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Jeff Fong

Jeff Fong

  • Joined: May 21, 2025
  • Articles: 36

Planning As A Question Of Scale

This post was inspired by Nolan Gray’s “Jane Jacobs’ Hayekian Critique of Urban Planning” and the discussion it recently sparked over at Strong Towns. In Jane Jacob’s Hayekian Critique of Urban Planning, Nolan Gray argues for the futility of trying to master plan something as complex as an entire city. And he’s right. The last century’s Corbusian fantasies overwhelmingly ended in failure. And, in what’s a very even-handed article, he goes on to make room for some amount of centralization where decentralized planning just seems to break down. He’s right on that point as well. But after reading Mr. Gray’s article and the discussion it sparked over at Strong Towns, I think we can take the conversation a little farther. Instead of a binary choice, we should be speaking in terms of a spectrum with centralization and decentralization on opposite, theoretical ends. Once we think in those terms, we can approach questions of planning as questions of determining what issues are best addressed at what scale (individual, neighborhood, district, municipal, regional, etc). Looking at India’s or China’s Wenzhou, we can see how hard it is to produce certain kinds of city-wide infrastructure through decentralized market coordination. In the specific areas where relatively decentralized coordination produces sub-par results, it makes sense solve problems via a single entity with responsibility for an entire urban area. The point here is not that municipal or regional planners are ever better at confronting knowledge problems than market participants; it’s that, in some places, transaction costs render decentralized coordination nearly impossible, so the potential benefits of better-leveraged local knowledge never even have a chance to appear. In these situations, any plan is better than no plan, and below a certain scale, no plan is what we end up with. And where transaction costs aren’t too high we should […]

A response to Interfluidity

On Interfluidity, Steve Randy Waldman posted some criticisms of the market urbanist position. The post was interesting, though I took issue with a few specific points. The following are my responses. Regulatory Authority as a Property Right The customary property rights surrounding homeownership in many cities and suburbs include much more than the use of a square of earth and whatever is built on it. Existing homeowners bought into particular neighborhoods in large part because of their “character”, which includes nice-sounding things like walkability or “charm”, as well as not-so-nice-sounding things like access to exclusionary education. I don’t buy the idea that local control of zoning is a customary property right. A property right implies someone owns something in a definitive way and can make decisions as to the disposition of said something within whatever bounds are prescribed by law. Land use regulations don’t work that way. The relative influence over land use between two homeowners comes down to arbitrary factors like who’s more charismatic in the homeowner’s association or who shows up most frequently at planning meetings. However, if we were to make authority over land use more like a property right, I might actually like that. Ideas like Tax Increment Local Transfers, state taxes on the municipal use of zoning authority, and municipal corporations with residual claimants move us to a world where authority over land use actually looks like something that can be bought, sold, and taxed. I’m partial to the idea of deregulation, but if reform means creating a market in which we can pay off NIMBYs, I can get behind that too. The Normative Case Against Deregulation “Zoning reform” is an anodyne way to describe an expropriation of those customary rights. It amounts to diminishing residents’ ability to preserve or control the evolution of their neighborhoods, in […]

Neither Public nor Private: Rethinking the Dichotomy

Cato recently kicked off an essay series they’re calling “What Can’t Private Governance Do?”. The series questions how far we can take private governance in replacing public institutions. The most recent essay by Mark Lutter questions where to draw the line between private and public in territorial governance. And, more importantly, whether drawing that line even makes sense. Mr. Lutter concludes that it does, but I’ll politely disagree. We should instead abandon the public vs private dichotomy. It doesn’t accurately describe reality. It’s not useful for understanding policy problems. And it distracts us from the more interesting lines of inquiry we could otherwise be pursuing. A Tale of Two Cities Imagine two different cities, one proprietary and the other public. The former is run as a private, for-profit firm. It has an executive team, board of directors, and shareholders. The latter is a traditional municipal corporation. It’s run partially by elected officials and partially by appointees. It’s what we would call non-profit. No one “owns” the government as a legal entity. Now imagine that both cities raise revenue through land values. Greater demand to live in either city translates into a higher price for land. And the more that either city does to make their jurisdictions attractive, the more revenue that either stands to collect. In this scenario, price signals in the form of land valuations give both cities an incentive to make positive sum investments. Those same price signals also provide both cities with the ability to understand what those positive sum investments might be. Each city is responding to price information and making positive sum investments. So what difference does it make to call one public and the other proprietary? In all fairness, there’s still one place we could draw a line. We could make the choice of […]

San Francisco Turned Sisyphus: Why the City Can’t Fix the Housing Crisis On its Own

Housing prices in San Francisco are obscene. And, in large part, that’s because the city hasn’t permitted enough new construction. But that’s not the entire story. For as hard as San Francisco has resisted development, the Peninsula cities have resisted it even more. And in so doing they’ve pushed the responsibility of development onto their Northern neighbor. If San Francisco’s housing crisis is to be resolved, the Peninsula cities will have to quite literally grow up. Bad Neighbors San Francisco is synonymous with tech, but there’s plenty going on just down the road. Menlo Park has Facebook. Mountain View has both Google and Linkedin. These two cities alone are home to over 1,300 other tech companies and the story’s much the same elsewhere on the Peninsula. But where firms have sprung up and jobs have become abundant, housing has remained in short supply. Tech companies bus an estimated 7,500 workers from San Francisco apartments to Peninsula offices every day. They don’t do this for fun. There’s simply not enough housing near major employers. And what is available is often unaffordable, even for tech workers. But if housing prices are as bad or worse on the peninsula, one might ask why we only hear the word “crisis” in San Francisco. The reason is simple. What makes for crisis in San Francisco is nothing but windfall to the South. According to the U.S. Census, San Francisco’s homeownership rate is 36.6%. Mountain View’s is 41.8%, San Mateo’s is 53.6%, Palo Alto’s is 55.4%, Menlo Park’s is 56.2%, and Cupertino’s is 63.7%. Homeowners in these cities aren’t faced with skyrocketing rent. And thanks to Prop 13, they also pay almost nothing in property tax–no matter how much their homes appreciate in value. They not only face no downside from the anti-development status quo, they […]

Urban Density, Mass Transit, and Uber

Over at FiveThirtyEight, Nate Silver and Rueben Fischer-Baum claim mass transit is Uber’s best friend.  They use data from New York to show that Uber is most frequently used in areas with effective mass transit. They explain that residents in areas with poor access to mass transit are more likely to assume the fixed cost of car ownership. Once that overhead has been assumed, these residents are more likely to use the personal vehicle they’re already paying for rather than rely on alternative modes of transportation. There’s variation in use depending on the intersection of income level and transit accessibility, but that the big takeaway is that mass transit supports Uber. And that Uber as well as other TNCs will be most successful where effective mass transit is already in place. It’s a great analysis. And it’s partially right–but not entirely.   Mass transit does support TNC growth just as the authors describe. But TNCs, in turn, support mass transit by solving the last mile problem. The two systems are complementary. But without a supportive urban environment, neither system stands any chance of success. Mass transit and TNCs may be allies, but both rely on urban density as their benefactor. Residents in densely developed cities with mixed land use consume less transportation per capita because the distances between work, housing, and recreation are all much shorter. And below a certain level of consumption, the minimum fixed cost of car ownership ceases to make sense. Alternative forms of transportation like a mass transit system or a TNC platform entail only marginal cost, so they begin to look more attractive. Imagine putting a mass transit system–commuter rail, BRT, whatever you’d like–in the middle of Houston or LA style sprawl. It might be a net positive for a TNC, but in no way […]

Trickle-Down Housing Economics? Laying Reagan’s Ghost to Rest

In a recent 48 Hills post, housing activist Peter Cohen aimed a couple rounds of return fire at SPUR’s Gabriel Metcalf. The post comes in response to Mr. Metcalf’s own article critiquing progressive housing policy. Mr. Cohen bounces around a bit, but he does repeat some frequently used talking points worth addressing. Trickle-down economics Mr. Cohen calls the argument for market-rate construction ‘trickle down economics’.  Trickle down economics actually refers to certain macro theories popularized during the Reagan years. These models assumed a higher marginal propensity to save among wealthier individuals. And given this assumption, some economists concluded that reducing top marginal tax rates would result in higher savings. This would then mean higher levels of investment which would, in turn, have a positive effect on aggregate output. And from there we get the idea of a rising tide lifting all ships. Note that none of that has anything to do with housing policy. Labeling something ‘trickle down’ is a way to delegitimize certain policy proposals by associating them with Ronald Reagan. It’s somewhere between rhetorically dishonest and intellectually lazy. Though to be fair, it’s probably pretty effective in San Francisco. The concept Mr. Cohen is trying to critique is actually called filtering. In many instances, markets do not produce new housing at every income level. But they do produce housing across different income levels over time. Today’s luxury development is tomorrow’s middle income housing. The catch, however, is that supply has to continually expand. If not, prices for even dilapidated housing can go through the roof. For a more thorough explanation, see SFBARF’s agent based housing model.   If you build it, they’ll just come But even accurately defined, Mr. Cohen still objects to the concept of filtering. He cites an article by urban planning authority William Fulton to make […]

Market Fundamentalism in the Mission?

There’s a proposal to place a moratorium on all market rate construction in the Mission District, one of San Francisco’s most rapidly gentrifying neighborhoods. Needless to say the proposal has sparked a debate. And Dan Ancona’s Putting Market Fundamentalism On Hold is another rock hurled into that particular fray. But in trying to take the anti-moratorium/pro-supply camp to task, it falls into the same unproductive bomb hurling we’ve been watching now for years. The following are a few thoughts on some of the points Mr. Ancona makes in his recent piece. Talking Past Each Other The first point is about a fundamental misunderstanding of the motivations behind the moratorium. Mr. Ancona makes this mistake, but so do the exasperated anti-moratorium/pro-supply advocates he quotes at the beginning of his piece. Hint: The moratorium is not about lowering housing prices. To be sure, the anti-moratorium camp wants lower aggregate housing prices throughout San Francisco and the entire region. The indisputable way to accomplish this goal is by building more housing. And as far as the anti-moratorium camp is concerned, this includes plenty of  below market rate (BMR) construction to mitigate some of the distributional effects of development. For the pro-moratorium camp, however, this doesn’t cut it. Lower aggregate prices are not their goal. Their goal is keeping the existing population of the Mission intact and in place. Even a 70/30 ratio of market rate development to BMR construction wouldn’t do that. There would still be demographic churn and this is specifically what they want to avoid. For the pro-moratorium camp, lower housing prices are all well and good, but not if that means the dispersal of the existing community in the process. Searching for the Endgame The second issue is that there’s no endgame for the pro-moratorium camp. Mr. Ancona seems to think there is, but doesn’t go […]

Seamless Transit: Thoughts on the new report from SPUR

Seamless Transit is the new transportation policy report from SPUR. Main author Ratna Amin proposes integrating the Bay Area’s balkanized transit systems to improve lackluster ridership. Given that the region has 23 separate transit providers–more than any other metropolitan area in the country–she may have a point. The report proposes standardizing service maps, fare structures, and payment systems; eliminating inter-system coverage gaps as well as redundant coverage; and reforming transit governance so that the different agencies actually make plans together instead of working at cross-purposes or not at all. The recommendations are sound and the report includes historical footnotes for context. These are helpful for understanding region’s complicated institutional arrangements. Seamless Transit is a fine piece of work and well worth the read for anyone interested in Bay Area transportation. But while organizational efficiency is important, it’s not the only thing to discuss. If we want to improve the region’s mass transit systems, we have to consider the physical environment in which those systems are embedded. To get transit right, the region needs to embrace density. Denser development around transit nodes would increase ridership substantially. When people live, work, and play in smaller geographic areas, more people travel between a fewer number of points. Mass transit, especially fixed rail transit, becomes more effective the denser development becomes. Hong Kong’s Metro Transit Railway (MTR) might be the quintessential example of urban density begetting mass transit success. The city is home to over 7 million inhabitants. It has a population density of over 18,000 residents per square mile. And of this population, 41% live within a half mile of an MTR station. The result? The MTR has a farebox recovery ratio of 186%–the highest in the world. Because of legal as well as political differences between Hong Kong and the Bay Area, […]

Why Money for Schools Means No Permits For Housing

Housing has a lot going against it in the California. But amidst all the legal, political, and regulatory roadblocks, there’s one law that sneaks by largely unnoticed: Prop 98. Prop 98 guarantees a minimum level of state spending on education each year. Sacramento pools most city, county, and special district property taxes into special education funds to meet this commitment. The localities only get to keep a small part of the property tax revenues for their own general budgets. This system creates a disincentive for cities to permit housing. New housing brings in new residents who need city services. But it doesn’t bring in a commensurate increase in property taxes since most of that revenue gets scooped up by Sacramento. Commercial development, though, brings in taxes a city gets to keep. Sales and hotel taxes are significant revenue streams. And they don’t cause the kinds of strain on city services that new residential does. Reforming Prop 98 might be low hanging fruit. Changing the formula to appropriate a broader stream of city revenues might help ease the bias against housing. And it might even be possible to amend the law without having to fight the California Teachers Association. As long as there’s no net decrease in education funding, of course.   It’s tough to say exactly how much new housing Prop 98 actually prevents. Different cities get to keep different amounts of their property taxes, so the disincentive differs case to case. And there are plenty of other things like CEQA and Prop 13 which put a drag on new construction as well. But where CEQA and Prop 13 make it easier for residents who are already NIMBYs to gum up the works, Prop 98 is a reason in itself for a city to avoid residential development. So while we can’t do […]

The Right to the City

This post draws heavily from Tom W. Bell’s “Want to Own a City?”  and would not have been possible without his prior writing and research The “Right to the City” is an old marxist slogan that’s as catchy as it is ill-defined. Neither the phrase’s originator Henri Lefebvre, nor David Harvey, a more recent proponent, seem to have articulated the idea in any meaningful way. Even the Right to the City Alliance stops short of explaining what the right actually is. When it comes up, it’s typically alongside a claim that something is being stolen or taken away from long-standing communities, as if neighborhoods were sovereign territory suffering from an invasion. For practical purposes, no one has any right to reside in any place beyond their ability to pay. But if the desire is for a way in which communities could actually own the places they call home, perhaps the Right to the City should be a property right. Public Ownership through Private Property What’s the difference between a private company and a municipal corporation? You can own the former but not the latter. Investors have clearly delineated property rights in their corporations. Residents have no equivalent ownership rights in their cities. But what if living in a city meant owning a piece of it as a legal entity as well? Imagine that a city issued shares to its residents. Shares would vest over time and long-time residents would have more equity than new arrivals. Now assume that this city took in all of its revenue through land value taxation and that land revenues were used to pay dividends to the city’s resident-shareholders. Instead of facing displacement, incumbent residents would benefit from rising demand to live in their city. Shares might also be used to weight the voting system. More shares could […]

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