Cities

A little over a year ago I published a post in which I proposed a simple rule for comparing the prices of things across the years.  I call it the “one-hundred rule” because it postulates that, at least since about 1900, prices — in US dollars — have been increasing a hundredfold in 100 years. It corresponds to an annual inflation rate of 4.73%, and also means that prices double every 15 years. I have found that it works quite well for such disparate products and services as postage, coffee, hamburgers, hotel rooms, cars (at least from the time that they were in general use) and even houses in rural England (with reference to Downton Abbey).

Some products or services, however, cannot be compared over a long time span.  As I noted in the post, the price of a Model T Ford automobile dropped considerably in the decade after its introduction, as car ownership gradually became the norm, and the formula works only from the later point in time (1925).   Similarly, a telephone call nowadays is a very different process from what it was half a century ago.

And while the formula works reasonably well with respect to broadly based housing costs, it fails spectacularly when it comes to housing in cities. A personal example: in 1966 (exactly half a century ago) my then-wife and I bought a small house in Berkeley (California) for $16,900 and sold it six years later for $22,300. This is a factor of 1.32, and 1.04736 = 1000.06 = 1.32 — perfect! But according to the rule the price should now be ten times what we paid, that is, around $170,000. Instead, it is estimated at between $700,000 and $800,000. Yikes!

What has happened is that city living in early-21st-century America is not what it was in mid-20th century, and though the house is physically the same (there is no record of any expansion), it no longer represents the same thing. In the 1950s and 1960s middle-class Americas, on the whole, didn’t like living in cities. The very rich, of course, had their mansions and town houses as well as their country homes, but the middle class opted for something in between, which was the suburbs. The Bay Area Rapid Transit (BART) system, which was designed in the 1950s and built in the 1960s, reflects the attitude of the time: what it does is connect the urban core that includes downtown San Francisco, Oakland and Berkeley (where the University of California is located) with the suburbs (including those that are within the legal city limits); what it does not do is facilitate movement among various parts of the metropolitan area that don’t happen to lie along the lines going through downtown Oakland and San Francisco.It is, in other words, not a metro like those in other big cities around the world, but a commuter railroad comparable to the RER in France, the S-Bahn in Germany or the Cercanías in  Spain, with the big difference that the European systems are integrated with their countries’ mainline railroad networks, including high-speed trains, while BART is not integrated with anything; it doesn’t even use standard railroad gauge.

The absence of a true metro makes Bay Area living more cumbersome and more dependent on driving.  (While Washington has something called Metro, it’s also a radial system like BART.)

The change from a time when “inner city” was a pejorative to the present situation, when it is desirable enough to have caused a hyperinflation in urban housing costs (except in places like Detroit), may have occurred some time around the 1980s, when air travel got cheaper and more Americans traveled to Europe, discovering the tree-lined boulevards with bicycle lanes, the sidewalk cafés (hitherto banned in the US for supposed health reasons) and other pleasures of city living, which were then brought back here. But, as a result of planning decisions made in an earlier age, convenient public transportation is not one of them.

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