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Stephen Smith

Stephen Smith

I graduated Spring 2010 from Georgetown undergrad, with an entirely unrelated and highly regrettable major that might have made a little more sense if I actually wanted to become an international trade lawyer, but which alas seems good for little else. I still do most of the tweeting for Market Urbanism Stephen had previously written on urbanism at Forbes.com. Articles Profile; Reason Magazine, and Next City
  • Joined: May 21, 2025
  • Articles: 282
  • Comments: 41

Mortgage-interest tax deduction cuts on the table

Urbanism doesn’t get a lot of breaking news (that is, unless Eric Fidler’s prediction pans out), but this might be an exception: the WSJ is reporting that Obama’s (bipartisan?) deficit commission is considering cutting the mortgage-interest tax deduction.  The reports are all very speculative, but it looks like they’re definitely not considering eliminating the tax break entirely.  While most libertarians have advocated eliminating the tax break (and in fact all tax breaks) completely and adjusting the general tax rates to make the measure revenue-neutral, it looks like this (along with cuts to the child tax credit, among others) is a cost-saving measure. As I discussed earlier today, the tax credit is just one of many highly regressive government advantageous to wealthy homeowners – the vast majority of Americans don’t even itemize their tax returns, and therefore don’t benefit at all from the tax break.  Still, in spite of its regressiveness, it’s enormously popular among voters. Leaving aside considerations of whether the savings should be used to pay down the deficit or to lower marginal rates, any move to limit this deduction would be a good thing for urbanism.  While the American ideal of the homeowner involved in a positive way in their community and schools is prevalent, I fear that the greater effect of increasing homeownership above the market equilibrium is to encourage NIMBYism by making people look at their home, rather than their wider community, as their biggest asset.  Furthermore, it puts people in the awkward position of desiring a rise in cost for one of life’s most essential needs, which clearly played a large role in the policies that led up to the subprime crash. While this proposed change is certain to encounter fierce resistance from America’s real estate industry and wealthy, entrenched suburban interests, it is only a […]

Matt Yglesias attacks parking maximums, outs himself as a market urbanist

Matt Yglesias has been on a roll lately with the urbanism posts, all of which have a heavy “market urbanist” slant, but it’s this post about parking reform in/around Boston (riffing off of this Boston Globe article) that seals the deal for me: Regulators pushing developers to build less parking than they want is much, much, much better than the near-universal practice of regulators mandating minimum levels of parking. But I do think the message is clearer and the potential political coalition bigger if parking reformers just stick to the idea that this should be left up to the market. Cars are useful, and people who have cars need to park them. So there’s nothing wrong with building parking. But urban space is expensive, and parking spaces take up space, so people should weigh the costs and benefits of building/buying more parking against other possibilities. Getting to market-determined levels of parking construction and parking space pricing would be a huge victory, and it’s not particularly necessary to go beyond that. I guess the only thing I’d have to add is that while I think these sort of parking maximums and general density-forcing rules are of minor import compared to the massively anti-density status quo, they do give rhetorical ammo to people like Randal O’Toole and other self-proclaimed libertarian types who like to claim that what planners really want is to banish cars entirely from cities. The sad truth is that they’re right – New Urbanism/Smart Growth might have some libertarian issues at heart, but at the end of the day, they’re out to put us all on trains/buses/bikes/our own two feet, not to set the market right. Now again, I think that O’Toole & Co. vastly overestimate the influence of density-forcing regulations, but they do have somewhat of a point. […]

Midnight parking round-up

1. Donald Shoup makes up for last week with an interesting piece on how America’s tax structure biases employers towards providing parking for their employees, similar to how untaxed employer-provided healthcare shapes that industry. 2. Back in August Randal O’Toole asked for proof that minimum parking requirements force Walmart to build more parking than they otherwise would. I think this is a bit of a red herring, since obviously parking reform would have more of an impact in areas that are more urban than where Walmart typically locates, but lo and behold, here’s the proof, at least in the case of one store in Northeastern Connecticut. In this case it looks like the parking minimums are going to be reduced, but I question whether smaller companies without Wal-Mart’s clout and money could have demanded such changes. 3. A survey of urban planners, supposedly biased towards big cities, found that 60% feel that the free market would not provide an adequate amount of parking if developers were not given parking minimums, with only 1 in 10 believing that the market would provide too much parking. The author of the paper, called “Are suburban TODs over-parked?” (.pdf), and published in the Journal of Public Transportation, found that suburban TOD projects in the East Bay and Portland supplied too much parking for the amount of cars that were actually parked. The authors unfortunately don’t do a great job of linking the parking surplus directly to parking minimums, but they do provide some interesting empirical evidence for what Matt Yglesias called “parking feedback loops” and what the study’s authors term a “virtuous cycle” – the idea that parking itself is a barrier to walkability, and thus removing spaces will lessen the demand for parking, even if nobody was using the spots that were removed.

Midnight links

1. Cap’n Transit weighs in on the ARC debate, and shows that Chris Christie is more interested in shifting resources to his suburban constituents than to cutting spending. Here’s the best part: Editorial board member: What’s the difference between a gas tax hike and a fare hike, besides who it lands on? Christie: That’s the difference. 2. The Los Angeles Times profiles Donald Shoup. I liked this part: Shoup depends on his bicycle for much of his mobility. He freely confesses, however, that when behind the wheel of his silver 1994 Infiniti J30, he often circles the block looking for a free parking space. “I don’t like paying for parking,” he says with a shrug. 3. Matt Yglesias notes DC’s second-only-to-NYC office rents, and blames them on the city’s absurd height restriction.  I’m happy that Yglesias is interested in urbanism, but it doesn’t really appear like he reads/interacts with the wider planning blogosphere (I stand corrected).

The economics of redevelopment and the shape of socialist cities

Earlier today I read an article by Daniel Garst about Bejing’s awkward population distribution that reminded me of a journal article about the general shape of socialist cities that I read a while back. Garst talks about Beijing being a “circus tent” when it comes to density, with population density increasing as you travel away from the city center, in contrast to the “pyramid” style of most cities, with high densities in the center and lower densities around the periphery (see chart for a visual representation). This immediately made me think of an article by Alain Bertraud and Bertrand Renaud called “Socialist Cities without Land Markets,” where they describe exactly this phenomenon, and explain it as a failure of administrative urban planning. Here’s an excerpt: As their economy and their population grow, cities expand through the progressive addition of concentric rings, similar to the growth of trees in successive seasons. New rings are added to the periphery as the city grows. With each ring, land use reflects the combined effects of demography, technology, and the economy at the time when the ring was developed. Wile this organic incremental growth is common to all cities, in a market city changing land prices exert their pressure simultaneously in all areas of the city, not just at the periphery. Land prices exert a powerful influence to recycle already developed land in the inner rings when the type and intensity of the existing use is too different from the land’s optimum economic use. Thus, changing land values bring a built-in urban dynamism as ceaseless variations in land prices put a constant pressure on the current uses of land and trigger changes to new activities and/or densities. Under the administrative-command economy, the absence of land prices eliminated the main incentive to redevelop built-up areas by […]

News and thoughts on the gas tax

An influential highway group has called for replacing the flat tax on gas with a percentage tax, according to the Wall Street Journal. They want to replace the current 18.4 and 24.4 cent taxes on gasoline and diesel, respectively, with more flexible 8.4% and 10.6% tax rates. At current gas prices that would be about a 2-cent increase (at least on the gasoline side of things), and it would at least allow for automatic increases with inflation. It is a bit awkward for road funding to rise and fall with the cost of fuel, but it may be the only politically feasible way to raise the gas tax – to pass it off as an unintended consequence. Of course, there’s the possibility of the price of gas falling, although I don’t know how likely that is over the long-run. As you can imagine, the political reaction was quite hostile, with Rep. John Mica, who’s on the soon-to-be Republican-controlled House Transportation and Infrastructure Committee, saying that anything that would raise gas prices is a “non-starter.” It’s unfortunate that the gas tax is seen as just another tax and not the explicit cost of the road infrastructure, but it looks like it’s going to be a casualty of the Tea Party’s anti-tax mantra. In any case, the issue will be dealt with after the midterms when hopefully politicians will be a bit more clear-headed. The WSJ suggests that politicians are reluctant to keep borrowing from the general fund for road projects, but I’m afraid that their fear of budget deficits will be overpower by their fear of raising the cost of driving. And as much as I resent Obama and this Congress for refusing to raise the gas tax, it could have been worse – both McCain and Hillary Clinton were in […]

The inanity of airport connectors

Despite my issues with how new transit projects are implemented in America today, I’m generally happy to see them built. Even though they’re flawed, heavily-subsidized government creations, they make upzoning more palatable and can later be sold off and privately managed. There’s a lot I’d do differently, but on net I think most new transit projects are a step, however imperfect, in the direction of market urbanism. But there’s at least one form of transit that I can almost never get behind: the airport connector. The airport connector is a special beast of a rail-based transit system that’s a relatively recent phenomenon outside of transit-dense regions like Western Europe and Japan. So manifestly wasteful that it generates more animosity towards mass transit than it does riders, it’s a project that only politicians and unions could love. Unlike more integrated networks where the airport is just one station on an otherwise viable route (like Philadelphia’s Airport Line or DC’s proposed Silver Line), airport connectors generally serve only the airport and one local hub. With no purpose other than to get people in and out of the airport, they provide neither ancillary transit benefits nor TOD opportunities.  Oftentimes they don’t even reach downtown, acting instead like glorified park-and-rides. The most egregious example in the US would have to be BART’s proposed Oakland Airport Connector. The rail line will extend for a little more than three miles, replacing what is now a bus routes.  The $3 fare will double, along with the half billion dollars that it will cost the government. Like the current bus route, it will only connect Oakland’s airport to the nearest BART station with no intermediate stops. It’s opposed by transit activists, who would rather convert the bus into a dedicated BRT lane and spend the rest of the half billion […]

Hell freezes over, or: the one in which I agree with Randal O’Toole’s argument over Shoup’s

I never thought the day would come, but I actually find myself taking issue with Donald Shoup’s recent criticism of the Cato Institute (which Randal O’Toole works for) and its own DC headquarters’ employee parking program. While I agree with Shoup’s more general critique of Cato’s stance on transportation and land use issues, and consider him to be the greatest urbanist since Jane Jacobs, his attack on Cato for giving its employees free parking appears to me to be misdirected. The gist of his argument is that since Cato offers free parking to its employees and neighboring NPR (both on Massachusetts Ave. in DC) charges its workers for parking, NPR is taking the “free market” approach and Cato is taking the “free parking” approach. But I don’t see how this comports with Shoup’s broader research, which focuses on parking policies of governments and not private (well, sort of) entities like NPR and Cato. Corporations are allowed to take a command-and-control approach to their operations and still be considered “free market institutions” as long as they are competing in a free market, and in fact some of the most successful ones are (Facebook, for example, is still run as Mark Zuckerberg’s own personal fiefdom). Now of course, Cato is not operating in a free market when it comes to parking. It likely was forced to build some amount of parking by law, and even if it wasn’t, the influence of neighboring areas’ land use policies looms large on a single building like Cato’s. There’s also the issue of employer-provided parking as a fringe benefit not being taxed, which Shoup mentions. He then suggests that Cato offer a parking cash-out program, whereby they pay employees who choose not to park the cash equivalent of the spot, which Cato doesn’t appear to currently […]

Darien, CT gets sued by the DOJ over inclusionary zoning

The New York Times has an interesting article about a Justice Department probe into Darien, CT’s local inclusionary zoning rules. Inclusionary zoning means essentially that multi-unit developments have to offer a portion of the project as “affordable housing,” which invariably means charging below-market rents. We here at Market Urbanism oppose it because it essentially acts as a tax on dense development that’s not levied on the sort of one-off developments that are usually large lot, detached houses, which discriminates against the very people that it purports to be helping. While the people who live in the units certainly benefit from the too-good-to-be-true rents, every other poor person loses out as their housing costs rise. But unfortunately, the DOJ doesn’t appear worried about inclusionary zoning generally, but rather is interested in the “priority populations” provision, which determines who gets the low-rent housing, which is in high demand because of the artificially low price. Currently the town favors current residents, which the Justice Department is right to find discriminatory, since the well-healed New York City suburb is overwhelmingly white. While I’m always glad to see inclusionary zoning challenged, the focus on the priority populations provision strikes me as a bit narrow-sighted – they should be concerned about inclusionary zoning itself reducing affordable development. And in fact, the New York Times seems to recognize this, as they quote a developer at length as she describes the difficult of developing anything affordable in Darien. Sorry for such a long quote, but it’s very interesting: Inclusionary zoning was one strategy for accomplishing that goal. The policy hasn’t been used yet, as no qualifying developments have been approved since it went into effect in May 2009. The federal inquiry came to light last month, when Christopher and Margaret Stefanoni, a local couple who have sought approvals […]

No ARC without TOD

A lot of fuss has been made by urbanists about how important the ARC transit tunnel under the Hudson is to curbing sprawl in North Jersey, but frankly I’m not convinced that more commuter rail into Manhattan is the cure for what ails New Jersey. The state’s fundamental problem is its reliance on two cities outside its borders for providing jobs to its people, and it’s used the existence of New York and Philadelphia as excuses to remain a sprawled, suburban oasis in the middle of a dense Northeast Corridor, which can’t continue once it runs out of land and money. Commuter rail in post-WWII America has never quite lived up to transit activists’ hopes, and the NJ Transit service and the ARC tunnel will be no different. Instead of viewing suburban train stations as smaller versions of city stations, locals like to think of them as their own personal portals into downtown business districts. Suburbanites don’t want transit-oriented development – they want lots of parking so they have access to the station, since most of them don’t live within walking distance.  Increased density and less parking might benefit future residents who would move in to new developments, but they don’t show up to zoning board meetings and don’t get a vote. As an example of how many towns waste their transit, I grew up in Bryn Mawr, a suburb of Philadelphia, and a town which has better transit access than the Upper East Side. It’s part of a string of towns collectively known as the “Main Line,” after the train tracks that run through the area, there’s a light rail line that runs south of the main commuter line, and there are a few bus lines (both SEPTA buses and private college shuttles) that connect the towns. Despite its […]

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