#128 Limiting Urban Sprawl

By D. Arnott | June 16, 2022
the christian economist dave arnott

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#128 Limiting Urban Sprawl

Land control schemes limit owners’ freedom, and they prevent the economic development that enables the poor to move into the middle class.

 

Pennsylvania gubernatorial candidate Doug Mastriano has called for extensions of the state’s Agriculture Conservation Easement Purchase Program.  The press release from Mr. Mastriano’s office goes on to explain the reasoning, “In recent years, more and more prime farmland has been lost to development.”  Lost?  Where did it go?  An economist would say it is being transferred from a lower economic use to a higher one.  Isn’t that good for the economy of Pennsylvania?

Oh, but wait, there’s more.  “Since 1988, the program has purchased permanent conservation easements on 5,979 Pennsylvania farms, covering 606,215 acres in 58 counties.”  If a little is good, is it a lot better?  In China, the Communist party owns all the land.  Is that where Mr. Mastriano’s Republicans are headed?  While not stating the total that’s been spent on the program, he hopes to raise the annual waste….excuse me….investment….no, that’s not right either…the annual amount of money that will be forcibly extracted from Pennsylvania taxpayers to prevent developers from moving the land to a higher economic use, to $80 million each year.  You realize, there is no free lunch.  That $80 million will be withdrawn from the productive part of the economy.  

I will throw the potential Governor a couple of small bones, before trying to explain the Biblical aspects of this program. 

First is imminent domain.  There probably IS Biblical support for forcibly taking SOME property from individuals to serve the common good.  But not in this case.  The second is common values.  There certainly is Biblical support for a community making laws that prevent extreme value violations, like prostitution, but this does not apply either. 

Now for the Biblical violations of forcibly taking money from taxpayers and using that money to limit the development of land.  You realize the word “development” means it is being DEVELOPED.  Something Mr. Mastriano seems to be against.  

 

People Should be Free

The first of the ten Biblical Commandments of Economics in our book Biblical Economic Policy is People should be free.  In this case, people should be free to use their property as they wish.  Why does Mr. Mastriano think HIS use of the land is better than the land-owner?  In most cases, the Bible would make a case for an individual doing what he wants with his property.  Unless of course, Mr. Mastriano wants to revert to the Old Testament law of Jubilee, where the land remained with the political powers of the age: The twelve tribes of Israel.  

 

The market works.  

No one is as smart as all of us, and the Governor is no exception.  Adam Smith – yea, that guy – his basic idea in The Wealth of Nations says, “Each person seeking his own good provides for the good of all.”  That idea would favor individuals mostly doing what they want with their land.  Former Speaker of the House Dick Army once quipped, “Markets are smart, governments are dumb.”

If limiting urban sprawl is good in 2022, would the Governor undo the sprawl that has happened in the past in Pennsylvania?  Should housing be taken from homeowners, and plowed under to return it to farmland?  Exactly where is the line drawn to stop urban sprawl?  And if it’s considered just to stop it, it would be just to reverse it.

Then there’s the “Thee not me,” conundrum.  I am guessing Mr. Mastriano lives in a house on some land.  Where is the justice in his family owning a home, just because he “got here first?”  Doesn’t a young couple have the same justice claim to own a home?

Life is cheaper in inland cities because, in coastal cities, half the land is underwater.  That’s why it’s cheaper to live in Omaha or Dallas than in Miami or Boston.  The prospective governor of PA wants to make life more expensive for his constituents, by limiting the amount of available land, just like in port cities.  The problem is: In port cities, they have the BENEFIT of the port.  In the Pennsylvania example, they won’t have the economic benefit of a port, but they will have the economic PENALTY of the loss of land. This is especially difficult for the poor.  The poor move into the middle class by buying a small home, then moving up to a bigger one.  Land restrictions deny that opportunity to the poor.   

 

Malthus and Mastriano

Malthus was wrong, and Mr. Mastriano is wrong.  Here’s how he expressed it, “An abundance of agricultural land is crucial to maintaining food security.”  Now I know why the most popular of my podcasts is titled “Don’t Fear the Future.”  He is playing on the fear of running out of food.  Economically, that’s just ridiculous.  Malthus was wrong in 1798 and every Malthusian since him has been wrong.  My favorite question to ask groups is to complete the following sentence: “Life was better on earth before we ran out of __________.”  There is no answer.  There probably never will be one.  Thomas Sowell says that as resources become scarce, prices go up and people change to alternate sources to satisfy the same needs.  Sorry to share our vacation pictures, but this vertical garden grows without dirt on a wall in Madrid, Spain.  Kinda spoils Mr. Mastriano’s call for more farmland, doesn’t it?

Then, there’s the Imago Dei.  Creative humans, made in the image of God, continue to find new ways to use resources more efficiently.  The computer you’re using to listen to this podcast is a good example.  Mr. Mastiano has more faith in government control of resources than in the creativity of the Imago Dei to make more.

 

Let Them Eat Cake

In a previous podcast, I nominated Energy Secretary Granholm and Transportation Secretary Buttigieg for the “let them eat cake” award for pointing out that electric car owners were not concerned about increasing gas prices.  Mr. Mastriano earns a similar nomination for suggesting the poor remain poor and do not have the same chance to enrich themselves via home ownership that his generation had.

Another of the Ten Commandments of Economics I found with my co-author Sergiy Saydometov when we wrote the book Biblical Economic Policy is “Love Your Neighbor.”  It’s hard to see how denying Pennsylvanians the freedom to own their own home on their own land is a show of love.  

A brief history lesson is in order.  King Charles II of England owed a large debt to William Penn’s deceased father.  He paid the debt by granting the Penn family a large tract of land west and south of New Jersey in 1861.  As such, William Penn had the authority to dispose of the land with little restriction.  So King Charles II allowed more economic freedom than Mr. Mastriano.  Are we moving forward or back?

Because the Quakers were more tolerant than other folks at the time, the colony became a haven for minority religious sects from Germany, Holland, Scandinavia, and Great Britain.  They moved there for the FREEDOM to practice religion and own land that they could do as they wished.

There is pretty good evidence that the recession of 2008 & 9 was more severe in locations that had land-use controls.  It makes sense: When you limit the supply, the price goes up.   

 

It looks good

Ginger and I walked a pilgrimage in Spain called the Camino de Santiago.  Each year, 350,000 people walk 17 different routes that end at the tomb of St. James in a little town in northwest Spain called Santiago de Compostela.  As we walked through the farmland, I noticed the small farms.  Some pastures were as small as an acre.  They are really serene.  Many of the walls are made of stone.   It reminded me of Scotland.  But as an economist, I had to wonder how this makes sense.  I commented to Ginger, “You think any of these farmers have ever seen the great expanse of a wheat field in Kansas?”  The economy of scale is much greater in Kansas.  And in central South Dakota, where I grew up, there are corn fields that are a mile square.  How do these small Spanish farms with one-acre pastures and a dozen Asturian milk cows compete?

I told one of our fellow pilgrims about my experience in Switzerland.  Small farms like the Spanish farms have these really bucolic-looking, huge brown cows.  I found out later that they are there to impress the tourists.  The farmer is paid by the government for each cow he keeps.  Uh-huh.  The Swiss transfer money from profitable sectors to the unprofitable farming sector, because it looks good to the tourists. 

And, as it turns out, Mr. Mastriano wants to do the same thing.  Reading again from his press release, “Pennsylvania’s agricultural land provides scenic images of rural life landscaped across fertile valleys of surrounding hills and mountains. These open spaces are a beautiful backdrop and draw thousands to our state to spend money in Pennsylvania’s growing agritourism business. We must act now to preserve these lands.”  But, he’s killing the goose that laid the golden egg.  He is purposely driving up the cost of living, so people will move to states with lower costs of living, like Texas and Florida.

So, as The Christian Economist, I don’t see any Biblical support for this land-control scheme.  But as a Texan, whose industries compete with Pennsylvania, I think it sounds pretty good. 

 

FEAR GOD,
TELL THE TRUTH,
EARN A PROFIT.

 

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