[GRRN] urban growth

chelsea center for recycling and economic development (amyp@chelseacenter.org)
Wed, 03 Mar 1999 15:56:35 -0500

Urban Growth Means Lower Taxes -- and Other Myths
By Donella H. Meadows

We need to bring in business to bring down taxes. This development will
give us jobs. Environmental protection will hurt the economy. Growth is
good for us.

If we've heard those arguments once, we've heard them a thousand
times, stated with utmost certainty and without the slightest evidence.
That's because there is no evidence. Or rather, there is plenty of
evidence, most of which disproves these deeply held pro-growth

Here is a short summary of some of the evidence. For more, see Eben
Fodor's new book "Better, Not Bigger," which lists and debunks the
following "Twelve Big Myths of Growth."

Myth 1: Growth provides needed tax revenues. Check out the tax rates
of cities larger than yours. There are a few exceptions but the general
rule is: the larger the city, the higher the taxes. That's because
development requires water, sewage treatment, road maintenance,
police and fire protection, garbage pickup -- a host of public services.
Almost never do the new taxes cover the new costs. Fodor says, "the
bottom line on urban growth is that it rarely pays its own way."

Myth 2: We have to grow to provide jobs. But there's no guarantee that
new jobs will go to local folks. In fact they rarely do. If you
compare the
25 fastest growing cities in the U.S. to the 25 slowest growing, you
no significant difference in unemployment rates. Says Fodor: "Creating
more local jobs ends up attracting more people, who require more jobs."

Myth 3: We must stimulate and subsidize business growth to have good
jobs. A "good business climate" is one with little regulation, low
taxes, and various public subsidies to business. A study of areas with
good and bad business climates (as ranked by the U.S. Chamber of
Commerce and the business press) showed that states with the best
business ratings actually have lower growth in per capita incomes than
those with the worst. Fodor: "This surprising outcome may be due to the
emphasis placed by good-business-climate states on investing
resources in businesses rather than directly in people."

Myth 4: If we try to limit growth, housing prices will shoot up. Sounds
logical, but it isn't so. A 1992 study of 14 California cities, half
strong growth controls, half with none, showed no difference in
average housing prices. Some of the cities with strong growth controls
had the most affordable housing, because they had active low-cost
housing programs. Fodor says the important factor in housing
affordability is not so much house cost as income level, so development
that provides mainly low-paying retail jobs makes housing unaffordable.

Myth 5: Environmental protection hurts the economy. According to a
Bank of America study the economies of states with high environmental
standards grew consistently faster than those with weak regulations.
The Institute of Southern Studies ranked all states according to 20
indicators of economic prosperity (gold) and environmental health
(green) and found that they rise and fall together. Vermont ranked 3rd
on the gold scale and first on the green, while Louisiana ranked 50th on
both.Myth 6: Growth is inevitable. There are constitutional limits to
ability of any community to put walls around itself. But dozens of
municipalities have capped their population size or rate of growth by
legal regulations based on real environmental limits and the real costs
growth to the community.

Myth 7: If you don't like growth, you're a NIMBY (Not In My Backyard) or
an ANTI (against everything) or a gangplank-puller (right after you get
aboard). These accusations are meant more to shut people up than to
examine their real motives. Says Fodor, "A NIMBY is more likely to
be someone who cares enough about the future of his or her community
to get out and protect it."

Myth 8: Most people don't support environmental protection. Polls and
surveys have disproved this belief for decades; Fodor cites examples
from Oregon, Los Angeles, Colorado, and the U.S. as a whole. The
fraction of respondents who say environmental quality is more important
than further economic growth almost always tops 70 percent.

Myth 9: We have to grow or die. This statement is tossed around lightly
and often, but if you hold it still and look at it, you wonder what it
Fodor points out, quoting several economic studies, that many kinds of
growth cost more than the benefits they bring. So the more growth, the
poorer we get. That kind of growth will kill us.

Myth 10: Vacant land is just going to waste. Studies from all over show
that open land pays far more -- often twice as much -- in property taxes
than it costs in services. Cows don't put their kids in school; trees
put potholes in the roads. Open land absorbs floods, recharges
aquifers, cleans the air, harbors wildlife, and measurably increases the
value of property nearby. We should pay it for to be there.

Myth 11: Beauty is no basis for policy. One of the saddest things about
municipal meetings is their tendency to trivialize people who complain
a proposed development will be ugly. Dollars are not necessarily more
real or important than beauty. In fact beauty can translate directly
dollars. For starters, undeveloped surroundings can add $100,000 to the
price of a home.

Myth 12: Environmentalists are just another special interest. A
who will directly profit from a project is a special interest. A
citizen with
no financial stake is fighting for the
public interest, the long term, the good of the whole community.

Maybe one reason these myths are proclaimed so often and loudly is that
they are so obviously doubtful. The only reason to keep repeating
something over and over is to keep others from thinking about it. You
don't have to keep telling people that the sun rises in the east.

There are reasons why some of us want others of us to believe the
myths of urban growth.

Donella H. Meadows is director of the Sustainability Institute and an
adjunct professor of environmental studies at Dartmouth College.

Amy Perlmutter
Executive Director
Chelsea Center for Recycling and
Economic Development
University of Massachusetts
180 Second Street
Chelsea, MA 02150
617-887-2300/fax 617-887-0399
visit our web site at www.chelseacenter.org