Wednesday, December 11, 2013

Breaking into the Grandkids’ Piggy Banks

I won’t break any new ground today.  Instead, I’ll call a play directly from the StrongTowns playbook.  But the story that Chuck Marohn and friends tell about the financial unsustainability of our predominant land-use pattern has evoked an image that seems worthy of sharing.

The image is of shaking coins from the piggy banks of our children and grandchildren and using them to support our current land-use model, without a credible plan for returning the coins.

Many of the development patterns of our time involve inter-generational fund transfers.

Approving drivable suburban subdivisions to secure the impact fees even though the incremental property tax revenues won’t cover long-term maintenance costs?  That’s borrowing from the future.

Building big-box shopping centers for the immediate sales tax revenues even though the likelihood is that the centers will soon lose their lustre and become financial drains as new centers are built elsewhere?  That’s borrowing from the future.

Accepting funds from the state or federal governments to build infrastructure for the short-term employment boost even though funds are unlikely to be available for maintenance?  That’s borrowing from the future.

The pattern is overwhelmingly obvious.  Over the past seventy years, we’ve evolved a complex system of securing current benefits while leaving many of the costs to be borne at a later time, a time when many of us will have left the stage.

I’m not an anti-usury nut.  I know that the lending and borrowing of funds is essential for the functioning of a successful economy.  But lending and borrowing needs the informed consent of both parties.  Borrowing from children and grandchildren still in the crib, or as yet unborn, is weird.  And a bit creepy.

One could argue that our parents and grandparents began this pattern, so our generation is paying some of their costs, entitling us to push costs into the future.  But that’s a weak rationalization.

For one, the earlier generations didn’t realize the extent to which the drivable suburban experiment would fail.  Perhaps they should have noted as early as the late 1970s that something was amiss, but it’s truly taken nearly all of seven decades for the full extent of failure to become evident.  And we can’t blame folks for not fixing something they didn’t know was broken.

For another, it’s not as if we’ve begun turning away from the failed experiment.  Indeed, we often seem to become more frenzied in our efforts to place bets on the losing proposition of drivable suburbia.

No, there is no exoneration for our sins.  Perhaps we can’t be expected to immediately make good on all the failed wagers of the past, but we should at least begin making amends, which we’re not doing.

One of our worst shortfalls is on land-use compromises.  Presented with a land-use proposal that has too little density to be financially sustainable, the frequent result of our land-use process is to further reduce the density, making it more unsustainable.  Adults, unable to reach reasonable and defensible compromises, are pilfering coins from piggy banks to make deals.  We should be ashamed of ourselves.

Once again, I haven’t said anything here that StrongTowns hasn’t said often and better.   But perhaps the imagery of slipping into the bedrooms of sleeping children to snatch coins from their piggy banks to feed our land-use addiction will turn a few more minds toward urbanism.  At least I hope so.

As always, your questions or comments will be appreciated.  Please comment below or email me.  And thanks for reading. - Dave Alden (

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