Ruining our cities to save them

Latching onto Kevin Rudd’s call for “a big Australia” and forecasts that our population will grow by 60 per cent to 35 million in 2050, urban planners are ramping up their war against suburbia. In paper after paper, academics across the country have been pushing the same line. Climate change, peak oil and the financial crisis mean we can’t go on driving and borrowing for low-density housing. Choices must be narrowed to buying or renting compact homes in high-density, multi-unit developments along public transport corridors, preferably rail lines.

Underlying it all is a radical vision of suburban doom. “That is one of my themes”, said Professor Peter Newman, anti-car activist and head of Curtin University‘s Sustainable Policy Institute, “that we stop cities developing into eco enclaves surrounded by Mad Max suburbs”.

The alarming truth is that planners are blasé about prosperity, living standards and choice because they see them as second-rate issues. The point is to save us from eco-apocalypse.

And their voice grows louder by the day. The mantra of green urbanism has long been heard on ABC radio programs like Background Briefing and Future Tense, but matters reached a crescendo in January when ABC TV’s 7:30 Report rounded up the usual suspects for a four-part series on preparing our cities for the population boom. Framed by scary graphics and a menacing soundtrack, the series delivered a stream of breathless dialogue from talking heads like Newman, who declared that “if we just roll out those suburbs one after the other, making a more and more carbon intensive world in our cities, then we’re stuffed.”

This current of thought has always lurked beneath the Rudd Government’s “nation building” agenda. But last October it burst open when the prime minister announced his plans to wrest control of urban policy from the states.

Rattling off tenets of the planning ideology, Mr Rudd said “we must ensure that communities are not separated from jobs and services”, that “increasing density in cities is part of the solution to urban growth”, that “forms of development need to be fully integrated with current and future transport networks”, that “climate change requires a whole of government response”, and that “we must make long-term investments in transport networks that minimise carbon emissions.” It’s all a question of government action, if he is to be believed.

That too was the message from infrastructure minister Anthony Albanese at the recent launch of State of Australian Cities 2010. Little wonder that he appointed Newman to the board of Infrastructure Australia.

Defying urban laws of gravity

“Cities are an immense laboratory of trial and error, failure and success” said the great urbanist Jane Jacobs, but today’s planners seem to think they’re as pliable as dough. Just tweak a couple of variables, say transport modes and population densities, and everything falls into place.

As a discipline, urban planning never emerged from behind Berlin Wall of command economics, albeit with a green face. Early hopes that the financial crisis would shift public sentiment in this direction have faded, and climate change hasn’t registered as an issue for commuters and home buyers.

Despite this, planners show no sign of losing confidence in their power to abolish fundamental laws of supply and demand. They’re still apt to dream up grand schemes for zoning, development and infrastructure controls with barely a thought about the impact on land values and bid-rents, two price inputs with far-reaching implications for urban commerce.

Nor have they managed to repeal the law of unintended consequences. Year after year, the Demographia housing affordability survey confirms the link between “more prescriptive land use regulation” and high median house prices. This is elementary economics. Restricting the supply of land for development, a starting point for all green planning, combined with rising demand from population growth, will ratchet up values, with knock-on effects for the whole economy. The survey continues to rank all of our capital cities, and some of our regional centres, in the “severely unaffordable” category. No amount of “cutting-edge design” or “more imaginative” planning can counter this effect.

The claim that concentrating development in dense “activity centres”, “urban villages” or “transport corridors” will ease the problem is a sham. Development controls will always drive up the price of land. When planners talk about affordability in this context, they really mean inferior housing in terms of space, amenity and title, even if it’s dressed-up as “design innovation” or “green rated building”.

But inferior quality may not be enough to compensate for escalating land values, so consumers get less housing for higher prices. And more are stuck renting instead of buying. Large numbers of low to middle income earners will be shut out of the housing market

Interestingly, Perth appears in Demographia’s “severely unaffordable” category along with Sydney and Melbourne, despite having only around a quarter of the population. Newman neglected this detail while praising the city’s rail network on the 7:30 Report.

Though Perth can fall back on the resources boom, south-eastern cities aren’t so lucky. They are service-based regions with dispersed patterns of employment, even by world standards.

Writing in a publication of the 2008 9th World Congress of Metropolis, Sydney University’s John Black observed that “apart from some noticeable peaks, employment density is quite uniform across the [Sydney metropolitan] region”. According to the NSW Department of Transport, only 12 per cent of Sydney’s jobs are in the CBD and second tier centres like North Sydney, Chatswood, Parramatta, Hurstville and Penrith have less than 2 per cent each. David McCloskey, Bob Birrell and Rose Yip of Monash University (demographers, not urban planners) report the same about Melbourne. The CBD hosts around 20 per cent of jobs and the rest are scattered all over the metropolitan region.

Platitudes like “we must locate people close to where they work”, or “we must locate jobs close to where people live”, have little basis in reality. They infringe another immovable law of economics, relating to economic rents or bid-rents. This mechanism determines how industries and firms are distributed. Put simply, a parcel of land will go to whichever use delivers the highest profits. Centrally located land (near major transport or infrastructure hubs) commands high prices, and goes to the most profitable uses. Peripheral land goes to less profitable or marginal activities.

Over the last 30 years, economic deregulation, flexible transport, advanced communications and population growth have raised up a sector in the latter category, extracting value from cheap outer-metropolitan land and low rents. It includes industries like transport and distribution, building and construction, food, consumer products, personal services, wholesale and retail. They depend on favourable location costs and proximity to urban markets and labour pools. According to the Greater Western Sydney Economic Development Board, “prime industrial land with direct access to transport infrastructure is 75 per cent cheaper [in GWS] than other areas of Sydney”.

Ultimately, green planning will phase out cheap urban land, undermining this sector and destroying jobs in the process. Breakthroughs in automotive and energy technologies offer the prospect of adaptation to a distant future of expensive oil. There’s no way to adapt to rising land values.

Green rated chaos

Many are in denial about this, recycling visions of the “concentric ring model” of urban form. This relic of pre-war sociology allocated industry to the core, or cores, and residences to the periphery. Take the Sydney Morning Herald sponsored Long Term Public Transport Plan, recently released with great fanfare. Authored by a committee of green-tinged experts and academics, the plan proclaims, according to a Herald feature, that “Sydney retains a strong centre-based structure, with nearly 40 per cent of the city’s jobs and most of its major retail, educational and entertainment facilities located within 26 key centres”. This is an essential precondition for the proposed network of denser rail infrastructure.

But the plan’s own figures don’t add up to Sydney having a “strong centre-based structure”. A hefty 60 per cent of jobs aren’t centralised and the plan actually cites 33 “centres” flung all over the Sydney region, from Norwest Business Park in the north, to Penrith in the west and Hurstville in the south. Apart from the CBD with 12 per cent, none of the centres have more than 1.8 per cent of Sydney’s jobs.

Concentrating housing in a city of dispersed jobs means horrendous traffic congestion, the costs of which loom large in State of Australian Cities 2010. Currently, around 72.3 per cent of Sydney’s people drive to work. No configuration of public transport will be efficient, leaving motorists to converge on dense localities. This is a city projected to explode from today’s 4.2 million people to 7 million in 2050. In Melbourne’s case, McCloskey, Birrell and Yip state plainly that raising densities along tram and train lines will end in chaos. Of the 1.4 million people who work outside central Melbourne, only 4.4 per cent use public transport.

On the other hand, attempts to concentrate jobs will throw thousands onto the dole queues. At least this is a type of solution: the unemployed don’t commute.

Ironically, some thriving “centres” in the Herald plan wouldn’t exist without the expansion of Sydney’s arterial road network. Examining the “edge city” phenomenon in Sydney, Peter Murphy and Robert Freestone conceded, way back in 1994, that the jobs-rich “global arc corridor” owed a lot to strategic road junctions like the intersection of Lane Cove Road with Epping Road in North Ryde and with the Pacific Highway in Gordon.

“The most prestigious development has overwhelmingly favoured the middle-ring northern and north-western parts of Sydney in centres easily accessible by car ...” say Murphy and Freestone, having explained that “there are now diversified employment centres in the suburbs which have grown up almost despite, rather than because of, traditional land-use planning policies”. These days the NSW Government bows to green intimidation, failing in its new Metropolitan Transport Plan to complete the highly successful Orbital Motorway Network, leaving M4 West, the F3 link and duplication of the M5 tunnel in limbo.

Demands that at we reshape our cities to fight climate change are illogical. Let’s assume, for argument’s sake, that there’s a case to cut Australia’s 1.4 per cent contribution to global carbon. Even the Australian Conservation Foundation’s Consumption Atlas ranks urban settlement patterns well below the general level of consumption as a factor in emissions. And general consumption is a function of living standards, not urban form. Since the world is far from putting constraints on consumption, calls for a transformation of settlement patterns are baseless.

But it’s worse. The Consumption Atlas and an analysis by Demographia’s Wendell Cox disclose that emissions across affluent inner-urban areas exceed those on the fringe. By focusing on settlement patterns rather than consumption levels, green planners engage in a form of class discrimination. The costs of climate change are heaped on outer-suburban working people, who lose jobs, mobility and housing amenity, while the affluent emerge unscathed.