What is the objection to private cities?

[michaelskis]

Let me start by saying that this is an interesting idea.

Short answer is no, there is government regulation from some level, no mater how independent a place is.

Having said that, the closest thing to what you’re looking for would be the top excusive gated communities where although they are within a township or municipality, they have little to now reliance on the public system. The community association fees pay much the same as taxes would for the creation and maintenance of streets, services, and utilities and all the residents send their kids to private schools. But then again, even these associations are set up like a government with elections, board members, and they create their own rules and regulations.

Ironically the wealthier a person is the less they need or use public services.

[Tranplanner]

The community association fees pay much the same as taxes would for the creation and maintenance of streets, services, and utilities

Until the time comes when the infrastructure needs to be renewed - then they come running to the City to take over their services because they can't afford to rebuild it themselves. As a bonus the City gets to take over wonderfully substandard facilities as the original (private) builder didn't have to build to public standards seeing as it was not public infrastructure and all.

I'll try to take some time to answer jaws's original question. I think my main point is that cities are expressions of society. While there is room for private sector operation of services within a city, I can't see how city that was owned in whole by a private entity or entities would work, largely for the reasons Luca has already elaborated on.

[michaelskis]

Until the time comes when the infrastructure needs to be renewed - then they come running to the City to take over their services because they can't afford to rebuild it themselves. As a bonus the City gets to take over wonderfully substandard facilities as the original (private) builder didn't have to build to public standards seeing as it was not public infrastructure and all.

Often times I agree, they do that, how ever there is an increasing number that are operated better than many governments when it comes to the replacement of physical infrastructure they use capital improvement funds that build up over time with investments and endowments. Granted they are rare, but even these have an association government.

[felipe]

i'm scared at how reactionary we're getting here. i think i might as well quit the discussion, otherwise they won't let me in the u.s. the next time i go visit some friends up there...

[jaws]

Until the time comes when the infrastructure needs to be renewed - then they come running to the City to take over their services because they can't afford to rebuild it themselves. As a bonus the City gets to take over wonderfully substandard facilities as the original (private) builder didn't have to build to public standards seeing as it was not public infrastructure and all.

This is not at all what I'm describing though. The original private builder was not building the streets in order to operate the streets in the long run as private property. It was building only to sell the houses, and it couldn't sell the streets because there is no free market for streets. As such it tried to make the streets the cheapest possible because there was no value to realize from them except the immediate short-term sale of the houses.

If the streets were held and operated as private property by a for-profit organization then the renewal and capital improvement process would be permanent.

[H]

Picking up on what Tranplanner was saying, who picks up the tab if the good folks running the private city declare bankruptcy, the capital improvement process ceases and this leaves the good people living there in an infrastructure and service crisis? Most likely the public picks up the bill at this point, and if this is the case then the city should be public from the onset.

If this is not the case (or should not be the case), please tell me the alternative solution of what happens (or should happen) in this scenario.

[jaws]

Picking up on what Tranplanner was saying, who picks up the tab if the good folks running the private city declare bankruptcy, the capital improvement process ceases and this leaves the good people living there in a infrastructure and service crisis? Most likely the public picks up the bill at this point, and if this is the case then the city should be public from the onset. If this is not the case, please someone tell me the alternative solution of what happens (or should happen) in this scenario.

I've already answered that. If the city goes bankrupt, the creditors get the assets, just like any other business. These assets are then liquidated to whoever bids the most for them, just like any other business.

I don't know why it's somehow bad for the public sector city to get free streets that will generate income. It's only the twisted logic of the public sector that makes an asset into a burden.

[H]

I've already answered that. If the city goes bankrupt, the creditors get the assets, just like any other business. These assets are then liquidated to whoever bids the most for them, just like any other business.

I don't know why it's somehow bad for the public sector city to get free streets that will generate income. It's only the twisted logic of the public sector that makes an asset into a burden.

I am talking about more than streets, rather the entire infrastructure and services package. If a service is not profitable (ie why it went under) then who wants to bid on it? What if there are no private bidders? This is what I am asking.

[jaws]

I am talking about more than streets, rather the entire infrastructure and services package. If a service is not profitable (ie why it went under) then who wants to bid on it? What if there are no private bidders? This is what I am asking.

What happens when a property is so worthless that it cannot be operated profitably by anyone? It is salvaged for parts and replaced with something actually useful, for example a corn field.

It is crazy to think that the government should support such a service after it has been demonstrated that there is no demand for it.

[felipe]

It is crazy to think that the government should support such a service after it has been demonstrated that there is no demand for it.

you have this religious belief that there is always demand for all the important things that we need a city to provide. like, a demand for "helping the homeless". what if no one is that nice after all? why should we wait for the private sector to take the responsibility if it's not always in its interests? [i never thought (extreme) neoliberal proposals such as yours would ever reach city planning, and it's so scary. maybe because in the 3rd world the average income level in the largest cities isn't as high, so not all people can cope with eventual higher prices (which can be the case, if they have monopolies) charged by privately operated services - if you really want to go into the 3rd world specificities, and why you CANNOT apply your solutions to any urban setting you might want to in the world - that's exactly why the imf and the world bank have lost all the credit and respect all over the south, no one believes in those institutions anymore anywhere but in the centres - i think we should start another thread...

[Tranplanner]

If the streets were held and operated as private property by a for-profit organization then the renewal and capital improvement process would be permanent.

Sort of like RailTrack in the UK?

[H]

What happens when a property is so worthless that it cannot be operated profitably by anyone? It is salvaged for parts and replaced with something actually useful, for example a corn field.

It is crazy to think that the government should support such a service after it has been demonstrated that there is no demand for it.

What about the people who have their homes there? Where do they go?

[jaws]

you have this religious belief that there is always demand for all the important things that we need a city to provide. like, a demand for "helping the homeless". what if no one is that nice after all? why should we wait for the private sector to take the responsibility if it's not always in its interests?

If no one is that nice after all, then the public sector cannot be helping either, can it? After all politicians aren't philosopher kings with the creation of a humanist utopia as their goal. They only do things when they are pressured to do so.

If the government didn't pretend to be helping the less fortunate, the regular people would make it their responsibility to do so, and they would organize this help in the free market.

What about the people who have their homes there? Where do they go?

Well considering the streets are making a loss, I assume they have long gone. If they wish to stay then they have to pay for the road themselves. It's not fair to make everyone else subsidize a lifestyle for a few exceptional cases.

[felipe]

If no one is that nice after all, then the public sector cannot be helping either, can it? After all politicians aren't philosopher kings with the creation of a humanist utopia as their goal. They only do things when they are pressured to do so.

If the government didn't pretend to be helping the less fortunate, the regular people would make it their responsibility to do so, and they would organize this help in the free market.

1. that's why what we need is to replace politicans, not politics. the state has failed to perform the basic in urban development (quality of life and social justice), i agree with you in that point. but delivering everything to markets is the far right wing solution, and i do believe you should defend what you wish, as long as you have in mind that it's still a political opinion - not a mere technical problem, to be resolved by science...

2. "regular people" and "free market" is a bit weird together, isn't it? what we're watching, and there's huge evidence here, is "regular people" getting their hands on politics, either through neighborhood associations, NGOs, participative budget assemblies and the list goes on. "free market" has more to do with "entrepreneurs" and "businessmen", and those are closer to the profressional politicians you (or we) were complaining about than to "regular people". or not? [in the sense that they don't give a damn wether profits come from city A, city B, the stock market or some emerging market debt bond. there's no citizenship, or sense of place/community involved in business practices. they're only in it for the money. or not?]

[H]

Well considering the streets are making a loss, I assume they have long gone. If they wish to stay then they have to pay for the road themselves. It's not fair to make everyone else subsidize a lifestyle for a few exceptional cases.

What if they are not long gone? Example: Indian Lake Estates, Florida. A private development from the 1950s with private streets (built sub-code on the argument that it was a private road) and utilities. People bought homes in the development and since the developer has died and the company no longer exists. There are several people that live there today and the streets are literally crumbling. What do they want? The county to help bail them out. Many (including myself) say exactly what you said, “it's not fair to make everyone else subsidize a lifestyle”, except for some exceptions.

They cant publicly incorporate, because they cant afford to. What is going to happen? I am not sure but there are a lot of people upset on both sides.

Moral to the story (the way I see it), if the development had not been privately concocted (for profit, as the ‘businesses' you praise generally are) and instead under the public regulations, the facilities (roads, etc) would not of been built sub-par and probably not be in such disrepair. Not to mention that the development would not of even of been there because it was out of the service area which is a big reason for it not being profitable (the costs of service distance is out of whack). So now no one wants it, not investors and not the county, but people live there, people who have children who go to school, people who have fires that need put out and people that need ambulances in the middle of the night, people who’s life savings are tied up in their homes. Who will get them these services now that the development has flopped? Probably not the private sector, and certainly not the one’s who felt the need to place this “private city” (because that is essentially what it is) in the middle of nowhere.

BTW: Cities convert back to unincorporated areas all the time when they cant afford to provide services. There are several in Polk County Florida even (the same county as Indian Lake Estates).

This is my view as to why cities should not be private economic investments and instead publicly run for the benefit of the good of ‘we the people’.

[jaws]

1. that's why what we need is to replace politicans, not politics. the state has failed to perform the basic in urban development (quality of life and social justice), i agree with you in that point. but delivering everything to markets is the far right wing solution, and i do believe you should defend what you wish, as long as you have in mind that it's still a political opinion - not a mere technical problem, to be resolved by science...

We've been replacing politicians every four years for hundreds of years and we still get bad politicians. It's time to admit that the problem is politics itself, not the bums in charge at the present time, who simply do whatever their role requires them to do. The problem with politics is the structure. It is a top-down, bureaucratic, command structure. It has severe limitations and is easily corrupted.

The market structure is a decentralized, bottom-up, demand structure. That is why it delivers. Delivering it to the market is what has brought us high quality and inexpensive goods in everything else that was left to the market. It's time to admit that it's a better way to do things.

2. "regular people" and "free market" is a bit weird together, isn't it? what we're watching, and there's huge evidence here, is "regular people" getting their hands on politics, either through neighborhood associations, NGOs, participative budget assemblies and the list goes on. "free market" has more to do with "entrepreneurs" and "businessmen", and those are closer to the profressional politicians you (or we) were complaining about than to "regular people". or not? [in the sense that they don't give a damn wether profits come from city A, city B, the stock market or some emerging market debt bond. there's no citizenship, or sense of place/community involved in business practices. they're only in it for the money. or not?]

Entrepreneurs and businessmen are regular people. They're no different from you and I. They have an interest in increasing their own wealth and the value of their property, just like you and I. If they own a town, they have an interest in that town being the best, cleanest, happiest and cheapest on the market. That is the only way they can make these profits. It's not true that they don't have a sense of place. They know they need to make the place the best it can be in order to be a successful entrepreneur.

What if they are not long gone? Example: Indian Lake Estates, Florida. A private development from the 1950s with private streets (built sub-code on the argument that it was a private road) and utilities. People bought homes in the development and since the developer has died and the company no longer exists.

First of all if the company no longer exists, who owns the road? This is clearly not the system I'm describing, where there is always a clear private owner of the road.

There are several people that live there today and the streets are literally crumbling. What do they want? The county to help bail them out. Many (including myself) say exactly what you said, “it's not fair to make everyone else subsidize a lifestyle”, except for some exceptions.

They cant publicly incorporate, because they cant afford to. What is going to happen? I am not sure but there are a lot of people upset on both sides.

Moral to the story (the way I see it), if the development had not been privately concocted (for profit, as the ‘businesses' you praise generally are) and instead under the public regulations, the facilities (roads, etc) would not of been built sub-par and probably not be in such disrepair. Not to mention that the development would not of even of been there because it was out of the service area which is a big reason for it not being profitable (the costs of service distance is out of whack). So now no one wants it, not investors and not the county, but people live there, people who have children who go to school, people who have fires that need put out and people that need ambulances in the middle of the night, people who’s life savings are tied up in their homes. Who will get them these services now that the development has flopped? Probably not the private sector, and certainly not the one’s who felt the need to place this “private city” (because that is essentially what it is) in the middle of nowhere.

It's unfortunate that people invested in a city that turned out to be a failure, but they took a risk and they have to face the consequences of the risk. Not every investment is a success. If the government starts bailing out every failed company the whole economy will come crashing down. Ultimately the only companies that survive must be those who really produced what consumers want.

Now it's not true that the residents "can't afford" the maintenance. The reality is that they think the maintenance is too expensive to justify paying for it themselves and they would rather leave than pay for it, but since the government is willing to subsidize their otherwise unjustifiable lifestyle then that's what they're trying to do. The only reason they say they can't afford it is because they know you will pay for them!

The bottom line is that it's unfair to force the people who made the right choices to pay for the people who made the wrong choices. You are only encouraging waste on a massive scale, and total ruin is what this policy will lead you to. We already see this with the ridiculous government insurance schemes that allows people with coastal mansions to rebuild them everytime they are destroyed by a hurricane or a flood. The free market determined that these homes were uninsurable for a good reason, they will just turn out to be a waste. And they are a waste, but since their owners are getting free money from the government every time the homes are wrecked, they can keep wasting over and over as much as they please.

Extending government services to everything is how we get sprawl, because everyone believes they are entitled to the services no matter where or how they build. (Why shouldn't they be? They pay taxes!) The only way to stop sprawl is to stop providing them these services, and stop taxing them for it. Only then will people make the investments that make sense, and perhaps there will be mistakes, but investors will be extremely careful.

BTW: Cities convert back to unincorporated areas all the time when they cant afford to provide services. There are several in Polk County Florida even (the same county as Indian Lake Estates).

Of course they'll do if you're subsidizing them! The only right thing to do is to leave them to fend for themselves. If the city can't survive on its own, it shouldn't survive. The land will be better put to use at something else.

This is my view as to why cities should not be private economic investments and instead publicly run for the benefit of the good of ‘we the people’.

This makes no sense. The opposite of economic investments is uneconomic investments, which is waste. This is against the benefit and the good of the people, especially since they are forcefully taxed to finance the waste. They would be better off having more money in their pockets to invest in something else, like more healthcare or more education. Why do you think paying for people's errors is more important than paying for healthcare and education?

[Lee Nellis]

I have no hope of jaws listening to anything I say, but just for the record: I live in a different world than the one jaws inhabits. His description of reality has only the faintest relationship to what I see going on around me.

I live in a world where local government works as often as not, where most elected officials - however little foresight they sometimes display - are there to serve, not for their own advantage, and where volunteer boards slave for hundreds of unpaid hours to make their communities better places to live.

I also live in a world where the top-down, centralized command and control that I experience, and the damage that it does, has little to do with government, but is relentlessly defended as the workings of private property and the market (which should be defended by government, but not regulated). I think jaws might well agree that there is no practical difference between the "private" BlueCross" bureaucracy and a hypothetical government health insurance bureaucracy. But, if there is no difference, how is it government that is the problem?

Both governments and businesses acquire their character from their scale and their level of accountability rather than from the nature of their organization. Any human institution that is too large and too isolated from its clients/customers is bound to behave in certain ways. This isn't about markets v. government. They both work well at a certain scale and level of accountability, and they both work poorly beyond that scale. The ethical ties that make small communities and small businesses work (and it is ethics that define this, not the type of organization - the reasons my mechanic does a good job and the reasons our select board make good decisions are the same) are slipped loose at a certain point and we get the "bad" politicians jaws rails against and the "bad" corporations that, in my life at least, have a much greater and more negative impact.

As long as we focus on private v. public, or government v. market dichotomies, we are missing the point. As long as we are focused on institutional/structural issues, we are equally far from the mark. In the final analysis, the quality of life we have is about ethics.

[felipe]

agree with most things, including the critique on a pure structural(ist) analysis. but the importance of knowing structures and recognizing they do have a certain power of explaining a lot of things in society cannot be underestimated... scale is part of structure!

[H]

First of all if the company no longer exists, who owns the road? This is clearly not the system I'm describing, where there is always a clear private owner of the road.

The HOA owns the roads. Still very private and they cant get it together to fix them.

Now it's not true that the residents "can't afford" the maintenance. The reality is that they think the maintenance is too expensive to justify paying for it themselves and they would rather leave than pay for it, but since the government is willing to subsidize their otherwise unjustifiable lifestyle then that's what they're trying to do. The only reason they say they can't afford it is because they know you will pay for them!

No. I have seen the price tag and highly doubt they can afford it.

The opposite of economic investments is uneconomic investments, which is waste. This is against the benefit and the good of the people, especially since they are forcefully taxed to finance the waste.

Not necessarily. As mentioned on NPR today, the opposite of a ‘Gay’ person is not a ‘Glum’ person… rather a ‘Straight’ person. In the same vain, the opposite of purely economic investment may be equity investment or even environmental investment, both of which benefit society as well, do they not?

Why do you think paying for people's errors is more important than paying for healthcare and education?

That is such a leap from what I have said that I am not even sure where you pulled it from. I think healthcare and education are essential parts of a society.

Good luck with your private city.

[jaws]

I have no hope of jaws listening to anything I say, but just for the record: I live in a different world than the one jaws inhabits. His description of reality has only the faintest relationship to what I see going on around me.

Describing reality is useless without a theory. I can describe someone walking across the street and being smushed into a cloud of red mist. Then I can describe a big metallic object now standing in that person's place. Without a theory, I cannot understand that this person was run over by bus. I only have descriptions of different things. The theory tells me that a massive object travelling at high speed made contact with a much less massive, more fragile object and transferred a lot of force to it, causing severe damage.

When you say that what I describe has only relationship to what you see, you're really saying that your theory of reality contradicts my theory of reality. However there is only one true reality. One of our theories cannot be correct.

I live in a world where local government works as often as not, where most elected officials - however little foresight they sometimes display - are there to serve, not for their own advantage, and where volunteer boards slave for hundreds of unpaid hours to make their communities better places to live.

Firstly volunteers have nothing do with this discussion, as they can continue to play their role in either system. Secondly this is not about whether or not politicians "work" or the local government "works," but about the results that are obtained from that work. It is easy to work hard and get absolutely nothing useful done. This is what takes place in bureaucracies. I'm not calling anyone lazy. I'm saying we aren't getting value out of it.

That politicians do not exercise foresight as you claim is no surprise. They after all only control their office temporarily and in the present, therefore their decisions will be present-oriented (they have high time preference in econ geekspeak). A private owner on the other hand controls an asset permanently, and controls the value of all future income of this asset which he can convert into present value by selling it to someone else. Foresight to private owner is therefore critically important. Failure to foresee results in losses. This does not happen to political office-holders, as they do not control their own wealth, but everybody else's, and thus have nothing to lose from making bad decisions, or not making good decisions.

I also live in a world where the top-down, centralized command and control that I experience, and the damage that it does, has little to do with government, but is relentlessly defended as the workings of private property and the market (which should be defended by government, but not regulated). I think jaws might well agree that there is no practical difference between the "private" BlueCross" bureaucracy and a hypothetical government health insurance bureaucracy. But, if there is no difference, how is it government that is the problem?

That isn't true. The free market has its own control structures, but they aren't bureaucracy. Bureaucracy is a control structure used to conduct actions that have no value in the market, meaning that do not generate income. The purpose of a bureaucracy is to spend money and nothing else. It spends this money in accordance with the regulations that have been imposed upon it. It will not react in any way to any changing conditions of reality other than a change in its regulations imposed from above. It will not seek to reduce costs and chase profits as a private company would, instead it will seek to expand its political influence.

For a private company, the aim is not to spend money, but to earn money. This allows the company to calculate the earning value of every member of its organization, and to reorganize itself rapidly to changing conditions of reality. Often whole departments of long-established companies are outsourced to other, specialized companies. The existence of an external market for the resources used in a company creates the possibility of economic calculation, efficiency and economy. This does not apply to government.

The key to the whole secret why government fails at producing and the market succeeds lies in this difference of structure.

Both governments and businesses acquire their character from their scale and their level of accountability rather than from the nature of their organization. Any human institution that is too large and too isolated from its clients/customers is bound to behave in certain ways. This isn't about markets v. government. They both work well at a certain scale and level of accountability, and they both work poorly beyond that scale. The ethical ties that make small communities and small businesses work (and it is ethics that define this, not the type of organization - the reasons my mechanic does a good job and the reasons our select board make good decisions are the same) are slipped loose at a certain point and we get the "bad" politicians jaws rails against and the "bad" corporations that, in my life at least, have a much greater and more negative impact.

As long as we focus on private v. public, or government v. market dichotomies, we are missing the point. As long as we are focused on institutional/structural issues, we are equally far from the mark. In the final analysis, the quality of life we have is about ethics.

You can't pin the blame on ethics for the failure of government. The most evil, insane and corrupt businessman is still restrained by the will of his clients in his actions. Since he cannot force anyone to give him money, he has no choice but to follow the market, just like everyone else. He must be cooperative in order for his business to survive and thrive.

The 20th century has demonstrated quite clearly what the most evil, insane and corrupt politicians can do. There have been memorials built to them.

The reason your mechanic does a good job is absolutely not the same as the reason a government board makes decisions. Your mechanic wants to earn your money. He has to do so by earning your goodwill. The board is only applying the law, it doesn't care what anyone thinks. If it makes good decisions, then that is only a happy accident. There is nothing in the system requiring it to do so.

The HOA owns the roads. Still very private and they cant get it together to fix them.

A HOA is yet another form of common ownership, though one that exists outside the official government corporate system. It will fail for the same reasons.

No. I have seen the price tag and highly doubt they can afford it.

Then they can sell the whole property to someone else for whatever it is worth today on the market. If that value is not the value they expected it would be when they bought, that is a forecasting error of their doing.

Not necessarily. As mentioned on NPR today, the opposite of a ‘Gay’ person is not a ‘Glum’ person… rather a ‘Straight’ person. In the same vain, the opposite of purely economic investment may be equity investment or even environmental investment, both of which benefit society as well, do they not?

First of all economic and environmental investment are essentially synonymous. Economy means without waste, and environmentalists are also against waste. I am in fact an environmentalist myself. Regardless your argument makes no sense. An equity investment is just a specific class of investment, into equity, as compared to real estate or bond investments. It does not qualify the investment with success or failure, which is what economic investment does.

That is such a leap from what I have said that I am not even sure where you pulled it from. I think healthcare and education are essential parts of a society.

And that's where you show your lack of comprehension of the subject. We don't live in the garden of Eden. We live in a world of scarcity with limited means. We can all say that we want health care and education and free roads for everybody, at some point a choice must be made between them. We only have so many resources at our disposal, and we must decide what's most important to produce with these limited resources.

When you advocate the government supporting failed investments in failed communities, what you are demanding is for other investments to be aborted and diverted to support this failed community. That means in practice that people will be taxed, their total income will fall and they will have to cut back on expenses. These expenses include health care and education. So when you say that you want the government to support roads that aren't profitable, you necessarily also imply that you think these roads are more important than the education and health care that people would buy if they could keep the money you wish to tax from them.

[Lee Nellis]

There really is no basis for communication here. I expect that when I say "works" every other cyburbanite understands that I mean "produces good, desirable results." You're just being obtuse.

The notion that private owners take the long view while government takes the short view is contradicted by what happens in this office every day. We are spending way too much time this week trying to correct mistakes made by a private property owner who was trying to cut costs 17 years ago, instead of making the best use of his property. Now his new development doesn't work and he wants us to bail him out. And you know what - having a simple regulation back then would have saved both him and us all this trouble. The market would never have given him the necessary signal - until now, 17 years too late. The market is a radically short-sighted institution and ownership per se confers none of the advantages you allege, jaws, none. It doesn't make people smart and it doesn't give them foresight.

On the other hand, in a world where folks make money on the time differences in electronic transactions, a politician's four-year term is forever. It doesn't always happen (and when it doesn't it is usually due to the confusion about how things work for which you are a poster child), but the only guardian of the long run in a market-driven society is government. I am about to go into a meeting where I will remind someone that they can't pass the buck for protecting water quality to someone else, in some distant future - the market is not sending them any signals that spending money to protect water quality is a good idea - but I am going to enforce a law that quite clearly will cost them money that adds no immediate value to their development. That's what government is for, jaws, and there is no private substitute.

It is true that there are property owners - mostly farmers and small business persons - who take a long view, but they are motivated to do so by something other than a desire to make money. They are motivated by an ethical regard for themselves, their families, their community, and the natural world. Sometimes this regard is also profitable, but it is the commitment that comes first, not the profit.

Enough. You can't take refuge in "theory" until you have the facts right.

[H]

A HOA is yet another form of common ownership, though one that exists outside the official government corporate system. It will fail for the same reasons.

It is a private org with sole ownership / investment in the facilities. (BTW: What is it you are saying here, do you think all democratic public government has failed?)

Then they can sell the whole property to someone else for whatever it is worth today on the market. If that value is not the value they expected it would be when they bought, that is a forecasting error of their doing.

You really cant step out of the econ box can you?… there are not currently any willing buyers. (I guess then you feel the 100s of homes and families should be left to rot?)

First of all economic and environmental investment are essentially synonymous. Economy means without waste, and environmentalists are also against waste. I am in fact an environmentalist myself.

I am surprised, but glad you feel that way. Good for you.

Regardless your argument makes no sense. An equity investment is just a specific class of investment, into equity, as compared to real estate or bond investments. It does not qualify the investment with success or failure, which is what economic investment does.

Equity investement: as in a social investment, very much an investment with successes and failure. Equity is the third E of the 3 Es of sustainability! (Wheeler 2004, Planning for Sustainability is a good book if you want to learn more about that )

And that's where you show your lack of comprehension of the subject. We don't live in the garden of Eden. We live in a world of scarcity with limited means. We can all say that we want health care and education and free roads for everybody, at some point a choice must be made between them. We only have so many resources at our disposal, and we must decide what's most important to produce with these limited resources..

I can lower my comments to personal attacks as well, and spare me the 101 level lecture, based on your responses you obvious have a long way to go before you understand how the world works yourself. I fully understand the concept of scarcity of resources and choices, but how you make the leap from a private / public city conversation to (previously) accusing me of not supporting education and healthcare, something I am all for, shows that you really have no real focus, rather just want to hear yourself argue.

When you advocate the government supporting failed investments in failed communities, what you are demanding is for other investments to be aborted and diverted to support this failed community. That means in practice that people will be taxed, their total income will fall and they will have to cut back on expenses. These expenses include health care and education. So when you say that you want the government to support roads that aren't profitable, you necessarily also imply that you think these roads are more important than the education and health care that people would buy if they could keep the money you wish to tax from them.

This is the comment that assures me that you are not having a discussion, but rather just on a rampage to hear yourself rant. I don’t advocate the government bailing out failed private cities, rather I am saying that is what ends up happening due to larger political reasons and this is why there should not be private cities in the first place. (the topic of this tread, lets try to focus here )

By the way, do you have any tangible frame of reference here about what it takes to fully make cities operate? I think I am at the conclusion that you have none, but are just making things up as you go along or at best using some intro information about how cities work. Please ask yourself here if you truly understand the multiple components of city planning? I don’t think you do, at least you have not shown me that you do. Do you have any 'real life' experiences? Or are you just going on what you have learned in Econ text books? Its okay, I am just curious on where this is all coming from. Because despite what economics may tell you life is more than what can be quantified, as in the Equity/Social qualitative aspects.


If you want to continue with a discussion I am happy to participate, but if you want to just continue with your rampage then in the words of JordanB, stop your whining and go do something about it.

[jaws]

The notion that private owners take the long view while government takes the short view is contradicted by what happens in this office every day. We are spending way too much time this week trying to correct mistakes made by a private property owner who was trying to cut costs 17 years ago, instead of making the best use of his property. Now his new development doesn't work and he wants us to bail him out. And you know what - having a simple regulation back then would have saved both him and us all this trouble. The market would never have given him the necessary signal - until now, 17 years too late. The market is a radically short-sighted institution and ownership per se confers none of the advantages you allege, jaws, none. It doesn't make people smart and it doesn't give them foresight.

I can't comment on this until you give me all the details of the case. As far as I can tell this private owner was forced by the government to provide something he would not be able to benefit from 17 years ago, and thus made it the least at the least cost possible to himself, and today you are blaming him for the shortsightedness that the government imposed upon him.

You also seem to believe that the government has a time machine that can travel backwards in time and impose a regulation that would have saved everyone the trouble 17 years ago. Obviously that investor would also like to have this time machine to save his investment. The government does not have better information than anyone else. If an investment turned out to be a mistake in the past, current investors know not to repeat it.

And once again, you shouldn't bail anyone out. It's not fair to the people who make the right choices. That's how the market operates. People must be responsible for their own choices.

On the other hand, in a world where folks make money on the time differences in electronic transactions, a politician's four-year term is forever. It doesn't always happen (and when it doesn't it is usually due to the confusion about how things work for which you are a poster child), but the only guardian of the long run in a market-driven society is government. I am about to go into a meeting where I will remind someone that they can't pass the buck for protecting water quality to someone else, in some distant future - the market is not sending them any signals that spending money to protect water quality is a good idea - but I am going to enforce a law that quite clearly will cost them money that adds no immediate value to their development. That's what government is for, jaws, and there is no private substitute.

If you are protecting water quality, then you imply that someone must benefit from water quality, and that implies that someone has property rights in water quality. So if someone's actions are reducing water quality, that means someone's rights are being infringed. The government, as it always has, fails to protect that person's property rights, then claims that it needs to intervene to regulate water quality.

The government cannot protect people from pollution. The government is the biggest polluter!

It is true that there are property owners - mostly farmers and small business persons - who take a long view, but they are motivated to do so by something other than a desire to make money. They are motivated by an ethical regard for themselves, their families, their community, and the natural world. Sometimes this regard is also profitable, but it is the commitment that comes first, not the profit.

The commitment is the profit. They consider it valuable to themselves to protect and improve their property. That is how private property operates in the long run. If they didn't protect their property as such, its value would fall and they would become poorer.

Politics cannot accomplish this. Politicians only work in the short-run, in order to maintain their current approval rating. Politicians do not benefit from any change in the value of the property they manage. If a politician wrecks a city, the worst that can happen to him is that he will not be re-elected.

Enough. You can't take refuge in "theory" until you have the facts right.

The facts are self-evident. There is sprawl, everywhere, and the government has built it. The environment is ruined. The infrastructure is crumbling. Pollution is rampant. You have failed. Your theory has failed. Worst of all, you do not see the facts.

It is a private org with sole ownership / investment in the facilities. (BTW: What is it you are saying here, do you think all democratic public government has failed?)

It's not a sole ownership if it is democratic. Sole ownership means one single individual owner. Which is it?

You really cant step out of the econ box can you?… there are not currently any willing buyers. (I guess then you feel the 100s of homes and families should be left to rot?)

That's not true. There are not any willing buyers at the asking price. They need to reduce their price. If the only valuable use of the property is a corn field, then they need to price it at the market rate for corn fields.

Again, you have no concept of scarcity in your argument. Do I think that 100s of homes and families should be left to rot? Of course not. I think a private investor should come along and buy their property from them at a price he deems fair. What you want is for thousands of other homes and families to be taxed in order to bail out these families at any price they deem is fair to themselves. This means that you take away resources used for health care and education by other families to spend on these families. That is an injustice.

I can lower my comments to personal attacks as well, and spare me the 101 level lecture, based on your responses you obvious have a long way to go before you understand how the world works yourself. I fully understand the concept of scarcity of resources and choices, but how you make the leap from a private / public city conversation to (previously) accusing me of not supporting education and healthcare, something I am all for, shows that you really have no real focus, rather just want to hear yourself argue.

This is the comment that assures me that you are not having a discussion, but rather just on a rampage to hear yourself rant. I don’t advocate the government bailing out failed private cities, rather I am saying that is what ends up happening due to larger political reasons and this is why there should not be private cities in the first place. (the topic of this tread, lets try to focus here )

This is a completely self-contradictory argument. You do not believe the government should bail out failed investments, therefore the government must make all investments. What happens to all the failed government investments, which as we have seen in the history of 20th century planning, is all of them? You are taxing resources that people need to spend on other things and deciding that they are better spent on the investments the government wants to make. You are implying that what the government chooses to do is more important than what people choose to buy for themselves, which includes health care and education.

The only logically consistent position is for the government to have no role at all in it.

By the way, do you have any tangible frame of reference here about what it takes to fully make cities operate? I think I am at the conclusion that you have none, but are just making things up as you go along or at best using some intro information about how cities work. Please ask yourself here if you truly understand the multiple components of city planning? I don’t think you do, at least you have not shown me that you do. Do you have any 'real life' experiences? Or are you just going on what you have learned in Econ text books? Its okay, I am just curious on where this is all coming from. Because despite what economics may tell you life is more than what can be quantified, as in the Equity/Social qualitative aspects.

You have no knowledge of economics yourself, therefore you are in position to argue this yourself. Your belief that economics is limited to what can be quantified is completely erroneous and against the entire body of knowledge of economics. In fact, in the very first post of this thread, I make the argument that the failure of government planning has been qualitative.

Now there's nothing wrong with being ignorant of economics. It is after all a specialized discipline mastered by only a few that most people find boring and useless. What is wrong is having a loud and vociferous opinion of economics when you do not understand the subject. Your appeal to "understanding the multiple components of city planning" is irrelevant. You do not need to understand everything about city planning, and regardless such a level of knowledge is impossible for any one person due to division of labor, to know why the system itself is a failure. I do not understand anything about the auto industry, but I know that the free market auto industry works much better than the government auto industry. I do not understand anything about health care but I know that government health care has been a total failure. You're saying that I need to learn everything about medicine and every speciality and every form of equipment the hospital operates before I can make that kind of judgement. It's only an excuse to avoid the argument instead of a defense of the system.

[H]

It's not a sole ownership if it is democratic. Sole ownership means one single individual owner. Which is it?

Again, “It is a private org with sole ownership / investment in the facilities”. As in the HOA as a single entity. (If you need I will explain how the HOA works, I maybe using ‘sole’ wrong here, I also misspelled a few words earlier, but I feel confident you can understand the meaning).

So, are you saying the cities would not just be private, but autocratic with no democracy at all? Wow, that sounds like a fun place to be a citizen!

That's not true... [snip]

Ok. If you say so, becuase you have the first hand knowledge, right?.

This is a completely self-contradictory argument....[snip]

You may want to re-read then if you still don’t understand, because once again your interpretations of my posts are wrong. I will stand by what I originally said.

What happens to all the failed government investments, which as we have seen in the history of 20th century planning, is all of them?

All of them? Really? You might want to put down your economics book for a minute and pick up a history book!

You have no knowledge of economics yourself, therefore you are in position to argue this yourself.

I better make sure I call up my old econ teachers so they can change may grades to failing then.

Economics is limited to what can be quantified is completely erroneous and against the entire body of knowledge of economics.

I am glad you are aware of this!!! I seem to have wrote my post too fast earlier and see why you thought I said what you thought I said, but basically I am not worried solely (am I using that right ) about the field of Econ (though I feel it does not stand alone, I use it on a regular basis) rather your perception of it, because I have become worried by some of your posts that you often are missing the Equity/Social qualitative component (even though you say it is there). My beef with Econ (as with any field) is that people (like yourself) get boxed in to one train of thought. Economics seems to think it is the only Social Science…. While economics is a very important piece of that pie, it is only one piece of many.

Your appeal to "understanding the multiple components of city planning" is irrelevant. You do not need to understand everything about city planning... [snip]

Yeah, becuase private cities only need to understand economics, not cities, right?

[jaws]

Again, “It is a private org with sole ownership / investment in the facilities”. As in the HOA as a single entity. (If you need I will explain how the HOA works, I maybe using ‘sole’ wrong here, I also misspelled a few words earlier, but I feel confident you can understand the meaning).

So, are you saying the cities would not just be private, but autocratic with no democracy at all? Wow, that sounds like a fun place to be a citizen!

This is not about autocracy versus democracy. It is about liberty versus democracy. A privately-owned business is not autocratic. It is free. It has the freedom to act in order to serve the needs of its clients as best as it can think to do.

Democracy destroys that freedom. It makes every decision a political issue, and soon there are no decisions taken at all. Here's a small story from my hometown, Montreal. Right now the big news story is how all the streets are filled with garbage from the melting snow. The opposition parties are accusing the mayor of not doing enough to clean the streets. The mayor is promising to spend more money. The streets aren't getting any cleaner while this debate is taking place! There is nothing more fundamental and simple for any business to get done than cleanliness, but a public company cannot even get this done properly! This shouldn't even be a debate!!!

Another item in the news tonight is a government plan to make mass transit free of charge (from its already highly subsidized fare) in the city. But mass transit is already much cheaper than using cars. The reason there aren't more people riding the bus is because the service is terrible. The buses are dirty and full of grafiti, and they don't even run on time. They treat riders like cattle. No private business would ever dare to treat its customers like this. That's what I mean by quality being irrelevant in a bureaucracy.

This is just what was on the news tonight. Every week it's something. It never ends. Nothing ever gets done. The system doesn't work for people. The citizens are being harassed by their own democracy.

All of them? Really? You might want to put down your economics book for a minute and pick up a history book!

I don't need to pick up a history book. It's in the city planning media itself.

I better make sure I call up my old econ teachers so they can change may grades to failing then.

I don't know how much economics you actually learned, but most of what they teach at the entry-level are theories that have been debunked by now. You need to provide more information.

Yeah, becuase private cities only need to understand economics, not cities, right?

Each business needs to know how to run itself. That is how the division of labor works. The car companies know how to run themselves. The computer companies know how to run themselves. The hospitals know how to run themselves. The cities need to know how to run themselves, and they shouldn't be obstructed by politics.

It's pointless that cities are run by experts if they can't even keep the streets clean. Even a school-drop-out janitor could run it better than it currently is run.