City Planning and the Rule of Law

The excellent Greater Greater Washington blog endorses this video from the City of Beverly Hills, an impressive bit of filmmaking that devote a tremendous amount of effort to knocking over a rather silly straw man:

Riffing on It’s a Wonder Life, the film tells the story of George Buildly, a businessman who’s upset that the expansion of his store is being delayed by the need to have his plans reviewed by Beverly Hills’s planning and architectural commissions. George’s guardian angel appears and gives him a chance to see an alternate universe in which there is no city planning, no zoning, and anyone is free to do whatever they want with their property. In this alternate universe, George’s store sits adjacent to a pawn shop and a strip club, an adjacent business is telling his customers and employees to park in George’s parking lot, his home is next door to a shooting range, the town is full of tall buildings, and there are billowing black clouds in the background emitted by a nearby factory.

The video seems to be a refutation of an imagined libertarian critic of urban planning who believes we’d be better off with a government that played no role in resolving disputes over urban land use. You might be able to find an anarchist libertarian somewhere who subscribes to the view the video is lampooning, but this certainly isn’t the position that smart critics of excessive urban planning, libertarian or otherwise, take.

There are a number of different types of regulations (in a broad sense) local governments can enforce. The mainstream debate isn’t over whether regulations should exist, but over which types of regulation are most effective. For example, the case of a neighboring business parking in George’s parking lot is easily solved by property rights: people who park on his lot are trespassing and he should be free to tow them at the driver’s expense. You could describe this as a kind of regulation in the sense that it requires the government to resolve disputes over property boundaries and regulate the towing business, but it’s different from the government (for example) telling every business how many parking spaces it must provide.

Next you have cases like the shooting range and the polluting factory. The “hard-core” libertarian position in cases like this is that these disputes should be settled through the tort system: if your neighbor opens a shooting range next door, you can sue for an injunction and/or damages based on the nuisance this creates, and the dispute is settled based on long-established principles of property law. Again, this is “regulation” in some sense, but not the kind libertarians object to.

Now, squishy libertarians like me are perfectly ready to concede that this kind of case-by-case adjudication isn’t always efficient—you don’t want every new factory owner to face lawsuits from hundreds of nearby property owners the day he opens his factory, for example. So in many cases it makes sense for the government to preempt this kind of lawsuit and instead establish general rules (maximum noise and emissions limits, for example) designed to prevent neighbors from harming one another.

There’s yet another category of regulations that proscribes things like tall buildings and pawn shops. These regulations generally seem counterproductive to me. A tall building or a pawn shop doesn’t produce a particularly large amount of noise, pollution, or other externalities. Rather, incumbent landowners—especially wealthy and well-connected ones—use these kinds of regulations to keep the riffraff out of their neighborhoods. These regulations might be good for current residents, but they’re not good for the city as a whole since they just crowd unpopular populations into other parts of the city.

Still, even this class of regulation doesn’t give rise to a complicated approval process of the type George Buildly complains about at the start of the video. A businessman wanting to open a new store or restaurant might need to hire a lawyer, but once he does he should be able to figure out relatively quickly what kind of business he can have in any given location. The rules may or may not be good public policy, but at least the business owner doesn’t wind up mired in red tape for months.

Beverly Hills is implicitly defending regulations of a different character. This type of regulation typically requires a permit for any significant change to the way a property is used, and the criteria for approval are vague enough to give city officials essentially arbitrary party to decide what gets built where. Often, this kind of regulation seems designed simply to flatter the egos of city officials. I suppose Georgetown’s Wisconsin Ave wouldn’t look quite the same with a glass and steel Apple store, but this hardly seems like the kind of aesthetic judgement that government officials should be making.

The basic issue here is about the rule of law: is property use governed by predictable rules that are applied consistently for all property owners? Or are property owners subject to the whim of city officials? Almost everyone agrees that regulations are needed to deal with genuine nuisances. And every one of the genuine nuisances mentioned in the video (noisy shooting ranges, polluting factories, trespassing) can be dealt with in a manner that’s consistent with the rule of law. But none of the examples in the video explain why it’s necessary for George Buildly to delay the opening of his store while city officials ponder the merits of his application.