back again (G. Mankiw should be a hint)... the way you put it it's like saying that a bridge isn't public because it only serves a certain fraction of the city's pop'l that needs it everyday. you can do better than that!
    You need to expand your knowledge beyond the socialist propaganda they taught you in Brazil. A bridge is certainly not a public good, it's only useful to people who need to cross the river. It can be funded with tolls very easily, and in many places bridges are funded as such. I don't understand why you would think bridges are public goods. They're about as public as toothpaste.

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