Cities are where most people live and their labor markets are the engines of productivity. Unfortunately America's most productive cities are failing us. They are increasingly expensive, congested, unlawful, and poorly run. We need a new model municipality that is focused on opportunity, growth, affordability, and competent administration. A private charter city should be created with the goal of providing efficient access to a large labor market and a safe and affordable environment in which to raise a family.
"Cities will be built around it" - Steve Jobs on the Segway
The design of a city is determined by the technological environment in which it developed. Early cities were built around walking, horses, and later rail. Cars enabled the suburbs and sprawl of the postwar era. New cities will be built around 21st-century technologies such as micro-mobility, robotics, and self-driving cars. These work in existing legacy cities but their true potential is unlocked in a city designed with them in mind.
The city consists of a variety of streetscapes and architecture styles that are influenced by cities that are universally well-regarded for pedestrians (New York, London, Paris, Tokyo, Venice). Density is roughly proportional to distance from transit stations. The downtown core is served by multiple rail lines and is mostly highrises. Radiating outward from downtown are districts centered on transit stations. District cores are a mix of mid- and high-rise buildings. Farther from the station the buildings transition to low-rises and scattered midrises.
The streets are narrow and the city has high floor area ratio. Rather than dig underground at high cost, the surface streets would be built one or two floors above ground. Narrow streets make building up cheaper than digging down. The underground areas are dedicated to infrastructure and logistics. One layer is dedicated to robotic goods movement, including shipping and garbage collection. The infrastructure layer contains plumbing and electrical and telecommunications wires. Laying a new cable is as easy as walking the hallways and placing cables in cable trays. Upgrades and repairs are simple and cheap.
The surface layer is dedicated to humans and their mobility. Walking, dockless bikes, and scooters provide the majority of trips. Low-speed self-driving vehicles (think glorified golf carts) are available for longer distances and for the disabled. Extremely high-density trunk routes are served by automated underground rail.
The design and technology of the city are mutually self-reinforcing. A higher-density city makes it affordable to move the logistics underground and the new transportation technologies make it feasible to build a dense city without crippling congestion. Smaller, denser streets allow for more investment in a high-quality street environment and pleasant streets make living at high density acceptable. More square footage available within a given radius makes delivery robots and micro-mobility more effective and delivery robots dramatically lower the cost of goods delivery.
The city is wholly privately owned. With a single owner the city is incentivized to maximize total economic value rather than the value of individual lots. Agglomeration effects and returns to scale mean that economic activity is maximized by continued population growth. The city profit comes from collecting a fixed percent economic rent on a superlinearly growing economy.
The city is governed with the knowledge that most of its residents don't live there yet. Decisions are made with a long-term view that optimizes for city growth. City growth is not necessarily at odds with liveability, as residents won't move to the city unless it is attractive and meets their needs.
Real estate scarcity is the root of many problems in American cities. Housing, office, industrial, and retail space are all too scarce and expensive. Low real estate costs benefit everyone, from highly paid knowledge workers to artists and aspiring restaurateurs.
One aspect of abundance is having housing that suits your needs. Due to zoning and incentives most cities only build a small number of housing types. The mismatch between supply and demand of housing types causes residents to over- or under-consume housing. A variety of housing types allows residents to choose the housing style and price point that works for them. From micro-apartments to luxury high-rises. From four-bedroom family apartments to row houses to standalone homes.
Disaggregated real estate gives residents access to a wide variety of amenities without having to pay for mostly unused rooms. Guest rooms, home theaters, and entertaining spaces are scattered throughout the city and can be rented on demand. Some residents would opt not to have a kitchen due to the convenience of food delivery, instead renting a kitchen and dining room when the need arises.
Affordability is not just about the immediate cost of housing but should be considered holistically as the fully burdened cost of living in the city. This includes housing, transportation, and services. Housing affordability is enabled by not artificially limiting supply and having entry-level units such as micro-apartments / SROs. Robotic logistics lowers the cost of goods delivery. Residents wouldn't own cars and most trips would be served by walking or micro-mobility. City services will be kept low-cost through automation, on-demand labor forces, and a constant drive towards improving cost efficiency.
The city is built, owned, and operated by a single entity so it is incentivized to optimize for the entire lifecycle. Greenfield development lowers land acquisition costs and allows for a holistic approach to city and building design. Buildings would be designed around efficient shapes and layouts, rather than to fit a specific lot, enabling modularity and automated design. Underground space and vertical shafts through buildings would be reserved for future uses. Maintenance, repairs, and upgrades would be cheap since most can be performed without demolition or tearing up streets.
The city is pleasant and enjoyable to live in with the goal of reducing stress. Small streets allow great attention to detail and investment in beauty. Air, noise, and light pollution are minimized. Electric vehicles and kitchen exhaust scrubbers prevent air pollution. Soundproofing and sound dampening reduce noise to enable high density living. Streets would be lit with high-quality warm lights. Infrastructure and logistics are moved underground to return the streets to humans. Ease of movement is paramount and congestion is avoided with demand-based prices.
Speed-limited self-driving cars make the streets safe for pedestrians. Citywide automated video surveillance of public spaces would prevent crime and nuisance behavior. Automated tickets and fines would be filed for ordinance-breaking. The goal is deterrence, not to raise revenue. Residents are gently guided to good behavior.
The city runs a number of markets around real estate, transportation, and infrastructure. Each market targets different users and has slightly different design and market mechanisms.
Most housing is built and managed by the city and rented as apartments. Prices are calculated based on demand and target a low turnover rate. Many forms of housing are provided at various price points. The city monitors the price of each type of housing to track supply and demand imbalances and adjusts the ratio of each housing type in future development. Housing prices are roughly proportional to the square footage consumed, number of rooms, and quality of finishes. Size and quality are decoupled: a family shouldn't have to rent an expensive penthouse to get a four bedroom apartment.
Innovative leasing is offered to residents. Instead of fixed-term leases, all housing is offered at a variable monthly rate with rates published six months in advance. Deposits and moving fees are amortized over the first few months rather than demanded up front as a lump sum. To encourage long-term residency and emulate the benefits of home ownership, residents get a discount based on how long they've lived in the city. This benefit follows them between units as they move to encourage right-sized housing choices.
Businesses have different needs when it comes to real estate. While homes come in discrete units, office tenants have continuous demand that scales with their company size. The market for office space looks much different than residential. Pricing is more dynamic and could be perhaps modeled off a Common Ownership Self-assessed Tax system. Industrial factory space likewise has its own market. Retail space such as storefronts has its own market with flexible options, such as leases as short as one day to enable popup shops.
Underground areas that aren't needed for logistics are rented out as gyms, art studios, theatres, clubs, indoor farming operations, repair facilities for the logistics robots, etc. Specialty buildings such as churches and hospitals are built by third parties with long-term ground leases.
There are two transportation markets: above- and below-ground. Each is a real-time market with fixed and variable prices based on distance and demand. They are accessed via an API which offers routes and costs and allows customers to bid and reserve capacity. These APIs are consumed by transit companies such as Uber or Lyft. Below-ground is dedicated to robotic logistics and the market is designed to maximize throughput. Above-ground is used for self-driving cars and throughput is limited to minimize congestion and maximize speed. The number of cars per hour on a given road is limited to improve quality of life.
The underground space is leased to companies who wish to offer infrastructure services. This market has a small number of high-touch transactions and isn't as automated. Imagine if a wireless company wants to install 5G cellular service. They work with the city to identify available rooftop locations to suit their needs. The fiber backhaul would be laid in existing cable trays and the city would help identify routes that minimize cabling and costs. The terms and prices of the contract are negotiated.
The city is a corporation focused on sustainable long term growth. Residents aren't able to vote on city issues, but can provide feedback to the city and the city may solicit input through polls and questionnaires. The rules and regulations are available as a version-controlled repository on GitHub.
Many charter cities are designed to be insulated from the laws of their parent country. For our purposes, the laws of the US are mostly sufficient; it is the municipal laws that are the problem. The city would seek a charter allowing it to innovate in specific relevant areas such as building codes. Codes have been developed over the years with a certain set of assumptions and path dependencies. The city should be allowed to develop its own codes and design patterns to match its specific needs without sacrificing safety.
Education is funded through vouchers and the schools themselves are marketplaces. Teachers rent classrooms and offer their own curricula. Families select the teachers and classes that suit their needs.
There are other more ambitious allowances the city may negotiate. One option is to exempt city residents from all forms of state taxes in exchange for the state getting an equity stake in the company. Since the city is focused on growth and affordability, it would be a prime candidate for place-based visas to allow immigrants to settle in a new city without disturbing residents in other cities.
"We do good through our core business activities" - Jeff Bezos
The city is focused on competent administration. It provides an abundance of affordable real estate and encourages economic growth by providing the infrastructure for commerce. The city collects no taxes and is funded entirely through rents, leases, and usage fees.
The city contributes to societal welfare through its core business of providing abundant real estate. Affordable housing and encouraging commerce and family formation do more good than any social program the city could offer. Nonprofits and social services benefit from the low real estate prices.