The dissonance of zoning and immigration
Democrats must be the party of open doors – at all levels
NEWTON RECENTLY BECAME a sanctuary city. I was proud to co-sponsor the ordinance and gratified by the legion of residents who rallied at City Hall in support of their immigrant neighbors. The next night, I listened to some of those same residents decry a request to build housing and retail near the Newtonville commuter rail station. They did not want the influx of people, with the attendant traffic and school children, and they did not want the bigger building.
There is dissonance here. Immigration restrictions and zoning can both be subverted into tribalism, and Democrats should start making the connection as an important step towards rebuilding a national coalition from states and cities on up. We should become the party of Open in contrast to the party of the Wall; we should embrace the freer movement of goods, services, capital, and people – between cities and between nations – based upon the optimism and the resolve that diversity plus competition breeds excellence.
The connection between immigration restrictions and zoning is threefold. First, they both create barriers to entry, which favors incumbents over outsiders. Second, they both suffer from asymmetric political organizing. And third, they both need to be addressed in the context of automation.
Immigration restrictions create a barrier to entry by literally creating a barrier: a border, a security guard, a wall. Zoning creates a barrier to entry by restricting the supply of housing units to below what the market would provide. In Newton, for instance, permitting more housing density on land near transit stations can double its value, since there is latent demand that outstrips the suppressed housing supply.
The benefits of open competition, by contrast, are diffuse and counterfactual. Immigration, by creating more competitive labor markets, reduces costs for producers and thereby reduces prices for consumers; consumers, though, do not credit the series of purchases that are marginally cheaper than they would be in a hypothetically closed economy. New construction, by creating more competitive regional housing markets, reduces prices for prospective homebuyers; disappointed would-be homebuyers, though, do not petition the planning board of their would-be hometown.
Incumbents, then, have the political advantage over open competition. National leaders promise workers they will deport immigrants and mayors promise local residents they will fight developers. Democrats need to change that conversation, and that means talking about the third connection between immigration and zoning: automation, the challenge-cum-opportunity that will remake the American economy.
First off, immigrants are not taking jobs. Automation is taking jobs. Forty-five percent of the American workforce could be automated within two decades. Cognitively or manually routine work like truck driving, food preparation, and cashiering will increasingly compete with algorithms, and no degree of incumbency advantage can preserve your job for long when the replacement works 24/7 without wages or benefits.
Democrats at the state and local level, where education and workforce development really happen, need to be compelling and consistent. We’re not going to retreat behind barriers that ultimately impoverish us – we’re going to compete for the wave of better jobs that automation creates. If you commit to working, we will make sure you can get the skills that next year’s job requires, we will make sure your kids can get the education that next decade’s job requires, and we will supplement your income with a steeply higher earned-income tax credit, because working Americans should not have to pay their rent with their grocery bill.
The connection between automation and zoning is more nuanced. Residential land values are partly a function of transportation: All else equal, parcels that are fewer minutes’ commute from employment density are more valuable. That logic allows public transit systems to self-fund part of their own expansion; under a financing method known as value capture, the increase in adjacent land values is shared between developers and the construction of rail extension. (Not incidentally, this is how the United States built the transcontinental railroad.)
That logic also suggests how autonomous vehicles (AV) are going to affect zoning and affordable housing. A system of continuously circulating shared AVs – a robotic Uber – would require as few as 20 percent of the vehicles to make the same number of trips, without the opportunity cost of driving or the human cognitive lapses that are usually the source of traffic. In this scenario, land on the periphery of employment density becomes more suitable for housing, because the same number of effective commuting minutes equals more distance. Land in the core of employment becomes less expensive, because the supply of the housing within the commuting radius has increased.
Again, Democrats need to send a compelling and consistent message about zoning: We’re not going to let housing costs become a barrier to entry for the middle class. If you hand in your car keys, we’re going to seize the efficiencies from autonomous vehicles to build more housing and to zone more inclusively.The party of Open should be optimistic and resolute. Instead of erecting barriers to entry around our nation or our cities, Americans are going to compete and, with the right skills and the right policies, they are going to win.