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Chapter 64 of 132 · The Freeman 1974 by Foundation for Economic Education

Another Case History of a Government Failure; B. Siegan

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Washington is usually unable to do in domestic affairs what its leaders want it to and say it will. Some of this is obviously due to corruption and incompetence, but probably most is attributable to the nature of the beast. One of the many difficulties is that, except perhaps in emergencies, represen tative government must necessar ily respond to the continual and varied pressures and demands of its citizens, and these can alter considerably the course of its pro grams. Copyright 1973 Bernard H. Siegan Mr. Siegan is the author of Land Use With out Zoning and many articles on the subject. He practiced law for 20 years in Chicago be fore moving in 1973 to La Jolla, California, where he is an adjunct professor of law at the University of San Diego Law School. 362 Unlike corporate stockholders whose influence is limited to the extent of their stock owner ship, individual citizens of the country can have vastly more pow er over its affairs. By participat ing and getting involved in local matters, individuals or groups con stituting small minorities can ex ert substantial influences, even impeding plans and efforts of the highest elected officials.

An excellent case history of the exercise of such powers, and the ensuing problems presented gov ernment, is contained in a short book published last year by the Urban Institute of Washington, D. C., entitled New Towns In town. It was written by Dr. Mar tha Derthick, a senior fellow at the Brookings Institution. The book describes the efforts of President Johnson beginning in the summer of 1967 to build housing develop ments for the poor in various met ropolitan areas on Federal surplus land. The government owned the land, and the legislative authority for funding and development was then in existence. At the helm was a 1974 ANOTHER CASE HISTORY OF A GOVERNMENT FAILURE 363 president personally .committed :to carrying out the program and -will ing to commit the full powers of his office toward that end. He ap peared" certain of success and well he might be, given the circum stances at hand.

New Community Prol?os~/s No .PositiveResults Nevertheless, four years after the program began,' it was almost a complete failure~ Of seven an nounced, proposals for newcom~ munities, three were dead and the future of the others was then in great doubt. In only one ,instance was a'· small· amount of construc tion proceeding. The record of each: of the seven proposals is basically the same. Private citizens and organizations, together with officials at various levels of government responding to the pressures of theirconstitu ents, were able' to prevail over the will of the administration. Another maj or problem was the conflict be tween the different government agencies involved in planning the program and using surplus lands. One of the sites was a 335-acre tract, located a few miles from the White House in Northeast Washington, which the adminis tration initially sought to develop with 4500 units, all but 800 in tended for public and subsidized housing. It was to be a showcase development in. the nation's capi tal, evidencing the country's con cern for its less fortunate citi zenry.

Presumably, ·in the Federal city, the administration would have maximum influenceand'< :impact. But its powers did not extend over local officials and citizens. Strong opposition. soon arose, both from neighboring residents who wanted only middle class housing,.and various other persons and organ .. izations elsewhere in the city who demanded a host of changes, in the plans~ 'A lawsuit was filed to obtain "meaningful" citizen participa tion .. Virtually from the moment the. program was announced, it went straight downhill; even a new school proposed for the com munity becam~ the subject of con troversy as to whether it should be "conventional" or "new and relevant"; and there were of course many opinions on that issue. Dr. Derthick does not suggest that in any of the seven situations there were any "bad guys" seek ing personal monetary gain; al most everyone involved ostensibly desired the best use of the land, but this generally meant adopting only his own preferred plan. Basic ally, the forces that blocked the program reflected the national concerns of that period.

364 THE FREEMAN June Perhaps in certain places some of those particular pressures may have receded over time, but they have been or will be replaced by others; comparable ones will al ways be with us, as well they should in a representative and par ticipatory society. Recognize the scenario? It is a preview of what can be expected to occur upon passage of a na tional land use bill. This legisla tion will involve much more plan ning, regulation and commitment at all levels of government, local, state and Federal. In addition, un like the case of surplus land, the land that will be the subject of the lobbying, jockeying and maneuver ing will be that of private citizens, not government owned. And in finitely more land will be involved than just seven sites. Among other things, this situa tion does not bode well for the right of private ownership, since the owner will be just one of many, many divergent interests attempt ing to dictate its use.

Government clearly has limita tions in carrying out its programs. Certainly legislators should take this into account in proposing new programs. There is absolutely no point in entering a milkhorse in the Kentucky derby. As Dr. Der thick states in her introduction: "The more government tried to do, the plainer became its inability to do very much." t) IDEAS ON LIBERTY Shifting the Slums THE BASIC PREMISE on which the program [urban renewal] was started and the one which maintains its intellectual momentum is that urban renewal eliminates slums, prevents the spread of blight, and revitalizes cities. It is much more likely that the fed eral urban renewal program shifts slums instead of removing them, and, in so doing, may actually encourage the spread of slums and blight. The people who move from the urban renewal area are not really helped by the operation of the program. Some receive payments for moving expenses and advice in finding new homes. But after they move, they still have the same incomes, the same social characteristics, and the same skin color. The only basic change is that they are now living in some other part of the city.

MARTIN ANDERSON, The Federal Bulldozer GiveTImghtHowlbuGive JAMES C. PATRICK ~ AMERICANS give away more. every year than the gross national prod uct of Austria or Greece or Norway ... We give more to our churches alone than the gross na tional product of Chile or Egypt or Israel. You will notice that I have not named the most poverty-stricken nations of the world. Gross· na tional product is often referred to as GNP and it includes every thing that the people of a nation extract from the ground and sell to others, such as coal or iron ore or diamonds or limestone or oil. It includes all that the people pro duce. through cultivating the soil, such· as corn or soybeans or ba nanas or flax or pineapples or rice. rt includes all the services that people perform for each other and collect a payment, such as writing a will or filing a tax return or filling a cavity in a tooth or acting ina television show or giving a manicure or repairing a flat tire or preaching a sermon.

The Freeman 1974

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