By David Lupton*
It is important that we get our cities right. And it is essential that we allow them to grow.
Labour housing spokesman Phil Twyford has received widespread support for his call to abolish the municipal urban boundaries, and allow cities to grow, but some concerns have been expressed about the implications in areas such as roading. Phil’s proposals must be part of a package that meets the needs of cities efficiently and equitably.
Cities thrive because they are efficient labour markets. They maximise the availability of labour for firms and the choice of employment and entertainment for people.
Most cities form around a centre. This maximises the inherent benefits. Firms that occupy the centre benefit the most and land values are highest there. Firms that benefit less from being in the centre locate further out, trading location for land cost.
Travel time used to restrict city size. Generally the maximum time people will invest in travelling to work is about one hour per day. However the wide availability of motor vehicles since the middle of last century vastly expanded the potential city catchment. Modern communications has reduced the need for, but seemingly not the demand for this daily travel.
Concentric cities work up to a certain size, but then problems such as road congestion start. At some stage, the additional travel time due to congestion distorts the time-distance relationship and development starts to occur at other points - creating the polycentric city.
Cities have reacted to this tendency for dispersal in a number of ways. Many cities have tried to reinforce the role of the centre by providing a central distribution system to increase the effective size of the centre, building motorways and railways to overcome congestion or provide alternative access to the centre. These solutions are usually very expensive.
Because catering for car access to the city centre is expensive, too little is provided. Cities subsidise public transport to encourage people to leave their cars at home. The attraction to infrastructure providers is that public transport uses less road space (or allows more people to use the space that we have).
But the effect of building motorways and subsidising public transport is to make commuting from remote suburbs even more attractive. People make location choices that seem rational to them but which impose excessive infrastructure costs on society.
The resulting outward expansion of cities (“sprawl”) is often condemned as environmentally unfriendly and socially alienating. It has given rise to a counter movement towards compact or ‘smart growth’ cities. The idea behind compact cities is that that population growth is catered for by increasing urban density, particularly towards the centre. It runs into several significant problems: firstly, densification on the scale required means knocking down what is already there, and that can be both expensive and unpopular; then adding density in existing areas can create additional costs for infrastructure such as roads, water mains and sewerage; and thirdly you need some way of enforcing your urban vision otherwise people are still going to commute from afar.
‘Smart’ cities have tried to enforce their vision by legislating an urban boundary outside which development is not permitted. Where this has been tried, the effect has been to drive up the price of land inside the boundary. What is more, where the land available for housing is scarce and the quantity is limited, it becomes a good investment for speculators. As long as land value increases exceed rates of return on alternative investments, speculators have an incentive to hold land rather than sell, exacerbating the shortage. Small parcels of rural land released for development are also likely to be land-banked and have no effect on prices– the only way to break the hold is to restore competitive access to rural land. If that means expanding Auckland, that is what we should do. Pukekohe is cultivated for horticulture because it is close to Auckland not the other way around.
Some people argue that freeing up restrictions on intensification and ‘building up’ within the urban area would be a better way to cater for increased population. It could certainly help – if you can achieve it despite opposition from existing home owners and residents. But only if sufficient potential building opportunities are created for the supply to become competitive. Limited densification of selected suburbs won’t be enough to increase supply and lower house prices. It may lead to a modest number of additional houses being built but international experience is that they will be smaller and more expensive than if land at the periphery is developed. What is almost certain is that limited up-zoning will increase the value of the underlying land. That will further increase the difference between rates of return from holding land and the return on alternative investments and risk further suppressing development.
Of course it isn’t a case of either up or out. There is demand for high density housing near the city centre, just as there is demand for low density suburban houses. So we should try to find ways that both can be provided. What is needed is a relaxation of the planning rules to allow a greater range of development. That sounds simple, but people who have purchased houses on the basis of one set of planning rules have a valid grievance if the planning rules change. One way to address local opposition to changing the rules might be to permit experimentation with relaxation of local planning rules in the context of neighbourhood schemes where all property owners in a neighbourhood (a city block for example) band together and share in the development proceeds. Such voluntary neighbourhood schemes are discussed in the third part of this land contiguity article. The Economist has reviewed the economic literature on other methods to reduce the NIMBY effect here.
If affordable housing requires competitive access to rural land, how do we achieve this without imposing excessive costs for infrastructure and/or pubic transport services? One option is to abandon the mono-centric city. Deliberately build a grid of high capacity roads around which the future city can grow in a polycentric manner. Variations of this concept include the linear city and the development of sub-centres linked by high capacity road and public transport routes. Cities that have embraced and provided for expansion in this way have lower land and housing costs than cities that have pursued a compact city model.
But if the fundamental issue is under-priced infrastructure, why not address the problem? Roads in most parts of the world are under-priced (paid for by the tax payer rather than the user). Even in New Zealand, where money collected from motorists through petrol levies and road user charges for heavy vehicles and diesels pay a significant portion of road costs, there is a huge difference between what the motorist pays to travel on and the cost of providing big city CBD focussed roads. So right from the start, the infrastructure spend on upgrading our congested parts of our road network is heavily subsidised by the non-congested parts (albeit in New Zealand by other motorists). But it gets worse. In order to avoid the huge costs imposed by people availing themselves of these subsidised roads, we encourage people to travel by public transport by – you guessed it - subsidising that too.
If you let people make location decisions that weigh up the cost of subsidised transport against the savings from cheaper land, they are of course going to make socially inappropriate decisions. Part of the answer is to introduce efficient charges for transport infrastructure and services. Road pricing is being discussed in Auckland but in the context of raising revenue for big projects rather than as a means of managing the network.
The costs of congestion reappraised, February 2013, Ian Wallis and David Lupton, P.37
If road prices are set to manage the network efficiently, they will reduce congestion and increase capacity – more people can travel quicker. But if the revenue is captured by AC or the government it is still likely to be opposed. To get buy-in from motorists and ratepayers the revenue needs to be recycled straight back. The most direct route would be through reduced petrol taxes and rates.
The most efficient charging system for roads is a charge that varies by time of day and location and is set such that the roads always flow freely. Five years ago that was a technological impossibility. Now it could be done with a smartphone app very similar to the Uber taxi app. Re-directing the discussion from what is seen in some circles as taxing motorists to pay for trains to road user charges to maximise network efficiency would make finding an accord with government easier. We will not need to fund alternatives to driving and can delay the construction of new road capacity – a road network without excessive congestion will carry more cars during the peaks than travel now and many more over the course of a day, while public transport operators will have the commercial incentive to invest. Buses, trams and trains can have a role depending on the price/service they can offer. Road pricing and public transport fares that increase the price for peak CBD trips but reduce the price for all others will discourage long commutes and thus affect location decisions for households and firms. Prices that encourage households to locate closer to jobs and services provide the sustainability benefits desired by advocates of compact city growth – and reduce the carbon footprint – without the coercion and unintended consequences for housing unaffordability of an urban growth limit.
Multiple infrastructure networks are under pressure from urban expansion. The three waters (fresh, storm and waste), electricity, and communications and possibly gas are also required. The capital cost of providing the three waters is often cited as a reason not to allow peripheral expansion – particularly not the sort of distributed development required if land supply is to be competitive. But why should such provision be the exclusive domain of the city authority? One option is to allow development of ex-urban communities that provide their own essential services. The concept – known in Texas as Municipal Utility Districts or MUDs, allows development to take place at no commercial risk or expense to the city.
MUDs can be thought of as geographically dispersed body corporates. Texas MUDs allow developers to transfer infrastructure such as the three waters to a body corporate type entity, these entities pay the developer using a debt instrument –a municipal bond, which is then paid off over time by the new residents’ rates. There are various audits and safeguards put in place to protect this process. The system encourages speedy developments so developers get compensated quickly and residents share costs over a greater number. Infrastructure costs for Texas MUD type systems are not absorbed into the section price as currently occurs in New Zealand. Like body corps, different MUDs can offer their residents different shared facilities such as swimming pools, sports grounds, neighbourhood heating or renewable power generating schemes etc., and compete on price and services. With more transparent infrastructure charging some MUDs might promote themselves as public transport hubs with features such as bike routes to and secure storage at interchanges, perhaps a driverless car pool for local transport, and a strategic partnership with public transport service providers for commuting to the CBD. Others might have a deliberate private car orientation. MUDs need not always be greenfield sites – neighbourhood redevelopments could also be undertaken using the MUD model -a variation on the earlier mentioned neighbourhood voluntary intensification concept.
MUDs offer a possible pathway to move from the current overheated property market to more rational land pricing without the collapse of house prices – the fear of which I believe is constraining some politicians from taking needed action. The city could adopt a programme of MUD license releases that start conservatively (thus holding up property prices in the short term) but which would become increasingly liberal. Unlike the ‘release’ of rural land, there would be some assurance that the land would be developed. Even without MUDs, councils could allow development outside the urban limit for a fee, with the fee reducing over time as the market stabilises.
Where the city provides infrastructure we need to ensure the charges reflect the cost of provision. The cost of operating and maintaining existing municipal infrastructure is largely determined by the size of the network, and that in turn is driven by the area covered. It is perhaps counter-intuitive, but rates on land value much more closely reflect the cost of providing municipal services than rates on capital value. (The cost of a sewer depends on its length, age and design capacity, not the number of connected pans). Rates on land value have the added attraction of discouraging land banking and encouraging intensification. Rates on capital value have been favoured by some councils on ‘ability to pay’ arguments. Distressingly, they are mandated in the legislation establishing the Auckland City Council. The role of municipal councils should be service provision, not income redistribution.
In summary, the housing ‘crisis’ is but one of the problems that arises from failing to cater for the growth in demand for city living. Other problem include road congestion and finding the money for projects such as Waterview and CRL. Ask people what are the biggest problems facing Auckland and I suspect the answers will include housing unaffordability, road congestion and spiralling rates. What is the answer?
We do need cities, and cities need to grow. For efficient liveable cities we need planning rules that enable the city to meet people’s needs and respond to their desires. At the same time we need appropriate charges for infrastructure and services so the choices people make do not impose financial burdens on others.
In particular we need:
- to abolish the urban growth limit and relax restrictions on urban intensification,
- to introduce efficient road pricing to reduce congestion, help encourage sustainable growth and discourage long commutes,
- rates based on unimproved value to better reflect the cost of municipal service provision and encourage development of available land,
- to provide for self-sustained urban development areas to give new housing choice and mechanisms for funding other essential infrastructure.
David Lupton is a transport economist with experience in transport planning and operations. He was initially employed as an economist with the New Zealand Ministry of Transport and the then New Zealand Railways Corporation and was the latter’s representative on the Auckland Regional Transport Committee. After leaving Railways he was, for a time, part-owner and director of New Zealand’s largest long distance bus operation. He worked for consultants Travers Morgan and Booz Allen and Hamilton before establishing himself as an independent consultant, and now mainly works internationally. Congestion pricing has always been an interest, and in particular the effect of transport pricing and investment on urban form.
85 Comments
Yes, where has this David Lupton been hiding all this time? Dozens of unenlightened bureaucrats are endlessly confusing the politicians and decision makers; obviously we have a major problem with "merit" / integrity / objectivity being overlooked as a decider of who ends up holding the sinecure positions in "policy advice". In fact this whole thing stinks of an establishment that looks after its own, and rocking the boat of political correctness (no matter how obviously wrong the mantra is) just risks consignment to livelihood oblivion.
The title of this article is far too simplistic for such a fine, paper-length piece of advocacy. "David Lupton says we need appropriate charges for infrastructure and services so the choices people make do not impose financial burdens on others". In fact this conveys a false impression anyway - because those charges, on net overall impact, would be a substantial reduction in long-term costs to ordinary households and the productive part of the economy. My guesstimate is that inflated housing costs for every future generation of Kiwis would be in the order of TENFOLD the level of "charges" needed otherwise to "pay for infrastructure" in the absence of growth boundaries. Those "charges" are grossly over-rated in any case, as we need infrastructure anyway and it does not cost "nothing" just because it is in existing developed areas. Even the assumption that it might cost "less", is highly disputable.
Auckland Council state urban expansion over the next 30 years could cost an additional $17billion. I am sure this is a complete guess -it could be more or less -but the purpose of announcing it was to put a scarily big figure into the public domain to frighten the punters into silence.
Of course AC do not mention that over the last 8 years they have presided over houses increasing in cost by $150 billion ($370,000 increase multiplied by 400,000 houses).
So I am sure if we stopped house price inflation we could afford better infrastructure.
One small error I noticed is the maximum one-way commuter range is generally accepted to be 60min. Alain Bertaud which David quotes has compiled these stats for his Cities as Labor market paper -so 1 hour a day might be a typo. I also quoted Alain's paper two years ago as no.9 of my Top 10.
http://www.interest.co.nz/opinion/70493/fridays-top-10-brendon-harr%C3%…
I think David's proposal is influenced by the Making Room concept. As promoted by NYU Stern Urbanisation Project. What I like about Making Room is it puts the needs of ordinary workers first. Whereas the Campact City concept does not consider the needs of people. Especially poor people. It enriches existing proprty owners and improvises future residents.
Many people in Auckland have been affected by the loss of a job (for whatever reason) which was close by. And are now faced with a much longer commute to work through no fault of their own. There is a dilemma: move house or put up with the commute "for a while".
When faced with this: I used to go to bed at about 9 pm, get up at 4:30 am. Get to work at 5 am and leave for home at about 2 pm. I was lucky that my boss allowed this. It was actually OK, but rather unsociable!
By the way, public transport was TOTALLY impractical. I tried it once. Bike ride to ferry. Ferry, got a fantastic connection to a train (So the tunnel project would have made no difference whatsoever: waste of money), 20 mins walk at the other end. The result: more than 3 times the cost of petrol. More than 3 times the time taken by car. (Assuming I did the shifted-work-day commute by car). So commuting by car was the only practical way of getting to that workplace.
It is an important point, that on the list of reasons people buy a house, "proximity to work" is well down the list anyway. Nevertheless, incentives matter. There is a major problem with the concept that if it costs more to commute further, people will make better location decisions. That is, property prices react to demand "by location". The more centralised and concentrated employment is, the more there will be an "invisible hand" effect "pricing out" people from efficient location decisions. Even if they want to move closer to work, many people will not be able to afford it.
The higher the market-wide land price, the worse this effect is. The factors that reduce it, are dispersion of employment, and a lower overall price of land.
It is a mistake to think that dispersion of employment is the result of distortions from planning. The reverse is true; dispersion is the norm as economies evolve, and if there is greater centralisation, this is always the result of distortions. The share of total urban area employment in the central cluster, ranges from <5% (Atlanta) to 33% (Wellington, NZ). Even in New York urban area, the central cluster contains about 20% of total employment. New York urban area is VAST. Auckland is around 16%, about the same as most developed nation cities.
Congestion itself is already an incentive to co-locate more efficiently. David Lupton's excellent insights about congestion pricing, include that traffic flows are INCREASED (contrary to popular opinion that fewer drivers, the higher income ones, end up using roads that poor people have been "priced off"). On net, it is unlikely that the charges themselves will be a stronger incentive to co-locate efficiently. They are such a substantial enabler of efficiencies in the urban economy nevertheless, that they are a no-brainer, if only voters could be brought to understand.
Economist after economist, for decade after decade, has been arguing that simply pricing road use and pricing infrastructure properly, would effectively achieve "key performance indicators" (such as resource consumption) by means that are all win-win; whereas the planners favourite tool, crude and draconian rationing of urban land supply, is fraught with unintended consequences. The tragedy of society being led by the blind (urban planners, Green activists) differs only in magnitude from the tragedy that was centrally planned eastern Europe for several decades. The same combination of ignorance and arrogance is to be found in the "planning".
Philbest I would disagree that urban planners who use crude and draconian rationing are only influenced by Greenies and activists. Conservative NIMBY's are just a strong driver behind restrictive urban planning policies. Often the conservative self-centred Tories hide behind naive greenes and weirdo activists.
It is interesting the NZ Green Party has not immediately condemned Phil Twyford's abolishing the UGB proposal. It seems Greenies are not going to be fooled into defending rich pr...ks land banking game.
Yes, I didn't mean to imply that "Greens" are "the" guilty parties - but they are what gives the land-rationing racket a stamp of "sanctification".
On the "Tory" side, there are really 3 separate interests that are "guilty".
1) The NIMBY opponents of intensification in their neighbourhoods. I do not agree that these people are guilty of causing housing affordability issues. Many of them, if given a choice, would be logically in favour of more greenfields development "instead" - and that guarantees affordability. Urban land markets are complex. If you have liberal policies re conversion of rural land to urban, there is almost no amount of NIMBYism that can make the market go unaffordable - the larger the section-size mandates, the LOWER the price of land is forced. Exemplar: Atlanta.
However, if you have a boundary or a proxy for it, no amount of zoning higher allowed densities will provide for affordability. Site value is HIGHLY elastic to allowed density. Exemplar: Hong Kong. So the local neighbourhood NIMBYs are not a "cause of unaffordability". In fact they are acting AGAINST their own potential capital gains in the event of rezoning! So at least their motives are sincerely those of "neighbourhood character", not a fiscal gouge at the expense of their fellow citizens. In so far as any of them might also be opponents of greenfields "sprawl", they are hypocrites, and in such cases, morally, they should be stripped of local NIMBY rights.
2) RURAL preservation conservatives - who are a major force in the UK, but I doubt the same exists here to such an extent. We do not have a "landed gentry", fox hunting, Lords of the Manor, etc. In fact, in NZ's lifestyle block phenomenon, we have a massive channel via which ordinary people can enjoy "rural" living, this channel does not exist in the UK at all. However, we then end up creating a "rural neighbourhood" NIMBY class of former townies who don't want more newcomer townies congesting their local roads and town tavern. As with the urban NIMBYs, such people forego capital gains through their own NIMBYism.
However, we DO have a class of "intelligent rural land owner" in lucky locations, who might "support" the boundary policy out of sheer mercenary greed - but this is a dangerous game highly dependent on the whole racket being sanctified and shielded from scrutiny of the mercenary motives where they exist.
3) The "rentier capitalist" is by far the guiltiest class of all. This includes incumbent owners of urban property portfolios, speculators in existing property and land banks, the finance sector, and - giving this class democratic power - all existing mortgaged home owners who oppose reform based on what it would do to their own property value. The most repugnant aspect of the way the rentier capitalist class works, is to be found in financial support of the "Green" patron saints of the racket and advocacy of "saving the planet". Quite possibly the Green recipients of the largesse are incapable of understanding their own useful idiocy, probably believing that their wealthy patrons are noble humanitarians putting their "honest" wealth to noble uses. Believe me, I could name some globally prominent patron saints of "smart growth" who truly think this way about the generous (to them) Rockefellers, George Soros, etc.
It is a measure of the progress we have made in NZ, that the Green Party now prefers not to remain on board the same rapidly-corroding and sinking ship with the Auckland Council Planners, Len Brown et al, and the rentier capitalists.
Every now and then interest.co.nz publishes a seminal article - this is one of them.
While the Twyford announcement was welcome in advancing the political agenda it was clear to me that merely abolishing the RUB in AKL would not, by itself, lead to house prices dropping to affordable levels. This article is the start of what we now need to do to make that happen.
Any chance of this being available in printer-friendly format? It's a keeper.
NZ is becoming a 'one main city state' as the proportion of NZers living in Auckland increases.
Many regions outside Auckland continue to experience declines in their population.
The vast majority of immigrants live and stay in Auckland.
The majority of the 100,000 international students live in Auckland.
The majority of foreign-related house purchases are in Auckland.
JK wishes to shift Parliament to Auckland.
"Growth in Auckland accounted for over half of the total population growth in New Zealand in both the 1996 to 2013 and 2006 to 2013 periods (accounting for 55 and 52 percent of total growth respectively). Auckland’s population increased from 1.07 million to 1.42 million between 1996 and 2013. The proportion of New Zealanders living in Auckland steadily increased from 30 percent in 1996 to 33 percent in 2013. Within Auckland the fastest growth was in the Upper Harbour local board area, which more than doubled between the 1996 and 2013 censuses (increasing by 130 percent), followed by Waitematā, which grew by 80 percent. "
Which only makes us identical to all of the states that form the federation of Australia, almost all the states in the US, all of the provinces of Canada, the UK, most European and African countries. The ratio between the population of Athens and the #2 city in Greece, Thessaloniki, is about 4:1. The ratio between the population of Auckland and the Christchurch metropolitan area (Christchurch City, Waimakariri and Selwyn) is about 3:1.
Brendon's point is the main one though. We are talking about the Auckland RUB but all councils have their own versions of it. Christchurch and Hamilton could have been good destinations for Auckland businesses who got sick of the conditions there. We could have spread out a bit but no, all of our councils have basically put up the "Not Welcome" sign in the form of highly restrictive planning.
Actually, according to figures crunched by Phil McDermott, Auckland is only "growing" in its "proportion of NZ population" because it is so big to start with. Many smaller cities are actually growing faster in annual percentage terms relative to their existing small size.
And Donald's point below is spot on - there is virtually no Council that is in a position to embrace growth deflected from Auckland due to its planning intransigence, that is doing so. In the USA, the result of Californian cities creating systemic unaffordability, is that Texas cities grow faster - because they have the "welcome" signs up. Even from an NZ national strategy point of view, we should be growing our cities where the geography makes the infrastructure cheaper. The cost of Transmission Gully might have paid for sufficient added road network in Christchurch or Hamilton, to cater for several hundred thousand new residents. What is happening in the USA is a kind of "closer to the free market" equivalent to this, and the US economy as a whole is far more resilient and diverse as a result.
Actually I think most people miss the reality of Auckland's growth dynamic. Auckland is really a huge holding pond where water levels rise and fall due to factors way beyond its control.
According to Statistics NZ the long-term "drift north" reversed 10-15 years ago. Auckland is now a net loser in internal migration. Auckland tends to lose residents to other parts of the country with the South Island being a major gainer in the overall trend. And, like very other part of NZ, it also tends to lose its young to overseas destinations, especially Australia. Auckland has its share of natural increase but migration from overseas and returning NZers can tip growth into plus territory and especially red-hot growth.
We see an identical pattern in New York which is also a major destination for inwards migrants from other countries as well as the principal source of internal migrants to other parts of the US.
So Auckland's growth rate is determined less by it's "attractiveness" as the balance between people wanting to get to New Zealand (via the front door)and people leaving the city for what they see as better places. By far the most important factor is the relative attractiveness of Australia. It was only five years ago that Australian mining companies were running employment fairs in NZ and there was a sign at Auckland Airport: "Last one out switch off the lights". What a difference a few years makes!
Subsidised anything can encourage wrong behaviour. For instance the accomodation supplement! Who is that really helping?
Having said that , who wants the doctors visit subsidy gone?
Public Transport has just not been dealt with properly because it's a huge cash cow for our government really to keep people using private vehicles
Public Transport is a "cash cow"? What do you mean?
Farebox revenue on average covers around 40% of OPERATING cost and NONE of capital cost - how is this a "cash cow"?
In contrast, car drivers pay for their own car, petrol, repairs, garage or carport, tyres, etc - if they are "subsidised", it is only to the tune of around 5% max. In fact because they pay in via petrol taxes and rates, and because roads major engineering costs are due to heavy vehicles needing to use them, 1% is more realistic.
In terms of cost to the taxpayer "per person km of travel", roads are below 1 cent, and PT is never under 30 cents. The average in NZ is around 45 cents, and some routes and times of day cost several dollars - several times as much as a Hummer stretch-limo would cost to run. Just because a bus or train carriage is "utilitarian" does not mean it is less thirsty in energy requirements than a Hummer stretch-limo. Every time you see a bus or a train carriage mostly empty, think of it as if it is a Hummer stretch-limo provided at taxpayer expense.
In fact average utilisation rates of PT in NZ is somewhere around 20% of seating capacity. This is not just because of underpatronised routes at off-peak times, but is also because PT vehicles must start out empty and fill up gradually; and must reposition empty of riders, to the start of the well-patronised direction of the run. PT efficiency is grossly over-rated by Joe Sixpack voter who never thinks of these basic realities.
You should really have said, to make it perfectly clear; roads and cars cost the government a heck of a lot less per unit of travel enabled, than PT. Hence rational government prefers roads. If roads are a "cash cow", this is by way of demand enabling, productivity and income growth, which is taxed. Of course there is petrol tax, and GST on the car and everything else associated with it. This probably covers more than the cost of the road system attributable to cars, which is still peanuts in terms of per person-km of travel enabled.
Do you find my analysis useful even if it was prompted by misunderstanding your comment?
Yes, and to honest we have current issue here in Nelson called the Southern Link. Basically everyone who lives outside of Nelson City wants this new motorway built because they can't stand the 5-10min delay( Yeap I'm serious) into the city. It's ridiculous cause when the school holidays are on there is no traffic queues into and out of the city during peak times. It all starts with the school runs/pick up, drop offs causing a build up. So for the sake of this delay these 'out of towners' as we call them want a $30-60 million dollar route made right through the middle of a lower socio economic community so the wealthier people living on Rocks Rd(state highway 6) can have massive capital gains due to traffic no longer going through their area. The NIMBY thing again but they are quite happy for others to suck it up.
Phil there is a huge amount of opaqueness about who pays for roads and who uses it. For instance a significant proportion of rates goes to roads. So rate payers subsidise road users.
Some regions with congestion problems such as Auckland and Wellington have received more back than local drivers have paid. While in some other regions it is the opposite.
I am fairly sure in addition to these subsidies, Roads of National Significance come from the consolidated fund so is another subsidy.
Also recently the government increased the weight limit for trucks therefore the damage they do to roads but did not increase road user charges. So this is a subsidy from one type of road user to another.
I believe It is false to imply only rail is subsidised.
When cars can drive themselves to the next customer (eliminating the parking issue via truly practical car sharing) and platoon for capacity, they will be pretty much the totally dominant mode of transport - even more than now.
Collective transport will still exist, but my best guess is it will exist as car-pooling for very cheap long distance travel. They will be driverless 4 to 6 person cars, but with retractable partitions for privacy (think of internal electric windows, but not windows).
You don't even have to be an optimist or a cornucopian to see that potential coming about on current trends. You have to be a blinkered pessimist not to see it. But that is diverting from the topic of this thread, which is attempting to address current bad policy making under ANY definition of the problem. In fact resource catastrophism is one of the excuses for the enabling of the great rentier gouge in urban planning. Inability to see this destroys credibility - why should we respect your resource catastrophism if you can't see the gouge and can't make any constructive suggestions how to deal with it? Your perpetual, chronic obfuscation of the issue just makes you look like a paid tool of the gouger class.
Uber Pool (still under development as far as I know) is a practical gamechanger in that it doesn't require driverless technology. As well as optimising ride-sharing Uber Pool software could analyse real time road pricing and optimise routes to minimise congestion. For which you would imagine they could negotiate a discount from the road network provider.
And you could develop the Uber Pool equivalent of the London taxi, one that is designed to provide privacy to ride sharers and pretty much guarantee a huge efficiency gain from our existing investment in roads.
Even as we are on the cusp of a significant change in how we do urban mobility our authorities continue to tilt at medieval windmills.
Our public service always remind me of the old industry joke about IBM: "Announcing yesterday tomorrow".
Here is another solution to part of the problem (urban travel speed) do-able without driverless technology:
And of course for a metro line with that efficiency to be relevant, a MASSIVE cluster of employment must exist at the destination. If achieving something closer to such a cluster is remotely possible, this begs the question, why is it not also possible in the utopia of the planners, to simply have all the employees living on another floor of the same building where they work, and dispensing with transport altogether?
One of the biggest ironies is that Hong Kong, with 66,000 people per square km, and a very high PT mode share, the average time taken to get to work is 47 minutes. Yet in Los Angeles and Houston it is 27 minutes. Obviously there is some kind of total disconnect between density and "efficient co-location sorting" in the property market. In fact I hold this to be a kind of iron law; there is NO high density city with even 'average" commute times, let alone low ones.
interesting that the writer completely ignores the increased value of land near to roads. Access to roads (highways) increase land value. Yet according to the writer users should pay for the road and the increased land value caused by the existence of the road should accrue to the land owner. Strange that .
Actually, historically, expansion of urban areas by unleashing automobile based development, has tended to reduce the real value of existing sites - the AGGREGATE land value still goes up because previously "rural" land of very low value, experiences an increase. And productivity and incomes increase faster than otherwise, because of the ease of putting land to higher value use. This is why the post-WW2 decades were a golden era in most of the west.
In contrast, nothing causes "increased land value" like a growth boundary does, as we are finding out. But that is nothing to do with market efficiency, productivity, income growth etc - it is entirely a zero-sum gouge out of status quo incomes and production. "Value capture" by government in this case is like a corrupt cop taking a cut from local drug dealers in return for not shutting down the racket (analogy provided by Brendon H somewhere once, top marks to him for that).
The post war years had the cheapest and easiest oil. The EROI on oil has been declining since 1961, along with the rate of growth in the population. Sure select pockets might have their oil subsidized, but elsewhere the decline is matched by the increased leverage of the rentier class. Trouble is for the rentiers is that they will be broken by the process.
The MUD model, along with its other virtues, looks to me as a way to facilitate innovation with infrastructure provision, as it leaves developers free to doing things a different way?
New ideas such as using modern compost toilets (the ones that rapidly dehydrate your poo into a non-smelly fertilizer powder) instead of a sewer system, or an ULTra PRT system for the "last 200m" of roading in a new development, etc. ...Note also, that a PRT system (as linked) can make buses more practical for many more people, as it can link so well to a dedicated bus stop. This could help a great deal to relieve the capacity issue with roading.
David Lupton clearly has little or no understanding of energy, nor much understanding of the point humanity has reached.
Cities are a very recent aberration in the scheme of things and are inherently unsustainable because they require the importation of all resources from elsewhere; whereas importation of resources was easily facilitated when cities were small and when fossil fuels were abundant and easily extracted, neither of those conditions now applies.
Cities require humungous quantities of fossil fuels just to remain in business -everything from transport to the food supply. And the peak of conventional oil extraction was over 2005 to 2008, with high-cost unconventional oil propping up the system since 2008..
It naturally follows that, in the long run, large industrial cities will not be capable of sustaining human life beyond a few hundred humans (if that) and will be largely abandoned once the industrial food system collapses. Just when collapse of the industrial food system will occur is still open to debate but a reasonable estimate, based on oil depletion and abrupt climate change, is around 2030.
Persisting with living arrangements that have no future is rather stupid. Attempting to expand living arrangements that have no future is the height of stupidity. However, as Einstein pointed out, human stupidity is infinite.
"Only two things are infinite, the universe and human stupidity, and I'm not sure about the former." -Albert Einstein
http://www.brainyquote.com/quotes/quotes/a/alberteins100015.html
So they have. Urbanisation begins about 10,000 years ago in what is now Turkey. 5,000-10,000 residents packed into an incredibly small area at Catal Huyuk, so small they walked across their flat roofs and dropped through trapdoors into their residences. There were no streets.
Classical Athens is thought to have a population of around 250,000 but this is where you have to be careful because Athens includes all the countryside around it, the whole of Attica. I have always thought that Athens got up to 1m eventually but I can't find any evidence of that.
This is the thing that cities have always been constrained by: mobility requirements. What we think of the great cities of history were often no more populous than a Dunedin or Hamilton in their densely built up, fully urbanised areas. They carried a lot of suburban/exburban population in lower densities. You can easily walk all of the Paris of the 18th century that was within the ancient city walls in less than a day. And Paris was the big kahuna of Western cities at the time.
Large cities? Such as?
Looking at London, we see that population overshoot commenced once food began arriving from overseas and the population overshoot became sever once coal became widely used. Imported oil made the predicament severely worse.
What had been little more than a village (sustainable) was morphed by external resources into a monster (unsustainable).
'Trade increased steadily during the Middle Ages, and London grew rapidly as a result. In 1100 London's population was somewhat more than 15,000. By 1300 it had grown to roughly 80,000.'
'the population rose from an estimated 50,000 in 1530 to about 225,000 in 1605'
1750 700,000
1851 2,363,000
1939 8,615,245
The current population is not very different, but the population of numerous towns around London has doubled or tripled since WW2.
Just what are those millions going to eat when the food stops arriving, as will certainly happen?
Just what are people in the central Auckland going to eat when food stops arriving? How will they obtain drinkable water when the pumps stop working, as will certainly happen?
There is no more dangerous human stupidity than Malthusianism as a policy pillar. We are NOT going to go backwards to the dark ages in "transport technology". As other commenters have pointed out, there were decent-sized cities even in ancient history, and we have the means already to sustain something far better than those, even if it is not the status quo.
In so far as there is any credence to a "resource run-out" paradigm, lower density living and more "localism" in production of food is a logical solution. Do you have constructive suggestions like that? Your argument does not clarify whether you are opposed to the policy of intensification - if you are, and that is your point, then you have more credibility than if you are arguing against greenfield growth, MUDs, and localised infrastructure provision and other scope for localised innovation.
EDIT: and I suggest David Lupton, from the evidence, is highly intelligent and more worth trusting the judgement of, than agitators who display not the first clue about complex systems like urban economies. If they can't even start to get their heads around the topic, they are certainly incapable of being right on the subject of their own hobby-horse beliefs.
Sorry to rain on your parade but we ARE going to return to what you refer to as 'the dark ages' -no electricity, no cars, no supermarkets, no anything-you-take-for-granted because the energy required to maintain present arrangements into the future simply does not exist:
http://crudeoilpeak.info/world-outside-us-and-canada-doesnt-produce-mor…
http://crudeoilpeak.info/peak-oil-in-the-south-china-sea-part-1
http://crudeoilpeak.info/us-shale-oil-peak-in-2015
No one can say exactly when energy depletion will bring the house of cards down but we can be certain that every day that passes brings the point of collapse closer.
The other aspect you and most other cornucopians ignore is the dire effect continuing to burn fossil fuels is having on climate and ecology.
Put simply. we cannot afford to burn the fossil fuels that remain because to do so would result in 'toasting the planet'.
The situation is already dire, as this graph clearly demonstrates:
http://www.esrl.noaa.gov/gmd/ccgg/trends/global.html#global_growth
I am well aware that a large portion of the populace refuses to accept any policies based on actual evidence or reality, and that is one of the reasons why there is no hope for the next generation. More fossil fuels than the environment can sustainably cope with WILL be burned. The plan, if it can be called a plan IS to crash and burn via continued squandering of fossil fuels, and nothing any expert says will prevent that. Just look at Dr.James Hansen, Head of the NASA Goddard Institute, who warned what would happen way back in 1988 -and was ignored. Or Dr M.K Hubbert, who warned back in 1956 what would happen -and was ignored.
So actually, we are headed for something far worse than the medieval period, which wasn't as 'dark' as many like to make out. We're headed for extinction -some time between 2030 and 2060- via the burning of fossil fuels and 'development'. And the only strategies that could possibly prevent extinction will not be implemented because of people like you saying basically that you refuse to abandon current dysfunctional paradigms.
If you want solutions, start by closing down the tourism sector and all the commercial television and radio stations that encourage squandering of energy and resources.
Then get councils to actually abide by the requirements of the Local Government Acts of 2002 and 2012.
. .
You should be walking the streets barefoot, with a long white beard, wearing a sandwich board proclaiming doom, mate. This discussion thread on this forum is the wrong place for your one-note nekrolog. Even if your argument was truly scientific and objective, it would still be the wrong place. The fact that you have no sensitivity regarding the disruption you are, is just another evidence that you are a nutjob. What other forums do you disrupt - any genuine science blogs? I think not - everybody there would pick you for a charlatan, unfortunately finance and economics specialists are easier to fool, if they are prepared to tolerate irrelevant trolling, period, that is their funeral.
David Lupton is absolutely correct in my view - on the need to scrap the metropolitan urban limit, the need to fund infrastructure as he suggests, and the need to price traffic congestion appropriately. I have little doubt that if that pricing were fiscally neutral - with the revenue from congestion pricing used to reduce rates and/or excise tax on fuel - it would be politically salable. Yes, some people would end up paying more, but they would get the enormous benefit of quicker commute times. Congestion charging isn't salable if it is seen as a way of providing yet more subsidies for trains!
Transport: In response to some comments...
You can transport food (and whatever) over large distances on negligible energy....virtually running your transport system on solar power IF we really want to.
You reduce trucks to platooning road-trains of small units, make them mostly battery-powered, and drop the top speed to 80 km/h (2x speed = 4x energy), and eliminate congestion with congestion charging. Employ high-pressure low rolling loss tyres....the list goes on. You can even employ road-based direct electrification of the main roads, if you want.
We will be doing stuff like this before we ever find ourselves being ruined by "peak oil", or a tiny bit more CO2 that actually does more good than harm.
So chill out people. The end is not near.
You need to read the Pulitzer-Prize winning book, Guns, Germs & Steel by Jared Diamond.
You also need to listen to these lyrics by Randy Newman.
In addition, you should restrain yourself with the generalised smear on someone else's religion. The religions of the West all went through some awful stages, inflicting dreadful agonies on non-believers. All in the name of "the one true way". It's a smear when you assume the actions of the few are ascribed to 'everyone'.
Tossed it out already.
How about Rudyard Kipling instead of Randy Newman?
Isn't Randy generally smearing all Europeans? After all probably only a small percentage benefited greatly from colonialism. Most Europeans at the time were poor, practically slaves, oppressed at home and abroad.
Also if the great religions go through stages could Islam be at that stage where it drives a colonizing urge? Your theory above would support that I think.
Also a lot of European countries didn't colonize.
You may call it arrogance, I call it epic. This is so old school. Almost everyone is over bagging the West for things that happened many years ago. Like other countries didn't colonize or have slaves etc. The West is the greatest civilization ever created and people would rather die than be kept out.
'The West is the greatest civilization ever created'
That very much depends on your definition of greatness.
The Chinese civilisation was generating everything the Romans had, and more, around the same time, and kept doing so long after the Roman empire collapsed. Surviving being temporarily overrun by Mongols, the Chinese civilisation persisted into the 20th century, and although temporarily subjugated through much of the 20th century, is beginning to dominate the world again.
By any logical reasoning, western industrial civilisation is the greatest failure of any to have ever emerged because not only is it in the process of destroying itself but is also in the process of making the Earth uninhabitable for humans (and most other vertebrate species).
Had Europeans not 'conquered the world' via the use of cannons and muskets from the 15th century on, and had Europeans not invented a steam pumps to extract water from coal mines, the Chinese civilisation may well have persisted for another 2,000 years.
As things turned out, Thomas Savery's steam pump led to woollen mills, cotton mills, railways, traction engines and steamships, then machine guns, underground rail systems, gas lighting, industrialised agriculture, dreadnaughts, electric lighting, vacuum cleaners, zeppelins, bombers and fighters, gas warfare, air-raids, fire-bombing, nuclear bombs, nuclear submarines and a stockpile of intercontinental ballistic missiles with nuclear warheads capable of destroying the world a dozen times over.
All that occurred before the age of comfort and convenience -courtesy of oil- took away the ability of most people in the 'west' to survive without the 'teat' of industrialised food, and took away the capacity of most people to think or act in their own best interests via inane television and lifestyle magazines etc.
I think you are way off the mark with your hypothesis about Islam attempting to colonise the world. People are leaving the Middle East and Africa because severe drought has taken away their livelihoods, because their homes have been blown up, and because population pressures are mounting.
http://www.theguardian.com/environment/2016/mar/02/syrias-drought-has-l…
I suggest you study Saudi Arabia: the population has risen from around 4 million to around 32 million -an 8-fold increase- since 1950; the current population and the current lifestyle are a very short term aberration in the grand scheme of things and will be 'all over' within a decade. Just how the collapse will play out is anyone's guess, but it won't be pleasant.
I think you are way off the mark with your hypothesis..
Most colonizing movements have something pushing them. War, overcrowding and drought can be reasons too but it will still be colonization. Strong religious beliefs will be of great benefit to the colonizers as they face the hard times ahead. You know like Puritans in America.
Great effort trying to school Chaston, Zachary. You know your stuff. I did not realise Chaston was "one of those" - no wonder is so unhelpful on applied urban economics too, with that dismal civilisational self-loathing attitude, including what "we" might have done or be doing to poor dear Gaia.
Puritans! Don't get me started. The good thing about America at that time was it gave somewhere to send the extremists and troublemakers after the civil wars had restored a constitutional monarchy. The Puritans under Oliver Cromwell slaughtered a third of the population of catholic Ireland - that's why the Irish hate the English to this day. Personally, I blame the Scots, the Scots kings brought French ideas with them and tried to create an absolute monarchy in England, thus causing civil war.
The Scots still side with the French ideas and the silly anti-democratic, imperialistic wet dreams of the EU. Northern Ireland is still scarred with the strife of state sponsored immigration from Scotland all those years ago.
I should add that when I say the Scots are to blame it is intended as a lighthearted inflammatory flourish. Clearly it is the fanatical ideas that were embraced at the time that caused the chaos that exists to this day.
Interestingly, it seems that the Prussians were particularly brilliant at amplifying internal strife. During WW1 they caused revolutions in Ireland and in Russia, thus severely weakening the anti-German alliance. Really very clever indeed. Again, these events continue to inflence us today.
I suspect the different thought processes behind Prussian as against Bavarian thinking is the root cause of the decline of the European Empire, sorry, I mean, the EU or whatever it is called. Since the Prussian worldview came to dominate post reunion the whole thing has gone downhill fast, on the basis that what they think is right, rather than a more flexible thought process pre reunion.
A quote from Diamond's book:
"Why did New Guineans wind up technologically primitive, despite what I believe their superior intelligence?"
No data to back this claim up, just his belief. One has to wonder about Diamond's motivation for writing this book. It is very anti-West. However it's main failing was that it was drudgery to read. I don't think it was aimed at my level.
Good grief. That makes it very clear you read little but the jacket and preface. You should have read on just a little bit. If you toss books because they don't confirm your bias, you will find it very hard to learn anything worthwhile. Understanding other points of view makes any conclusions you might come up with worthy of respect. Failure to do that - or even attempt it - undermines other's respect for your views. Your views just seem shallow.
Diamond is far from "anti-West". In fact, seeing any issue as us-vs-them is real throwback stuff. Even Huntington didn't do that. Huntington argued with a deep understanding. I recommend it over a bias-toss. Maybe that's your way into this issue; you might agree with him, so that can start you off.
Diamond's book is like the bible of political correctness. I doubt that even Diamond believes his own theories. He once said that agriculture was mankind's worst mistake.
He reckons Westerners are just the same as any other race and their success can be attributed to geographical location however states in the book that in mental ability New Guineans are probably genetically superior to Westerners.
So why can't Westerners, in theory, be genetically superior? I'm not saying they are but according to Jared that must be possible, no?
A good book for tearing out pages to help get the fire started this winter if you can't afford fire-starters.
Well said, Zachary. The common denominator in political correctness, and the only way to explain its myriad self-contradictions and hypocrisies, is that its raison d'etre is traducing western civilisation, particularly everything subsequent to the Reformation, after which everything pointed out by experts like Angus Maddison, "started to happen".
A cannibalistic, deeply superstitious, mumbo-jumbo tribal warfare culture can be morally elevated above this, in their parallel moral universe.
But I can see now why this forum has turned irrelevance into an art form, on the general subject of urban land policy. Even the politicians like Phil Twyford are now light years ahead of "the consensus" on this forum, which was at one time placed to be NZ's leading specialist finance and economics forum. Still, giving David Lupton the scope to say his highly intelligent piece is like an unexpected digression in the trend. But the irrelevance of the trend in the comments thread still says it all. It is impossible to have a sensible discussion of actual economics here - just a whole lot of mumbo-jumbo from a pack of neo-pagan Gaia worshipers who pretend that they are objective and scientific. Just like any theocracy pretending to authority.
Thanks PhilBest, it's good to know I'm not alone. I came back to this thread to see if anyone sane had commented or to fire a few more rounds but I see I don't need to now and my resolve is restored. I actually did do some self-reflection after reading Scarfie's comment.
Forgive me for laughing at you David, but you got trolled.
It is quite easy to read this guy, in MBTI typology, very similar to Profile. An IQ outside the first standard deviation, which brings a certain intelligence. But not outside the second standard deviation, so insufficient intelligence to know the limitations that are quite apparent to a lot of those on the forums here. He is a Sensing and Thinking type. This means a good ability to store facts, and some logical ability. The opposite to Sensing is Intuition, with no intuitive ability these types can't link facts together to form their own logical conclusions, they rely purely on what other people tell them. What you end up with is an inflated belief in their own ability.
In short, you lose when you engage them.
And the Internet is the perfect environment for such an organism. Who needs high intellect and a woman's intuition when you can just tap into the World Wide Brain?
Edit: they rely purely on what other people tell them This reminds me of Isaac Asimov who said he was criticized for being unoriginal because all the info in his science books could be found in encyclopedias.
Oh come on, Chaston has let himself be used as a doormat by trolls for years already - Malthusian nutjobs and "scientific" charlatans. Zachary Smith is just shining a light on this nonsense, which is all too rare on this site. Zach, mate, no-one is going to have the time to waste on this thankless task; the nut-jobbery on here is so full-time, one assumes the culprits are welfare beneficiaries with no time pressures. Unless someone with vested interests in rackets in resources rationed by regulations based on doomsaying, is paying them.
OB - because we in the west are so 'clever' we will invent more drugs to kill whatever comes out of Africa next - whilst at the same time destroying our own natural immune systems through the use of these antibiotics and diets of processed foods, living lives on antidepressants because we can bear to live un-drugged in the conditions of society we've created for ourselves. But we're pretty smug about the whole deal.
Jeez we're clever and so superior to those Africans...
Let's bring the thread back on - er- track, or should that be Pavement?
Roads are like the classic economist 'public good' to at least some extent: in that, just as one cannot stop a seal, dolphin, small-boat sailor or whale (all non-contributors to lighthouse costs) from - er - Seeing the Light, there's no practical way to stop pedestrians, cyclists, horse-riders, children - non-contributors all - from using them.
Plus ambulances, fire engines, police vehicles and other social necessities, not only need roads, but have the special quality of being able to demand precedence in their use.
So the 'real costs' need to be viewed in this context, and the proposals to do 'whatever', thus need to recognise the partial nature that inevitably has to exist, given the irreducible 'public-goods' component of the whole deal.
It's also hugely complicated by the fact that, unlike the factories of the late 19th century and the mass transport and mass housing needed for these mass labour markets, there's almost no 'mass' anything left. Transport exists to connect a source with a destination, and these pairings are now small, numerous, and highly opaque to centralised solutions. That's exactly why Uber-style techniques for people-oriented transport, are now on the rise, mimicking the existing arrangements which have been in place for decades for commercial goods. That's also why the insistence, by some common taters, of continued mass solutions such as rail, without understanding the intricate and timely intermodal connections that need to exist to make the thing remotely attractive, is misguided.
To be sure, the common London tri-modal pattern - drive to a BR park-and-ride, BR to Waterloo or King's Cross, Tube to place of work, is certainly feasible for some places, some types of commuter. But we're far away from the needed density, frequency and reliability of service, and mind-set that allws this pattern to be successful. There's no way There from Here.
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