Freakonomics Radio - 22. Why Cities Rock

Episode Date: February 17, 2011

Could it be that cities are "our greatest invention" -- that, despite a reputation as black-soot-spewing engines of doom, they in fact make us richer, smarter, happier and (believe it!) greener?

So, Ed Glazer, recent research indicates that humans, or at least something close to humans, have been living on this planet for perhaps six million years. In your view, what is our greatest invention? I think the city is our greatest invention because it plays to something that is so fundamental in humanity. It plays to our ability to learn from one another, and that ability has evolved over 6 million years, and it's made us what we are. From American Public Media and WNYC, this is Freakonomics Radio. Here's your host, Stephen Duffner.

Today, we're doing something a little different on our podcast. Usually, we talk to a good number of guests, weave them together, mix in some magic radio dust. But this time, we're giving the floor to one guest. I wanted to share the conversation we had because it just might make you think differently about how you live and where you live. The guest is Ed Glazer. He's a Harvard economist whose research covers everything from obesity and crime to innovation and urban policy. He's just published a new book called Triumph of the City, how our greatest invention makes us richer, smarter, greener, healthier, and happier. And you're thinking, the city? Our greatest human invention? Healthier? Greener? Glazer, are you for real? Yeah, he's for real.

So let's start with why blacktop is actually greener than grass. On a pleasant spring day in 1844, a young Harvard graduate and a friend went out for a picnic in the woods outside of Concord. They did a little bit of fishing, and the fishing was good because there hadn't been much rain lately. And they decided to cook a chowder using the fish. Now, there was a little bit of wind and the flames flicked from their fire to the nearby tall grass. A fiery inferno ensued. And by the time it was done, more than 300 acres of prime Concord woodland had been burned to the ground. That young Harvard graduate was, of course, Henry David Thoreau,

the modern patron secular saint of environmentalism. And it's hard to imagine that there was any Bostonian merchant, even industrialist during his time period, who did as much damage to the environment as Henry David Thoreau did. Now, there's a lesson there, which is we're a destructive species. It's one of our defining characteristics, right? We make a big mess when we're around stuff. And if you love nature, stay away from it, right? We're much more likely to harm nature as Thoreau did when we lived surrounded by the woods than if we lived in tall urban apartments by ourselves. Now, there's a statistical partner to that, which is together with Matthew Kahn. I've assembled data on carbon emissions associated with living in different parts of the country. And there are two facts which I think are important to come out of that, one of which is that people who live in cities do tend to emit significantly less carbon than people who live in countries.

And this is controlling for – incoming controlling for family size. That's coming mainly from driving, from the fact that there's just a lot fewer carbon emissions associated with dense living. It's not just the move to public transportation. It's also for drivers within cities. They're just driving much shorter distances. And then, of course, it's because of smaller homes. The higher price of urban space means that people are living in smaller homes even with the same family size. And that leads to lower electricity usage, lower home heating usage.

And those are the facts that I think make cities seem, at least to my eye, significantly greener. I think this is really important when we think about the future of countries like China and India, because future carbon emissions of the world are going to be a lot lower if China's urban patterns, if India's urban patterns look like New York, look like dense cities, than if they look like American suburban sprawl. And that's why, in fact, I think it's particularly important that the sort of great carbon-related battles of the 21st century, I think, will have a lot to do with urban development patterns in Asia. One second point, though, that comes out of our patterns across areas within the U.S. is that there are big differences across metropolitan areas in terms of carbon emissions, where the sunbelt tends to be, the old sunbelt tends to be the highest

emissions places like Houston, Oklahoma City, mostly because they're just very, very hot and they have huge electricity usage. Their electricity usage isn't all that, production isn't all that green either. And the lowest by far is in coastal California, where they just have this temperate climate that makes for very, very low levels of energy use. Made up for slightly by car usage but it doesn't really even come close in terms of the – it just requires so much less energy to heat or cool their houses than much of the rest of the country. Now, you'd think then that if you were interested in reducing America's entire carbon footprint, that people in California would be championing new development in high-rises around San Francisco Bay. These areas are by far the lowest carbon-related areas in the country.

And if you built lots of high-rises in these attractive areas where there's plenty of demand, you would significantly reduce our overall carbon footprint. Yet unfortunately, there's been, I think, something of a mistake that people have looked at their local situation and thought that by stopping a building, they were making things greener. But that's not really how things work because if I turn off the spigot of housing in coastal California, it turns on somewhere else. It turns on in the desert outside of Phoenix. It turns on in Houston. And the place where the new building is going on is almost surely going to be more carbon intensive than coastal California. So implicitly, by pushing development away from California, many environmentalists have actually increased carbon emissions for the country

as a whole. Now, Ed, you grew up in Manhattan, correct? Indeed. Your father was born in Berlin, I read. You, I know, got your PhD in economics from Chicago, the University of Chicago. Now you teach at Harvard, so you live near Boston. So you're pretty much a lifelong city dweller. Persuade me that your conclusions about the greatness of the city are not a result of personal bias, whether subconscious or otherwise. Well, I don't know if I can do that. But it is true that about five years ago when I started acquiring small children, my wife and I did move out to a fairly sylvan suburb. So I certainly have had the experience of living in suburbs, which has pluses and negatives.

I mean, it's really suburban life is really, at least as I experience, is of course half urban, right? So I go to work in a city. We go to Boston for museums and restaurants and all sorts of things that I drag my kids to despite their protests. But unquestionably, we actually have the experience of living in a suburb. And certainly nothing in the book suggests that people who choose suburban life are necessarily making a mistake by doing that. What I'm arguing against is policies like artificially subsidizing homeownership, like artificially subsidizing highways, and like our very difficult problem of local schooling that are pushing people into suburbs. I mean I'm just arguing that people should be free to choose without government policies

that follow Jefferson's lead and vastly bias the decision against urban life. Talk to me about some of the feedback. I was interested to see on the blog yesterday. A lot of the commenting was along the lines of, oh, this is a Harvard professor who's in an ivory tower. Of course he likes cities. He's in the upper class. He travels well when he goes to cities. And the fact of the matter is that he's got it

all wrong. The cities are horrible, big, noisy places. And the place where I live is optimal. So it seems like people generally have a very strong identification, if not a bias, with the choices that they've made about where they live. Talk to me about the feedback along those lines to your book. Well, it's certainly right that people – different people like different types of living, right? So it's a great thing that we have suburbs that enable people to live in their own areas. I differentiate myself from the great urbanist Jane Jacobs who had wonderful ideas of cities, many of which show up in the book and have changed my views of this. But Jacobs seemed to have a very particular view of what urban life was supposed to be like. She believed in the Greenwich Village neighborhood

in which she lived, and that led her to champion, you know, strong limits on building up, strong preservation of older areas, and a particular vision of urban life that was her vision, that was her area. That's very different from the economist's perspective, right? What I'm championing is unleashing cities.

What I'm championing is rethinking those barriers to building that would enable places where the market demand is there when there are people who actually want to live in high-rise apartments. I'm championing eliminating the barriers that stop that from happening. I'm not championing anyone who lives in a – who loves his quiet rural area and saying that, gosh, we want to shoehorn this person into an apartment. Obviously, some people don't want that. And that's terrific. It's wonderful the market can deliver lots of different living styles. I will say that it's pretty easy to see in the data that there are real advantages from urban areas. And that's certainly one of the things that I try to make clear in the book. And it is certainly true that one of the things that I try to fight against is the historic misconception, the prejudice that cities are somehow or other decaying and corrupt. That, I believe, is completely wrong.

But I'm not arguing that everyone should live in a city. New York is where I'd rather stay Coming up, we pinpoint three things that have been pushing you and millions of other people to the suburbs. Also, imagine that restaurants were run like public schools. You think you'd eat out tonight? And finally, we'll hear Ed Glazer name his favorite cities in the world. I've got to say, he didn't do this willingly. Didn't want to turn off book buyers in Peoria, I guess. Great Ed, we are there! From WNYC and American Public Media, this is Freakonomics Radio.

Ed Glazer is a Harvard economist and author of the new book, Triumph of the City. His argument is that if you really want to spur an economic recovery in the U.S., what we need to do is unleash our cities. So I asked him, what are the barriers to doing that? I think that at the federal level, there are three issues, one of which is the home mortgage interest deduction. The home mortgage interest deduction essentially acts as a push away from urban apartments into suburban homes. And 85 percent of multi-unit dwellings are rented. There's a good reason for this. If you rent out single-family detached housing, they depreciate on average more than 1 percent a year according to some studies. And that's quite easy to understand. Renters don't do the maintenance that homeowners do taking care of their homes.

On the other hand, anyone who's ever dealt with a co-op board knows that having a ton of owners under a single roof can be like herding cats. So there are good reasons why that's – why larger buildings are sensibly rented. Well, if high-density dwellings are typically rented and low-density dwellings are typically owned, then if you're going to have a huge public push where hundreds of billions of dollars are going to be thrown to promote homeownership, you're basically telling cities to go drop dead, right? You're basically pushing people out of urban apartments into suburban homes. And I think that's a mistake and I'm glad that President Obama's budget came out favoring at least a reduction in the cap of the home mortgage interest deduction.

Second policy that's problematic, right? And we're still doing this and this actually I give President Obama much less credit for. We've been huge on building infrastructure in this country for a long time and some of those investments like the Erie Canal proved to have very high returns. Especially, I mean, the Erie Canal especially had high returns for New York, from what I understand, right? I mean, it really helped turn New York into the market town that it became. It was very, very helpful. Although it is true that the growth of New York was just as fast before the canal as after the canal. But sure, the canal was clearly important.

And it also didn't actually end up requiring much subsidy, right? I mean, it actually generated huge returns, direct returns on the ground, which is usually true of the best forms of infrastructure investment, right? Really good infrastructure can actually pay for itself with user fees. But I worry about a renewed push towards building more transportation infrastructure in this country. The work of Nathaniel Bam Snow finds that every new highway that cut into a major city in the post-war period reduced that city's population by 18 percent because of suburbanization. Transportation is sort of the opposite of urban clustering. You're sort of subsidizing people to spread out. And the third thing, which is not really a federal issue but it's huge, is our local system of schooling, right? Certainly for anyone who's a parent like myself,

the suburban school districts offer a huge enticement to leave cities. And this is really a question of how we've decided to structure our schools. So I want you to just imagine if, for example, instead of having a New York restaurant scene that was dominated by private entrepreneurs who competed wildly with each other, trying to come up with new, new things and the bad restaurants collapse, the good restaurants go on to cooking show fame and you have these powerful forces of competition and innovation working.

Imagine instead if there was a food superintendent who operated a system of canteens where the menus were decided at the local level and every New Yorker had to eat in these canteens. Well, the food would be awful and that's kind of what we decided to do with schooling. Instead of harnessing the urban ability to provide innovation, competition, new entry, we've put together a system where we've turned all that stuff off and we've allowed only a huge advantage for a local public monopoly. It's very, very difficult to fix this. I think the most hopeful signs – and there's been, as you know, a steady stream of economics papers on this. The most hopeful signs I think are coming from charter schools, which are particularly effective in urban areas. And it's not so much that the average charter school is so much better than the average public school, but rather that

in charter schools, because they can go bankrupt, because they can fail, the good ones will succeed and the bad ones will drop out of the market. And certainly we've seen lots of great randomized studies that have shown the case of cities, it really means harnessing the urban ability to generate competition and new startups, reducing the subsidy to homeownership, something which is very much I think in the Obama agenda. It was also coming out of course in the housing finance reform package last week, which talked about reforming Freddie Mac and Fannie Mae and reducing the subsidies to them. And then of course infrastructure, which doesn't seem to be on the Obama agenda. But I hope that, in fact, we will rethink our dedication to building highways in lonely places. Excellent. I see it's your time. I'll just ask you for a one-word answer. Ed Glazer, what is your favorite city in the world? I'm selling a book.

I can't possibly pick favorites. It's like asking – picking favorites among children. Top three? Top three. You want to give – how many children do you have? I have three. All right. So give me your three favorite cities then.

Boston, New York, Chicago in the US. Worldwide, Barcelona, Hong Kong, London. Very good. Ed, I thank you so much. It was really a treat to speak with you. Great to speak to you as well. Thank you so much. Hot town, summer in the city

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