What is the objection to private cities?

[jaws]

Every time I read this thread I am blown away at some of the agreements that are being made and others that are not being made.

Politics is everywhere... even within privately run corporations! It is all about doing something to influence how someone views a topic or individual, and the results that it will have on that particular topic. It is all around us. Started with the person who had the most influence in resource allocation when we were in a sandbox and goes all the way up to national policies.

That's irrelevant. The objectives of the free market enterprise will always be different than that of the government enterprise. The free market enterprise obtains its funding by voluntary exchange with its clients, while the government enterprise obtains its funding by force. The former must always respond to the clients, thus no matter what kind of personal "politics" take place at the office the objective of the company is not politicized: serve the client.

On the other hand a government enterprise has a politicized objective: what do we do with the money we taxed? This is what the debate is always about.

Jaws... Can private cities work, not be in the way that you would like. They would be for limited extremely wealthy population who can afford to privatize everything. But even with that, you don’t fully have a true privatized system. Someone is always going to be the head of decision making and others are always going to influence those individuals to get what they want. It’s the way it works and as long as people have these freedoms including the freedom to come and go, it is the way that it will always be.

Here is a link listing many of the Private Communities in the United States. One thing that many of these have in common is that they are operated around a basic theme, are very expensive, and still have several political aspects about them... more so, they still have to answer to another larger municipal authority and are not sovereign from the county or city.

That's not surprising. It happens to every industry that the government gets involved in by force. The government always drives up costs, thus making goods unaffordable to the poor. Since those "private communities" must be provided at a cost in excess of what has already been taxed by the government, the only people who can afford such a luxury are the rich. This is like the Brazil case we were discussing previously in this thread. Only the rich can afford good security in Brazil, and again not very much of it. I'll give you another example. In Canada we have the supposedly universal health care, whereby a friend of mine cannot find a physician to help with her arthritis. If she were rich however she could go to a doctor in the US or, increasingly so, India. But since she's already been taxed dry she can't afford to do such a thing. Or there is also the much more stealthy triangular cost increase where the government forces up the price of something by regulation, without anyone noticing they're being taxed. For example in the U.S. there are laws that force health insurance companies to provide coverage for psychologists or chiropractors, thus insurers have to raise the rates and the poor can no longer afford any health insurance.

A free market for cities will not exist until private cities are exempt from being taxed for goods that aren't being provided to them. Then we will see what can be done for the poor.

[Samminn]

Cool stuff Jaws

Its actually a lot similar to some thoughts that I've had in the back of my head for some time.

[steveatx]

We already have "Private Cities." Look at Phoenix, Houston, Dallas, Atlanta, etc. The governments and planning boards are virtually owned by corporate interests, and that's why you have what you have-- bottom-line profit driven tract homes made out of particle board and Krazy Glue, profit driven strip malls with their seas of concrete, and 10 lane highways and feeder roads to bring customers. This is what you get when private interests take over-- ugly, undemocratic, crappily slapped together money generators intended to "create the maximum value" from the environment.

[bud]

We already have "Private Cities." Look at Phoenix, Houston, Dallas, Atlanta, etc. The governments and planning boards are virtually owned by corporate interests...

Even private corporations are agents or “creatures” of the State; everyone in business is an agent of the State or Municipality if they have a business license - this the very definition of socialism (state control of the means of production). I wonder what it would be like if we went by the U.S. Constitution where commerce within the several States is regulated only by Congress; furthermore, we should have a federal system of government at the local level rather than the feudal system we have now where commercial or mercenary interests have undue control. That failure to follow the law is the basic problem with cities if I may say so.

bud…

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.

I believe Fairhope, Alabama is a private city - but it was formed about a hundred years ago. http://www.cofairhope.com/

bud...

[jaws]

We already have "Private Cities." Look at Phoenix, Houston, Dallas, Atlanta, etc. The governments and planning boards are virtually owned by corporate interests, and that's why you have what you have-- bottom-line profit driven tract homes made out of particle board and Krazy Glue, profit driven strip malls with their seas of concrete, and 10 lane highways and feeder roads to bring customers. This is what you get when private interests take over-- ugly, undemocratic, crappily slapped together money generators intended to "create the maximum value" from the environment.

This is corruption, and corruption is only possible under a system of public ownership. Since the politicians do not own the capital value of the city they have no interest in building it up, and they will take bribes to act in a way that destroys this value.

[steveatx]

This is corruption, and corruption is only possible under a system of public ownership. Since the politicians do not own the capital value of the city they have no interest in building it up, and they will take bribes to act in a way that destroys this value.

What makes you think that private owners would approach development differently than the way it is approached now? It is the most cost effective way to develop land (strip malls, car-centric development, shoddy, short-term profit oriented construction) not only for the landowner, but for the consumer. The low cost would draw residents there as opposed to more responsibly developed, expensive areas. This is why the suburbs are exploding and why Wal*Mart is replacing local business. It's why there are a few small examples of "new urbanism" as opposed to absolutely explosive exurban growth. People care about their pocketbooks first, and so do corporations. The average American would purchase a cheap McMansion in the hinterlands before a smaller, more expensive home in a walkable area. This is what demand dictates, and demand would not change if we suddenly handed control over to private business.


Also, the purpose of the corruption you mention (often instigated by private business) is expressly to turn all control over to the private owners. Granting private ownership of cities would erase the few meaningful regulations that are currenltly left, and the status quo of sprawl creation and easy profits would be continued, only to a much higher degree. It takes the foresight of an overseer that is uninterested in short term profit-making to ensure that civic life is given a fair chance in the face of money grubbing.

[jaws]

What makes you think that private owners would approach development differently than the way it is approached now? It is the most cost effective way to develop land (strip malls, car-centric development, shoddy, short-term profit oriented construction) not only for the landowner, but for the consumer.

That's not true. The most valuable way (cost alone is irrelevant) to develop land is to build as densely as possible. This is why private infrastructure developers naturally promote high-density development. The only reason sprawl is possible is that the infrastructure is provided by the government, thus the sprawl developments can externalize most of the cost onto the public utilities. Private infrastructure providers will seek to economize on these costs by regulating development to be as dense as possible.

Also, the purpose of the corruption you mention (often instigated by private business) is expressly to turn all control over to the private owners.

That's wrong. The purpose of corruption is to secure a privilege for one private owner at the expense of all others. In a free market there are no such privileges.

It takes the foresight of an overseer that is uninterested in short term profit-making to ensure that civic life is given a fair chance in the face of money grubbing.

Unfortunately no such person exists nor will ever exist. We have to deal with what we are.

[Samminn]

If I, as the mayor of a middle sized American city, would approach you and ask for advice on how to transform my city into an idealised, or a near-idealised free market system, what would you propose? (given the fact that the mayor is thus probably risking his own existence by doing that).

And would it be possible to do that without giving up total local authority and just to some degree (for example as a strategy for a "phasing out" from a governmental to a free-market system)?

[jaws]

If I, as the mayor of a middle sized American city, would approach you and ask for advice on how to transform my city into an idealised, or a near-idealised free market system, what would you propose? (given the fact that the mayor is thus probably risking his own existence by doing that).

And would it be possible to do that without giving up total local authority and just to some degree (for example as a strategy for a "phasing out" from a governmental to a free-market system)?

Strategy is going to be a tough project. As a rule any attempt to eliminate political authority will be opposed by all political authorities. We are leaving the field of determining what is best for everyone in order to figure out how we will combat the established system. Since we then have to play the political game with all the drawbacks I've condemned, it's going to be a hard fight. If you want to win at politics, you have to get popular opinion, and popular opinion is not really going to understand advanced planning concepts. The masses respond to persuasion, not convincing arguments. You'll have to mount an elaborate propaganda campaign pointing out how incompetent city governments are, and propose an alternative. Then you have to rally this public opinion into concrete political reform.

The best plan is to go straight for the people. Allow property owners on a block to petition and give them the power to secede from their municipal corporation or county and take the city property around them along so as to sell them to a private business, or start one. This sounds like a perfectly fair, populist system of escaping corrupt municipalities and will be the easiest to convince the public to back.

The next plan is to go above local leadership and just force the cities to go up for auction. The cities that are nearly bankrupt will go for nothing and will have to be liquidated, while other cities wil be sold off for profit. This can't be done under current political conditions, and will only be possible as part of a greater movement of reform towards less politics and more freedom.

The third plan is to convert municipal votes into exchangeable shares, then hope that some competent owner will buy them up and clear out the politicians. This will not work on bankrupt cities.

The first task of such a strategy, and one that is essential otherwise the plan just can't go ahead, is to convince the elites to get on board. This is what I'm doing here. With enough elites a convincing plan can become a persuasive plan. In a way this is an even more difficult reform project than the former USSR and its allies faced in the early 90's. There was broad concensus that the system should be dismantled and yet a lot of confusion as to how to disentangle such a mess. We have not only to create the support but also to find a path to disentanglement. There is not going to be an easy path.

[steveatx]

You have some very good theoretical arguments for the privatization of cities. But for now, I will go with real life examples of what is possible with conscious planning and regulation (i.e. Portland) versus laissez-faire economics (i.e. Houston). Good luck with your crusade, though. I am sure you will come up with some good-in-theory lp.org talking points to debunk or discredit these examples, and I'm looking forward to it.

[jaws]

Houston is not a free market. The only thing Houston has different is the absence of use-based zoning, but all the other disruptive regulations are there. See http://papers.ssrn.com/sol3/papers.c...ract_id=837244.

[btrage]

I'm curious jaws. Are you, or have you ever been, a land use planner? I only ask because I tend to agree with some of your libertarian concepts, but I am having a real hard time wrapping your ideas around the actual use of land.

[bud]

... versus laissez-faire economics (i.e. Houston).

Houston is not a free market.

The term, "laissez-faire" was confused by the British economic philosopher Adam Smith in his 1776 (counter-revolutionary?) publication of The Wealth of Nations. Jefferson and the founders of our Federaist Republic understood it in a much different way and it was the economics of our American Revolution in 1776. While Americans won the war it seems the British won the peace since most people seem to understand and favor the term in the sense of it as used by Adam Smith.

If we had gone with our Founders rather than with the British in the matter of economics all of our cities would be private cities as they were to begin with; because State and Local governments would be limited to land use planning rather than the regulation of commerce - http://www.geocities.com/douglas36601/pax.html .

bud...

[Samminn]

I'm curious jaws. Are you, or have you ever been, a land use planner? I only ask because I tend to agree with some of your libertarian concepts, but I am having a real hard time wrapping your ideas around the actual use of land.

But its really not that hard when you come to terms with the fact that the urban form is directly related to how we treat the fundamental urban resource, which is land and the use of land. Or is it?

[jaws]

I'm curious jaws. Are you, or have you ever been, a land use planner? I only ask because I tend to agree with some of your libertarian concepts, but I am having a real hard time wrapping your ideas around the actual use of land.

No. I can't imagine what good a land use planner could do.

[Wulf9]

I didn't read the whole thread because jaws tends to get a bit .. er ,, wordy and .. um.. argumentative.

That being said, I have no objection to private cities. I think it would be a worthy experiment. Go forth and build.

I repeat my comments to previous Jaws posts, if this is a superior paradigm, show me an example. Why is it not being used anywhere in the world?

[jaws]

I repeat my comments to previous Jaws posts, if this is a superior paradigm, show me an example. Why is it not being used anywhere in the world?

Why in God's name do you believe something like that? What kind of twisted reasoning makes you ask this kind of question?

[Wulf9]

Why in God's name do you believe something like that? What kind of twisted reasoning makes you ask this kind of question?

All I asked was for one good functioning example among the thousands of cities in the world. What is twisted about that?

I would like to see a private city in operation, so I can evaluate it on its merits. Wasn't that the topic of this post?

[jaws]

All I asked was for one good functioning example among the thousands of cities in the world. What is twisted about that?

I would like to see a private city in operation, so I can evaluate it on its merits. Wasn't that the topic of this post?

You do not need to see one in operation to evaluate its merits. You continue to demand evidence in the visible absence of evidence, a completely irrational stance. You also claim that this absence of evidence is proof of lack of merit, an even more irrational stance.

[Wulf9]

You ,,, claim that ,,, absence of evidence is proof of lack of merit.

Yep. If there was merit, someone would be doing it somewhere.

[jaws]

Yep. If there was merit, someone would be doing it somewhere.

Which of course betrays your ignorance of the totality of human history and development. Perhaps even ignorance of current events.

Jaws, personal attacks will not be tolerated.

[iamme]

Yep. If there was merit, someone would be doing it somewhere.

C'mon, let's be a little realistic here. What you're saying is that an idea is invalid unless it's already invented. When someone pondered a democracy, what if everyone said, "well, that's all well and good, but golly-gee, that must be a bad idea because if it was really that great, it would have already been done".

How arrogant.

[jaws]

C'mon, let's be a little realistic here. What you're saying is that an idea is invalid unless it's already invented. When someone pondered a democracy, what if everyone said, "well, that's all well and good, but golly-gee, that must be a bad idea because if it was really that great, it would have already been done".

How arrogant.

Thank you so much.

[Wulf9]

C'mon, let's be a little realistic here. What you're saying is that an idea is invalid unless it's already invented. When someone pondered a democracy, what if everyone said, "well, that's all well and good, but golly-gee, that must be a bad idea because if it was really that great, it would have already been done".

How arrogant.

Wait a minute. I didn't say it was a bad idea or even an invalid idea. If you read back a few posts, I said I would like to see one working. I always ask Jaws for an working example of his economic theories because I am willing to give his ideas a chance. He has strong opinions, and i would like to see where they have been applied.

I was called ignorant and irrational because I asked for an example. And, from you, arrogant.

However, in a nation with a strong and active private sector, why don't we have private cities? Is it an idea that no one has tried? I doubt that. Or is it an idea the private sector doesn't want? That's my suspicion.

[jordanb]

When someone pondered a democracy, what if everyone said, "well, that's all well and good, but golly-gee, that must be a bad idea because if it was really that great, it would have already been done".

Ok, well, the first democracy was the short-lived Athenian democracy whose highlights include the killing of the greatest thinker of their age in the heat of mob anger, and getting defeated in war by the Spartans. So it's really not a good idea to be the first at something.