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Cubs Fail to Sell Wrigley to State (100 years of faith for sale)

I received a message from a reader with a link: Probably not as interesting to your NY readers, but Wrigley is back on the market. Can’t say I like the cubs, but you have to give credit (?) to their fans, 100 years of painful loss and they still love the cubs. I’m guessing most of the fans would also like to see Bush given a 3rd, 4th, or 100th term to see if he could actually succeed. Nothing like blind faith, I guess…. DBM MLB – Wrigley Field back on the market Dan, Thanks for the tip. Market Urbanism actually has readers across the world, not just NY. As a fellow White Sox fan, I would hate to have my hard earned money subsidize the enjoyment of those despised Cubs fans. But, by that same logic, the public financed the Sox’s ballpark. Should I feel guilty?… Check out this econtalk podcast about externalities and subsidies. At 9:15, they discuss subsidies to sports teams.

Bush’s “Ownership Society” and Subprime

From Rationalitate – The WaPo finally realizes the root cause of the subprime crisis Agencies like FHA and HUD, and pseudo-private agencies like Fannie Mae and Freddie Mac, were the government’s tool to manipulate the market for mortgages, and manipulate it they did: 40% of all mortgages are financed by lending companies Fannie Mae and Freddie Mac, which hold $5.3 trillion in outstanding debt, and receive tax breaks (read: subsidies) to the tune of $6.5 billion a year. Part of the irony of Bush’s “ownership society” is that it requires taxpayers to fund it. While on its face home ownership might seem like the paragon of private property and private ownership, it’s really not in very high demand in the actual free market. While America does indeed have very high rates of homeownership, it’s in spite of the market, not because of it. (I don’t really agree with the phrasing, “it’s not really in high demand.” I think almost all people desire to own their dwelling, but at a price that makes sense for them.) “Experts” often say how important it is for people to “own” their homes. I agree that ownership is great. But, at what cost? Market distortions that create bubbles? Wealth transfers from the less fortunate and landlords to “owners” of homes? “Ownership” isn’t best for everyone, especially the “owners” of a junk loan…

Want Density? Turn the Free Market Loose

Matthew Yglesias – What Price Density The solution, as Ryan Avent says, is to build denser communities. We ought to build more transit infrastructure, of course, but it’s cheaper to use what we already have more intensively. And, of course, it’s more practical to build new infrastructure if there’s a reasonable expectation that it will serve intensive development. Beyond that, density also serves to make walking and biking more practical for more trips. And best of all, getting denser could be accomplished mostly through growth-enhancing relaxation of regulatory burdens. And of course if the supply of housing in central cities and nearby suburbs were radically higher, then it would be much easier for people to afford to live in them. Instead, restrictions on the supply of conveniently located housing lead to high prices and the “drive until you qualify” phenomenon that’s currently leaving many Americans in deep trouble as they try to pay for fuel. In general, relaxing density restrictions will ease housing prices. But, a couple notes: Creating more socialized infrastructure, whether transit or roads, disperses development. High densities create demand for transit, not the other way around. Transit creates demand to locate near the stations, but not elsewhere. This is because as commuters are diverted from roads, congestion subsides, allowing drivers to commute from further-out places. So, if density is the goal, I would privatize highways & parking, while putting the breaks on construction of new public highways & parking prior to building new expensive transit. If individual commuters were to pay for their use of the roads, many would alter their habits and perhaps where they choose to commute to / from. The change in location preference will, no-doubt, increase density. Building densely has higher construction costs per unit as land costs are dispersed among more units, […]

CATO Podcast: Transportation

Today, I was listening to CATO’s Daily Podcast about transportation with Samuel Staley of the Reason Foundation. I started listening to him talk about the best ways to plan highway systems and said to myself, “Oh boy, here we go again another so-called “free-market” person talking about how the government can ‘pave our way out of congestion’.” “We’ve got the space, and we’ve got the land, and we’ve got the wealth” to pave away congestion. That’s a very collective “we” for a supposed free-market person to use. But, after about 5 minutes of that, he goes into how we now have the technology to privatize highway use and are 15 years away from the technology to privatize even local roads. Now we’re talking. We need to actually begin to tie those traditional market mechanism to the products that are being developed and implemented at the local level, and that’s something we’ve never been able to achieve before. It’s an exciting time for transportation policy. If, transaction costs are no longer the obstacle to privatization, society needs to start shattering these bureaucracies and selling the roads to the private sector. I think the biggest hurdles to privatization are peoples’ perception/biases and politics. People never paid for roads before, so it’ll take effort to convince them it is not as free as the air we breath… download mp3

Historic Preservation Can Work in the Marketplace

Houston Strategies – Historic preservation should be a neighborhood choice “In Houston’s Old Sixth Ward, the city’s first fully protected district, property values have shot up 27 percent in the last year. When given the chance, historic preservation works.” This is great news! It means there should be absolutely no problem getting voluntary neighborhood buy-in for deed restrictions. If it boosts their values, who could be opposed? Why do we need the government to impose it, when it’s obviously in their own self-interest? I argued a similar point in comments about the Carroll Gardens’ downzoning. In the case of Historic Preservation, neighbors could voluntarily form a corporation that owns facade easements on their properties. The corporation would protect the historic structures via property rights, as opposed to by mandate. Outsiders could always donate money to the corporation to buy easements on certain historic properties or make repairs. Did you know that facade easement donations by owners of historic buildings are considered tax-deductible contributions? If a municipality really feels it needs to step in, it could purchase those easements at market price, but it would probably be unnecessary.

Airport Protectionism?

Richard’s Real Estate and Urban Economics Blog – Federalism and Taxis Taxicabs in the Washington area are regulated by various jurisdictions–DC cabs may not pick up fares in Virginia and Maryland, Virginia cabs can’t get passengers in the District and Maryland, and District Cabs are forbidden from pick ups in Maryland and Virginia. In New York, they charge an additional $15 surcharge fee to take a taxi to Newark, NJ. It seems like interstate protectionism to me, nudging me to use LaGuardia or JFK.

California’s Water Resources vs Development

There are some good articles out there this morning, I want to share them with you… Rationalitate – California developments halted over water While the knee-jerk libertarian reaction might be disgust, I think the markets are probably ruined by the government, and current pricing isn’t what it would be in a market setting. UCLA professor Edward Leamer corroborates this, saying “[w]ater has been seriously under-priced in California.” So, the plan would have an effect similar to a liberalization: increased barriers on sprawling development. But obviously it’s only a nudge in the right direction, and is a woefully inadequate mechanism compared to outright liberalization of water resources. Is it possible to liberalize the water market, which would be the ideal solution?

NYC Crane Inspector Corruption

Associated Press – Senior NYC crane inspector accused of corruption: A senior city buildings official took bribes in exchange for falsely reporting that cranes had been inspected and that crane operators had been certified, but his actions did not appear to be connected to two recent crane collapses that killed nine people, authorities said Friday. James Delayo, an assistant chief inspector with the Department of Buildings’ cranes and derricks division, accepted thousands of dollars in bribes from a crane company, Department of Investigation Commissioner Rose Gill Hearn said in a statement. As Manual Lora at the LRC blog put it: So will the Department of Buildings suffer a market loss? Perhaps its stock will go down? Maybe they will take a hit in subscribers? Will its certification suffer? Will insurance companies still use their services? Oh wait. This is the state we’re talking about. Nothing to see here…move along… I guess I couldn’t put it any better than Manual….. photo by flickr user Alexandry Augustin

Free Market Impostors

I subscribe to the CATO Institute’s Daily Dispatch email. I enjoy ready the daily briefings of current events from a free-market perspective. But, once in a while, my capitalist stomach turns when they mention transit, usually accompanied by a quote from Randal O’Toole. Usually he bashes some transit plan, and gives some statistics about the inferiority of transit. Here’s a quote form the most recent Dispatch: Cato senior fellow Randal O’Toole writes: “A mile of rail transit line typically costs more to build than a four- to eight-lane freeway and typically carries fewer than half as many people as a single freeway lane mile. Federal funding for rail transit comes out of gasoline taxes and other highway user fees, and in most cases those funds would be more cost effective if spent on other transportation facilities.” Does this sound particularly “free market” to you? He’s just saying one socialist system is better than the other. On top of that he consistently presents only half the facts. You don’t even have to dig into his sources of data to know he is pulling a trick on the reader. Can you detect the deceptions? Yep, he discusses construction costs and completely neglects land costs, then focuses on cost/mile (as opposed to the more relevant cost/trip), while falsely inferring that the costs of automobile use is fully paid by fees and gas tax. Out in the country, land may be cheap and costs can be neglected. But, in urban areas where transit becomes more competitive, land is significantly more expensive. If one neglects land costs, one could justify tearing down several 60 story, $1000/sf office buildings Midtown Manhattan to build a 10 lane highway instead of an underground subway. I have a hard time respecting anyone who willingly neglects real costs (not just […]

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