Paul Krugman joined The New York Times in 1999 as a columnist on the Op-Ed Page and continues as professor of Economics and International Affairs at Princeton University. Mr. Krugman received his B.A. from Yale University in 1974 and his Ph.D. from MIT in 1977. He has taught at Yale, MIT and Stanford. At MIT he became the Ford International Professor of Economics.
Mr. Krugman is the author or editor of 20 books and more than 200 papers in professional journals and edited volumes. His professional reputation rests largely on work in international trade and finance; he is one of the founders of the "new trade theory," a major rethinking of the theory of international trade.
The waters are receding in Houston, and so, inevitably, is national interest. But Harvey will leave a huge amount of wreckage behind, some of it invisible. In particular, we don’t yet know just how much poison has been released by flooding of chemical plants, waste dumps, and more. But it’s a good bet that more people will eventually die from the toxins Harvey leaves behind than were killed during the storm itself.
Oh, and if you trust the current administration to handle Harvey’s aftermath right, I’ve got a degree from Trump University you might want to buy. There are already signs of dereliction: Many toxic waste sites are flooded, but the Environmental Protection Agency is conspicuously absent.
Anyway, Harvey was an epic disaster. And it was a disaster brought on, in large part, by bad policy. As many have pointed out, what made Houston so vulnerable to flooding was rampant, unregulated development. Put it this way: Greater Houston still has less than a third as many people as greater New York, but it covers roughly the same area, and probably has a smaller percentage of land that hasn’t been paved or built on.
Houston’s sprawl gave the city terrible traffic and an outsized pollution footprint even before the hurricane. When the rains came, the vast paved-over area meant that rising waters had nowhere to go.
So is Houston’s disaster a lesson in the importance of urban land-use regulation, of not letting developers build whatever they want, wherever they want? Yes, but.
To understand that “but,” consider the different kind of disaster taking place in San Francisco. Where Houston has long been famous for its virtual absence of regulations on building, greater San Francisco is famous for its NIMBYism — that is, the power of “not in my backyard” sentiment to prevent new housing construction. The Bay Area economy has boomed in recent years, mainly thanks to Silicon Valley; but very few new housing units have been added.
The result has been soaring rents and home prices. The median monthly rent on a one-bedroom apartment in San Francisco is more than $3,000, the highest in the nation and roughly triple the rent in Houston; the median price of a single-family home is more than $800,000.
And while geography — the constraint imposed by water and mountains — is often offered as an excuse for the Bay Area’s failure to build more housing, there’s no good reason it couldn’t build up. San Francisco housing is now quite a lot more expensive than New York housing, so why not have more tall buildings?
But politics has blocked that kind of construction, and the result is housing that’s out of reach for ordinary working families. In response, some workers engage in extreme commuting from affordable locations, spending as much as four hours each way. That’s no way to live — and no way to run a city.
Houston and San Francisco are extreme cases, but not that extreme. It turns out that America’s big metropolitan areas are pretty sharply divided between Sunbelt cities where anything goes, like Houston or Atlanta, and those on the East or West Coast where nothing goes, like San Francisco or, to a lesser extent, New York. (Chicago is a huge city with dense development but relatively low housing prices; maybe it has some lessons to teach the rest of us?)
The point is that this is one policy area where “both sides get it wrong” — a claim I usually despise — turns out to be right. NIMBYism is bad for working families and the U.S. economy as a whole, strangling growth precisely where workers are most productive. But unrestricted development imposes large costs in the form of traffic congestion, pollution, and, as we’ve just seen, vulnerability to disaster.
Why can’t we get urban policy right? It’s not hard to see what we should be doing. We should have regulation that prevents clear hazards, like exploding chemical plants in the middle of residential neighborhoods, preserves a fair amount of open land, but allows housing construction.
In particular, we should encourage construction that takes advantage of the most effective mass transit technology yet devised: the elevator.
In practice, however, policy all too often ends up being captured by interest groups. In sprawling cities, real-estate developers exert outsized influence, and the more these cities sprawl, the more powerful the developers get. In NIMBY cities, soaring prices make affluent homeowners even less willing to let newcomers in.
Can America break out of these political traps? Maybe. In blue states where cities build too little, there’s a growing political movement calling for more housing supply. Until now, there’s been much less evidence of second thoughts about unmanaged development in red states, but Harvey may serve as a wake-up call.
One thing is clear: How we manage urban land is a really important issue, with huge impacts on American lives.