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Of course infrastructure is subsidizing those who use it. Even more so when it comes to infrastructure that takes a lot of space, as every square foot of surfac

Of course infrastructure is subsidizing those who use it. Even more so when it comes to infrastructure that takes a lot of space, as every square foot of surface dedicated to one thing cannot be dedicated to another. And infrastructure induces demand by lowering some prices relative to others. In an extreme case, imagine that your typical, currently congested highway gained another 6 lanes in each direction, and we raise speed limits to 100 mph. First, the right of way is now way bigger, so we need to wreck a lot of buildings for this infrastructure. It makes being able to travel near that highway really nice for a while: Minimal congestion! A straight out windfall by people owning land near it. But that also means that the area redevelops, as farmland that was in the middle of nowhere is now a reasonable commute downtown! But as the development continues, the highway will fill up. And since downtown streets were not changed, it's the area downtown near the highway that is now a congested mess, as the limitation is getting from there to buildings. And again, a subsidy for you can be a harm for me: If every street is 8 lanes wide, it's very hard to cross. Every pedestrian crossing added is also infrastructure, but it slows down traffic. Every bit of lawn you use is another bit of distance I have to wade through to get to my destination, vs an area with the same number of houses, but without lawns. One can like one tradeoff more than the other, but the fact that infrastructure means subsidy, and that urbanism choices are picking some people's interests over others is just factual.

tellsomething 3y ago
> One can like one tradeoff more than the other, but the fact that infrastructure means subsidy, and that urbanism choices are picking some people's interests over others is just factual. You do have a point. But, do you think cities prosper in spite of this subsidy? It seems like an investment that pays off in second error effects. I mean, why aren't cities without infrastructure growing like mad? Because it's not possible and cities with infrastructure outcompete them. Only way to make this work is if you outright ban infrastructure and then make competition impossible in that domain.
- tstrimple 3y ago
  The investment only pays off in areas with the tax base to recoup the upfront cost. Largely this isn't the suburbs or rural areas and only some parts of urban environments. Massive suburbs are built without the ability to maintain their infrastructure in the future based off of the taxes of its residents. There is an interesting image in this article (https://www.strongtowns.org/journal/2017/1/9/the-real-reason-your-city-has-no-money https://www.strongtowns.org/journal/2017/1/9/the-real-reason...) which shows the areas of a city which earn a ROI and those which are just expenses. The poorer and denser parts of the cities are the only ones which pay for themselves (and thus everyone else). > There are some remarkable things to note right off the top. When we added up the replacement cost of all of the city's infrastructure—an expense we would anticipate them cumulatively experiencing roughly once a generation—it came to $32 billion. When we added up the entire tax base of the city, all of the private wealth sustained by that infrastructure, it came to just $16 billion. This is fatal. > It's obvious to me why this is fatal, but for those of you for whom it is less clear, let me elaborate. > The median house in Lafayette costs roughly $150,000. A family living in this house would currently pay about $1,500 per year in taxes to the local government of which 10%, approximately $150, goes to maintenance of infrastructure (more is paid to the schools and regional government). A fraction of that $150—it varies by year—is spent on actual pavement. > To maintain just the roads and drainage systems that have already been built, the family in that median house would need to have their taxes increase by $3,300 per year. That assumes no new roads are built and existing roadways are not widened or substantively improved. That is $3,300 in additional local taxes just to tread water. > That does not include underground utilities (sewer and water) or major facilities such as treatment plants, water towers and public buildings. Using ratios we’ve experienced from other communities, it is likely that the total infrastructure revenue gap for that median home is closer to $8,000 per year.
  - bombcar 3y ago
    The absolute abundance of suburbs and relatively few bankruptcies thereof indicates the math is off somewhere. Hint: the cost to build something is not the cost to maintain it.
  - tellsomething 3y ago
    I will read the article later on, only skimmed it. I don't trust the numbers though. I've noticed in my area that companies congregate near their nexus. Attorneys will get an office near the tribunal, accountants near the IRS building, etc. Also, big companies will set their headquarters in the state capital but earn money from all over the place. This makes it seem like the capital "makes" all the money though it's actually just fiscally declared in that place. I suspect that chart shows the same thing. Eg. perhaps the gutters may not be covered from the home tax, but that person goes to work someplace, spends money elsewhere and maybe has a company registered elsewhere in the city. Though, I do agree that overinvesting may happen for infrastructure. I don't buy it though that, for example, suburbs are inherently a subsidy.

tellsomething 3y ago

> One can like one tradeoff more than the other, but the fact that infrastructure means subsidy, and that urbanism choices are picking some people's interests over others is just factual. You do have a point. But, do you think cities prosper in spite of this subsidy? It seems like an investment that pays off in second error effects. I mean, why aren't cities without infrastructure growing like mad? Because it's not possible and cities with infrastructure outcompete them. Only way to make this work is if you outright ban infrastructure and then make competition impossible in that domain.

tstrimple 3y ago
The investment only pays off in areas with the tax base to recoup the upfront cost. Largely this isn't the suburbs or rural areas and only some parts of urban environments. Massive suburbs are built without the ability to maintain their infrastructure in the future based off of the taxes of its residents. There is an interesting image in this article (https://www.strongtowns.org/journal/2017/1/9/the-real-reason-your-city-has-no-money https://www.strongtowns.org/journal/2017/1/9/the-real-reason...) which shows the areas of a city which earn a ROI and those which are just expenses. The poorer and denser parts of the cities are the only ones which pay for themselves (and thus everyone else). > There are some remarkable things to note right off the top. When we added up the replacement cost of all of the city's infrastructure—an expense we would anticipate them cumulatively experiencing roughly once a generation—it came to $32 billion. When we added up the entire tax base of the city, all of the private wealth sustained by that infrastructure, it came to just $16 billion. This is fatal. > It's obvious to me why this is fatal, but for those of you for whom it is less clear, let me elaborate. > The median house in Lafayette costs roughly $150,000. A family living in this house would currently pay about $1,500 per year in taxes to the local government of which 10%, approximately $150, goes to maintenance of infrastructure (more is paid to the schools and regional government). A fraction of that $150—it varies by year—is spent on actual pavement. > To maintain just the roads and drainage systems that have already been built, the family in that median house would need to have their taxes increase by $3,300 per year. That assumes no new roads are built and existing roadways are not widened or substantively improved. That is $3,300 in additional local taxes just to tread water. > That does not include underground utilities (sewer and water) or major facilities such as treatment plants, water towers and public buildings. Using ratios we’ve experienced from other communities, it is likely that the total infrastructure revenue gap for that median home is closer to $8,000 per year.
- bombcar 3y ago
  The absolute abundance of suburbs and relatively few bankruptcies thereof indicates the math is off somewhere. Hint: the cost to build something is not the cost to maintain it.
- tellsomething 3y ago
  I will read the article later on, only skimmed it. I don't trust the numbers though. I've noticed in my area that companies congregate near their nexus. Attorneys will get an office near the tribunal, accountants near the IRS building, etc. Also, big companies will set their headquarters in the state capital but earn money from all over the place. This makes it seem like the capital "makes" all the money though it's actually just fiscally declared in that place. I suspect that chart shows the same thing. Eg. perhaps the gutters may not be covered from the home tax, but that person goes to work someplace, spends money elsewhere and maybe has a company registered elsewhere in the city. Though, I do agree that overinvesting may happen for infrastructure. I don't buy it though that, for example, suburbs are inherently a subsidy.