"If there was an opportunity to design a city from a blank slate"

Just stop. Your premise is both inadequate and dangerous. There is almost never an opportunity (excepting Barcelona's Eixample, Brasilia, and Dubai) to design a city as a blank slate. And when we do, it often doesn't age well, as conditions and transport technology change. Ie, Urban Air Mobility (UAM) is going to be a Thing in the future, but almost none of our present planning reflects that.

Read transportation history, and nobody planned for railroads in 1840--they invested millions in canals. Even after the Model T kicks off in 1908, it's not until 1919 that serious road planning starts, and not until 1957 when serious Interstate building happens. And never in those years did they think about preserving right of way for the metros and light rails systems that would be needed a few short decades later.

Further 'blank slating' even a district in an existing city is dangerous--from whence do we get the worst ills and failings of urban renewal. With an existing urban context, disjointed incrementalism really is best, but it does require planning to be a process to coordinate action, rather than steps to produce a document.

Dr. Cameron Murray Reflections

I much enjoyed this article by Dr. Cameron Murray, but there are a few things I'm having a hard time with. So this post is me wrestling with the implications.

 Explainer: Markets efficiently delay building feasible new homes

Specifically, while I understand that for housing, while the stock dominates, there is a unit of analysis problem. A comment was made here (Comments - Inescapable Equilibrium? - by Jeff Fong) that that Houston halving lot sizes didn't do anything for housing affordability.

Houston? Yeah, probably mostly a reallocation with the city, and nationally a reallocation for sure.

This essentially hinges on the contention that making housing cheaper in Houston just induced someone from not-Houston to move to Houston, doing nothing at all to make housing prices more affordable. Which seems counter-intuitive, but I can see it in action in Salt Lake City, which has made strenuous efforts to improve housing affordability through new construction. But locals aren't really seeing the full benefit of that, as the affordable housing (housing cost compared to income) is attracting people from all over to move there. And there is not really anything anyone can do about that.

Not to say the supply isn't helping--this article is nicely explicit on the relationship between additional supply and lower rents: 1% more supply means 1-2% lower rents, and that is really hard to lower rents, because adding 1% more supply to a metro with a million housing units requires ten thousand housing units. So, in a large metro, it requires a lot to move the needle. (Salt Lake has been doing it anyway, by building thousands of apartments). But the awkward reality is that in order to keep rents from increasing, Salt Lake is going got need to keep doing it. Which means at some point, it will run into the 'Vancouver Problem', where all the depreciated low-rent strip-malls and auto dealerships have been developed, and the only low-density development that remains are the single-family homes that make up 80% of the urbanized area. And eventually, (theoretically), Salt Lake would have the Barcelona problem, where developing a seven-story apartment requires demolishing a three-story apartment. (An issue, ironically, arising not from the geographic constraint of an island or peninsula, but from regulatory constraint of military planners). 

And for whatever else, Dr. Patrick Condon has done a nice job of showing that no matter how much new density you add, single family detached homes are still nice, and people will still pay quite a bit for them, and the smaller the share of the stock they represent, the more valuable they are. I still remember a story of the last private house facing Central Park, owned by an heiress who'd lived there, life-long, and didn't care to sell at any price. Her heirs sold and immediately realized some millions in windfall. 

Nothing short of a Rustbelt-style dying city is actually going to lower land values, and no one wants to achieve housing affordability that way anymore than they want to achieve weight loss through amputation. 

Dr. Cameron Murray did also comment that:

Planning DOES change the spatial distribution of homes, as intended. But make the spatial distribution more efficient will make average dwellings better and hence higher value.

Which is kind of a bid deal, from a transportation perspective. The spatial distribution of buildings is extremely important from a transportation perspective. And that uniform density generates pretty much the worse possible outcomes in terms of maximizing required travel distances, limiting labor market access by non-car owners, making effective transit infeasible, losing time in traffic, and suffering air pollution.

From an economic perspective, I suppose it seems like it doesn't matter--the cost of all those externalities will be priced into location values, and people will make location choices based on how they allocate their consumption between their pleasures - clean air or a daily pack of cigarettes.

But from a planning perspective, it matters quite a lot. There is plenty of evidence of low-income folks clinging to incredibly substandard housing because of locational amenities. Exiling someone without a car to a car-dominated district effectively stands them, something most clearly seen in that people prefer being homeless* in an urban setting to marginal housing in a rural setting.  It's not well known, but the majority of the homeless population experience it only temporarily, as gaps in being housed (however inadequately) and only a hard core are long-term homeless. Consequently, there are people who are willing to pay incredibly high proportions of their income toward housing, simply because they cannot meet the threshold requirements of car ownership. And the core of the many anti-blight measures that characterize our modern planning regime are simply anti-density measures, hostile design to the poorest and least well-off, and that the slum-reforming efforts describing the ills of density readily translated into a slum destroying and slum clearance mentality. 

It's easy to forget that while we now associate streetcar and subway use as being working class, it was (at first) very middle class--a way to escape the central city to streetcar suburbs without suffering the transportation cost of needing to walk for hours. Which in turn enabled both lower density and higher quality housing (as landlords and developers competed on quality rather than location). Indeed, if we could costlessly teleport, and go anywhere, instantly, and location ceased to matter, competition would be purely on quality.  However, the internet supplies an immediate counter-factual: in a space where we can be anywhere in an infinite space, instantaneously, we've still clustered in a small number of high-density websites, via the network effect. 

People will spend their money for A or B, but how much A or B people get matters, and especially so for the marginal. Tokyo is a megalopolis, the largest city in the world, and while rents haven't decreased, the amount of space per person has, which represents a very real improvement over previous conditions. 

Even if halving Houston's lost sizes didn't do anything for average rents in Houston, it still enabled a lot more people to move to Houston, and to enjoy the amenities of density. People talk endlessly of the ills of density--the smells and sounds of neighbors, of traffic congestion. But too little is said of its benefits--access to employment, services, and amenities that enrich life. There are, of course, cities that are Doing It Wrong and have managed to obtain all the ills of density with realizing many of the benefits. Partially, this is a matter of the non-linearity of costs and benefits. Ten times the density doesn't make traffic congestion 10x as bad, while ten-times the density is 100x the job opportunities. But partially it's a matter of failing to make a regime shift, not away from auto-mobility, but away from auto-dependence. The automobile works at basically any scale--if you've the time, you can drive across Eurasia. It doesn't get less efficient at smaller distances (you can still drive across the parking lot), but other (slower) modes become more competitive. After all, humans don't measure travel in distance, but in time. A 30m trip is a 30m trip, regardless of if that trip covers 5 miles or 10, all else equal. 

Growing up in suburbia, walking wasn't really feasible--a 10-minute walk didn't get you anywhere you wanted to be. 20 minutes would do the job, but a 20-minute trip is really a pair of 20-minute trips--one outbound and one inbound. Regardless, the empirical evidence is clear--the relationship between trip distance and frequency is inversely proportional--a trip that is twice as long is made half as often. Longer trips mean fewer trips, which means less access, which means less interaction, which means less employment, entertainment, and interaction. 

As traffic congestion slows the car, alternative modes become more attractive. Hmm. I think it is important to think of parking as the 'access mode' to the car, in much the same way walking is the access mode to a bus stop. Where there isn't a bus stop, you can't embark on a bus. But likewise, where there isn't parking, you can't disembark from your car. And that is a significant limitation on car use. Of course, where parking is sparse, people can (and do) disembark from a travel time, further slowing other cars, and again eroding the value of automobility. 

That enormous effort is spent to maintain auto accessibility should come as no surprise. The highway network is a network, and reduced access to even a single node degrades the whole network. And if the highway network were to lose access to a high-density location, such as a CBD, the impact to network value would be enormous. Which will make the effects of congestion pricing in New York very interesting. And interestingly implies that part of the reason that auto congestion has fallen is that auto access to the congestion zone is suddenly a lot less valuable. Which will have knock-on effects to the value of parking in the zone, which will in turn affect parking supply, in turn affecting auto accessibility. 

Amsterdam an interesting example--a rational understanding that land is limited and that creating more of it (by reclaiming it from the sea) is expensive, and so a space expensive project like a highway system has opportunity costs that other places don't face. A national macrocosm of the problem faced by every city in the world.

Substack, Twitter, BlueSky

 I also maintain a Substack, have a Twitter account, and a BlueSky account. 

FEDERAL-AID HIGHWAYS NATIONAL SUMMARY (2023)

The Federal gas tax does not pay for local roads (urban or rural). The exceptions are meaningless--in the whole county, it's .000083%. (About 500 miles out of 7 million, or less than 1 in a million). 

Source: hm18m.pdf

Against Homeownership

If you like money, you are better off renting and putting money in a savings account than buying a house and enjoying the appreciation. This is poorly recognized generally but explicitly recognized by people who are serious and conscientious about their money. It is poorly recognized generally due to the persistent bullshit* of real estate agents, who will talk about appreciation, tax benefits, and the value you can add through home improvements. 

Appreciation is Geographically Limited

Research has shown that home price appreciation is only substantial if you if you live in a supply constrained coastal metro. Anyplace else, land markets still function and rising prices result in increasing supply*. 

Accumulating Equity

The real estate agents who collaborate in the selling/buying of your home will claim a total fee equal to 3% of the total value of the home. On a $250k home, that represents $7,500. Other substantial fees exist. The rule of thumb I learned is that if you sell your home within the first seven years, you lose money--the transaction costs outstrip any value created**. 

The Pretend Appreciation of Inflation

A combination of inflation and the effects of compounding. If you buy a house for $250k and sell it for $300k ten years later, it's tempting to think you've made $50k. But in reality, as prices have inflated by 2% a year over those ten years, you've actually lost money. Inflation has been so regular for most of my existence that it's hard to come to terms with the fact that prices have increased by 25% in the past five years. So a house bought for $200k in 2020 ought to be worth $250k, just thanks to inflation, without any actual increase in value. 

Tax Benefits

The home mortgage tax exemption no longer exists. Which barely matters, as after the standard deduction was doubled a few years back, it basically only benefitted HENRYs ("Higher Earner, Not Rich Yet"). 

Home Improvements

The research is pretty clear that most home improvements don't make a statistically significant difference. The only ones that do are revamping your kitchen and adding square feet. Your real estate agent will tell you to paint the house to improve the curb appeal, and that's probably a good idea--your agent will get more calls, and your house will sell faster. But it won't sell for any more money. The buyer knows they can pay for regrouting the tile. Even fixing the roof doesn't necessarily help you--some buyers would rather have a bad roof they can fix in their own time rather than pay a premium for it up front. 

As Default Savings

The only serious financial argument that can be made about homeownership is that it requires people to save, by requiring them to invest. There is something to be said for the power of defaults, but the argument is specious. It's only meaningful if: a) you lack the discipline to save, and b) you can afford to keep making those mandatory contributions regardless of shifting conditions. In the case of b), such as for marginal buyers, all its done is load at-risk people with additional risk. 

Quality of Life

People serious about money can eventually be argued around to recognizing that they are buying a home for quality-of-life reasons--to obtain things they can't obtain by living in an apartment. But if you buy a luxury car so you can have a nicer quality of life, you recognize you didn't buy the car as an investment. If you buy a house for a nicer quality of life, you didn't buy the house as an investment.

Secondly, the advent of "Build to Rent" (BTR) houses as undermined the logic of this. Nowadays, it is possible to have all the non-financial quality of life perks we often associate with home ownership without actually needing to own a home.  

Social Benefits via Selection Bias

Detached homes are often erroneously associated with a wide variety of social indicators, including better school test scores, higher graduation rates, and lower divorce rates. This drives well-meaning but idiotic efforts to improve social metrics by improving home ownership rates. The benefits are entirely a function of a selection effect. If you can afford a house, you've got your act together in other ways, implying both financial stability and wherewithal. 

"People Invest In Their Neighborhood" 

Quite rare. People will act to defend an investment in their home, in a variety of ways both unethical, and quasi-legal. But actual improvements to the public rare are scarce. The best that can be hoped for is some extraordinary soul will dedicate a decade toward getting an informal trail recognized and paved. Mostly, it's that a class of folks with spare time and a college degree will show up at a public meeting and NIMBY anything that might lower property values. 

Sweat Equity

Buying the worst house in a good neighborhood was once a viable strategy. But one of the offspring of the Great Recession was an industry of 'flippers', devoted to buying, rehabbing and re-selling houses, with access to cheap capital and professional labor. 

In Conclusion

Comparing renting to owning is hard, because it's an apples-to-oranges comparison. Either type of tenure is a bundle of perks and problems, among them: size, location, private access, private open space, legal privileges, legal liabilities. Both apartments and houses offer things you can't get without pre-selecting for a housing type. But deciding the financial case for home ownership is much simpler: there isn't one. 

Others have written most of this more eloquently and more extensively.

A Caveat: Getting Lucky

Buying a house in an 'up-and-coming' neighborhood, as previously unsafe / polluted / run-down neighborhoods transition is an astonishingly good way to make money. There exists an entire class of developers focused on this strategy (which requires money and political capital and time and patience). Catching and riding such a wave of transition can be enormously lucrative. 

But planning a property purchase to match public or investments in infrastructure or policing (or land use-transition away from noxious industrial or nuisance users) isn't feasible for an investor for whom their investment is also their shelter. 

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* In the technical sense, where bullshit is a statement which is made without any effort to ascertain the truthfulness of the statement. On Bullshit - Wikipedia

** During the Great Recession, I had the unpleasant experience of explaining to a single mother who had bought a house (in a then-marginal neighborhood), and that the two years she'd owned her house had built her almost no equity, and that there had been no appreciation at all. 

On Redeveloping Single Family

Many years ago, I worked on analyzing when real estate would redevelop, and the analysis simply ignored single family homes, because they rarely redevelop. As long as you have land to spare, you can simply add more building. And in many cases, adding another story is also trivial. So it's not until you run up against fire code for wooden structures (at five stories) and 100% lot coverage that demolition and replacement is a better alternative to a structural retrofit.  And that's a greater level of density than 99% of America.

Of course, doing that is illegal almost everywhere. Partially for good reasons (fire code). But you can see the dynamic in action in wealth neighborhoods--where people aren't running afoul of unit limits, parking requirements, or non-related family status laws. People just keep adding on extensions, with some minimal setback from the neighbor's house. Generates terrible internal floorplans over time, so eventually someone guts everything inside the walls, improves the foundation, and builds something of similar dimensions but much better quality. Without various zoning laws, the same dynamic would apply to multifamily, but we can't have Those People in Our Nice Owner-Occupied Single-Family Neighborhood. 

It's fallacious to equate "there is no demand at that price point" with "there is no demand".

If the starter housing bonus was less profitable than building monster/luxury houses, developers (rightly) ignored it as irrelevant. It's obviously fallacious to equate "there is no demand at that price point" with "there is no demand". A single look at a basic economic chart* makes it pretty clear:

The price we 'see' and can observe is an equilibrium between supply and demand.  If I want 1100 SF of house, I can get that for $2000 a month. But If I could get 1200 SF, I'd take it. Likewise, if I could get 1100 SF for less than $2000 a month, I'd take that too. If push comes to shove, I might take 800 SF of house, but I'm not going to be willing to pay $2000 a month for it. 

Further, the discount in price has to reflect the discount in the quantity of what is being purchased. Being asked to pay $1800 for 800 SF is a bad deal when I can get 1200 SF for $2000. Of course, both supply and demand are non-linear (hence, curves), so I might be willing to pay $1500 for 800 SF, rather than the $1333 you'd intuitively expect. 

Regardless, there is no demand for starter houses at large-house prices. A subsidy offering me an extra $50 if I'll take an 800 SF house is totally irrelevant if aforesaid house costs $1600 a month. The subsidy just shifts the price curve down, but it's the equilibrium point that matters. Saying "there is no demand for starter houses" is nonsense. Look at that curve--there is a huge amount of demand below the equilibrium point! But none of it is matters, because the price is too high! 

* Undergrad economic textbooks are bad to the point of being gibberish. Do yourself a favor and buy Economix. I specifically mention this as mine left me baffled when it talked about things 'moving along the curve'. To be clear, in the chart, when one of the curves move, the equilibrium point shifts to a new point along the other curve. 

On Greedy Developers

 Developing housing is incredibly risky, and (successful) developers are incredibly risk averse, so they walk away from anything that even smells like it might not be profitable. A lot of people chalk this up to greed, but that kind of misses the point. If you are a developer, anything you do is with borrowed money. And if you borrow money, and can't repay it, no one will ever loan you money again, and your career is over, and your company is bankrupt. So, every developer is incredibly cautious to never let that happen. And the best way to prevent that from happening is to plan for projects that are incredibly profitable. That way, when things go wrong  is to have a project that is planned to have a very high profit margin. Lot of developers won't touch anything with less than 10% profit at the initial planning phase. It's not greed, but a rational reaction to being an investor in a high-risk context--only the risks with the highest potential reward are worth gambling on.

A useful contrast is the Good Samaritan who plans to build housing with 0% profit. When things go wrong (permits delayed, material prices go up, labor costs rise), the project doesn't get finished, and the half-completed construction is ruined, all the money is wasted, and no housing is produced.

Chatting with a not-for-profit housing developer, the way they do the analysis is not to build in explicit profit, but to make plans that everything is going to cost 10% more than they expect. (Not everything does, but when one thing costs 20% than expected, the project doesn't die).

A Marxist take on home ownership

If I felt like being more Marxist about it, I'd say that the existence of mortgages was a capitalist ploy to destroy class consciousness by permitting the proletariat identify as petty bourgeoisie by permitting them access to the trappings of capital ownership, while actually entrapping them with debt. 

After all, once you've taken on a mortgage (and put that 20% down), it's not until the 153rd payment that you are actually paying more principle than interest. And since your equity in the home is proportional the  sum of the principle you've paid, the amount of equity built early on the loan is nominal. Add that you will lose 2-4% of any equity you've built when you sell, that wipes out any gains if you move within the first 6-7 years.

Extending the length of the loan (splitting principle accrued over more payments) means less equity will be accrued per payment. Meaning more total interest paid.

To pay off a 50-year mortgage by the time you retire at age 67, you'd have to buy a house at age 17. Ergo, such mortgages are never intended to be paid off--they are just a form of lease. 

A mortgage is just paying rent on money

A mortgage is just paying rent on money. Until you own your home outright, you are still a renter. Even now, assuming a 30yr mortgage only works if you are <35, and the average age of new homeowners now exceeds that.

Most Roadways Aren't Multi-Modal

After someone can be made to recognize that a corridor where cars occupy 99% of the space and have (effective) priority at all conflict points, and admits that cars are being prioritized, they will then attempt to weasel their way out. After several years arguing with goons on Twitter, this usually consists of series of disputable claims:

All Roads are Multi-modal!

Dream on. If it was actually multi-modal, it would have a dedicated lane for that mode, and design standards that reflected all modes, and managed conflict between them.  If I design a home for horses, no one tries to pretend it's for humans, even when humans can use it. There are no 45mph humans, so no road with a 45mph design standard is designed for humans.

Sidewalk, Curb, Gutter, the park-strip and 'Safety Area' are Multi-modal!

Bunkum. Curb and gutter exist to funnel water aware from the road, to ensure that water flowing off the road doesn't undermine the roadbase* that supports the asphalt. Even if you didn't need to have a sidewalk, a road would still need to build it. And the 'Safety Area' between the right-most travel lane and the curb and gutter, which gets used for bike lanes? It's for car safety. Older highway manuals will still give it the proper name, which is "recovery space", and "obstacle free zone" and it was intended to give an out-of-control car time to recover before it ran off the roadway and crashed. In urban areas, it's been coopted for on-street parking, resulting in lots of crashes. The 'park strip' is also a misnomer, because it's actually where obstacles get put--telephone poles, traffic cabinets, bus stops, and sometimes some grass and small, bedraggled trees**. These things would be fine to have in the 'safety area', except cars. So, for your standard arterial, that's four lanes of auto traffic, one turn lane, two 'recovery space' areas, curb and gutter, the park strip, and two 5' sidewalks. Which means 95% of space is getting devoted to cars. 

Curbs exist to Protect Pedestrians!

Nonsense. I drive an SUV, and I drive over the curb every time I try to parallel park. For an out-of-control car, a curb is barely a speedbump. Bollards, now those protect pedestrians. I can offer no better evidence than 7-11, which clearly understand that stopping a moving car requires a massive metal pole reinforced with concrete, embedded four feet into the ground. 

*roadbase: specialized compacted soil that can hold up heavy weights. Often a mix of crushed rock, gravel, pea gravel, sand, and maybe some clay. Largely free of organic matter (which is why street trees die). 

**Not by accident. Trees get planted in roadbase, which is basically free of any kind of nutrient, so they don't grow. Which is fine for highway enginneers anyway, as they  don't want roots disrupting the road base. (Many state codes require cities to put trees in concrete boxes to constrain roots. And as trees are as large above as they are below, a 5'x'5 concrete boxes creates a 5'x5' canopy above. 

Awkwardly, rapid transit does almost nothing for drivers in the peak hour

 To be awkward, thanks to the Triple Convergence, rapid transit does almost nothing for drivers in the peak hour--trips just converge from other routes and other times. However, drivers on the shoulders of the peak (from whence trips migrate) do benefit. Rapid transit can still induce the long-cycle aspect of induced demand, when less-miserable commutes induces new development in peripheral areas. However, rapid transit continues to act as a congestion 'safety valve', such when the traffic congestion gets too bad, people switch from cars to rapid transit. But talking about rapid transit as a congestion reliever kind of misses the plot--parking is the real story, and rapid transit allows places to get denser (earlier, more cheaply) by reducing parking demand.

Modal balance & multi-modal corridors

Modal balance is a dead concept, a weird rhetorical legacy of past planning theory. Planning now is about which modes do we prioritize and where. I explicitly differentiate between the old paradigm of 'share the road', where all users are expected to make use of arterial roadways, and what I'll call the "Streetmix" paradigm (after the website), which says "we have 60' of ROW, how are we allocating that to car lanes, bike lanes, landscaping, sidewalks, and street trees?", and realizing that there is often more value created by not following the historic default of prioritizing auto capacity uber alles.

More broadly, it gets into the issue of what it means to have a multi-modal corridor. It's sometimes used in minimalist way, to suggest where it's possible for multiple modes to be present. Most corridors are nominally multi-modal, in the sense that it's nominally legal for other modes (pedestrians, bikes, etc) to travel along them (freeways being the exception). But at a higher standard, having a multi-modal corridor means having infrastructure for multiple modes -- sidewalks for urban streets, or a divided highway that has bus stops. 

But for anyone who actually makes use of non-auto infrastructure, non-auto modes are clearly second class. Because for transportation, it's the network that matters. Sidewalks that end mid-block aren't very useful. Bus stops where the ADA-compliant sidewalk stops beyond the bus stop are a bit of a cruel joke.  So the next tier of quality for a multi-modal corridor is one that is designed to encourage use by multiple modes, rather than merely permit, tolerate, or minimally accommodate them. 

Recognizing that automobile access has been prioritized over that of other modes is the first step, because it opens the door to the option that other modes might be similarly prioritized. Traffic planners intuit that is dangerous, and so there will be endless whatsaboutism that the corridors are already multi-modal, designed to obscure the fact that most planning prioritizes the automobile. 

After someone can be made to recognize that a corridor where cars occupy 99% of the space, and have (effective) priority at all conflict points, and admits that cars are being prioritized, they will then attempt to justify that priority. After several years arguing with people making goon arguments on Twitter, these will include the chestnut that the gas tax pays for it. If they can be made to accept what the gas tax actually pays for (ie, not the existing ROW), an awkward silence may ensue, and then it's possible to have a real conversation about how we allocate an expensive, limited public resource to maximize transportation and economic development benefits, and what that means about prioritizing different transportation modes. 

CAHSR

Mistakes abound, but CAHSR is the 'icebreaker' for Shinkasen in American--there is no domestic industry experience in HSR, yet politics demanded that it had to be American Made. So such mistakes were (depressingly) inevitable. CAHSR was also, at the start, politically tenuous--it had barely fifty percent support, and was only feasible because a massive slug of Federal cash was available.

The cost estimates were, if no laughable, certainly questionable. And because of the lack of cost sensitivity that afflicts most public sector infrastructure projects, a whole series of decisions that would have been questionable from an engineering standpoint were made to buy political support. The political support for a tenuous project was maintained, but suffered ballooning costs. All very typical mega-project issues. (Flyvbjerg has written extensively on such issues).

Goon Arguments for Automobile Priority

After someone can be made to recognize that a corridor where cars occupy 99% of the space and have (effective) priority at all conflict points, and admits that cars are being prioritized, they will then attempt to justify that priority. After several years arguing with goons on Twitter, this usually consists of series of disputable claims:

The Gas Tax Pays for It!

Delusion. The Federal gas is used to pay for the Federal Aid Highway System (US Interstates and US Highways), which (IIRC) represent about 1% of road miles. Secondly, the Highway Trust Fund (which receives gas tax revenues) has been bust since 2008 and has been bailed out six times using revenue from the General Fund, which comes (mostly) from income tax. 

The State Gas Tax Pays for It!

Dream on. The state gas tax is largely used to provide the 'match' share the Feds require the states kick in on US Interstates and Highways. The Feds pay for 80-90% of it but still require the states to kick in 10-20%. The rest of the state's gas tax gets used to pay for State Highways*. 

Developers Choose to Do it!

Nice try. Every talk to a developer, who'd like to cut three inches off the width of the road, so they could save themselves a million dollars? The specifics of how subdivisions get built (road width, pavement thickness) is highly specified by city ordinance. 

Cities Choose that for Their Roads!

Again, pre-emption. Most of the wide roads in cities are highways, and the state owns them*. And the state has its own standards for state highways, and those standards are highly focused on moving automobiles at highway speeds. Many states also have rules mandating certain standards (width) for roads anywhere in the state.

All Roads are Multi-modal!

Bunkum. If it was actually multi-modal, it would have a dedicated lane for that mode, and design standards that reflected all modes, and managed conflict between them.  If I design a home for horses, no one tries to pretend it's for humans, even when humans can use it. 

*Which, if you live in Ohio, might actually be all roads in the State. 

Fares and (economic) equity

Transit districts, where transit is spread equitably (a stop every two blocks, a frequent network grid, excellent coverage) can be funded by a local property or sales tax--the beneficiaries of the service are also those who fund the service. But if you have people using transit who are from outside that district, who aren't paying the local property/sales tax to fund that service, they are functionally free-riding*, and in equity should be charged higher fares than those within the zone. In the reverse, using sales tax to pay for transit only works if that transit is equitably spread through out the sales tax area. Else people are paying for services they aren't using.

There is argument to be made that in either case, the affected folks do benefit, indirectly, through reduced  traffic congestion. But the match or mismatch of the taxed service area and the services provided matters. Fail to provide service while charging taxes and you'll get a tax revolt that revokes funding for transit. But spend too much money providing transit service to marginal transit-hostile areas, you'll go broke. Analyzing the cost per rider of any transit system clearly shows a wide variance in cost per rider by route (and even by route segment). So you have to hope that the transit planners have made a good 'bargain' in expending scarce and limited dollars to buy political support by providing transit service to marginal corridors/stations. (This hope is often in vain). 

In an equity sense (ignore the benefits of congestion mitigation), people should pay for what they get. But doing can be complicated, as it requires accounting for the cost of service and also the cost of infrastructure. In an ideal case, fares at an underground station with trains every four minutes should be much higher than fares at a ground-level station with one train an hour. However, because that underground station is located downtown, so the cost per rider of providing that service may actually be much much lower than at the peripheral surface level station with poor frequency. 

* A certain level of free-riding is of course tolerable, on the basis of generosity, charity, equity, and the cost of attempting to collect all revenue due exceeding the value of the revenue collected.

Securitization, Financialization, Loans, and Asset Classes

Securities were initially things like stocks and bonds - functionally promises to pay. Modern securitization includes other such debts--mortgages and credit card debts and invoices and whatever else. 

Formally, a security is just a 'tradable asset'. Functionally, it's also representative instance of an asset class, such that one instance of a security is like another, such that the two are for all effective purposes, similar. So securitization of unlike things is difficult, a limitation overcome through grading. The entire pleroma of a thing are divided into classes on the basis of some metric (age, credit score) and sold on that basis, such that things with a graded group are more similar to one another than to another graded group. Imperfect, but it reduces the variance of any given sample.

But once the grading criteria are established, the metric starts to bias production. The value of something is what is can be securitized as, and how something can be securitized depends on its grade, and its grade depends on whatever metric is being used. 

Standardization is hostile to edge cases, extensions, innovations, etc, because they are risky--they make something difficult to grade, so that something that might otherwise automatically be a B grade might receive a C grade. Likewise, there is no point in including A-class attributes in an otherwise B-class product--it will never be included in the B class. So there is every incentive for the product to aim for the 'lower edge' of each class--just good enough to be included. Due to this dynamic, over time, the median quality of each class tends to fall, and new sub-classes get introduced to identify where things fall within each sub class. So securitization drives both standardization and enshittification. 

Its worth saying that the more of the economy that is securitized, the more of the economy that can be financialized, and the more things financiers can profit from the buying, selling, holding, and insuring. So much of the finance industry is extremely interested in figuring out how to financialize things by converting them into securities. Hence the interest in both NFTs and BitCoin. 

Using more granular systems like credit scores, rather than classes, also lends itself readily to thresholds and hence to threshold effects.  A credit score of 649 is 'sub-prime', a credit score of 651 is 'prime'; a credit score of 790 is 'prime', a credit score of 810 is 'super-prime'. Indeed, classification based on scores may actually be worse than those based on classes, if less prone to enshittification. 

Interest rates, planners, developers

Real estate developers talk endlessly about interest rates, but they don't matter in a planning context. Developers make their living at the margin--they make money when they can land before the owners become aware that an interest rate reduction has raised the value of their land. (When rates rise, development locks up until inflation reprices sticky land-values to match their fundamental value). But in planning context, the average over time generates an equilibrium where interest rates don't matter. Temporary dis-equilbria just average out over time. And if it doesn't, who cares? Development that didn't happen isn't going to get you fired. But if you are a developer, it's an existential issue--can you get planners to permit your development in that window between when rates move and when the ground gets repriced?

Development is a market with imperfect information, with a lot of independent developers responding to the same market signal--rising rents. However, developers have limited information about how much competing supply (new units) are coming on the market. While its possible to know about permits pulled, or development applications, or zoning changes, (and believe me, developers pay attention to that) it's impossible to know how many competing projects are in earlier stages of development.

It takes a while for a long, multi-actor process (involving land-owner, developer, lender, city planner, development review, city council, etc.) to play out, so development tends to happen in booms (minimal supply meeting huge demand) followed by busts (excess supply meeting slackening demand). Early in a development cycle, few recognize or respond to the market signals, and there is a lot of money to be made, and late in the cycle, much to be lost. So once the cycle starts, every developer wants to get their development into production/sale as fast as possible.

Dangerous Densities

Jane Jacobs noted that the essence of the city is that is is a place full of strangers, where social sanctioning simply doesn't work, and suggested that there existed 'dangerous densities', below which there were insufficient 'eyes on the street'. (The suggested residential densities were also quite high, 150 units/acre if I recall correctly)

The limits of reciprocal restriction

The whole basis of the legal argument FOR zoning is that while a property owner has been restricted from developing their own property, that very real loss is none the less compensated by others losing the same property rights--that zoning is a sort of 'reciprocal covenant' that the homeowner bough into by buying that property.  (Houston is useful, because rather than having zoning, they have a plenitude of explicit private covenants governing land use). 

Monster houses are an interesting case, as they certainly impose costs on their neighbors (loss of light, view, etc), but those costs aren't recognized as property rights (even if they do affect your property value). Which begs the questions: why aren't duplexes of similar size permitted? And the immediate response is one of parking. Not of the amount, per se, but of it's regulation. Existing owners want to mandate sufficient parking that there is no possibility that renters will compete with them for on-street parking. And so they demand absurd levels of parking (One stall per bedroom).  

Because one of the tacit covenants of suburbia concerns the use of the local 'commons', the public street. You are permitted to store vehicles on it, but not so many vehicles that it impairs others use. Informally, it gets regulated as "Don't park in front of my house". But the whole things runs on social sanction (as I've discussed elsewhere) and renters (demographically different from owners) simply can't be sanctioned effectively. And as a a landlord, if you write me about my tenants use of 'your parking', in front of 'your house', my recourse to an impolite letter is to simply ignore it--I can't be socially sanctioned either.  So when owners fight against rentals, they aren't irrational--they are fighting the collapse of their way of life, and the beach head of an invasion. Because once that dam breaks, opposition to additional rentals degrades. People learn rentals aren't so bad, renters don't care in the first place, and the truly implacable will move away. 

The liberalism joke, and zoning

I recall my My Pakistani professor told me the following joke:

In the Koran, everything is permitted, except those things that are forbidden.

In Iran, everything is forbidden, except those things which are allowed 

In Pakistan, everything is permitted, especially those things that are forbidden.

Which seems to be a variant of Churchill's (WWII) joke:

In England, everything is permitted, except those things that are forbidden. 

In Germany, everything is forbidden, except those things which are allowed 

In Russia, everything is forbidden, even those things that are permitted. 

It's an old chestnut, and different jokers use different countries (reflecting changing circumstances). But it does get to the root of what is meant by liberalism (Case 1) and where our zoning has gone wrong--so much land has been downzoned that we are no longer operating in a Case 1 context, but in a Case 2 context. 

And, to be a bit brash about it, that's simply un-American. We inherited the English Common Law tradition of property rights (lawsuits and all), and we have so meaningfully limited our land rights that it can be said we have eliminated them. So we should, as a country, do something about it. It's been politically palatable for years, because voter class was nearly identical to the home ownership class. But the recent destruction of housing affordability, due to COVID-induced migration and the advent of remote work means that more households are staying in rental tenure longer. And over time, that's going to destroy the political acceptability of the suburban covenant, and we see that today in the YIMBY movement.  NIMBY has been around for a long time (a pejorative) but as someone who has been watching housing affordability for a couple of decades, the political groundswell of the YIMBY movement has been staggering. 

YIMBY is chipping away at the "everything is forbidden" with an ever great list of things which are allowed--triplexes, single stair, reduced on-site parking, etc. And that's huge, because all of those things are multifamily rentals, which is going to make is possible, plausible, likely, that more households will stay in rental tenure longer, and won't sign up to the suburban covenant.  

Buying a house was once a sound financial decision. Post-pandemic, in most big cities, it no longer is.

The elimination of starter homes cuts the lower rung on the housing ladder, which means a lot of people are no longer going to climb it at all. So we're going to see a sharp generational shift toward households being life-long renters. And as the renter population becomes more affluent, older, and more politically active, we're going to see a big shift in urban politics to reflect that.

Rapid Transit Network Expansion

If you start with a small transit network, and build it out over time, it gets larger and more efficient, providing more access over time through the network effect. But at some point, the dynamics switch and the operator realizes that they can get more money out of running more service on the existing service than on further expanding the existing network. (Which is financially prudent). But it breaks an implicit political bargain between city and suburb, viz: "If you pay to build ours now, we will pay to build yours later". As long as those network expansions are promised, and voters think they might be able to use them (or make use of them or benefit from their use), they'll fund them. 

But if you are an exurban commuter, you'll never see any direct benefit, and you know it, but you are still paying for it. Which means sales taxes work basically in urban areas, where they can match the beneficiaries with the payers. People who drive into the county and buy things matter less politically, because they don't vote on referendums--but still do matter, as they still do lobby for things, as NJ and NY demonstrate with the congestion charge. 

Anyway, if the transit network stops expanding, and the transit constituency ceases to include those folks, the transit providers switches to concentrating on existing riders. And then all the capital and operating costs go into providing additional mobility (more tracks, faster loading at stations, more trains/hour). And the main trouble, I think, is that transit agencies that have made that transition once have a hard time switching back to the other regime. Once you've quit building subways, it takes herculean efforts to get things like CrossRail and the Second Avenue Subway built. On the flip side, LA did manage to get the Regional Connector done. 

Speeding, speed cameras, and geometric design

If the camera is issuing tens of thousands of tickets, there is a clear mismatch between the speed limit and the geometric design of the road. Since the speed limit is a policy decision and the geometric design a hangover from an earlier policy decision, pretty clear which should change.

Public Investment is never just for public benefit

A lot of public investment (especially in new infrastructure) is targeted toward eliciting private investment. Sometimes the degree and share of subsidy is more obvious, sometimes the ROI is more dubious. Public sector would be better off addressing what it controls directly (the regulation-imposed costs on new development) rather than attempting to allocate capital.  

Lot of transportation planning is about providing mobility--enabling people to get between places faster. A much smaller share of it is about providing access--making it possible to get 'there' at all. Partially, that reflects the maturity of the US highway network--where goes pretty much anywhere you want to go. But accessibility takes a front seat when we talk about our much-less-mature networks of walking, cycling, or transit. 

The stroading of Main Street

The historic (pre-automotive) main street demanded the highway run through town (so the state would pay to pave Main Street) and later highway design standards for rural highways were fecklessly applied to it, and it's not for decades that highway engineers recognize 'context sensitive design' or 'traffic calming' to make it a street and not a stroad.

A historic main street is wide, because it was full of parked vehicles (even when those vehicles were wagons and buggies) as well as through traffic. So there was plenty of room, even with automobiles, for two lanes of on-street parking and two travel lanes. But the 'capacity uber alles' mentality demanded removing on-street parking in favor of travel lanes, and so you get main streets that are four-lane raceways, in a way deeply deeply incompatible with the existing land use.

Eventually, the existing land use shifts, as every other building is knocked down for a parking lot with a curb cut, or demolished and replaced with something where half the lot square footage is parking lot. 

The suburban social compact and parking

A ways back, I read a post where someone talked about new development disrupting the  'social compacts" of their neighborhood. Today, I realized that part of what makes suburbia 'work' is regulation. Not legal regulation, but social regulation, via social shaming. It's a series of unwritten rules and often unspoken rules with bounds established by the informal process of social shaming, gossip and stigma.  

Which relies on people sharing the same norms and values. So when your neighborhood ceases to consist solely of family households (with children), suburbia stops working. Clearest example I can cite is parking: in suburbia, you only park in front of your own house. Even if you have five cars and your neighbor has one, you only park on 'your' curb. As a urban renter, the whole idea is laughable: I park where-ever I can find parking, regardless of whose house it is. So as a suburban neighborhood shifts over, regulating things like parking has to shift from being a social compact to having legal framework. So you see the emergence of resident parking programs. Which is on it's face grossly inequiable--residents have no more right to the public right of way than any other person. But there is another sense of the word 'equitable', a more legal sense, that says when you've done someone harm, you owe them recompense, that they should be no worse off than they were before. Personally, I'm of the "Paris is worth a mass" school of thought. If a resident parking program that unfairly privileges incumbents is the price of getting new housing permitted, I'm willing to pay it. Because when you come down to it, most neighbor opposition is due to parking--people don't want to have the privilege they've been enjoying impaired.

I have a hard time keeping mum when someone talks about their 'right' to parking, because they haven't got one, in the legal sense. But urban history is pretty clear--the process of getting rights largely consists of traditional and customary privileges becoming enshrined in law (by treaty or charter)*. So insisting on a right to parking is hardly unprecedented or unreasonable.

It's worth a moment to talk to talk about the rest of the suburban social contract: most of it governs the acceptable use of 'public' space: streets, 'park strips', sidewalks. But a surprising portion of it governs lawns/landscaping. It's your property, but your neighbor has to look at it, which affects their ability to enjoy their own property. But, since lawn care is expensive, it's one of the first thing that breaks down when people not party to the 'suburban social contract' move in. Hence, there are a surprising number of public laws governing requirements to mow. 

There is an interesting class lens of the suburban social contract: things that happen in public space are regulated by public law, and so middle-class people have access to legal relief--they can call the police or code enforcement. But things like fences fall largely outside that penumbra. So it's only those wealthy enough to say 'my lawyer' who legally contest this. So you see a surprising amount of litigation about fences, quasi-fences, trees, spite fences, etc.   

*Which I suspect is why 'blue' cities are having a hard time advocating for themselves versus their red home states--there is a reliance on using courts to establish 'rights', as opposed to insisting on customary rights. And perhaps cities in conflict with their home state would do better to insist of legal recognition of the customary rights they've been enjoying. 

'Non-Economic Levels of Maintenance' & Implications

Two decades ago, I was told that corporations didn't own SFD homes because of maintenance costs, and the economic consensus was clear that the 'non-economically rational' level of maintenance required made it so. Which suggests that maintaining a neighborhood as home-owner dominated requires a type of structure burdened with high maintenance requirement. However, the impacts of that strategic burden manifest when people get too old to do maintenance, or new owners lack the time/capital to maintain things: the housing depreciates rapidly. It also means that when converted to rental units, there is an inevitable shift toward lower maintenance ('ugly but efficient') materials, fixtures and landscaping. Aging households are making some of the same changes as they adapt housing to be able to 'age in place'.

Electoral calculus of tenure in America.

My working theory in the US is that we'll wind up solving our housing crisis entirely through the production of rental housing. It's the least politically threatening way to add housing, as it doesn't compete with owner-occupied housing the same locational market--different set of amenities, if nothing else.

However, the long-term implications of this is that owner-occupied housing will become an ever smaller component of the housing stock. This has serious political implications on the support for 'social contracts' that currently privilege owners. There are huge number of things that owners care about, which renters simply don't. The danger of this is already clear to some home-owners, which is why you are starting to see increasing yakking about the 'dignity of home ownership' and the 'American way of life'.

But while the data is clear that home-ownership is the dominant form of tenure in America, it's also clear that it's becoming less common. Now, the claim is generally proposed in such a way as to suggest that home ownership is near universal because it is normal. But that has never been the case. The statistics are fiddlier than that, because if you calculate home-ownership by person, the size of home-owner household biases the statistic--there are lot of dependents. (Even fiddlier, people paying to live in a rented room or ADU may be counted as part of a home-owner households, despite paying rent). So while a lot of the American population may be living in householder owned homes, the share of persons who own homes is rather smaller, and the share of voting-age persons who own homes is smaller still. So in electoral calculus terms, the 'party' which supports the rights and privileges of the owner-occupied housing social compact is dangerously close to parity with the 'party' which just wants housing to be cheap enough for them to form their own household.

Of course, "the future is already here--it's just unevenly distributed", so what are 'future-me' problems for the average American are already 'present-me' problems for an ever larger number of Americans, and it is only the mythos of home owner normativity/dominance that keeps things that way. 

Appreciation Expectations

 My experience with the Great Recession in the US suggests that one of the things that makes unwinding a property boom difficult is that an expectation of appreciation (due to limited supply) has become baked into housing prices. So even if house prices don't fall, even a reduction in the rate of appreciation is hurtful a wide variety of owners, from long-term householders to brand new purchasers.

You just have to think about a house as a financial instrument, like a stock or a bond. It provides a dividend (in terms of rental income, or owners equivalent rent), is a security is costs money to acquire. But like a 'growth stock', there is an expectation that the value will increase over time. 

There used to be a lot of debate over whether housing was a good investment or not. That's died down, largely because I think the empirical data is clear--it's not. The difference is largely due to dividends--you can reinvest the dividends from money you put in the market in the market. But you cannot reinvest the  benefits of having been provided housing. 

Consulting & AI

An article in the Economist this week suggested AI a major threat to consultants, whose primary goal is the provision of expertise. I remain unworried. Consultants make their living providing specialized expertise to cover rare situations. However, most consultants are actually consultants, but contractors: you pay them to get a job done that you can't (or don't want) to do yourself. The name is simply a matter of prestige: more like Boston Consulting Group, less like the local plumber.

Of course, every contractor-consultant aspires to being a proper consultant, by providing "thought leadership", which is simply a way of saying "I have thought about this a great deal and have useful things to say", in the sense of having useful advice. Of course, the consultant-contractor dichotomy is blurred in the other direction--while some of the BCG folks do 'strategy', rather a lot more do 'implementation', (although they build you a new organizational structure rather than a new bathroom). 

"You can only write what you know about" and so a great deal of consulting is knowing about things. Which requires rather a lot of learning about things and doing research about them. Consultants get accused of "Let me Google that for you", but that sort of misses the point--you could Google it for yourself, but since your consultant is really a contractor, you really are paying for someone to Google it for you. 

An aside on that: Googling something requires ever more wading through an SEO optimized and enshittified web, but also the ability to extract content from our society's least enshittified corpus: publicly available PDFs. This category includes peer reviewed research, think tank reports, local government documents, for-profit and non-profit think pieces, etc. An advantage I strongly suspect will remain, because while much web-content is open for the scraping under a generous fair-use doctrine, a PDF has a much better (more litigable) claim to being 'published' and copy-righted than a blog post. 

So, in the context of AI, an increasingly valuable portion of the service a consultant provides (compared to an AI) is the able to discriminate between high-value and low-value content, in terms of quality and relevance. Of course, all consultants use AI, but I find arguments against AI use tediously familiar to childhood injunctions about using spell-check. My (unassisted) spelling is indubitably worse, but the productivity of my time is vastly greater. It should tell you something that we no longer employ whole armies of copy-editors in document production. The real question is if your consultant is making efficient use of AI (to produce analysis tools and draft documents) and scam artists (using AI to produce analysis and review documents). 

If it's something I could task a junior analyst with, it's suitable for AI. (To the very real peril of the entire class of junior analysts, who of all people should focus on using AI to become much more productive). Which raises the issue of the use of AI by junior analysts--if they give you something an AI could have produced, what is their value? But that only suggests a misuse of analyst time and capacity, like paying someone to spellcheck a document. 

But it requires analytical capacity to understand the capabilities of AI, and how to apply it well. And that capacity is sadly lacking. It's easier to spurn and disparage AI tools rather than learning to use them (and teach others to use them). But it's a hard time--AI is not widely adopted, and where it is widely adopted, it's not necessarily well used. Things are changing so fast that there really aren't best practices in the professional use of AI--merely cautionary tales about the misuse of AI. But I expect that's also a source of competitive advantage: Everyone claims expertise in AI and AI use, but it will take rather a bit longer for consultant clients to be able assess actual facility with it. 

As an aside, if you can't afford to hire someone competent to assess and manage a consultant/contractor's work, you have no business contracting something out. The risk of buying a 'pig in a poke' is simply too great, and fly-by-night consultants feeding on the credulity ignorant have been a risk since the days of court sorcerers. An interesting parable for AI--if you can't assess the quality of what your AI produces, you have no business using an AI. Which is perhaps the fundamental skill senior analysts should be teaching their juniors.

Planning Permissions

Everything I read suggests that the British system of explicitly requiring Council-specific 'planning permission" for new development is something of a disaster. It has tremendously enriched the cohort able to purchase under Thatcher, to the general detriment to everyone after.

Nominally, as zoning provides 'build-by-right', things should be different in America. But due to aggressive downzoning to the degree that most new infill/redevelopment also requires a zoning change, it's hard to tell the difference. 

The modern 'Urbanization Problem'.

The problem*: how to add additional rentable space in the way last disruptive to existing 'social contracts'. In my bubble, there are two general schools of thought: 'Missing Middle' (incrementalism) and Transit-Oriented Development (bounded high density) development. The first holds that we should permit gradual intensification everywhere, and the latter that we should cluster new high-rise development near transit stations. 'Missing Middle' affects a large share of the metro environment, even partial wins (triplexes) yield big changes. On the flip side, transportation research pretty clear that modest density increases (especially at the low end) don't yield any benefits in things like changing frequency, length, or mode shifts.

The 'Missing Middle' approach aligns with the small or non-professional developer, creating ADUs by 'barnacling on' to existing housing units. Strong Towns' is emblematic of this approach. What I call the 'TOD approach' largely aligns with the interests of professional developers, and often of city planning departments, as they both represent the focus of a finite amount of expert/professional energy on a limited number of sites, typically focused on created value or reducing 'blight'. The two have a 'bottom-up' vs. 'top-down' dichotomy, as well as a 'muddling through' vs 'technocratic' rationality. 

While I love density, I do not love its modern implementation, which largely consists of replacing defunct and vacant strip-malls along high traffic arterials with elevator apartments. As a resident of one, the noise is a misery, the traffic a barrier. The most affordable ones are the modern reincarnation of the railroad apartment. 

In contrast, there is little to be said against the Missing Middle, apart that it is feral and pernicious (and hence successful). It is also the heir to the near-totality of the human urban tradition (the pre-automotive part). 

*The historic 'urbanization problem' was how to deal with the health and safety impacts of crowding unprecedented numbers of people into unprecedently enormous conurbations, as highly paid factory jobs induced the rural population to become city dwellers. These problems mainly related to water: sewerage, drinkable water, and the nexus between them: run-off. But it also required enormous advances in transportation, including the oft-forgotten canal age, the railway age, electric traction, and the automobile. And indeed, enormous advances in structures: steel frame construction and the elevator. That the preliminary limit on urban growth/agglomeration has been regulatory is an entirely new problem that emerged within living memory. 

What is Outlook Tower?

This blog was named in honor of  Sir Patrick Geddes 'Outlook Tower' in Edinburgh. 

Per Wikipedia:

In 1892, Patrick Geddes, a pioneering Scottish urban planner, sociologist, and ecologist, assumed management of the site, renamed it the "Outlook Tower," and organized it as a museum and urban study centre demonstrating his philosophy of planning, which was based on comprehensive surveys of the site, city, and region. 

He installed a series of exhibits on progressively broader geographic themes as one ascended the tower — first the world on the ground floor, then Europe, the English-speaking countries, Scotland, and Edinburgh — with the camera obscura itself continuing to project a real-time image of the city at the very top.[3] People from all walks of life were invited to come to the tower to study and learn about their city.[4]

Mission, monopoly, and your local transit agency

If your organization doesn't have a declared mission, then your default criteria becomes 'What is best for the organization?'. Which (ironically) is not necessarily what is best for the organization (or its members, employee, beneficiaries) long-term. There are organizations (public and private) that have been captured (or held hostage) by internal stakeholders. In a competitive market, it solves itself, but in a monopolistic context (Amazon, public transit agency) there can be no effective competition. Private companies subject to sufficient disfunction are preyed upon by private equity (Sears, Red Lobster, Joann's).

But for something supported by public subsidy, it would be the height of idiocy to support two competing organizations--especially so for public transit, where networks effects create natural monopolies.

So for a transit agency, it's critical to have governance (a board), representing the interests of the beneficiaries. Of course, for any labor intensive business (and operating transit is), the workforce becomes an important stakeholder. As are the transit dependent--people who don't have the resources (time, attention, human capital) to advocate for themselves. But a transit agency requires a board that can articulate a mission, vision, and goal for the agency and ensure management adheres to it.

Which is hard--there is a constant temptation to use public resources to 'do good'. Jarrett Walker talks a lot of about the coverage vs. frequency, which really gets to the core of the issue--what is a transit agency for? Who should it serve, who is it obligated to provide benefits for. Clarity is essential for agreement. It's not a black-and-white. But your agency should be clear how much resources it intends to dedicate to providing benefits to who.

Passenger Rail and urban rail

When I started out in transportation consulting, I couldn't understand why the commuter rail and light rail couldn't just share track. (Especially baffling in Utah, where the same track that ran TRAX by day ran freight rail by night). 

I still sometimes find the division between passenger rail and urban transit kind of quirky. As a transit user, commuter rail is just another form of transit, a commuter bus on rails--lousy frequency but higher speeds. But as an operator, those are two unlike things: one is a railroad, and one is not. Partially, it's regulatory: railroads fall under the FRA, urban transit falls under the FTA[2], and the two have different standards.  But it's also historical, a matter of convergent evolution. Railroads start with steam engines, urban transit with the horse drawn coaches. 

My memory has it in Europe that the regional rail systems don't so much end as they peter out. The further out stations get fewer trains per day. (Less active station inline, also-not every train stops at every station). Which can be nice: it's possible to develop passenger rail into commuter rail simply by increasing frequency. Ie: There is an Amtrak train in California with more daily trains than most commuter rail systems. And hence to build a regional rail system by increasing headway further and running it outside of peak hours. The NJ-NY PATH train has followed that path to quite a peak: 15m headway, including subway sections[1]. 

There isn't really a division (technologically speaking), between passenger, commuter, and regional rail systems, as far as right of way is concerned. There are certainly operational differences in the cars used: different journey lengths require different amenities. A seat acceptable for an hours ride isn't for 8 hours. And long-distance journeys require things like outlets, reclining seats, a bathroom, a dining car, etc.  

Part of the confusion comes from legacy metro systems: in an urban context, the only way to get a railroad through a street grid is to either put it on an elevated or in a subway [1] . So some of the first 'subways' are just steam trains run underground (which is why some NYC subways have steam grates). But at the same time, STREET RAILWAYS are also being put into tunnels, via a sort of convergent evolution. (Stage-coach --> horse-drawn omnibus --> trolley->subway). That streetcars could also (safely) travel much faster underground made their operations more railroad like, and in turn required more railroad-like geometric design. 

Muddying the waters are inter-urbans. The supply of railroads had been overbuilt, truck freight on highways was a growing competitor, and there were some under-used railways available for conversion into a sort of railway/trolley highbred, running as a railway outside of cities, and as a trolley within it. Functionally an early light rail. 

Further muddying the brew is BART and WMATA: A Tomorrow-Land reinvention of urban mass transit, with more widely spaced rails, operating as a railroad in the suburbs, and as a metro in the city center (underground with widely spaced stations). 

But their is a well-maintained regulatory distinction, in terms of vehicles: heavy rail and light rail, and it has to do with crash standards. Since passenger rail sometimes shares ROW with freight railroads, the cars have to be designed to withstand crashes with heavier vehicles. While 'light' rail vehicles are much lighter and less sturdy. ('Light' is relative--your standard light rail vehicle can still shred the heaviest passenger car like it was an aluminum can).

[1] Indeed the whole subway/overground distinction is kind of a humbug--trains run best on flat/level, and the ROW gets built to reflect that, regardless if the undulations of the terrain means that results in the ROW being underground or overground. Plenty of subways have overground and/or elevated sections. 

[2] Originally the UMTA - Urban Mass Transit Administration. Original name clearly established what it wasn't about: non-mass transit (taxis, jitneys) or rural transit (stages, coach buses).