Reason.tv: Richard Florida Discusses The Great Reset of Urban Development in Economic Downturns

How is the current economic crisis remaking American cities?

Reason.tv's Nick Gillespie sat down with Richard Florida, author of The Great Reset: How New Ways of Living and Working Drive Post-Crash Prosperity. Florida discussed the housing bubble, high speed rail, and how economic shifts give rise to new urban landscapes called "megaregions."

Approximately 10 minutes. Shot by Dan Hayes and Josh Swain. Edited by Josh Swain.

Go to Reason.tv for downloadable versions.

Comments

[Apologetic California]

Florida is as dumb as the state he shares a name with. This floster makes a living popping champagne everytime a poor person leaves a neighborhood so some fuckwit progressive gentrificator can move in.

[Argosy Jones]

Florida is an assclown. Fuck him.

[hurly buerhle]

Yeah, Florida is a tool. He basically wants all of America to be like Palo Alto. And like any academic, has a lot of top-down plans for how the state can make that happen.

[e]

oh my god..Palo Alto...that sounds awful!

[Wegie]

Affordable rent means one thing....subsidies!

[Wegie]

The best role for government is to stay the fuck out of the way.

[Colin]

OK, so we should spend tax money on high-speed rail because Richard Florida has a hunch? Color me unimpressed.

[Wegie]

A government subsidies that pays for it's self....right!

[Chad]

I have never understood why libertarians so strongly defend our utterly-subsized, completely government-run system of roads over other forms of transit which have similar levels of government involvement and subsidy.

Can someone please explain?

[Douglas Fletcher]

Because light rail sucks?

[Wegie]

Goverment sould susidize nothing.

[Chad]

A quick question: Are the following subsidies

A: The government refusing to set up an appropriate scheme to enforce property rights, in effect allowing certain businesses to harm their neighbors with no viable way for the neighbors to fight back

B: The government allowing a business to use public property without an appropriate charge?

[Wegie]

This is a loaded question. Give examples. Most public property should be private property.

[Chad]

Transportation systems can rarely be privitized because of monopoly issues. If you disagree, how about we privitize the roads surrounding your home, I buy it, and charge you a million to step outside your door?. There is absolutely nothing stopping that in Libertopia.

Specifically, in the first situation I was referring to widely dispersed damages such as most pollution. While theoretically I could sue you for the damage caused by your CO2 emissions to my property, there is no *viable* method for me to do so. Court costs would vastly exceed the damages, even in small claims court. Hence, lawsuits simply cannot solve this problem.

In the second case, pollution often damages public property as well, and polluters should be held fully accountable for this damage. Anything else is a market failure.

[AA]

"I buy it, and charge you a million to step outside your door?. There is absolutely nothing stopping that in Libertopia."

You have a hard time thinking in terms of incentives don't you? Are you really that afraid of the world?

The more people who use the road, the more money the owner/s of the orad make. Therefore there is an incentive to set a price the market will bear. If what you say is true, nobody would have anything, and everything would cost a million dollars. Stossel is discussing this on his show right now. Take a look.

[Chad]

Sure, charging you a million dollars would not be my profit maximizing price (which would be the monopoly price, which is NOT the "market" price). However, I just don't like you, and would be willing to give up some profits to spite you. I never said I would charge EVERYONE that price. Just you, and any other libertarian I ran across.

Watcha gunna do about it?

Remember, we are talking about your verdant and perfect Libertopia.

And don't say you'd buy the roads outside MY house, because I wouldn't screw you or anyone until I had protected myself by owning the roads most important to me.

God, it is so easy to prove how epically libertarianism just doesn't work in the real world.

[AA]

No, all you did here is prove what a spiteful shit face your are. Grow up.

[KPres]

However, I just don't like you, and would be willing to give up some profits to spite you. Watcha gunna do about it?"

Bullshit. Roads would almost always be operated by Corporations, who's shareholders aren't going to look to kindly on your "giving up a little profit."

[KPres]

P.S. - I love how liberals say all the evil in the world is created by greedy businessmen who only care about profit, but when you point out that the profit motive is exactly what creates the market's self-regulating mechanism, all of the sudden those same businessmen are going to up and decide to forgo the profit motive and start acting out of "spite."

[Mike]

Transportation systems can rarely be privitized because of monopoly issues.

Not really. There are very few transportation systems that haven't had at least part of their operations privatized at some point.

If you disagree, how about we privitize the roads surrounding your home, I buy it, and charge you a million to step outside your door?. There is absolutely nothing stopping that in Libertopia.

No, there's nothing stopping that. But a much better framework for privatization in this case would be for the road I live on to be privately and collectively owned by myself and my neighbors, with shared decision-making regarding maintenance standards and financing.

Specifically, in the first situation I was referring to widely dispersed damages such as most pollution. While theoretically I could sue you for the damage caused by your CO2 emissions to my property, there is no *viable* method for me to do so.

The solution to the CO2 problem is an economy-wide carbon tax, not government ownership of roads. The problem of pollutant emissions is not limited to the transportation sector, so neither should the response be.

In the second case, pollution often damages public property as well, and polluters should be held fully accountable for this damage. Anything else is a market failure.

Again, this not an a priori justification for government intervention. What "public property" is being damaged? How feasible is it to "hold polluters accountable"? Furthermore, why would government allow an activity that (greatly) damaged public property?

[Chad]

Not really. There are very few transportation systems that haven't had at least part of their operations privatized at some point.

I said "rarely" for a reason. A small minority can be privatized, or more typically partially privitized into a public-private model. Except for two-tracks on the back forty, I really can't think of any fully private transit systems.

No, there's nothing stopping that. But a much better framework for privatization in this case would be for the road I live on to be privately and collectively owned by myself and my neighbors, with shared decision-making regarding maintenance standards and financing

And I presume you are going to make decisions by vote...which makes your plan sound an awful lot like local government, which is the entity that manages the roads that most people live on. The difference might be that you would give more votes to the rich, because they would be measured in dollars. How democratic of you.

The solution to the CO2 problem is an economy-wide carbon tax

Agreed. It's rare to see a libertarian admit this. Quit wasting your time with me and start bashing in the heads of the conservative cretins out there that refuse to understand that markets cannot work if the prices are incorrect.

Again, this not an a priori justification for government intervention. What "public property" is being damaged

Assuming we are talking about CO2, the obvious answers our air and water quality, our public lands, and the wildlife that lives on any of the above. There are also negative effects on many other aspects of government, such as more flash floods knocking out more roads, increased world tensions resulting in higher military spending, and climate changes' effects on public health.

Furthermore, why would government allow an activity that (greatly) damaged public property

Mostly because idiot conservatives argue that if the government were to charge businesses for the privlege to damage public property, those businesses couldn't compete.

[Mike]

A) No. The neighbors have legal recourse through the court system (another way of enforcing property rights) and can sue the business for damages.

B) This is not a subsidy so much as it is an example of government failure, in this case the failure to efficiently price access to public property.

Presumably you are using this as an analogy to government-owned road networks. In this case, charging at the point (time and place) of use is not always feasible or efficient, though one can make a strong case for at least tolling limited-access highways (and Reason does).

[Chad]

Mike. Let's say I do something that harms you by one nickel.

Are you going to sue, even in small claims court? Of course not. Now, what happens when I do that same thing to everyone on earth. That implies I am causing hundreds of millions of dollars in damages, but hurting no one in particular enough to justify a lawsuit. And in return, everyone else is doing the same thing to me. The lawsuit model just doesn't work in these cases of highly-dispersed damages.

You keep focusing on HIGHWAYS, and ignoring how they are utterly dependant on the much larger feeder road system, which cannot be privatized.

Highways can probably be semi-privatized, but even then you run into monopoly issues. I have to use one toll road when heading back to my parents' home, and there is absolutely no viable alternative. They charge monopoly prices not only at the toll booth, but at the gas stations and rest stops along the way. Monopoly prices are clear indiations that this "market" is failing.

Btw, the toll roads I know of all cost around $.05/mile. The federal gas tax is around $.01/mile. Even assuming the government is throwing in some help to the highway fund, it is less than the gas tax brings in. So at most the feds are spending $.02/mile.

Now, are the feds really that much cheaper, or are you going to concede that the private toll operators are charging monopoly prices?

[KPres]

"And in return, everyone else is doing the same thing to me. The lawsuit model just doesn't work in these cases of highly-dispersed damages."

Horseshit!

What would happen is profit-seeking consumer advocacy groups would spring up to file class-action suit on behalf of their members. After a few

[KPres]

"And in return, everyone else is doing the same thing to me. The lawsuit model just doesn't work in these cases of highly-dispersed damages."

Horseshit!

What would happen is profit-seeking consumer advocacy groups would spring up to file class-action suit on behalf of their members. After a few

[KPres]

"Btw, the toll roads I know of all cost around $.05/mile. The federal gas tax is around $.01/mile. Even assuming the government is throwing in some help to the highway fund, it is less than the gas tax brings in. So at most the feds are spending $.02/mile."

Dumbass, $.05 tolls you're describing are only located on well travelled highways, whereas $0.01 represents an aggregate of ALL roads. Of course the highways are going to cost more, they're more in demand! More demand = more traffic = higher maintenance costs, etc, etc.

[Mike]

I have never understood why libertarians so strongly defend our utterly-subsized, completely government-run system of roads over other forms of transit which have similar levels of government involvement and subsidy.

If you bother to take 5 minutes perusing this website for publications related to transportation, you will see that Reason is one of the strongest advocates of privatization in transportation.

Which other forms of transit have similar levels of government involvement and subsidy?

[Chad]

Rail and buses, on average, bring in about half of their costs at the fair box. Indeed, there are some systems out there (in Germany and Japan) which are actually profitable.

There are no profitable road systems anywhere. There are profitable individual roads (typically interstates), but they are not a "system", and are dependant on money-losing feeder roads for their business.

Very little transportation can be privatized without running into serious monopoly problems.

[JoshINHB]

Bus and rail lines were profitable in this country also, until private auto ownership became widespread.

You just can't accept the fact that people prefer private transportation over public transportation.

Why do you hate private choice so much?

[Chad]

The fact that you are calling our automobile system "private", when it is subsidized up the ying-yang and largely controlled by the government, pretty much proves you haven't thought about this matter much.

[JoshINHB]

What subsidies Chad.

Be specific.

[KPres]

"There are no profitable road systems anywhere. There are profitable individual roads (typically interstates), but they are not a "system", and are dependant on money-losing feeder roads for their business."*

Yep, and those "feeder" roads wouldn't exist if roads were private, which means less urban sprawl, less pollution, revitalized cities, etc, etc.

Government has created all these problems because the value of our infrastructure is not properly calculated into the system by. If not for government, the cost of these negatives would be accounted for, and if they're found to carry a negative overall social burden, they would not have been implemented.

*Actually, they still would exist to large extent, but they might be dirt roads or what not, carrying the same disincentive to overconsume the land, while still provided access if absolutely necessary.

[Wegie]

Should read "Government" "Should"

[WhiskeyJim]

The tax on gasoline pays for roads and bridges hundreds of times over.

[Chad]

lol...yeah right.

Fuel taxes bring in about $30 billion to the feds. They spend over $40 billion on the interestates. One bit of conservative mythology has a grain of truth, however. About $8 billion of the $30 billion is diverted to other forms of transit. But then the government gives the interstate system $20 billion from the general fund to make up for it. In the end, the interstate system only covers 75% of its current costs. Additionally, it is important to note that much of its primary capital costs were paid for with general funds as well.

If you look at state and local roads, typically a little less than half of the spending is covered by state fuel taxes and license and registration fees. Overall, our road system covers between 50 and 55% of its spending with fuel taxes and related fees...which is the about the same as the fraction of "public transportation" spending that comes from the fare box.

[Mike]

Explain to me which source indicates that the government gives $20 billion in general fund dollars for spending on the Interstate system. In the past couple of years, the federal government has authorized transfers of about $8 billion per year to cover shortfalls in the highway trust fund. This could be easily rectified by simply increasing federal fuel taxes to cover the deficit, but both Bush and Obama have opposed this measure. Government failure, yet again.

Ironically, the shortfall in the trust fund is just about the same amount the federal government spends on public transit subsidy programs. And if you think that public transit fares cover 55% of costs, you need to re-check your sources. The actual figure is closer to 25%.

[Chad]

The actual figure is closer to 25%.

I've seen it that low for individual systems, but not the average. NYC's system is closer to 75%, and by far the biggest in the country. There are several systems in Japan and Germany which are actually profitable.

[Bill Dalasio]

"NYC's system is closer to 75%, and by far the biggest in the country."

And most heavily used. Always a boon for a fixed cost infrastructure investment.

[Chad]

Most heavily used, just like the interstates.

Get the point?

Yes, the most heavily-used parts of rail, bus, and automobile systems are "profitable", but are critically dependant on the unprofitable, subsidized parts.

[KPres]

Again, if those feeder roads are unprofitable, it means they carry a social cost that outweighs their benefit. Why would you want something to exist whose benefit does not outweigh the cost?

The truth is that our choices about where to live would have developed differently if these things are unprofitable. That is, our choices would have developed RATIONALLY, accounting for all costs, rather than irrationally (which has created a whole host of massive social problems).

[The FHA]

Agreed with KPres- Early "suburbs" were clustered around train stops. Many of today's cities were founded at ports, and then later at key rail intersections/ depots. Yes these early train companies and ferries were given special subsidies- but the land development post WWII would not have happened without the highway system. Much of what we call "smart growth"- dense, mixed use, rail centric development is what I believe the free market would have chose for the past 100 years had we not been subsidizing "dumb" development.

[JoshINHB]

Fuel taxes bring in about $30 billion to the feds. They spend over $40 billion on the interestates

So raise the federal gas tax 30% to cover the costs.

That would be a whopping 6 cents per gallon. Hardly a large enough cost to restructure society.

[Chad]

Oh, and you will have to tack on another $.30 to cover state and local roads, and $.30 for a carbon tax, and about another $.30 for other miscellaneous pollution. And then congestion pricing needs to be added as well. And I am just getting started.

Oh my, didn't $4.00/gallon gas start changing things a couple years ago, until the economy collapsed and sent prices back down?

[JoshINHB]

Carbon Dioxide is not a polutant - nice try.

Congestion pricing is a bullshit concept and you know it.

If a state's gas tax does not cover the maintenance of the roads then it should be increased. The tax in CA more than covers the costs of roads here.

[designer clothes]

I have never understood why libertarians so strongly defend our utterly-subsized, completely government-run system of roads over other forms of transit which have similar levels of government involvement and subsidy.

Can someone please explain?

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[Bill Dalasio]

Florida's career has been built around telling liberal elites exactly what they want to hear, rather than what is. I mean look at the video, he's ducking and weaving to avoid disagreeing with Gilespie, even though he's blatantly at odds with libertarian views and values ("Price the damn road....And they're probably going to need some form of subsidy"). Policies based on his claims have been a disaster (see Michigan's Cool Cities program).

[Chad]

Citation, please. I want to see your evidence that this little government program was a "disaster".

[Bill Dalasio]

Choad,

How much has been spent? And who exactly associates cities in Michigan with cool?

[Mike]

Florida fails to advance a plausible argument at any point in this interview for why we should be trying to centrally plan "megaregions" and why (subsidized) high-speed rail needs to be a part of it. Most megaregions in the US already exist and are well connected by existing transportation networks. There is no economic argument that explains why subsidized transportation is a necessary component of urban economic growth.

[Mike Erickson]

I don't understand why the term "home owner" is used to describe people who have a mortgage. How about mortgage holder instead?

[Woozle]

There's nothing libertarian about private land ownership.

Mike Erickson - it's the homeowner who pays the local real estate taxes, not the mortgage bank. The fact that you bought something with loaned money does not make it the property of the creditor. Your home can be confiscated if you fail to make your mortgage payments - but it can also be confiscated if you default on any other of your debts (apart from the states with homestead exemptions).

[Scarpe Nike]

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