Planning Pratfalls

The people who have been heaping acclaim on comprehensive urban planning policies like those of Portland, Oregon, should consider recent reports from the former Soviet empire. Years after the collapse of communism, we are starting to learn that central planning fails at the national and the local level.

The first lesson comes from World Bank economists Alain Bertaud and Bertrand Renaud, writing in the Journal of Urban Economics. They examined the current land use patterns of cities in Russia that were largely destroyed in World War II and rebuilt from scratch under comprehensive and centralized local planning. They found a planning pathology that makes the most sprawling U.S. city look like paradise.

The quintessential "socialist city" was inefficient on an epic scale, with sparsely populated centers that became more densely inhabited as you moved away from downtown. Moreover, most residents lived far from their jobs and faced long commutes. Even worse, the extensive rail transportation systems did not connect homes and offices. Though planners had complete control over the siting of residences and businesses, they could not create efficient cities.

Since 1990, housing and other markets in Russia have been liberalized. As a consequence, residents are moving closer to their jobs and the centers of cities, leading to a more even spread of population, shorter commutes, and a lower variation in housing prices.

A similar lesson comes from the former East Germany. Germany is one of the most densely populated countries in Europe and has an extensive public transit system. Prior to reunification, very few East Germans owned or used automobiles. In 1987, 46 percent of urban travel in West Germany was by auto, compared to only 25 percent in East Germany, where 40 percent of urban travel took place on foot.

In the last 10 years, however, former East Germans have caught up with their western brethren. By 1995, 49 percent of urban travel in the former West Germany was by auto, compared with 48 percent for the former communist country. Even high population densities and well-designed public transit systems couldn't keep former East Germans from getting behind the wheel of a car as soon as they were able to do so.

The totalitarian power of the Soviet state was incapable of controlling work and housing locations in a predictable manner. And the East German experience suggests that free people will pursue their own desires despite the overarching visions of urban planners.

Portland, tear down that wall!