Sunday, March 2, 2008

Tax suburbs more than cities

Harvard economist Ed Glaeser (whose previous work I criticized) argues that the suburbs should be paying higher taxes for two reasons: 1) suburbanites pollute more and 2) don't contribute as much as city-dwellers to the welfare of the poor.

His point about urban poverty is worth noting. Some urban poverty is cyclical, denying opportunities to generation after generation, and society is to blame for not working to prevent this cycle from continuing. But urban poverty also results from urban success:

Urban poverty does not reflect urban failure, but rather the enduring appeal of cities to the less fortunate. Poor people come to cities because urban areas offer economic opportunity, better social services, and the chance to get by without an automobile.
Cities shouldn't be punished for this by paying higher taxes to care for the poor. Providing social services is a universal responsibility and the suburbs should share the burden.

Hat tip: Greg Mankiw.


Scott said...

Yep. Cities end up providing services for the poor so the poor end up in the cities, even if they started out in the burbs. (Also, cities provide better transit options for the poorer). Basically, the burbs get out of dealing with poor people by refusing to help them out, forcing them elsewhere.

The burbs also require more infrastructure (more, longer, wider roads, power & water lines, etc.). IMO the state should find a way to stop construction of new roads and road expansion and instead begin investing in maintenance of existing infrastructure... I think this was one area where Granholm is actually on the right track.

Cooper said...

I'd hesitate to congratulate Granholm on her transportation policy. The only reason we're spending more money on maintenance rather than new construction is the budget -- we don't have nearly enough money, not even for maintenance.

But Granholm has refused to endorse even a 3 cent increase in the gas tax and has shown no vision on mass transit. Couldn't she have lent strong verbal support (if not financial) to the effort to connect Detroit and Ann Arbor with commuter rail or bring rapid transit to Metro Detroit? Instead she leaves no legacy.