The "good old days" that never were
Will Wilkinson has a post discussing how residential zoning laws were originally instituted to exclude certain minority groups:
In 1926, the Supreme Court ruled that zoning was cool in Euclid v. Ambler Realty. However, despite the fact that Euclid’s lawyers insisted that their law had nothing to do with race, the district court judge whose decision the high court reversed didn’t see much difference between the law in Euclid Township, Ohio (a suburb of Cleveland) and the Louisville law declared an unconstitutional encroachment on property rights and freedom of contract in Buchanan. He wrote, “The blighting of property values and the congesting of the population, whenever the colored or certain foreign races invade a residential section, are so well known as to be within the judicial cognizance” — which translates roughly as: “Don’t try to bullshit me; I see you, Euclid.”
Wilkinson relies heavily on a book by Richard Rothstein, who makes a very interesting point about the Supreme Court:
Rothstein notes the suspicious oddity of the Lochner-era laissez faire court’s tolerance of the infringement of property rights and economic liberty in this one case:
Over the course of nearly 40 years, the Court struck down all kinds of regulation (not only zoning as in Buchanan, but most notably, health and safety and minimum wage regulation) on the grounds that it interfered with freedom of contract. Euclid’s permission for economic zoning was the only significant exception to this rigidly ideological approach. . . It was about race.
Some libertarians believe that there was a sort of Golden Age when the Supreme Court had a principled objection to government economic regulations that interfered with property rights. I’m skeptical of that view. It’s always been about who gains and who loses.
PS. The politics of zoning is interesting:
1980s: Conservatives insist that zoning is an example of inefficient government regulation, citing Houston as evidence that people flock to cities without zoning. Progressives worry that urban areas would be a mess if you didn’t have zoning laws.
Late 2010s: Progressives gradually realize that residential zoning laws make it hard for the poor and minorities to move to where the jobs are, and begin opposing zoning. Conservatives suddenly see merit in restrictive residential zoning.
“You like it? Then I hate it!” I’ve never seen this country more polarized.
Jul 1 2021 at 9:45pm
The Lochner Era was working with a hobbled 14th Amendment. So no, it wasn’t a golden age, more of a silver age.
Incidently, regarding inconsistency between Buchanan v Warley (which was also about race!) and Euclid v Ambler, there were only 4 Justices on the court for both, two of whom voted in both cases in favor of freedom of contract in both.
Jul 1 2021 at 10:00pm
Zoning laws exist all around the world and were not used in the UK, New Zealand or Australia to keep out African Americans.
Zoning seems to be one of those things that starts of as being sensible, i.e. no allowing chemical plants in the middle of a residential area but more and more zones are added until construction is constricted and then prices shoot up. As they have all over Europe, the US and Oceania.
In some, hopefully most, YIMBY groups there is a mix of people on the right and the left. Zoning law changes might be one of those things that unite people of different political persuasions. Noah Smith and Russ Roberts disagree a lot, but they agree on zoning.
Jul 1 2021 at 10:08pm
There’s actually a very big difference between American and European zoning law, which is that European countries usually allow mixed use by default and American cities do not
Jul 2 2021 at 1:07am
Compare also Japanese Zoning: http://urbankchoze.blogspot.com/2014/04/japanese-zoning.html
That’s why people usually specifically talk about Euclidean Zoning as the really bad kind.
Btw, Houston has plenty of other obnoxious rules for real estate that are on par with Euclidean Zoning. Eg minimum parking space requirements, I think.
Jul 1 2021 at 10:40pm
If the “exception” was due to race, then it would have been in Buchanan v. Warley rather than Euclid. I don’t think even the plaintiff in Euclid argued it was a matter of racial discrimination.
Jul 1 2021 at 10:45pm
I can’t comment on Wilkinson’s post because I’m not a paying subscriber, but both he & commenter John Quiggin are mistaken about education funding in the US. Thanks to the federal government, poorer schools actually spend MORE per student. A lot of this is admittedly due to the higher costs of special education.
Jul 2 2021 at 5:02pm
Jul 2 2021 at 7:48am
You can still see the impact of racial exclusion in property titles for homes built before 1955 in our area of Bethesda. The deeds contain language restricting sales of the home to “members of the Negro race.” The La Jolla section in San Diego excluded both Negroes and Jews until about 1960. My late father’s business partner who was Greek could buy property to build a home there but my dad could not (this was right after WW-II).
Thomas Lee Hutcheson
Jul 2 2021 at 8:49am
Overt racism may have something to do with the origins and development of zoning and other kinds of land use regulation, but I think it’s better analyzed as a problem of a sub-optimal way of dealing with the hyper local externalities of commercial and residential development. There is no market in which the city majority who will benefit from development can compensate the locals.
Jul 8 2021 at 5:39pm
Of course, there is. Create a property tax structure in a manner that properties in tracts where more development is happenning are paying less of it and it can lower the opposition. Or pass an ordinance that some serious amenities have to be built by the city according to some density-dependent formula. There might be a problem with locking the comittment, I don’t know how to do it, but if a city is serious about development they can view the trust in whatever scheme they propose to be an essential asset.
Jul 3 2021 at 6:46am
I find this argument weak, perhaps in part because there is a misrepresentation of how hands off the court really was. Of course there is the reflexive citation to Lochner, but as always the almost unwillingness to deal with the facts of Lochner. David Bernstein does a great job laying out the relevant facts.
In short, there was a bakers union and that union worked in large shops. There were a number of small, independent bakeries (typically Jewish) that the bakers union disliked (because competition is competition). The union worked with the government to institute “health and safety” regulations to crush the independent bakeries.
The court upheld some of these requirements, but not all of them. Most famously, the court struck down hours worked during the day. But it is key to understand why independent bakeries had employees work such long hours. Basically, between preparing the dough and putting it in the oven and then taking the bread out there was a pretty big time lapse. It didn’t make economic sense to have someone leave and come back (though the bakers union could afford such luxuries) so often the independent baker employee would sleep during the downtime. This was described as working someone to death.
The court saw this in form health and safety regulation as in practice a way for the politically connected to crush competition as the court believed this rule didn’t really impact health & safety (stated differently they took a hard look). But it is equally important to emphasize that the court didn’t simple say: no health and safety regulations, period.
The court was not libertarian but classically liberal. They didn’t see government’s use of the police power is per se invalid, but were deeply concerned about the politically connected using the police power in an inappropriate way. That doesn’t mean they got Euclid right, but it is the odd court who supports the Jewish immigrants (in Lochner) but decides Euclid because “eww black people.” This was the early 1900s. Immigrant jews were not popular.
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