Fixing Sick Cities (with Alain Bertaud)

Alain Bertaud: Thank you. I’m very glad to be back.

Alain Bertaud: It came from–when I start working in Russia, at the time where Russia was trying to convert to market. It didn’t succeed, but I was working there. And, my Russian colleague, their first impression, I had the title of Urban Planner from the World Bank, and they say, ‘Why the bank is sending more planners? This country is dying from planners.’

And, indeed there was a Gosplan where next to the office where I–and one of them may even say they are, what, I think he was counting a million of planners in Russia were destroying the country. Why?

So, I decided that urban planners, in a way–the old way–means that you are planning city for people. You are deciding what to do; and the people have to follow like the Gosplan of the Soviet Union. So, I decided to change my name there–I mean, my title.

Alain Bertaud: No. It means that I deal with cities. I consider that what people call ‘urban planner’–I mean, the way I see myself, because I work in many different cities, I see myself as a city doctor. I’m not going to a city and tell them, ‘Hey, I have a vision for you. You should create a new Silicon Valley,’ or something. I’m looking at the problem they have–usually housing, affordability, traffic, labor market thing. And, I’m trying to, with my knowledge, solve them their problem. I’m not trying to plan the city.

Now, part of it might be city extension. I may advise on that. But it’s part again of a problem they have already. I’m not here to design a city for them, the way an architect, for instance, design a building for a client.

Alain Bertaud: There is also a cultural aspect, you see, in solving a problem. Again, similar to a doctor who, his patient has been smoking for 50 years. This is different from somebody who has a very healthy life. So, you have to deal with that.

Then there is the geography and the topography. I’ve never been to Tel Aviv, but I can imagine that there are a lot of land constraints–

Alain Bertaud: including because Israel itself is a very small country. So, if you have a land constraint like that, certainly the way to go is up, because you cannot go so much extending the city. So, you have to create more floor space.

Now, when you reach a certain amount of floor space or people per hectare, the amount of road space is limited. It’s not–where you can increase the supply of floor space, you cannot increase the supply of road space, practically. Because, if you had to enlarge the roads, you will destroy building, you will destroy a very valuable. And, except in the case of a dictatorship, it’s practically in a democracy, it’s nearly impossible.

So, you have then to change the way people circulate within the city; and a number of people will have to use transit. And, I suppose in a dense city like Tel Aviv, a subway. Going tunnel–tunneling–is only way to expand in a democracy. The only way to expand the space which is devoted to circulation.

When you have a large city, you have to connect everybody together. If not, there is no point in having a large city–is, everybody is isolated in his own neighborhood. So, you need to expand the possibility of moving goods and also people between different neighborhoods.

The idea that you could have self-, autarkic neighborhood, which was the idea of Corbusier–for many planners actually–is absurd. A city like Tel Aviv works well economically because there is a very large labor market.

If I establish a firm in Tel Aviv and I am looking at somebody who have a very narrow skill–for instance, say, the food regulation of Europe, so you can export food to Europe–I will find this person. But, I will find this person if this person is able to meet me, if we have to. So, we need the connection of that.

If I look at somebody who is at the forefront of quantum computer design, I will find this person: but on the condition that we have the possibility to meet face-to-face, practically. So, for that we need a connection to the entire city, to the entire metropolitan area.

Alain Bertaud: Yes. So, again here, there’s a number of way to improve transport; but usually now you will have to have a type of transport with multiple modes. A subway is not enough. You will need again, the–what’s it called–the last mile, or the last two kilometers. Because, if, and to go from your house to or your office from a station or something.

And this is, by the way, what a transport company have been very bad at doing. If you have a subway, they are only interested in the people who take the subway. They are not trying to connect with, for instance, a electric bicycle rack where you could go, or scooters, or things like that. And, I think that the only people who are doing that now, unfortunately, are the Chinese. They are looking at that very, very carefully.

Alain Bertaud: Yes. I think that, again, like in Tokyo, practically there will be no street space should be devoted to long-range parking. You could have curb space of course to loading or unloading. A large city like Tel Aviv or New York require, by the way, a lot of maintenance. You need to have plumbers coming and unloading things. They cannot come on a bicycle or a subway.

So, you need loading and unloading, but that should be very strict. It should be a few minutes and the rest should be entirely[?]. Parking should be a type of real estate, independent from housing or things like that.

Like hotels, for instance. Hotels is a type of rent, so it will be hotel for cars, and it should be priced the way hotels are priced: If you are for the weekend for instance, you’ll pay more. In certain season, you pay more, and parking price should be adapted to that. So, to adjust demand to supply.

But, they should be–the idea that it’s a responsibility of the city to provide free parking in the street is an aberration. I don’t know where that came from. For instance in New York, where they are trying now to do congestion pricing, but at the same time I think about 70% of the parking lot in Manhattan are free, which is an aberration.

Because, in a way when a car is moving–but, say the problem is cars. Cars consume. They are very convenient to go around because they are always on demand, but they consume an enormous amount of real estate. Including when they move faster, they need more real estate. If I move at 20 kilometers an hour on Fifth Avenue, I am consuming about 80 square meters of Fifth Avenue, which it’s the size of two studios. Just for moving. And I don’t pay anything.

So, of course it’s kind of a under-supply. Something which is free is always under supply. So, we have to find a way of moving around in a dense city because dense city has some advantages.

Although, there are cities which are not dense at all, like Dallas, Fort Worth, or Houston or Atlanta. And, they are congested, but in a certain way they function relatively well.

If you look at that, for me the median or the average–well, the median commuting time is very important in a large city and it should be monitored, by the way, very carefully. And, if it goes above, say, the median go above 35 minutes one way, you have a problem. You have to look at it very carefully.

I have seen cities like Johannesburg where there are some people who commute two and a half hours one way. So, that means five hours commuting. This is a complete destruction of personal life. It’s a complete waste of time.

Alain Bertaud: I think that to use market–to use congestion pricing, the way it is done in Singapore–Singapore is the best city for that. They have done it for years and they have the best experience. This is completely legitimate.

It’s a bit, again, like pricing for a cinema. If a movie is very popular, you will put a high price. But, say you’ll put a high price on Saturday night or Friday night. And, if you want to go to see the movie at 2:00 in the afternoon on a Monday, you’ll pay much less.

Congestion pricing is that. It’s not to ban cars. It’s to a bit optimize demand and supply at the same time.

Unfortunately, for I think it was a case in New York when they try to do congestion pricing, you have the feeling that it’s more an anti-car thing. The idea is not to ban cars or vehicles because no city can survive without vehicular traffic. Again, you have plumbers, electrician, people. If people take cars, it’s because it’s shorter.

When I go–about twice a week, I go to Manhattan; I have an appointment there–I take my car because it’s shorter. But, shorter by, I diminish by half I think. And I pay a huge price for doing that. But so, you have to balance this, demand and supply–because again, the supply of road is limited. And a car–again, a traditional car–use a lot of real estate free.

But, to ban car is not a good idea. For instance, the policy now in Paris to prevent crossing the center of Paris with a vehicle unless you stop in the center, is a bad idea. It’s just pushing traffic on the side of this thing. It doesn’t decrease the number of cars. You will decrease the number of cars if you have much better-performing non-car traffic, like bicycles, scooters, or buses. You could have express buses or things like that.

Alain Bertaud: Let’s say the best in terms of regulation is Singapore. Now, Singapore, by the way, has improved a lot in terms of cultural aspect, things like that.

But, say–it depends. If I am a tourist, I enjoy Paris very much, or New York. Because in the center–the historical Paris–you have a very good system of subway and buses. And, it’s so small in a certain way that it’s nearly walkable and you have a lot of things.

But, if I was working in Paris–if I look now at the labor market of Paris, I see that about 30% of the people who live in the center of Paris are commuting outside. They have jobs outside Paris. Because again, Paris control densities, not directly, but because of preserving the existing floor space. You can use the floor space the way you want, but you cannot expand it in Paris, practically, ever. Because of preserving the aspect of Paris as it was at the time of Impressionist, which was the time where Paris was really the top city in the world.

So you see, here, if you are living in Paris, but you have to commute outside and you commute then sometime up to an hour, then again you have living in Paris lose a bit its attractiveness. You still have it for the weekend, you can, but it loses attractiveness.

So, we have not yet found a perfect city to balance those things.

In a certain way, again, Singapore does it, but Singapore now, the population is slightly growing, but it’s mostly people on contract. People who are coming to Singapore on contract, whether they are at the low end or at the top end, they never become Singaporean. And, I think that again, this is linked to the land use.

And so, no city that I know is perfect yet. I see a lot of the big difference also now is compared to my career, is a fertility rate. Falling in a love city of Europe for instance, and in Asia. This is a turning point and we have no experience to deal with that.

Alain Bertaud: The fertility rate.

Alain Bertaud: For instance, recently I was, five months ago I was in Thailand and was in Bangkok. I was asked by the government to advise on the growth of secondary cities. And suddenly I realized–I lived in Bangkok 30 years ago, the fertility rate was six. That mean every woman had six children on average.

And, now the fertility rate in Thailand is 1.3. That means that the country is losing population in the long run: it’s going to lose population. So, when the tide, people in the tide[?]–my client were the people from the Parliament, were representing secondary cities. When they asked me, ‘We want our secondary state to grow and so that people will not all move to Bangkok.’

And, I look at the demography, I say, ‘Well, you don’t have enough people for that.’ And, the young people in the secondary city, as soon as they finish their studies, they move to Bangkok because for a young person it’s much more attractive.

For firm, it’s the same thing. Would you move to a city which have a shrinking labor force? And, shrinking labor force mean an aging labor force. You don’t have young; you have old people. In Germany for instance now, the median age of the labor force is something like 47, I think 46, 47. It’s disturbing.

I see this is what happened in Japan. That the large cities, Tokyo, Osaka are still growing because the young people from smaller city are growing, but particularly all the smaller city are losing population. And, that by the way, as a city doctor, I don’t know how to deal with that.

Alain Bertaud: I think that zoning–we have to make a difference between the different type of zoning. If the zoning, the restriction of zoning–for instance, in the case of Paris, as you said, the Parisian tried to maintain Paris at the time of the Impressionist. So, we have zoning restriction like the height of building, the slope of roof, the size of windows, which are–so these are restrictions, but the restrictions are doing exactly what the objective is.

They don’t say, ‘You cannot build high because of it’s bad for the environment.’ They say, ‘Well, you cannot build high because the roof of Paris are what we are looking for.’ So, when the regulation does exactly what it says it does, and if you are in a democratic country, I have no objection for any regulation which is even extremely restrictive, like the slope of the roof of Paris.

If you have restriction like American zoning, which are literally based on completely arbitrary thing–like, for instance restricting where a restaurant can locate; imposing also the number of parking for every commerce, or things like that–the regulation has nothing to do with the objective. You cannot even find the objective. You know, that there are in New York, some commercial zoning where you can sell bicycles but you cannot repair them in the same thing. The zoning. Restrictions like that, absolutely not.

By the way, in Paris–one of the advantages of Paris is the lack of–you have zoning for the structure of the building, but not for the use. You can have a lawyer living on the third floor of a residential building, for instance, and have an office there. You can open a bakery anywhere in Paris–on the sidewalk, anywhere.

Alain Bertaud: Yes. Yes, yes. Basically, I was in Vancouver recently. Vancouver is a beautiful city, also very pleasant. Mountains, beautiful. It’s well-run, also. It’s clean, it’s wonderful.

So, the people who live there, they appreciate it so much that they are against any possible change because it works so well. Don’t fix it if it works. But, no city can survive without changing. The world around us is changing, our demography is changing, the technology is changing; and so you have to adapt to that.

I think that, in a way Paris survives because historical Paris, which is really restricted, is two and a half million people, but is surrounded by eight million people who work really hard and have very little of the benefit of Paris. But, again, you have this very large labor market which do not benefit from going to the opera or having those fancy restaurants.

And so, you have a mix of things. How do you adapt to that? How do you improve, for instance, the access of people who live in suburbs to the high density of amenities that you have in the center of Paris? By the way, heavily subsidized by the central government. It’s not the Parisians who will pay for the opera or the Comité Français: It’s a French taxpayer.

Alain Bertaud: Because American restrict density more than any other cities in the world, American cities. You have zoning with a minimum load size, which is usually large. You have the floor ratio which limits the amount of floor space you can build on those large floors. Basically, most American city are zoned for single-family housing.

Single-family housing, especially if they are on relatively large lots, do not have–if I wanted to operate a French café or a Viennese Café or a Tel Aviv café in my neighborhood, I will not survive because within walking distance there are just not enough people. And then, if they have to drive, then there are not enough parking for people to come to my café. So, then you don’t have it. So, you have your coffee in your house, and you will watch television instead.

Alain Bertaud: You have very large house, yeah–

Alain Bertaud: Yes. There is a cultural aspect in people. Market is driven by culture. People are shocked when I say that sometime, but they are driven by culture. I think that American still have the spirit of the frontier, where you will move West. I mean, maybe it’s a myth, but it’s in the spirit. So, they value the size of housing–

Alain Bertaud: much more than Europeans do. And, they value also having a piece of land around their house, for some reason.

You know, in the town where I’m living, there’s a lot of pressure from the state to build some townhouses. We are about 20 minutes from Manhattan; and the entire town resists that very much. They think that townhouses are kind of like if they were immoral or that they will bring the wrong type of people. Let’s face it.

And, I’m not talking here about–you know, I’ve been in the zoning board, attending the zoning board meetings several times, and I don’t think it’s now anymore racism. It’s just that people will have a different income from themselves; and they don’t want people higher income. They don’t want people from lower income. They think it will disturb the social balance of the city for some reason. That’s why they fight, again, so-called McMansion, which are just larger houses, but do not bother anybody, frankly.

And, they will fight against townhouses because they figure out the people who can–the townhouses will be cheaper than the single-family house and therefore it will be the wrong type of people. The people who are not like us, let’s say.

But that again, I think it come from the frontier spirit: that you wanted to move out.

It could be also if you are not used to go regular meeting your friend in a café, you don’t see the need for it. And, that’s why in Paris you will find rather wealthy people living in apartments of 60 square meters. And, for them the trade-off is that okay, they live in 60 square meters, but they can walk to 100 very wonderful restaurants. They can meet friends, things like that. So, it’s a trade-off based on culture. You cannot change–I mean culture change slowly but very slowly.

Alain Bertaud: Well, they invite their friends to watch sports, for instance, for the Super Bowl or something like that. They have a barbecue or something like that. But, it doesn’t replace the European cafe or the New York cafe or the San Francisco cafe.

I recently read a fantastic book about the Viennese and how many ideas came out from the Viennese cafe and people–because it was also at the time the center of the Habsburg Empire. So, people were very different were coming to Vienna different.

And, for instance, at a certain time they were talking about Schumpeter having a discussion with Weber in a cafe. Schumpeter saying that the Bolshevik revolution was a great thing because it was a way of experimenting with the socialist system. It will show that it doesn’t work.

And, Weber was very upset and say, ‘Well, but million of people will die.’ And, Schumpeter saying, ‘Well, that’s the price of ideas.’

So, you see this fertilization through random encounters. That’s what I like in New York–that’s why I go to Manhattan from time to time, is to meet people.

Alain Bertaud: Well, they consider me a bit as a Martian. But, in a way, my French accent helps. They say, ‘Well, with a guy with an accent like that, you cannot expect him to agree with us.’

Alain Bertaud: I completely agree. I think that the big contribution of cities is precisely randomness. That’s why, by the way, remote work doesn’t work that well in the long run. It’s because if you go to work from time to time, at least maybe not every day to an office, you meet people–you meet the people you have to meet, but you may meet people randomly.

When I was with the World Bank, that was the case. At the cafeteria, I will meet somebody was for instance, specializing in garbage removal, in refuse disposal. And then, we discuss with them and suddenly it become very interesting for me, things that I didn’t realize. For instance, our disposing of garbage affect land prices in the area around it, things like that. I say, ‘Hey, yes, this is interesting.’ So, you see, it stimulates the mind to meet people and it has to be random.

If everything is structured, it’s a terrible thing. One of the worst–well, for instance, Sartre, Huis Clos—No Exit–Hell are the others. It’s because there’s no randomness. People are stuck in the room and forever. This is hell. And so, there’s no randomness. They know already everybody and they will be with them.

The other book like that is One Day in the Life of Ivan Denisovich, Solzhenitsyn. He described–again, there is no randomness there. Life is completely structured every day. And, all his life, I mean until he dies, will be exactly the same.

A city is just the opposite. You don’t know what to expect. You don’t know who you will meet. And, it’s precisely because you meet people who are different from you, who have different ideas. Sometime even it could be obnoxious people. I think obnoxious people are necessary, too. I mean, what I consider obnoxious are necessary in order to stimulate. Well, it give you in the same way as ugliness is necessary, if you can identify beauty.

Alain Bertaud: And, you have that again when people meet together. That’s why cities have always been the source of philosophy, new ideas, technology, and innovation. Is because this shock of people, even if these people do not always like each other. [More to come, 44:53]