During much of the twentieth century, the rise of consumer cities like Los Angeles seemed to be yet another force battering the Londons and New Yorks of the world. Yet as older cities have become safer and healthier, they, too, became reinvigorated as places of consumption, through restaurants, theaters, comedy clubs, bars, and the pleasures of proximity. Over the past thirty years, London and San Francisco and Paris have all boomed, in part, because people have increasingly found them fun places to live. These metropolises have their pricey treats, like Michelin Guide three-star meals, but they also have their more affordable enjoyments, like sipping a coffee while admiring the Golden Gate Bridge or the Arc de Triomphe, or downing a real ale in a wood-paneled pub. Cities enable us to find friends with common interests, and the disproportionately single populations in dense cities are marriage markets that make it easier to find a mate. Today successful cities, old or young, attract smart entrepreneurial people, in part, by being urban theme parks.
The rise of reverse commuting may be the most striking consequence of successful consumer cities. In the dark days of the 1970s, few were willing to live in Manhattan if they didn’t work there. Today, thousands of people choose to live in the city and travel to jobs outside it. Middle Eastern millionaires aren’t the only people buying pieds-à-terre in London and New York, and Miami has done well by selling second homes to the rich of Latin America.
Robust demand, created by economic vitality and urban pleasures, helps explain why prices in attractive cities have risen so steadily, but the supply of space also matters. New York, London, and Paris have increasingly restricted new building activity, which has made those cities harder to afford.
Many of the ideas in this book draw on the wisdom of the great urbanist Jane Jacobs, who knew that you need to walk a city’s streets to see its soul. She understood that the people who make a city creative need affordable real estate. But she also made mistakes that came from relying too much on her ground-level view and not using conceptual tools that help one think through an entire system.
Because she saw that older, shorter buildings were cheaper, she incorrectly believed that restricting heights and preserving old neighborhoods would ensure affordability. That’s not how supply and demand work. When the demand for a city rises, prices will rise unless more homes are built. When cities restrict new construction, they become more expensive.
Preservation isn’t always wrong—there is much worth keeping in our cities— but it always comes at a cost. Think of the ordered beauty of Paris. Its tidy, charming boulevards are straight and wide, lined with elegant nineteenth- century buildings. We can relish the great monuments of Paris because they’re not hidden by nearby buildings. A big reason for those sight lines is that any attempt to build in Paris must go through a byzantine process that puts preservation first. Restrictions on new construction have ensured that Paris—once famously hospitable to starving artists—is now affordable only to the wealthy.
Like Paris, London has a strong attachment to its nineteenth-century edifices. The Prince of Wales himself took a strong stand against tall, modernist buildings that might compromise a single sight line of St. Paul’s Cathedral. And the British seem to have exported their antipathy to height to India, where limits on construction are less justified and more harmful.
Mumbai has had some of the most extreme land-use restrictions in the developing world; for much of Mumbai’s recent history, new buildings in the central city had to average less than one-and-a-third stories. What insanity! This bustling hub of India enforces suburban density levels in its urban core. This self-destructive behavior practically ensures prices that are too high, apartments that are too small, and congestion, sprawl, slums, and corruption. Despite an economy that is even hotter than Mumbai’s, Shanghai remains far more affordable because supply has kept pace with demand. Like other pro-growth autocrats, from Nebuchadnezzar to Napoléon III, China’s leaders like building.