All Commentary
Saturday, March 1, 1975

No New Urban Jerusalem

Dr. Rogge is Distinguished Professor of Political Economy at Wabash College. A graduate of Hastings College, he holds an M.A. degree from the University of Nebraska and a Ph.D. from Northwestern University. He delivered this presentation at Hillsdale College during the Center for Constructive Alternatives seminar titled “Recycling the City: Alternatives to Decay.”

In the paragraphs to follow you will find me critical of most of the work now being done on the nature of the urban crisis and equally critical of the public poli­cies proposed to ease that crisis. To compound my sin, I offer no alternative scheme by which the New Jerusalem can be erected on the shores of the Hudson or Lake Michigan or Lake Erie. I intend to argue that no one even knows how to define the New Urban Je­rusalem, let alone construct it.

In all of this, I will be utilizing no special knowledge of urban processes but rather the simplest of analytical and evaluational con­cepts of economics. In so doing I am acting upon my firm belief that a handful of hypotheses about human action are sufficient for most, if not all, decisions on economic policy. I would be pre­pared to argue that the practice of breaking up this useful disci­pline into agricultural economics, transportation economics, develop­ment economics, labor economics, urban economics, and the like, has been productive of much mischief.

Behind the shield of special cir­cumstances and special knowledge, theories have been developed and given wide acceptance that would be regarded as patently absurd if they were put as a general model; policies have been developed and urged upon society that would be recognizably catastrophic if ap­plied generally.

One Man’s Atlantis

Proposition No. 1: The first of the propositions on which I wish to base my argument is the fun­damental proposition of all mod­ern value theory: Value does not consist of objectively definable characteristics of a good or ser­vice; value exists only as subjec­tive judgment in the mind of each beholder. It cannot be measured directly but only indirectly by the behavior it elicits. There is no way that the subjective valuations of two people can be summed or even directly compared.

Thus, the value of a chair is not something inherently residing in the physical properties of the chair or in its costs of production; its value is different to each viewer and for any one man can be measured only by what other goods or services he would be will­ing to give up to acquire this par­ticular chair.

There is no way of defining in absolute and universal terms the essential characteristics of the Good Chair; one man’s throne is another’s torture device. What is true of a chair must be true equally of a city. There is no way of defining in general terms the essential characteristics of the Good City; one man’s Atlantis is another’s Hell. Nor are there oth­er objective ways of measuring the degree of goodness of a city. For example it is sometimes ar­gued that a good city is one that survives or one that grows. But as circumstances change, the func­tions served by a city change, per­haps even disappear. Were some of the ancient cities of history and legend less successful because they no longer exist?

Some illustrations: From the introduction to a recent book with the title Environment for Man: The Next Fifty Years, sponsored by the American Institute of Planners:

If we had the technology and the economy — both said to be imminent — to build an ideal environment, what kind would we build? What could en­vironment contribute to a “good” day? Do we know how to define and work toward “Optimum Environment with Man as the Measure”? To date neither optimum nor environment has been defined, nor have we made an adequate beginning at measuring man. And we must somehow learn to allow for subjective human values.¹

Here we find repeated the ancient myth of planning, that it is pos­sible to both plan the allocation of resources from the center and also to serve the subjective pref­erence systems of the individuals who make up the society. It is doubtful if the planners are cap­able of designing programs and processes (even with unlimited funds at their disposal) that will in fact produce the outcomes that they, the planners, desire — to say nothing of the outcomes desired by the other members of the so­ciety.

A second illustration: In an­other recent book with the title, Sick Cities: Psychology and Path­ology, we find the following:

The Saturday Evening Post in an editorial in 1961 called sprawl “per­haps our cruelest misuse of land since our soil mining days. Urban sprawl,” it went on to state, “is not the growth of cities. Instead, the cities are disin­tegrating and spreading the pieces over miles and miles of countryside.” Robert Moses, responsible for so many of Gotham’s public achieve­ments in the present century, takes the opposite point of view in an ar­ticle in the Atlantic Monthly: “The prosperous suburbanite,” he says, “is as proud of his ranch home as the owner of the most gracious villa of Tuscany. The little identical subur­ban boxes of average people, which differ only in color and planting, rep­resent a measure of success unheard of by hundreds of millions on other continents.”2

Quick about it: Is “urban sprawl” a vice or a virtue? Well, that all depends. On the basis of my admittedly incomplete reading of the materials in this field, I would conclude that urban sprawl (and all similarly achieved out­comes) are per se unacceptable to those who see any unplanned out­come as less than optimal. In other words, any characteristic of the urban environment that, like Top­sy, “just grew” stands condemned by its very origins.

One final illustration of my thesis, this one drawn from one of the most instructive and civil­ized books yet written on this topic: The Death and Life of Great American Cities, by Jane Jacobs.

People gathered in concentrations of big-city size and density can be felt to be an automatic — if necessary —evil. This is a common assumption: that human beings are charming in small numbers and noxious in large numbers. Given this point of view, it follows that concentrations of peo­ple should be physically minimized in every way: by thinning down the numbers themselves insofar as this is possible, and beyond that by aim­ing at illusions of suburban lawns and small-town placidity. It follows that the exuberant variety inherent in great numbers of people, tightly concentrated, should be played down, hidden, hammered into a semblance of the thinner, more tractable variety or the outright homogeneity often represented in thinner populations.

On the other hand, people gathered in concentrations of city size and den­sity can be considered a positive good, in the faith that they are desirable because they are the source of im­mense vitality, and because they do represent, in small geographic com­pass, a great and exuberant richness of differences and possibilities, many of these differences unique and un­predictable and all the more valu­able because they are. Given this point of view, it follows that the presence of great numbers of people gathered together in cities should not only be frankly accepted as a phys­ical fact. It follows that they should also be enjoyed as an asset and their presence celebrated.³

Quick about it: Is high popu­lation density a vice or a virtue? Well, that all depends. As that great, mythical Irish bartender, Mr. Dooley, once put it: “As the Frenchman said, as he drank from the fire extinguisher, ‘Each to his own taste.’ ”

To sum up: Given the fact that value is subjective by its very nature, given the fact of the enormous internal diversity of human populations, and given the never ending changes in tastes and circumstances, it is impos­sible per se for there to be con­structed a universally valid, ob­jective definition or description of the Good City. City planning is by definition, then, an exercise in either futility or coercion (or both).

It is possible for a group of peo­ple of like values to agree upon a definition of the Good City and to attempt to implement that partic­ular vision with their own monies and without coercion, and to this I offer no objection. But most True Prophets prefer to work with oth­er people’s money, obtained by the exertions of the tax collector, and with the sheriff at their side to deal appropriately with those re­calcitrant few who stand in the way of the developing New Jerusalem.

Right Rules Promote Right Outcomes

Proposition No. 2: The Good City will be whatever arrange­ment of things and people em­erges out of the decisions of those people when such decisions are made within a framework of ap­propriate rules. That is to say, the Good City cannot be defined in terms of its own characteristics but only in terms of the correct­ness or incorrectness of the deci­sion-system within which it emer­ges. Right rules promote right outcomes; wrong rules promote wrong outcomes.

The point that I’m attempting to make here is one I believe to be of greatest significance to this and to all other discussions of social policy-making. I need hardly ad­mit that it is not an idea of my creating but one that many of my betters have developed before me. The best explicit development of this idea, in my opinion, is to be found in the article, “Individ­ualism: True and False,” by F. A. Hayek.

… by tracing the combined effects of individual actions, we discover that many of the institutions on which human achievements rest have arisen and are functioning without a design­ing and directing mind; that, as Adam Ferguson expressed it, “na­tions stumble upon establishments, which are indeed the result of human action but not the result of human design,”4 and that the spontaneous collaboration of free men often cre­ates things which are greater than their individual minds can ever fully comprehend.5

In this and other writings, Hayek points out that this thesis does not imply that good results will flow spontaneously from in­dividual decision-making under any and all institutional frame­works. On the contrary, Hayek and his predecessors have all stressed the necessity of right rules. Here, for example, again from Hayek:

True Individualism is, of course, not anarchism, which is but another prod­uct of the rationalistic pseudo-indi­vidualism to which it is opposed. It does not deny the necessity of coer­cive power but wishes to limit it — to limit it to those fields where it is in­dispensable to prevent coercion by others and in order to reduce the total of coercion to a minimum.

The most general principle on which an individualist system is based is that it uses the universal acceptance of general principles as the means to create order in social affairs.

He concludes with a sentence that is the stage-setting for the rest of this paper.

But if our main conclusion is that an individualist order must rest on the enforcement of abstract principles rather than on the enforcement of specific orders, this still leaves open the question of the kind of general rules which we want.6

Our search, then, is for the right kind of rules, within whose framework the spontaneous forces of social development would work to produce the better city. It is my argument that these rules, in their general form, are not to be found by assigning a team of urban af­fairs experts to the task but rath­er by identifying those general rules of human conduct that are morally correct and economically efficient. Note: Unless the world is totally absurd, that which is correct in principle will also be that which works. It follows from this that those who come closest to understanding and discovering the right principles of human con­duct (by whatever means, includ­ing, if you wish, revelation) will also come closest to understand­ing that which will work.

The few simple principles from which I will work from here on out are the ones that make moral sense to me. I need hardly direct your attention to my obvious fallibility and hence to the strong possibility — nay, certainty—that I am wrong in one or more or all of my pre­suppositions. I go through this ex­ercise as an illustration of what seems to me to be correct proce­dure — even if the specific prin­ciples (and hence answers) are not themselves the correct ones. I remind you that, in my opinion, the correct procedure is one in which, whatever the topic, we rea­son from first principles to spe­cific policy positions.7

You will note that, in doing this, I am careful not to attempt to predict the specific details or even the general nature of the out­comes (in terms of urban charac­teristics) that might flow from the application of the suggested rules to this problem area. The reason, as Hayek has made clear, is that it is impossible to predict the nature of the outcomes of free and peaceful decision-making. Just literally, no one knows what our cities would have looked like had they developed under different rule systems than have in fact prevailed.

What it is possible to do, though, is to relate many of those char­acteristics of urban life that many see as undesirable to those rule systems that have prevailed — and this I intend to do. This implies that I know what rules would have been morally correct and econom­ically efficient. With a reminder of the caveat issued earlier, I pre­sent below a list of some parts of what I consider to be the proper rules system for the dealings of men, one with another, whether those men live in a wilderness or at Broadway and 42nd Street.

1. Individuals and groups shall be permitted (have the right) to enter into voluntary exchanges of goods and services on terms of their own choosing, provided that neither force nor fraud is in­volved.

2. Individuals and groups shall be permitted (have the right) to use properties legally under their control in any manner they choose, provided that in so doing no dam­age is inflicted upon the person and/or property of unwilling third parties.

3. The coercive power of gov­ernment shall not be permitted (has no right) to be used for any purpose other than that of mini­mizing coercion in human affairs, i.e. for any purpose other than that generally described in the phrase, “law and order.”

4. The price to be charged for any good or service shall be that which emerges from the voluntary exchange process.

I am not insisting that this is a complete listing of the appropri­ate rules. I wish to deal with a manageable number of rules and cases as an illustration of the procedure I believe to be proper, and I do not presume to be presenting a complete, definitive state­ment of the case.

What I now intend to do is to take each of these four rules and to provide illustrations of specific urban problems that seem to have been brought on or to have been exacerbated by the fact that the rule involved has not been in force.

Rule No. 1: Freedom of Exchange

Case No. 1: I intend to argue here that coercive intervention in labor contracts by government and by labor organizations granted spe­cial privileges by government has been an important cause of one of the most dramatic and difficult of the urban problems: the high rate of unemployment among low productivity work groups in urban areas — the young, the old, minor­ity race members, and so forth.

Let us begin with minimum wage laws. For the purposes of a book on which I have been work­ing for some time, I have had occasion to examine what I be­lieve to be every major study ever made of the employment effects of minimum wage setting. Most such studies show in one degree or another a significant direct re­lationship between upward changes in legislated wage min­ima and increases in the rate of unemployment in low productivity work groups (with a particularly severe impact on young people from minority race groups).

One of the most informed men in this field, Professor Yale Bro­zen of the University of Chicago, has written as follows:

It is hardly surprising that unem­ployment among the unskilled in­creased with this rapid rise in the minimum wage. To the extent that teenagers are inexperienced, unskilled workers, they are the ones who have been priced out of the labor market by the rise in the minimum wage rate.8

That this interpretation of the evidence is not restricted to those identified as conservative econ­omists is attested to by the fact that the Swedish socialist economist and sociologist, Gunnar Myrdal, reports the same kind of finding in his well-known study of American race problems, An American Dilemma, where he notes that Negroes have been the main sufferers from the employ­ment effects of minimum wage laws.9

The distinguished modern lib­eral economist, Paul Samuelson, asks, “What good does it do a Negro youth to know that an em­ployer must pay him $1.60 per hour, if the fact that he must be paid that amount is what keeps him from getting a job?”¹°

To the problems caused by the minimum wage laws must be added those caused by child labor laws. Senator Abraham Ribicoff has noted that most of the things he did to earn money as a boy would now be forbidden. His con­clusion: this country has far too many laws coddling children.¹¹ Indeed, as many have noted, the great problem of the urban young person is not overwork but a deadening, self-destroying idle­ness.

Case No. 2: Another one of the critical problems of American cities is the fact that the propor­tion of blacks in the inner city is increasing dramatically and these blacks do not have ready access to high income employment and particularly to positions in the skilled trades. This too is a topic to be covered in the pro­posed Rogge book and, in a con­tinuing show of immodesty, I quote again from that source:

… trade unionism has tended to pro­duce the following consequences on the economic position of the Negro in the American economy: 1) to reduce his access to many of the industries and trades in which trade unionism is an important factor (and partic­ularly in the high-pay, skilled trades) through outright discrimination against non-whites; 2) to reduce the opportunities for the Negro to move to the higher-paid skilled or super­visory positions, again through out­right discrimination; and 3) to re­duce generally the opportunities for the Negro to find employment in un­ion-covered industries and trades through a) the raising of wage rates above what the market would have brought into being, and b) the in­sistence on equal pay for equal work. Admittedly, some Negroes have shared in the higher incomes asso­ciated with union pressures on em­ployers; on balance, though, the Ne­gro has probably been a significant “loser” from the growth and present strength of trade unionism in the American economy.”

The same point has been made by Sir Arthur Lewis, the Jamai­can-born black economist (and socialist) now teaching at Prince­ton University, who has written recently, “The trade unions are the black man’s greatest enemy in the United States.”¹³

To summarize: some of the problems usually identified as af­flicting the city relate to the high unemployment rates in the low productivity work groups in the city and to the difficulty of minor­ity race group members moving into the higher paid, higher skill jobs. I have argued that both of these urban problems have arisen in part from coercive interven­tions in the labor-exchange proc­ess by agencies of government and by private groups granted semi-governmental privileges.

As Vic Fingerhut, once princi­pal speech writer for Vice-Pres­ident Hubert Humphrey has pointed out, one of the central economic functions of the Ameri­can city over the decades has been as a locus of relatively low-cost labor supplies. This was reflected in the great variety of light man­ufacturing, service and labor-in­tensive industries that were to be found in the cities of this country.

As artificial restrictions have been imposed upon the labor mar­ket, the city has produced un­happy consequences for urban populations.

Welfare legislation, minimum wages, maximum work hours, and the like have minimized the economic func­tion of the conglomerations of poor but-willing people in our cities. Sim­ilarly, the goad of hunger has been mitigated by the rising level of wel­fare payments. In Newark a woman with three children lives very badly on welfare payments, but these nev­ertheless average somewhere around $300 to $350 per month. To live at the same level, a man with a wife and three children would have to make about $5,500 a year. For un­skilled labor, that sort of money just isn’t available.¹4

This factor also accounts in part for the high welfare costs of most cities today — and for the high liv­ing costs in urban areas. A city can function only as it uses a high ratio of service-oriented indus­tries not called for in the country­side, and it is precisely such ser­vices that are made much more expensive as a result of wage interventions.

Some of the market interven­tions that damage urban dwellers deal not with city processes but with farm processes. Thus the whole of the American farm pro­gram, including milk marketing programs and the whole parapher­nalia of price supports and output restriction, impinge unfavorably on the urban consumer. Its im­pact is particularly severe on the low income urban consumer be­cause he spends a very large part of his income on food, fiber and alcohol — all derived in whole or in part from farm outputs.

In one market after another, in one interference with voluntary exchange after another, the state has added to the woes of urban America. The policy implications would seem to be obvious.

Rule No. 2: Property Rights and Control

Individuals and groups shall be permitted (have the right) to use properties legally under their con­trol in any manner they choose, provided that in so doing no dam­age is inflicted upon the person and/or property of unwilling third parties.

This rule would seem to be a two-part rule. Part 1 deals with the bundle of rights known as “private property,” while part 2 deals with the problem usually identified as “pollution” or “ex­ternalities” or “neighborhood ef­fects.” In fact they are two sides of the same coin. A’s right to use his property as he sees fit cannot be used as a defense of an action of his which denies B his right to his, B’s, property. The freedom of your fist ends at my nose; the freedom to use private property ends at the property line. Spill­overs from A’s actions that affect B’s use of his property are a di­rect violation of the right of property.

It should be obvious to one and all that modern governments have sinned grievously in both aspects of this private property rule. They have themselves invaded the prop­erty of private citizens in a great variety of ways and they have not protected the property rights of the B’s of this world from the unwanted intrusions of the A’s.

In what ways have governments in cities (and elsewhere) invaded the property rights of its citizens? In many, many ways. An example would be the use of the weapon of eminent domain to confiscate private properties for use by the state or for use by other private persons or groups. Is a road to be built? Seize the property of the citizen, paying him a price for it that, had he been willing to ac­cept, would have made the con­fiscation unnecessary. Is it decided that some collection of assets is unsightly and undesirable? Seize those assets, tear down the build­ings, then make the land avail­able to other private parties and at a price by definition lower than they would have had to pay in a truly voluntary exchange. This is known as urban renewal or city planning or what-have-you.

If you wish to understand the true consequences of such actions, read the Martin Anderson book, The Federal Bulldozer,¹5 or the following pages from the Jane Jacobs book:

There is a wistful myth that if only we had enough money to spend — the figure is usually put at a hundred billion dollars — we could wipe out all our slums in ten years, reverse decay in the great, dull, gray belts that were yesterday’s and day-before-yester­day’s suburbs, anchor the wandering middle class and its wandering tax money, and perhaps even solve the traffic problem.

But look what we have built with the first several billions: Low-income projects that become worse centers of delinquency, vandalism and general social hopelessness than the slums they were supposed to replace. Mid­dle-income housing projects which are truly marvels of dullness and reg­mentation, sealed against any buoyancy or vitality of city life. Luxury Lousing projects that mitigate their nanity, or try to, with a vapid vulgarity. Cultural centers that are un­able to support a good bookstore. Civic centers that are avoided by everyone but bums, who have fewer choices of loitering place than others. Commercial centers that are lack-luster imitations of standardized suburban chain-store shopping. Promenades that got from no place to nowhere and have no promenaders, expressways that eviscerate great cities. This is not the rebuilding of cities. This is the sacking of cities.

That such wonders may be accomplished, people who get marked with he planners’ hex signs are pushed about, expropriated, and uprooted much as if they were the subjects of conquering power. Thousands upon thousands of small businesses are destroyed, and their proprietors ruined, with hardly a gesture at compensation. Whole communities are orn apart and sown to the winds, with a reaping of cynicism, resent­ment and despair that must be heard and seen to be believed.16

Explicit Ownership, No Zoning

In the same way that it has itself violated B’s property rights; the state has permitted, in one form or another, to one degree or another, the A’s of the world to trespass on B’s property through air pollution, noise, etc. It is not that laws have not existed dealing with such questions. Indeed, that most remarkable of the unplanned creations of Western man, the Common Law, included a long history of cases in which the courts had redressed B’s grie­vances against the trespassing A’s of the world. (See for exam­ple, an unpublished doctoral dis­sertation by my colleague at Wab­ash, Steven Schmutte.)17

In many cities the general wel­fare was thought to require that the A’s (perhaps major employ­ing firms in the area) be per­mitted to continue to trespass on the properties of the B’s in the community, else they might leave and set up shop in another city.

Admittedly, once a firm has been permitted to pollute for many years, a kind of adverse posses­sion problem arises, and equity may demand an appropriate time period for a remedy to be devel­oped. Moreover, it is inefficient and inappropriate for the court to state precisely what form the rem­edy is to take. To the charge that this is going to “cost a great deal,” I reply that the cost is already being assessed — but it is being assessed in part against innocent third parties. The cost should be borne by the users of the goods and services involved, not by un­willing recipients of smoke, irritants and noise.

I might add that the proper approach is not to prescribe cer­tain activities (such as brick-making) in certain areas, but to proscribe the externalities. If a firm can find a way to make bricks in the center of an affluent suburb in such a way as to produce no ex­ternalities, no damage to sur­rounding properties, and if this is what it believes to be the appro­priate site for the activity, the state should not intervene — as it now does with its zoning laws. The city of Houston, Texas has demon­strated the practicability of a city operating without zoning laws. Such laws represent an unwar­ranted invasion of private prop­erty and are certain to be abused by the governments involved.

A substantial part of the prob­lem of externalities relates to the choice of uses for “spaces” (such as the air, lakes and streams, oceans, etc.) to which no one has explicit ownership. The Tragedy of the Commons arose precisely because it was a commons and not the private property of any one person or group. Should a given pond of water be used for boating or for fishing or as a wild game preserve or as a focal point for home sites or as a source of a cooling agent for a generating plant? Permit private ownership of the lake and such questions are readily resolved by the simple process of competitive bidding.

And if the people of the city, who want more electric power, outbid the fishermen, so be it. As such questions are now decided, a few hundred (upper-income?) fisher­men and nature lovers may be able to secure the lake as a fishing re­serve at no cost to themselves and to even persuade the state to provide the fish as well.

This has been a most hurried and oversimplified look at a diffi­cult problem area. But the diffi­culty lies not in deciding the proper principles to apply; the difficulty lies in the details of working out the applications of the principle.

To summarize: Through sins of both commission and omission, governments at all levels have violated the principle of private property. Some of the serious problems of urban America seem to arise from precisely the fact that states have themselves in­vaded private property and have permitted one private citizen to invade the property of another, in the form of spillover effects. Again, the policy implications seem obvious.

Rule No. 3: Only Minimize Coercion

The coercive power of govern­ment shall not be permitted (has no right) to be used for any pur­pose other than that of minimiz­ing coercion in human affairs, i.e. for any purpose other than that generally described in the phrase, “law and order.”

Here again governments at all levels have been involved in sins of commission and omission. They have undertaken a whole host of activities that have nothing to do with minimizing coercion and at the same time they have done a rather poor job in this country of maintaining “law and order.”

Governments are involved in owning and operating schools, hos­pitals, utilities, housing projects, parks, golf courses, airports — but the list is almost limitless. In addition they subsidize, regulate, supervise and harass private own­ers and operators of enterprises.

It is my firm conviction that it can be demonstrated that these departures from right principle have produced unwanted rather than wanted outcomes. I believe it can be demonstrated that many of what are said to be the great problem areas of urban America — housing, transportation, school systems, tax burdens, and so forth — are directly traceable to over-extension of government’s role in human affairs.

I would find it interesting and useful to take but one of these areas — say, hospitals or schools — and attempt to prove my point. In fact, I have done just this for higher education and have come to the conclusion that “tax-supported education tends to make of our schools and colleges a collection of non-students under the tutelage of non-teachers and the admin­istration of the incompetent.”18 However, time will not permit any fuller exploration of this and re­lated topics. Suffice it to say that it is precisely the areas where the state has stepped in that problems of quality, quantity and cost are most in evidence; those goods and services relatively untouched by the dead hand of the state are precisely the ones about which we need not be concerned.

This disease of overextended government seems to strike urban areas more severely than rural (although God knows it is not unknown in the latter). One of the more obvious consequences of this fact is the constantly rising tax burdens that must then be imposed on urban populations. This in turn prompts both private citi­zens and businesses to “escape” the city, thus reducing the tax base, increasing welfare costs, etc. which in turn calls for even higher tax rates, and so on. The great multiplication of governmental activities has taken both attention and funds from the one legitimate area for government action: law and order. City planners seem al­ways to be better paid than city policemen.

Non-market Pricing of Services

We turn now to the conse­quences that flow from the fact that many of the services offered within and around the city are not priced in a market process.

One of the more dramatic ex­amples is to be found in the trans­portation services in urban areas. Specific users may be charged nothing and or may pay a charge having little or nothing to do with costs of providing the facility. This distorts the decision-making of both those who use and those who provide the facilities involved.

Here is the way in which Dean Dick Netzer of New York Uni­versity’s School of Public Admin­istration and chairman of the In­ter-University Committee on Ur­ban Economics, has described some typical cases:

There have been a number of esti­mates of the full social costs involved in peak-hour use of high-capacity ur­ban freeways to and from the CBD. One such estimate is that the costs commonly exceed 11 cents per vehicle-mile. Ordinarily, the only prices for specific trips on highways that mo­torists confront are the gasoline taxes they pay, amounting to no more than 1 cent per vehicle-mile. So the peak-hour motorist should really be paying a price for highway use which is ten (or more) times greater than the price he usually does pay, while the peak-hour transit rider’s fare should rise by much smaller propor­tions.

For the latter, an extreme case —for example, the construction of a new subway line in New York City to relieve overcrowding — might re­quire a three or four-fold increase in the fare. For peak-hour motorists, the extreme cases are truly fantastic. For example, if peak-hour uses of the proposed third tube of the Queens-Midtown Tunnel in New York, re­quired only for rush-hour traffic, had to pay its full costs, the indicated toll would be at least $5, compared to 25 cents at present.’°

In describing the impact of such pricing practices on city characteristics, Netzer concludes as follows:

Thus, the highly dispersed form of residential development characteris­tic of most American urban areas, involving heavy auto use even for commuting to work is not necessarily independent of changeable transpor­tation characteristics. If auto use were no longer faster, more comfort­able, and cheaper, it is a fair bet that some consumers would choose other transport modes and some of these would alter their residential location choices as well.

In a longer, more complete dem­onstration, a wider range of rules and cases could be explained. For example, no study of the city should be thought complete that ignores the consequences that have come from the modern system of welfare. The appropriate rule of right principle would be one that speaks against any coerced trans­fer of assets from one person to another. The case would build up­on the incredible problems that have come from the impact of state-welfare-availability in urban areas upon the social, political and economic faces of the city. But enough is enough. It is time to summarize.

Summary: Toward the Good City

I have argued that, given the subjective, individual nature of value, it is impossible per se for there to be created a single, ob­jective, meaningful definition or description of the Good City. I have questioned whether it would be possible by any means whatso­ever to construct such a city, even were it possible to define it in advance.

I have presented as my central thesis the idea that the Good City cannot be described or aimed at in terms of its own characteristics but only in terms of the rightness of the rules system within which it emerges. Again, right rules pro­mote right outcomes; wrong rules promote wrong outcomes.

I have admitted (nay, insisted) that the exact nature of the out­comes that would flow from right rules cannot be predicted in advance. I have insisted though that it is possible to identify kinds of generally admitted city ills that have been brought on by wrong rules. The greater part of the pa­per has consisted of case studies of this part of the argument.

Let me close with a summariz­ing example of what I am trying to say. This, too, is drawn from the book by Jane Jacobs, The Death and Life of Great American Cities, and it relates to the “grew­like-Topsy” evolution of a given section of the city of Boston.

Twenty years ago, when I first hap­pened to see the North End, its build­ings — town houses of different kinds and sizes converted to flats, and four-or five-story tenements built to house the flood of immigrants first from Ireland, then from Eastern Europe and finally from Sicily — were badly overcrowded, and the general effect was of a district taking a terrible physical beating and certainly desperately poor.

When I saw the North End again in 1959, I was amazed at the change. Dozens and dozens of buildings had been rehabilitated. Instead of mat­tresses against the windows there were Venetian blinds and glimpses of fresh paint. Many of the small, con­verted houses now had only one or two families in them instead of the old crowded three or four. Some of the families in the tenements (as I learned later, visiting inside) had un­crowded themselves by throwing two older apartments together, and had equipped these with bathrooms, new kitchens and the like. Mingled all among the buildings for living were an incredible number of splendid food stores, as well as such enterprises as upholstery making, metal working, carpentry, food processing. The streets were alive with children play­ing, people shopping, people strolling, people talking.

I could not imagine where the mon­ey had come from for the rehabilita­tion, because it is almost impossible today to get any appreciable mort­age money in districts of American cities that are not either high-rent, or else imitations of suburbs. To find out, I went into a bar and restaurant and called a Boston planner I know.

“Why in the world are you down in the North End?” he said. “Money? Why, no money or work has gone into the North End. Nothing’s going on down there. Eventually, yes, but not yet. That’s a slum!”

“It doesn’t look like a slum to me,” I said.

“Why, that’s the worst slum in the city. It has two hundred and seventy-five dwelling units to the net acre! I hate to admit we have anything like that in Boston but it’s a fact.”

“Do you have any other figures on it?” I asked.

“Yes, funny thing. It has among the lowest delinquency, disease, and infant mortality rates in the city. It also has the lowest ratio of rent to income in the city. Boy, are those people getting bargains. Let’s see… the child population is just about average for the city, on the nose. The death rate is low, 8.8 per thousand, against the average city rate of 11.2. The TB death rate is very low, less than one per ten thousand, can’t under­stand it, it’s lower even than Brook-line’s. In the old days the North End used to be the city’s worst spot for tuberculosis, but all that has changed. Well, they must be strong people. Of course, it’s a terrible slum.”

“You should have more slums like this,” I said. “Don’t tell me there are plans to wipe this out. You ought to be down here learning as much as you can from it.”

“I know how you feel,” he said. “I often go down there myself just to walk around the streets and feel that wonderful, cheerful street life. Say, what you ought to do, you ought to come back and go down in the sum­mer if you think it’s fun now. You’d be crazy about it in summer. But of course we have to rebuild it eventu­ally. We have got to get those people off the streets.”20

I submit that the problem lies in the attitude expressed in that last sentence. The solution lies in a return to those principles of hu­man conduct that are generally and universally valid, in fact, to the ancient principles of private property, limited government and individual freedom.



¹ Environment for Man: The Next Fifty- Years, sponsored by the American Institute of Planners, edited by William R. Ewald, Jr., Indiana University Press, Bloomington & London, 1967, p. 3.

2 Mitchell Gordon, Sick Cities: Psy­chology and Pathology, Penguin Books, Baltimore, Maryland, 1963, p. 20.

³ Jane Jacobs, The Death and Life of Great American Cities, Vintage Books, a division of Random House, New York, 1961, pp. 220-221.

4 Adam Ferguson, An Essay on the History of Civil Society, 1st ed., (1767), p. 187.


  • Benjamin A. Rogge (1920-1980) was Distinguished Professor of Political Economy at Wabash College, Crawfordsville, Indiana. He held degrees from Hastings College (A.B.), the University of Nebraska (M.A.), and Northwestern University (Ph.D.), and was a member of both the American Economic Association and the Mont Pelerin Society. He had a gift for rendering into clear English the vital principles of economics, all with a touch of unforgettable humor. He opposed compulsory, state-funded education and sought market alternatives. Among his intellectual mentors was Nobel laureate F. A. Hayek.