Richard Florida on walkability and foreclosures

Normally, I defend Richard Florida from my fellow urban social science types. He’s an interesting guy, he’s obviously learned how to work the media, he’s raised some interesting issues, etc, even if his research doesn’t hold up very well under scrutiny. So what if he’s more focused on staying a celebrity than making scholarly contributions anymore?

But that doesn’t mean the rest of us have to go along with what he says.

In particular, his high-profile claims about the way foreclosures are occuring just make no sense. Here are Richard Florida’s comments on how “central” and “walkable” places are less hard hit by the foreclosure crises.

We’ve had evidence for quite some time that central city locations and inner-ring suburbs have gentrified with higher income people less likely to have mortgages, less likely to default, and less likely to have taken on mortgages at all during the most hazardous time periods to do so. The chart Florida shows demonstrates that places which had a large portion of their housing stock constructed and sold during boom years are also getting hit hardest with the contraction and foreclosures. Why that’s evidence of anything is beyond me; it’s a regional-level chart, and it is basically an upside-down chart of Rob Lang’s descriptive work on “boomburgs.”

Florida’s little anecdote about Miami Beach REALLY sets my teeth on edge, however. You mean to tell me that Miami Beach real estate hasn’t lost much value? Surely you jest. That must be because it’s so darn walkable and such a good value therefore and not because rich people still have money, and rich people spend money on beachfront playspaces. Of course, walkability wouldn’t correlate with moneyed environments, either, would it? Or with the basic economic principle that increased land value prompts density and diversity in land uses which increase walkability, which then cycle through and increase land values?

How’s about this logic, instead: if affluent Americans weren’t such jerks about excluding people from housing opportunities in existing urban and regional environments over the past 30 years, people on the margin of home ownership wouldn’t have bought in far-flung, unwalkable suburbs.

I live in one of the densest urban environments outside of Manhattan with a very high walkability score, and there are three foreclosures in my high-rise, centrally located, infill development. Does that prove Florida wrong? No. It’s an anecdote. It’s not research.

So yes, walkability might be related, but not in the way people want it to be, and actual research findings? We’ve got nothing.

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A macro guy defends macro theory by telling us all we’re not smart or trained enough to “get it”

My colleague Richard Green commented on the Kartik Athreya’s critique of economics bloggers. He writes:

But George Akerlof did, way back in 2006, during his American Economic Association Presidential Address. which was entitled “The Missing Motivation in Macroeconomics.” I remember finding the piece enthralling (I know, we economists aren’t supposed to use such emotion laden words), because in made the very simple but devastating case that when the foundations of modern macro (the independence of consumption and current income (given wealth); the independence of investment and finance decisions (the Modigliani-Miller theorem); inflation stability only at the natural rate of unemployment; the ineffectiveness of macro stabilization policy with rational expectations; and Ricardian equivalence) are tested against data, they generally fail the test. I remember at the time that some economists thought that Akerlof had taken leave of his senses (and some friend of mine thought I had taken leave of mine because I so admired the address).

link: Richard’s Real Estate and Urban Economics Blog: One more take on Kartik Athreya’s critique of economics bloggers

Athreya’s essay may be found here. My favorite quote is:

So far, I’ve claimed something a bit obnoxious-sounding:that writers who have not taken a year of PhD coursework in a decent economics department (and passed their PhD qualifying exams), cannot meaningfully advance the discussion on economic policy. Taken literally, I am almost certainly wrong. Some of them have great ideas, for sure.But this is irrelevant.The real issue is that there is extremely low likelihood that the speculations of the untrained, on a topic almost pathologically riddled by dynamic considerations and feedback effects, will offer anything new.

Nope, Athreya, that’s not the issue. You might want to make it the issue, but that’s not the issue. The issue is, as Akerlof pointed out in his manuscript, whether modern macro theories have any predictive value at all, and if not, whether the profession legitimately merits a privileged position as a consultant to institutional power. The dribbling bit at the end about how the topic is “pathologically riddled by dynamic considerations and feedback effects”? Welcome to social science, cupcake. Do you really think deriving a verifiable theory of culture or society or cognition is a picnic?

Yes, economics is hard. So is driving a bus. Most of us can’t drive a bus, in fact. But most of us, when we are riding on a bus, can tell when there is an incompetent driver. So if Athreya wants to blame the traffic and the potholes and the sun in his eyes, that’s fine, but:

The New Federalism v. 4.0 in transport?

Over dinner the other night, a political scientist and an economist dismissed my financial worries about HSR. “The government wastes money all the time” one said said. “It might as well be on trains rather than military spending.” The political scientist, in particular, said that Congress can just appropriate more to transportation to cover HSR; I was making a faulty assumption that the money for HSR will displace other transportation funding needs like the Big Dig did in the state of Massachusetts.

I’m still not convinced that the US Congress is ready to pull out their checkbooks for HSR any time soon, and I’ll be really interested to see the day that military spending gets cut in favor of infrastructure spending (or anything else)–but I am not holding my breath. The $2B allocated to California is hardly chump change, but it’s still $7B short of what the HSR says it expects the Feds to kick in (which means it will probably need closer to $10B to $12B of additional federal sources).

As early as 1974, comments on the “the New Federalism” began emerging as the Federal role in transportation began change from what it had been after the mid-1950s. The easy part of the interstate system had gotten built; the rest was becoming increasingly more nightmarish to implement as urban neighborhoods resisted being paved on. From there, the federal involvement in planning for transport became much more associated with “fiscal federalism” for just about everything, and Reagen’s “New Federalism” was ostensibly about a diminished federal responsibility in domestic programs. As Brian Taylor noted, however, it’s nearly impossible to argue in transport that finance is separate from projects or planning. Nothing gets implemented without resources, and the resources usually comes with strings. ISTEA was also noted as break from the previous round of fiscal federalism, where localities, MPOs and states got much more discretion and block-grant funding. Nonetheless, there were real variations in how much discretion and control over funding MPOs had from state-to-state.

It has been widely bandied about that the Obama administration and the economic crisis he’s got on his hands has worked to re-Federalize policy across the board, from banking to housing to urban policy more generally. We have for years had persistent calls for Federal funding for walking and biking projects, which I have to say I’m not sure I can get behind: why, exactly, can these not be paid for out of local taxes sources and, in particular, property taxes given all the studies that want to show me how TODs and New Urbanism, etc increase property values? Ditto with street projects, btw.

More compelling, the inter-city nature of HSR suggests the same type of Federal role it had during the Interstates. Yet with the Interstate we had a new Federal tax that went straight into a trust for that system. And that’s where I am pausing before I can call HSR or ARRA the new New Deal.

By contrast, the 30-10 plan from Los Angeles, recently passed, does promise to be a very new approach to Federalism in the US–one where the states are largely bypassed in favor of local fiscal capacity hedged against US federal financial capital and risk reduction. The feds are paying up front, but are being paid out of a dedicated local revenue source; it’s an infrastructure banking plan. That is a lot different than a simple act of appropriations, and my suspicion is that if states want their piece of the HSR pie, that’s the direction they are going to have to go. How far they have to go in will depend on how powerful their Congresspeople are.

References that informed this post:

Blumenberg, E. & Schweitzer, L. (2002). Devolution and the new federalsim: The role of the federal job access program in improving the mobility of welfare recipients. Planning Theory and Practice.

Dinan, J. & Gamkhar, S. (2009). The state of american federalism 2008-2009: The presidential election, the economic downturn, and the consequences for federalism. Publius: The Journal of Federalism.

Gage, R. W. & McDowell, B. D. (1995). ISTEA and the role of mpos in the new transportation environment: A midterm assessment. Publius: The Journal of Federalism, 25(3), 133.

Pagano, M. A. (1986). Old wine in new bottles? An analysis and preliminary appraisal of the surface transportation assistance act of 1982. Publius: The Journal of Federalism, 16(1), 181.

Mertins, H. & Jr. (1973). The “new federalism” and federal transportation policy. Public Administration Review, 33(3), 243-252.

Taylor, B. D. (2000). When finance leads planning: Urban planning, highway planning, and metropolitan freeways in california. Journal of Planning Education and Research, 20(2), 196-214.

Freewaves and art on the bus

Last Saturday, my posse (ok, I don’t really have a posse, but work with me here) and I attended Video on the Loose, an exhibit of video art from Los Angeles’ Freewaves, a community-based organization in Los Angeles that tries to produce images in the public sphere from a variety of sources and artists and which is celebrating its 20th year in existence.

A new, very exciting, partnered project of theirs has just received funding:

Freewaves, Echo Park Film Center, Public Matters Group and UCLA REMAP receive $100,000 grant from the John D. and Catherine T. MacArthur Foundation for MetroVoice, an initiative to involve youth in writing and producing videos and TV screen text banners. The geo-coded messages will be transmitted on 2200 LA Metro buses, and explore aspects of the young participants’ families and neighborhoods.


My two companions were a bit mystified by the social significance of putting art on the bus. For those of us who have been in the transit business for awhile, the transgressive and social aspects to putting art on the bus, made by local artists, is probably pretty apparent. Public art tours on transit tend to focus on rail transit, with its higher socio-eonomic profile, riders, and audiences. Plenty of Los Angelenos are engaging with at LA-area TODs, dripping with design and art, without setting a foot on either the bus or the train, if the ridership numbers are believable. Putting art on the bus suggests engaging with those riders too often taken for granted by transit companies. Having it be art about the communities that the buses are traversing connects mobility with place; communities are no longer merely pass-throughs in the process of mobility.

It’s a very cool idea, and I’m looking forward to seeing how it works out.

Freewaves has produced a book and a dvd well worth investing in, see here.

My favorite movie about teaching

I love everything that Curtis Hanson does, but Wonder Boys is basically my favorite movie about teaching. Most of us are not of the “Captain, My Captain” variety of teacher of Dead Poets Society fame. Some are. I’m not. Instead, I think most of us in the academy are like everybody else: wounded and screwed up, limping along, too dependent on something bad for us to get us through the night. Sometimes we run out of stories to tell; we get burned out. We don’t fit in. We do the wrong thing, hurt people, try to do good work, and then fail. Still, we can’t stop. We can try telling a dishonest story but if we are authentic scholars, we can’t make that work either. Despite it all, there’s one student who is just as outside as the rest of us, and that person has something to say, and there’s something important to him about all the walking wounded who have come before him. Teaching and creating art are messy, unpredictable, and often sad processes that nonetheless can yield glorious results.

David Sloane, Judith Butler, ghost bikes, and the entitlements of mourning

Earlier last week, Gothamist reported that the sanitation department was going to clear out the “ghost bikes”, shown here, largely because they have started taking up too much room. Ghost bikes are memorials created for bicyclists who have died on road in crashes with vehicles:

Leah Todd, who heads up the Street Memorial Project here in NYC, tells us, “It would be devastating for many people who use them to mourn or remember or advocate better conditions for safer streets.” When asked if the memorial movement had faced opposition in other cities, Todd said, “We’ve seen a lot of interesting things happen in different cities. In DC when a ghost bike was removed, 21 ghost bikes returned on that corner to replace it on the next day.”

link: Ghost Bikes Targeted by Sanitation Department – Gothamist

There were about 45 to 50 ghost bikes around New York City slotted for removal. The city rapidly saw (probably due to the tactic suggested above) that this wasn’t going to be politically worth the conflict, and so they dropped the plan:

City nixes plan to remove ‘ghost bike’ tributes after outcry from families of dead cyclists.

I have to admit to being somewhat torn about the ghost bike question. Of course memorializing bicyclists is important, but the space-consumptive nature of the ghost bike in the public sphere is off-putting to me. Ghost bikes do take up space where it is as a premium, and the reason why the bike advocates think it’s great is the same reason I pause over it somewhat: the in-your-face-there’s-a-victim-of-a-vehicle who died here. Fine, I get that.

But where are the very public, very prominent memorials for pedestrians who die the same way?

Or the public memorials for homeless people who die on the streets?

Of course we want safe streets. Absolutely. But why are bicyclists entitled to very public, and I guess now we’re supposed to allow them to be permanent, displays of mourning when others, also arguably victims of unsafe streets, are not?

Judith Butler said some really interesting about mourning and recognition in a recent interview:

It is not enough to have a politics that has “public mourning” as its final goal. The point of public mourning is to expand our ideas of what constitutes a livable life, to expand our recognition of those lives that are worth protecting, worth valuing. This is, importantly, not an individual activity, but something that not only happens in public, but has the power to redefine the public sphere.

link: Judith Butler – Ungrievable lives | Re-public: re-imagining democracy – english version

One of my favorite colleagues, David Sloane, wrote his dissertation on cemeteries and memorials, which he then published into an absolutely wonderful book on cemeteries and cities, which gets into the politics of prominence of mourning and the use of urban/rural space for memory.

Sloane, D. 1991. The Last Great Necessity: Cemeteries in American History. John Hopkins University Press.

Meghan Daum on mortgages and the bubble in Los Angeles

Now that the housing bubble (or whatever it was) has gone pear-shaped, we tend to see the whole episode discussed in highly clinical, economic terms. For those of us who had been trying to cope with the costs of housing during that time period, it was hardly clinical, and the people holding short sticks now were hardly then the sad little victims of the big bad banks then that they are generally portrayed to be now. Yes, I do think some people are victims, but the truth is, for every victim, I encountered back then swaggering realtors, mortgage lenders, and home owners who believed they were the smartest people in the world for being the market while was the dumbest and most pathetic person in the world for not being in the market.

Meghan Daum’s new book is called Life Would Be Perfect If I Lived In That House, and I have to admit I stayed up all night last Monday reading it. She’s an absolutely marvelous prose stylist, wonderfully funny, and remarkably insightful about how the external trappings of the house and decorating became, for Americans during our second Jazz Age, a way to demonstrate to others and ourselves our personal character and distinctiveness. Bourdieu, my favorite social theorist, will probably get to use this episode as a nice double entendre wordplay for his concept of habitus.

The brilliant writing of this next passage from Daum’s does more to capture the reality than all the sanitized economic writing about the “Bubble that wasn’t a bubble” I’ve consumed in months:

It was, by now, 2004. We were not at the apogee of the market, but we were getting there. The way I’ve always imagined it is this: if the real estate bubble were a distended piece of chewing gum in the mouth of a teenage girl, it would have been about the size of a lemon at that point–formidable but not yet out of control. By early 2005 the bubble would have covered her nose and eyes, and by the end of that year, it would been as big as her head. By 2007 it would have deflated slightly, and by 2008 it would have popped and been all over her face. By 2009 she’d have choked and died on the gum, but let’s not go there now.

She continues:

Instead, let’s remember 2004. Money was everywhere: talk of it, displays of it, envy of those who had it, and pity for those who didn’t. In the spring of 2004, you could find a thirty-year fixed interest rate of 5 percent. Adjustable-rate loans were, of course, practically falling off trucks–not just shiny, new expensive trucks but old, beat-up trucks, garbage trucks, even. People were paying $600,000 or $700,000 for properties that, four years earlier, would have been worth $200,000. people were taking out low-interest loans for $700,000, buying houses for $550,000, and using the difference to buy Range Rovers and vacations in Anguilla.

I remember thinking about this when I came back to Los Angeles from Virginia and I was staying with dear friends. I had made an above-average steak dinner, and we sat around that night and talked of three things: food, as these friends are foodies, the shootings Virginia Tech which still exert a profound effect on me, and real estate. And real estate and more real estate. I wondered then if I hadn’t simply been overloaded with real estate talk because I was looking for housing, but I don’t think so. It was everywhere, in the air, like the heady-sick sweet smell of jasmine past its prime.

Elizabeth Currid on celebrities, attention-seeking, and philanthropy

Social activism, Ms. Currid points out, is the modern currency in Hollywood, forming an important part of a performer’s public persona. Celebrities use it to jockey for position in the entertainment ecosystem. The relationship between celebrities and fans has become less iconic and more accessible, she says, adding that their appeal is more about their personal narrative and less about talent or glamour.

link: Gulf oil spill, Haiti, Darfur: Hollywood stars rush to do their bit –

Just one thing. It’s Dr. Currid.

High credit scores among deliberate defaulters?

I am confused by this entry from Lending Tree:

Recently, Morgan Stanley revealed there is a rate of about 12 percent of mortgage defaults that are made up of homeowners who do have the means to pay for the mortgage but don’t. The company’s recent report showed borrowers who had high credit scores and loans were more likely to stop paying their mortgage when the rate was higher than what the home was worth. As of March, online real estate database reported about 23 percent of single-family homes had loans that were more than what the properties value was.

link: Fannie Mae Will Deny Loans to Deliberate Defaulters

So does this mean that high credit scores are measuring something other than credit-worthiness the way we’ve always been told? What’s the latent variable here? Or latent variables? Or I am not reading this correctly?

An article last year from the LA Times:

Reporting from Washington — Who is more likely to walk away from a house and a mortgage — a person with super-prime credit scores or someone with lower scores? Research using a massive sample of 24 million individual credit files has found that homeowners with high scores when they apply for a loan are 50% more likely to “strategically default” — abruptly and intentionally pull the plug and abandon the mortgage — compared with lower-scoring borrowers

link: Homeowners who ‘strategically default’ on loans a growing problem –

So is this a question of all those risk-assessors getting trapped in their own logic? Hypotheses:

a) People with higher scores were more likely to be allowed to over-invest than those with lower scores–thus winding up underwater more often.

b) People with higher scores are more likely to do the math, and look to the bottom line, realizing that they are better off financially getting banned for a few years and taking the credit hit than they are continuing to pay on a house that will never come back to the value they paid; or

c) those with high credit can take the hit on their credit and not have it hurt their chances of getting housing or other credit than those with lower credit.

Interesting hypotheses. Too bad I have no idea how study any of them.