Though many people consider Portland,Oregon, a model of 21st-century urban planning,the region’s integrated land-use and transporta-tion plans have greatly reduced the area’s livabili-ty. To halt urban sprawl and reduce people’sdependence on the automobile, Portland’s plansuse an urban-growth boundary to greatly increasethe area’s population density, spend most of theregion’s transportation funds on various rail tran-sit projects, and promote construction of scores ofhigh-density, mixed-use developments.

When judged by the results rather than theintentions, the costs of Portland’s planning faroutweigh the benefits. Planners made housingunaffordable to force more people to live in multi-family housing or in homes on tiny lots. Theyallowed congestion to increase to near-gridlock lev-els to force more people to ride the region’s expen-sive rail transit lines. They diverted billions of dol-lars of taxes from schools, fire, public health, andother essential services to subsidize the construc-tion of transit and high-density housing projects.

Those high costs have not produced the utopiaplanners promised. Far from curbing sprawl, highhousing prices led tens of thousands of families to

move to Vancouver, Washington, and other citiesoutside the region’s authority. Far from reducingdriving, rail transit has actually reduced the shareof travel using transit from what it was in 1980.And developers have found that so-called transit-oriented developments only work when theyinclude plenty of parking.

Portland-area residents have expressed theiropposition to these plans by voting against lightrail and density and voting for a property-rightsmeasure that allows landowners to claim eithercompensation or waivers for land-use rulespassed since they purchased their property.Opposition turned to anger when a 2004 scandalrevealed that an insider network known as the“light-rail mafia” had manipulated the planningprocess to direct rail construction contracts andurban-renewal subsidies to themselves.

These problems are all the predictable resultof a process that gives a few people enormouspower over an entire urban area. Portland shoulddismantle its planning programs, and othercities that want to maintain their livability woulddo well to study Portland as an example of hownot to plan.

Debunking PortlandThe City That Doesn’t Work

by Randal O’Toole

_____________________________________________________________________________________________________

Randal O’Toole is a senior fellow with the Cato Institute and the author of the forthcoming book, The Best-LaidPlans: How Government Planning Harms Your Quality of Life, Your Pocketbook, and Your Future.Now a resident of Bandon, Oregon, O'Toole is a native Oregonian who has spent most of his life in the Portland area.

Executive Summary

No. 596 July 9, 2007

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Introduction

The city of Portland, Oregon, has receivedenormous publicity in recent years for its land-use and transportation planning. The NewYork Times calls Portland “the city that lovesmass transit.”1 Portland is “successfully gettingpeople out of their cars,” says the BBC.2

From all over the country, city planners,elected officials, and reporters travel to Portlandto examine the region’s urban-growth bound-ary, rail transit system, and transit-orienteddevelopments. “It sometimes seems as if thewhole country is looking to Portland as a rolemodel for 21st-century urban development,”says Governing magazine.3 Portland’s plans havewon numerous awards from the AmericanPlanning Association, and Congress happilygives the city more than its share of federal tran-sit dollars to fund expansion of the region’slight-rail system.

Residents of the Portland area are not asenthusiastic about the region’s planningprocess. Recent elections reveal that most cit-izens are upset by the unaffordable housing,traffic congestion, increasing taxes, decliningurban services, and disappearing jobs thathave resulted from the plans.

In 1995, the city council adopted the slo-gan, “The City That Works.”4 No one on thecouncil felt any sense of irony that Portlandwas borrowing a slogan first applied toChicago by Mayor Richard J. Daley. Daley, ofcourse, was famous for using a politicalmachine of patronage and pork to get himselfreelected five times. Since few Portland may-ors remain in office for more than two terms,no one imagined in 1995 that the Northwestcity was also run by a machine.

The head of that machine, NeilGoldschmidt, had been mayor of Portland inthe 1970s. President Carter appointed himSecretary of Transportation in 1979, and inthe late 1980s Goldschmidt served as gover-nor of Oregon. In 1991 he left public officeand started a political consulting firm thatused his federal, state, and local contacts topromote seemingly idealistic schemes that

quietly diverted billions of dollars in publicfunds to Goldschmidt’s clients and cronies.

Known to insiders as the “light-rail mafia,”Goldschmidt’s machine suffered a huge set-back in 2004 when the public learned that,while mayor, Goldschmidt had a three-yearsexual relationship with a teenage girl startingwhen she was just 14. The former mayor disap-peared from view, leaving his allies to fend forthemselves. Today, public employee unions,neighborhood groups, and county officials areamong those challenging what remains of themachine, and the main goal of many of thesegroups is to halt the diversion of funds fromessential urban services to expensive transitand land-use projects.

History

The planning that made Portland famousattempts to integrate land-use and transporta-tion. Urban planners have long believed in aland-use-transportation connection that wouldallow them to manipulate one through theother. So Portland plans land uses to try toreduce the amount of driving people do whileit plans transportation to try to slow the con-version of rural land to urban purposes.

No such integration was contemplated in1973, when the Oregon legislature requiredevery city and county to write plans that con-formed to goals and guidelines established bya Land Conservation and DevelopmentCommission appointed by the governor. Therules aimed to protect farmland from leapfrogdevelopment (subdivisions not physicallyadjacent to the nearest urban area) by requir-ing all cities in the state to draw urban-growthboundaries. Development inside the bound-aries was allowed to proceed unchecked whiledevelopment outside was strictly limited torural uses.

The commission’s rules specified that theinitial urban-growth boundaries shouldinclude enough land to accommodate twentyyears worth of growth. As that land was devel-oped, cities were to expand the boundaries tomaintain land and housing affordability.

2

In 1995, Portlandstarted calling

itself “The CityThat Works”

without any senseof irony that it borrowed the

slogan from a cityfamous for

patronage, pork,and a political

machine.

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Indeed, due in part to a severe recession, hous-ing in Portland and other Oregon citiesremained very affordable through 1989.5 Thegoal was to keep development orderly and effi-cient, not to slow or stop development.

Transportation planning was a completelyseparate process, responding mainly to federalfunding and mandates. Inspired by federalsupport for 90 percent of the cost of urbaninterstate freeways, Portland had planned agridded network of such highways. But theearly 1970s saw a backlash against urban inter-states from neighborhood residents whoargued that freeways reduced their propertyvalues. In response, Congress passed a lawallowing cities to cancel planned interstatehighway projects and to spend the money onmass transit capital improvements instead.6

Under Mayor Neil Goldschmidt, Portlandbecame one of the first cities to take advantageof the law, canceling a road known as the Mt.Hood Freeway in 1974. But that created adilemma for the city. The federal share of thefreeway cost would be enough to buy hundredsof new buses. But Portland’s transit agency didnot have the funds to operate that many newbuses. Moreover, simply buying buses did notcreate the local construction jobs and profitsthat would have been gained from freeway con-struction.

Goldschmidt’s solution was light-rail tran-sit, a sort of heavy-duty streetcar that some-times operated in streets and sometimes on anexclusive right of way. The term light rail hadbeen coined in 1972; light referred not to weightof the vehicles or the rails but to the smallernumbers of people carried by these rail vehiclesrelative to the large numbers carried by theNew York City subway or other heavy-rail linessuch as Washington’s Metro.

For Goldschmidt, the big advantage oflight rail was that it was expensive, easily cost-ing enough to absorb most of the federalfunds that had been allocated to the Mt.Hood Freeway and (as it turned out) muchmore. Rail construction also provided lots ofjobs and profits for local contractors.

At the time, few observers noted the ironythat an urban transit technology was selected

precisely because of its high cost. PresidentCarter was so impressed with Goldschmidt’sinnovative solution to the freeway controversythat he made Goldschmidt his second secre-tary of transportation. As it turned out, lightrail required so much planning and designwork that construction did not begin untilGoldschmidt had left that office in 1981 andwas not completed until Goldschmidt wasrunning for governor of Oregon in 1986.

Until that point, there was still no con-nection between Portland’s land-use andtransportation planning. But when the light-rail line opened, the city zoned much of theland near light-rail stations for high-densityhousing in order to allow more people to livewithin walking distance of the light rail.

During Goldschmidt’s term as governor,the Land Conservation and DevelopmentCommission began writing a transportation-planning rule.7 This rule was heavily influ-enced by controversy over another proposedfreeway, this one skirting the southwesternsuburbs of Portland. A land-use group called1000 Friends of Oregon argued that the high-way would lead to expansion of the urban-growth boundary and that the city could avoidsuch expansion by integrating its land-use andtransportation planning to emphasize com-pact development that relied on transit, walk-ing, and cycling instead of driving.8

The proposed highway was never built andthe final transportation-planning ruleendorsed the 1000 Friends’ ideas. The ruledirected planners in all of Oregon’s majorurban areas to change “land-use patterns andtransportation systems” so as to reduce per-capita driving by 10 percent in 20 years and 20percent in 30 years.9 To reach those goals, therule specified that planners must increase resi-dential densities, promote mixed-use develop-ments, mandate pedestrian-friendly design(meaning, among other things, that retailshops should front on sidewalks and not beseparated from streets by large parking lots),and various related policies.10 In 1996, Marylandgovernor Parris Glendenning applied the termsmart growth to this planning philosophy.11

The transportation rule effectively killed

3

In the 1970s,Mayor NeilGoldschmidtselected light-railtechnology pre-cisely because itshigh cost wouldallow him tospend lots of federal dollarscreating construction jobsand profits forlocal contractors.

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the idea of expanding urban-growth bound-aries to make room for growth. In 1993,Oregon homebuilders asked the legislatureto require that boundaries be expanded tomaintain a supply of land, but Portland plan-ners convinced the legislature to allow themto instead accommodate growth by rezoningexisting neighborhoods to higher densities.

In the meantime, Goldschmidt announcedin 1990 that he would not run for re-election asgovernor. His decision, which he blamed onmarital issues, was mysterious, as most peoplebelieved he would have easily been re-electedand probably gone on to the U.S. Senate.Portlanders later learned that the woman hehad seduced when she was a teenager was seek-ing a settlement—he eventually paid her$350,000—and he feared the statutory rapewould be made public.12

Out of office, Goldschmidt immediatelystarted a political consulting firm that eventu-ally became known as Goldschmidt ImesonCarter. Early clients included Bechtel, Nike,and Weyerhaeuser. Goldschmidt used hismany federal, state, and local political contactsto grease the skids for those companies tooperate in Oregon’s regulatory environment.Goldschmidt also used his political muscle tohave friends, relatives, and political protégésappointed to various high offices.

The resulting light-rail mafia shapedOregon’s integrated land-use and transporta-tion planning system to favor Goldschmidt’sclients and friends. Some of the members ofthe mafia included:

•Bechtel Corporation—Goldschmidt arrangedfor Bechtel to receive a no-bid contract tobuild an extension of Portland’s light-rail line to the city’s airport. Under thecontract, Bechtel was paid $95 millionand given a 99-year lease to 120 acres ofvaluable land near the airport.

• Tom Walsh—Longtime Goldschmidtfriend and co-owner of Walsh Construc-tion, which specializes in building high-density housing projects. Goldschmidtarranged for Walsh to be appointed gen-eral manager of Portland’s transit

agency. From that position, Walsh hand-ed out millions of dollars in subsidies tohigh-density, transit-oriented develop-ments, many of which were built byWalsh Construction.

• Homer Williams—Goldschmidt arranged forhundreds of millions of dollars of federaland local subsidies to an urban-renewalarea popularly known as the PearlDistrict. Goldschmidt client HomerWilliams built many of the develop-ments in the Pearl and, later, the NorthMacadam District.

•Schnitzer Group and Zidell Marine—Ownersof a large block of former industrial landson Portland’s Willamette River waterfrontsouth of downtown, an area called eitherthe North Macadam or South Waterfrontdistrict. They hired Goldschmidt to helpthem plan a low-rise residential develop-ment, but Goldschmidt persuaded themto go for a high-rise development instead.The development, which is being built byHomer Williams, is enjoying nearly $300million in public subsidies.

• Oregon Health Sciences University—Goldschmidt served on the board ofdirectors of this nominally publicschool that operates a hospital two-thirds of a mile away and 500 feet abovethe Schnitzer-Zidell land. Goldschmidtpersuaded the hospital to build an aer-ial tramway to access offices and clinicsin the waterfront development andconvinced the Portland city council tohelp subsidize this tram, whose costballooned from Goldschmidt’s initial$5 million estimate to $57 million.13

Goldschmidt’s efforts were not entirelydirected to land-use and transportation issues.In 2003, he was involved in a shady deal to takeover Portland General Electric, a utility thatserved two-thirds of Portland’s residents.14 TheState Accident Insurance Fund paid him a mil-lion dollars to help shield the governmentagency from private competition. Goldschmidt’swife was superintendent of Portland’s schools,which hired Goldschmidt’s brother in a lucra-

4

After 1990,Goldschmidt

built a “light-railmafia” consisting

of contractors,developers, and

landowners eagerto cash in on thecity’s rail transit

and high-densitydevelopment

mania.

341402r1 PA596.qxp 6/25/2007 1:59 PM Page 4

tive consulting contract. His wife was also avice-president of Pacific Power & Light,Oregon’s largest electric utility.15

All in all, Goldschmidt was easily themost powerful man in Oregon.16 Inresponse to that power, “the city and thePortland Development Commission wentcrazy,” observes Lewis & Clark law profes-sor (and popular blogger) Jack Bogdanski,“throwing money at Goldschmidt clientslike there was no tomorrow, making allsorts of dubious deals.”17

Was Portland’s land-use and transporta-tion planning system nothing more than agiant real estate scam for Goldschmidt’sclients and cronies? To help answer that ques-tion, this paper will first examine some of thebenefits claimed for Portland’s planning sys-tem and then look at some of the costs.

The Portland Myths

Portland planners and officials have donetheir best to promote claims that their inte-grated planning process is successful. In par-ticular, they say that

1. Investments in transit and land-usechanges promoted by planning ruleshave significantly reduced auto use;

2. Transit-oriented developments haveproven commercially successful andhave moved many people out of theircars;

3. Rail transit has, in turn, stimulatedbillions of dollars of land-use devel-opments;

4. The urban-growth boundary andother planning rules have significantlyreduced sprawl; and

5. Portlanders love their plans.

Myth #1: Portland Loves Transit

“Car junkies like me are becoming anendangered species,” enthused a reporter vis-

iting Portland for the BBC.18 Portland “lovesto ride” transit, said the New York Times.19 Butthe sad truth is that Portland’s transit num-bers are little better than mediocre.

More than 97 percent of all motorizedpassenger travel (and virtually all freightmovement) in the Portland area is by auto-mobile. Though transit’s share of passengertravel has fluctuated between 1.8 and 2.6 per-cent over the past 35 years, it has never madea significant dent in auto usage.

Portland’s transit agency, TriMet, accu-rately brags that Portland transit usage grewfaster than driving in the 1990s. But it fails tomention that transit’s share declined in the1980s, when the region’s first light-rail linewas under construction. In 1980 more than2.6 percent of motorized passenger travel inthe Portland area used transit. By 1990, thathad fallen to 1.8 percent. Over the next 12years, it slowly climbed to 2.3 percent but stillremained well below the 1980 level. Since2002 it has stagnated or slightly fallen.20

Even if it were still increasing, the differencebetween 1.8 and 2.6 percent means takingless than 1 percent of cars off the road.

Because transit’s major market is com-muters, many prefer to measure transit by itsshare of commuting rather than of total pas-senger travel. During the 1970s, TriMet mademany improvements in bus service, includingbuilding a downtown transit mall, increasingbus frequencies, and providing commuterswith park-and-ride stations. Between 1970and 1980, total transit ridership tripled andthe share of commuters taking transit towork increased from 7.0 to 9.8 percent.21

After construction began on Portland’sfirst light-rail line, however, cost overrunsforced TriMet to raise bus fares and reduceservice. By 1990, four years after the light-railline opened, only 6.7 percent of commutersrode transit to work—less than in 1970.Ridership recovered in the 1990s, but by2000 the share of commuters using transitwas still only 7.7 percent, well under the 1980rate. By comparison, buses in Portland’s rivalto the north, Seattle, carried a smaller per-centage of travel than Portland in 1980, but

5

Transit’s sharesof Portland traveland commutingare lower todaythan they werebefore the citybegan buildinglight rail.

341402r1 PA596.qxp 6/25/2007 1:59 PM Page 5

were ahead of Portland’s bus-and-light-railsystem in 1990 and 2000.22

Transit works best at taking commutersto centrally located jobs. In 2001, TriMet wasproud to say that 46 percent of all downtownPortland workers rode transit to work. Only11 percent of Portland-area commuters workdowntown, so on a regional level this is notvery important. But transit did help relievecongestion and parking problems in thedowntown area. By 2005, however, the num-ber of downtown workers commuting bytransit declined by more than 20 percent,while the number driving to work increased.The result was that transit’s share of down-town commuting fell to just 38 percent.23

One reason for this decline is that TriMethad to make service cuts due to the 2001recession. The high cost of new rail lines andinflexible light-rail mortgage paymentsforced the agency to cut deeper than wouldhave been necessary if it operated a debt-free,bus-only system.24

High gas prices in 2006 led to record rid-ership levels for many transit agencies.25 Butdue to budget and service cuts, Portlandtransit ridership grew by an anemic 0.1 per-cent.26

Even with adequate budgets, Portlandplanners themselves do not predict that theirplans will lead to a huge shift in travel habits.A 1997 regional plan called for a 70 percentincrease in population densities within theurban-growth boundary and the construc-tion of 125 miles of rail transit and scores ofhigh-density, transit-oriented developments.Planners projected that these actions wouldreduce the share of trips taken by automobilefrom 92 percent in 1990 down to 88 percentin 2040. Since planners also anticipate a 70percent population increase during thattime, the small decline in driving’s share oftravel would not prevent a huge increase intraffic congestion.27

In short, Portland’s integrated land-useand transportation planning has not pro-duced any miracles for transit. If transit playsa slightly greater role in regional travel thanin some other cities, it plays a smaller role

than in Portland’s closest peer, Seattle, whichuntil 2000 had no rail transit.

Myth #2: Transit-Oriented Development

One of the highlights of any tour ofPortland offered by planning officials is avisit to one of the many transit-orienteddevelopments that have sprung up all overthe region. These high-density, mixed-usedevelopments are supposed to herald a newlifestyle that uses less land and resourcesbecause people live in multifamily housing orin homes on tiny lots, walk to shops, taketransit to work, and generally drive far lessthan people living in traditional suburbs.

Many transit-oriented developments, orTODs as planners call them, are built rightnext to light-rail stations. A typical develop-ment is four to five stories tall, with shops andoffices on the ground floor and apartments orcondos above. One famous transit-orientedvillage, Orenco, was built when a light-rail linewas constructed across prime farmland withthe express purpose of subdividing that landinto a high-density development.

Tour guides usually neglect to mentionseveral important points about PortlandTODs:

1. They are heavily subsidized, manyreceiving tens of millions of dollars ofsupport in the form of tax breaks,infrastructure subsidies, below-marketland sales, and direct grants.

2. Despite the subsidies, vacancy rates areoften high, particularly in areas desig-nated for shops.

3. While these developments may attractsome people who prefer not to drive,there is little evidence that they havesignificantly changed people’s travelhabits.

As previously noted, when Portland’s firstlight-rail line opened for business in 1986,the city zoned much of the land near light-

6

Despite light railand streetcars,

between 2001 and2005, the number

of downtownPortland

commuters taking transit to

work declined bymore than 20

percent, while thenumber driving

to workincreased.

341402r1 PA596.qxp 6/25/2007 1:59 PM Page 6

rail stations for high-density development.Ten years later, city planner Mike Saba sadlyreported to the Portland city council, “wehave not seen any of the kind of develop-ment—of a mid-rise, higher-density, mixed-use, mixed-income type—that we would’veliked to have seen” along the light-rail line.City Commissioner Charles Hales noted,“We are in the hottest real estate market inthe country,” yet city planning maps revealedthat “most of those sites [along the light-railline] are still vacant.”28 To correct this, Halesconvinced the council to offer developers 10years of property tax waivers for any high-density housing built near light-rail stations.

Over the next decade, the city experienced aboom in high-density developments, virtuallyall of which were subsidized. Even with thesubsidies, planners and developers soonlearned that so-called transit-oriented develop-ments only work if they have plenty of parking.

For example, the state of Oregon ownedland next to a light-rail station in eastPortland. In 1998, the state sold the land todevelopers at below-market prices and develop-ers received a total of $13 million in subsidies tobuild a $31-million, high-density project calledCenter Commons. The development providesless than two-thirds of a parking space perdwelling unit, but residents handle that byfreely parking on the sidewalk and in areasclearly marked as fire lanes.29

Despite those problems, the city considersthe project a success. When asked for a defini-tion of success, an official replied, “When theconstruction was completed, the projectbecame a success.” In other words, “it’s not justa matter of ‘build it and they will come,’” com-ments John Charles of the Cascade PolicyInstitute; “simply building it is enough.”30

Another development called The Roundis located in the Portland suburb ofBeaverton. Beaverton gave $12.4 million insubsidies to the developer, who was supposedto build a retail-office-housing complex sur-rounding a light-rail station.31 Yet bankswere unwilling to finance a developmentwith inadequate parking, so the developerwent bankrupt and the project sat half-com-

pleted for several years. Finally, the city founda new developer who finished it—on the con-dition that the design would be modified toinclude 700 parking spaces. “The key compo-nent is parking,” said the developer.32 Yetvacancy rates remained high after construc-tion, partly because the development still hadparking shortages.33

Another development, Beaverton Creek, islocated next to a huge light-rail park-and-ride lot. But the parking is open only to light-rail riders. With little or no parking availableto customers of the ground-floor retailshops, nearly all of those shops remainvacant several years after it was completed.

Parking problems also plagued Orenco,the pride and joy of Portland-area planners.Planners allowed only limited parking in theareas closest to the light-rail station, andmore parking further away. As a result, theareas near the station were the last to bedeveloped, so most of the residences are notwithin walking distance of the station.34 Thedeveloper who built much of Orenco called it“our nonprofit wing,” implying that his com-pany only built it so it could get permits tobuild more lucrative developments of single-family homes on larger lots.35

A survey of Orenco residents by Lewis &Clark College researcher Bruce Podobnikfound that most of them liked the develop-ment but that few had changed their travelhabits. “Though some have increased theirreliance on mass transit for occasional tripssince moving into Orenco Station, most resi-dents of the neighborhood report usingalternative modes of transportation far lessthan do their counterparts in NortheastPortland,” says Podobnik. “A key objective,that of significantly altering resident trans-portation habits, therefore remains to beachieved in Orenco Station.”36

One of the most embarrassing failures ofPortland’s transit-oriented planning wasCascade Station, an office-and-retail parkthat was supposed to be built on the 120acres of land given to Bechtel in exchange forthe company building the airport light-railline. Because the land was immediately adja-

7

Even when theyare next to light-rail stations,transit-orienteddevelopmentsonly work whenthey have plentyof parking.

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cent to the airport, it was not suitable for res-idential use, but planners zoned it for small-box retail—shops no larger than 60,000square feet—because big-box retail (stores of100,000 to 300,000 square feet) would be too“auto dependent.” Although the city spent$28 million on parks, utilities, streets, andsidewalks, no one wanted to lease a smallshop or office on a site that was miles fromany residential areas, so the area remainedvacant for five years after the light-rail lineopened in 2001.37

Rail skeptics were amused that every light-rail car going to and from the airport duti-fully stopped at both of Cascade Station’s railstations, even though no one wanted to geton or off. Apparently, not stopping wouldhave disrupted the schedules. Critics wereeven more amused when a passenger didboard the rail car one day: a coyote lookingfor solitude aboard one of TriMet’s emptytrolley cars.38

Finally, planners caved in to developerswho insisted that small-box retail made nosense at the site. Instead, the city has persuad-ed Ikea to build a 280,000-square-foot store onthe site and hopes to attract at least one otherbig-box store (though not one headquarteredin Bentonville). Apparently, cheap Asian-madegoods sold by a Scandanavian retailer aremore politically correct than cheap Asian-made goods sold by an Arkansas retailer.Though Ikea will deliver purchases to any cus-tomers who arrive by light rail or stow theirbikes in one of the mandated 75 bike racks,the store expects most of its customers to useone of its 1,200 parking spaces.39

Myth #3: Development-Oriented Transit

Portland planners believe in the “field ofdreams”: “Build it, and they will come.”40

TriMet claimed that Portland’s first light-railline stimulated more than $1 billion worth ofdevelopment.41 After Portland built a down-town streetcar line, planners claimed that itstimulated $2.3 billion worth of develop-

ment.42 And after Portland’s aerial tram wasbuilt, planners claimed it generated $1 bil-lion worth of development.43

The first problem with these claims isplanners’ assumption that correlation provescausation. In counting developments sup-posedly “stimulated” by transit, plannerssimply added up all the value of develop-ments within a few blocks of transit lines orstations. They made no attempt to insurethat the developments really had anything todo with transit.

Measured by value, the vast majority ofthe $1 billion of investments supposedlystimulated by the light rail consists of gov-ernment buildings, some built in response toexecutive orders by President Clinton andOregon’s Governor Barbara Roberts that allfederal and state agencies should relocate todowntown areas.44 One government-fundedbuilding supposedly stimulated by the light-rail line was a $5 million downtown parkinggarage. If light-rail works so well, why is a newgarage needed and in what sense did light railstimulate the construction of that garage?

The second problem with claims that tran-sit stimulated new development is that they arebased on double counting. For example, thestreetcar and aerial tram both serve the samearea, so all of the $1 billion in developmentsupposedly stimulated by the aerial tram isincluded in the $2.3 billion in developmentsupposedly stimulated by the streetcar.45

The biggest problem with the claim thattransit stimulates development is that most ofthe private developments themselves receivedhuge subsidies. The Portland DevelopmentCommission (the city’s urban-renewal agency)uses tax-increment financing and federalgrants to subsidize developments in urban-renewal areas. In recent years, those areas havefocused on transit zones and corridors. (For adescription of how tax-increment financingworks, see “Problem #3” below.)

The Portland streetcar, for example, trav-els almost entirely within the River, SouthPark Blocks, and North Macadam urban-renewal districts. New developments in thesedistricts received more than $665 million of

8

If light rail worksso well, why was a

new garage needed and in

what sense didrail stimulate its

construction?

341402r1 PA596.qxp 6/25/2007 1:59 PM Page 8

tax-increment financed subsidies from thePortland Development Commission. TheNorth Macadam District, which received atleast $289 million of these subsidies, is alsothe location of the aerial tram. It is fair to saythat the subsidies played a much larger rolein redevelopment than a 7-mile-per-hourstreetcar line or 13-mile-per-hour tram.

Other subsidies include Federal TransitAdministration grants to transit-orienteddevelopments; U.S. Department of Transpor-tation grants for “congestion mitigation,” and(as previously mentioned) below-market landsales and 10-year tax waivers for high-densityhousing.46 When tax-increment finance dis-tricts aimed at supporting new light-rail linesare added, subsidies to Portland-area transit-oriented developments probably come close to$2 billion, not counting the cost of light rail,streetcars, or other transit projects.

Portland’s story of spending $90 millionon a streetcar line to get $2.3 billion of devel-opment, or $57 million on an aerial tram toget $1 billion of development, sounds attrac-tive to officials from other cities. It might notsound so attractive if Portland admitted thatit really had to spend $665 million, in addi-tion to the cost of the streetcar line and tram,not to mention 10-year tax waivers on at least$100 million of development, to get that $2.3billion worth of development.

“It is a myth to think that the market willtake care of development along transit corri-dors,” said Portland City CommissionerCharles Hales in 1996, when he proposed tosubsidize such developments.47 “The $55million streetcar line has sparked more than$1.5 billion (and growing) in new develop-ment,” said consultant Charles Hales 10years later, working to sell streetcars to othercities and conveniently forgetting about thesubsidies he promoted when he was on thecity council.48

“Look at all the cranes in the city,” saysdeveloper Homer Williams. “Outside of two orthree exceptions, it’s all because of the street-car.”49 Yes, because of the streetcar and thehundreds of millions of dollars in subsidies inthe areas served by the streetcar. While transit

may be a catalyst for subsidies to develop-ment, it is not itself a catalyst for development.

Myth #4: Portland Curbed SprawlEven if Portland’s integrated land and

transportation planning is not changingpeople’s travel habits, planning advocatescontent themselves with the thought thatPortland is at least preserving farmland andcurbing sprawl. After all, according to theCensus Bureau, between 1990 and 2000, thepopulation density of the Portland urbanizedarea increased by 10.6 percent.50

One problem with this reasoning is thatmany urban areas that have no urban-growthboundaries increased their densities by evenmore than 10.6 percent. During the 1990s,Kansas City’s density increased by 39 percent;Phoenix’s by 34 percent; Dallas-Ft. Worth’s by33 percent; San Antonio’s by 26 percent;Houston’s by 20 percent; and Orlando’s by 13percent.51 One reason for these increases isthat the Census Bureau changed its definitionof urbanized area so as to eliminate vacantlands that had previously been included.

Another reason for Portland’s increaseddensity is that much of the growth took placeas “infill” on prime farmlands, such asOrenco, that happened to be inside theregion’s urban-growth boundary. This sug-gests that planners are not so much protect-ing farmlands as determining which farmersget to enjoy windfall profits because they areinside an imaginary line.

At the same time that newcomersincreased the Portland area’s density, largenumbers of other people escaped Portland’splanning system by moving to Vancouver,Washington; Salem, Oregon; and other com-munities outside the reach of Portland plan-ners. As land-use rules drove up housingprices, many people with Portland-area jobsmoved to communities outside the bound-ary. “Middle-class people are moving to thesuburbs for bigger houses,” admits Portlandcity commissioner Erik Sten.52

9

Rail transit is nota catalyst fordevelopment; it isa catalyst for subsidies todevelopment.

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Between 1990 and 2000, Portland grew by21 percent, while its Oregon suburbs such asBeaverton and Gresham grew by 30 to 40 per-cent. Meanwhile, Vancouver, Washington—directly across the Columbia River fromPortland but beyond the reach of Portlandplanners—grew by 210 percent.53 ThoughVancouver started the decade with barely 10percent of Portland’s population, it actuallygained more new residents during the 1990sthan the city of Portland.

Meanwhile, 45 miles south of Portland,Salem grew fast enough to overtake Eugene asOregon’s second-largest city in 2001. Like allOregon cities, Salem has an urban-growthboundary, but planners there were less aggres-sive than in Portland and so Salem’s housingmarket has remained more affordable.54

Rather than preventing sprawl, Portland’splanning has to some degree accelerated it.Instead of leading people to drive less, theplans are forcing people to commute longdistances to find affordable housing.

Myth #5: Portlanders Love Planning

Portland’s planning represents “truedirect democracy in action,” says the BBC.55

Hardly: Several recent elections and otherevents have seen defeats for the planners, butthey continue to plan anyway.

• In 1995, planners began rezoningneighborhoods to higher densities. Thefirst neighborhood targeted for densifi-cation was Oak Grove, where I lived atthe time. When planners held publichearings to find out how residents feltabout the plan, they were confronted byhundreds of angry homeowners. Localgovernment officials reluctantly askedMetro, Portland’s regional planningagency, to take Oak Grove off the list ofneighborhoods slated for rezoning, say-ing “there is no community support”for the plan.56 Metro and other localgovernments responded by not holding

public hearings in most other neigh-borhoods slated for densification.Instead, plans were written by commit-tees consisting of a few neighborhoodresidents who were prescreened toinsure they supported Portland’s densi-fication, along with many more nonres-idents, such as officials representingTriMet and other government agencies.

• In 1997 voters in the Portland suburbof Milwaukie recalled their mayor anda majority of their city council fromoffice because the council hadapproved a plan to rezone part of thecity for higher densities.57 Plannerswere greatly relieved when no other cityfollowed the suburb’s example.

• Public hearings held in 1998 on light-rail expansion plans revealed planners’lack of commitment to the democraticprocess. At the first few hearings, plan-ners intimidated anyone who attempt-ed to distribute anti-light-rail litera-ture, even just copies of their testimo-ny, by threatening them with arrest for“criminal trespass.”58 Metro changedthis policy after it realized that the FirstAmendment allowed people to expresstheir opinions at public hearings.

• In November, 1998, Portland-area vot-ers rejected, by 47-to-53, the proposedexpansion to the light-rail system. YetTriMet is expanding anyway, using tax-increment financing—the only waylocal officials in Oregon can use prop-erty taxes without a public vote—tofinance the new lines.

• In 2002 planning opponents put a mea-sure on the ballot that would forbidMetro, Portland’s regional planningagency, from requiring that more neigh-borhoods be rezoned to higher densities.Having already densified dozens ofneighborhoods, Metro responded withits own measure that put a moratoriumon densification through 2015.Planning advocates claimed victorywhen Metro’s measure won—but if theyhad really believed that voters supported

10

Thanks to planning-induced

housing shortages, the

fastest growingcity in the

Portland area isVancouver,

Washington.

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their density plans, they would simplyhave opposed the original anti-densitymeasure.

• In 2004 property-rights activists putmeasure 37 on the ballot, allowing any-one whose property values had beenreduced by planning and zoning to askfor either compensation or to have therules waived. Planning advocates spent$2.7 million to argue that this woulddestroy Oregon’s land-use planningsystem. Though measure 37’s support-ers spent barely a third of that amountpromoting it, the measure passed by 61percent, winning a majority of the votesin every county in the Portland area.

• In 2005 Portland’s incoming mayor,Tom Potter, announced a “VisionPDX”process that would allow Portland resi-dents to “create a vision for Portlandfor the next 20 years and beyond.”59

After collecting people’s opinions formore than a year, a draft report revealedsignificant uneasiness with thePortland’s plans. Respondents “worryabout a growing gap betweenPortland’s haves and have-nots—inschools, health care and the prioritiesof city government,” says the draft. Inparticular, many people think “thetram/South Waterfront/North Macadamdevelopment (not to mention the Pearl,which seems to have become a verb, asin ‘to Pearlize’) was a total waste ofmoney.”60

Far from representing direct democracy inaction, Portland’s programs are a classicexample of arrogant government plannersdoing their best to sidestep the public’s wish-es. “Portland-area residents have not know-ingly consented to be willing research sub-jects in a radical experiment,” warned aPortland State University professor of urbanstudies in 1995.61 The Goldschmidt affairrevealed that, not only was Portland’s plan aradical experiment, it was manipulated byspecial interests to maximize the profits ofselected developers and rail contractors. The

only question left is how Portlanders willoverturn the dominant paradigm.

Problems withPortland’s Plans

The previous discussion has already hintedat some of the major drawbacks of Portland’sintegrated land-use and transportation plan-ning. These include the following:

1. Increasingly unaffordable housingprices.

2. Increased traffic congestion.3. Higher taxes or reduced urban services

as tax revenues are diverted to rail tran-sit and transit-oriented development.

4. A reputation for having an unfriendlybusiness environment, leading tohigher unemployment.

Problem #1: Unaffordable Housing

During the 1990s, housing affordabilitydeclined by more in Portland than in any otherurban area in the United States. Today, Portlandremains more affordable than most Californiahousing markets, but it is far less affordablethan many less-regulated housing markets,such as Atlanta, Raleigh, and Houston.

A standard measure of a region’s affordabil-ity is median home price divided by medianfamily income. A price-to-income ratio of 2 orless is very affordable, whereas markets withratios above 3 verge on unaffordable. At cur-rent interest rates and a price-to-income ratioof 3, a family devoting a quarter of its incometo mortgage payments would need 17 years topay it off. At a ratio of 4, it would need 32 years,and at a ratio of 5, it could never pay it off.

The decennial census estimates both medi-an family income and median home value forthe year prior to each census. Census data revealthat almost all U.S. regions outside of Hawaii(which passed growth-management planninglegislation in 1960) had affordable housing in

11

Far from representingdirect democracyin action,Portland’s programs are aclassic example of arrogant government planners doingtheir best to sidestep the public’s wishes.

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1969. During the 1970s, many counties inCalifornia imposed urban-growth boundariesand other growth-management tools. By 1979,most California housing prices had become asunaffordable as those found in Hawaii.

Oregon urban-growth boundaries wereimposed in 1979–85, but a severe recessionthat caused the state to actually lose popula-tion during some years in the 1980s kepthousing affordable through 1989. As thestate’s economy recovered after that year,prices rapidly accelerated.

Growth boundaries limit the supply ofland available for new home construction. In1990, builders could buy an acre suitable forresidential use in the Portland area for$25,000.62 By 1997, the cost of the same acrewas between $150,000 and $200,000. Becausemedian incomes had not increased signifi-cantly, the National Association of HomeBuilders ranked Portland the second-leastaffordable housing market in the country.63

Growth boundaries are not the only causeof unaffordable housing. Other problemsinclude impact fees and an onerous permittingprocess that allows anyone in the state to chal-lenge a proposed development without hiringan attorney. One result of this regulation isreduced competition in the housing market.“The urban growth boundary has really beenour friend,” says a leading Portland home-builder. “It kept the major builders out of themarket.”64 Of course, in this case what is goodfor homebuilders is bad for homebuyers.

In 1989, Portland’s value-to-income ratiowas less than 2. By 1999, it had increased tomore than 3. It was no fluke that this increasewas greater than that of any other U.S. urbanarea: the second- and third-greatest increaseswere in Salem and Eugene, Oregon. Today, asnoted in the discussion of Mayor Potter’sVisionPDX, housing affordability is a majorconcern for many Portland-area residents.

Unaffordable housing hits low-incomefamilies particularly hard. With the growthboundary limiting new home construction,many young families are gentrifying low-income neighborhoods in Portland, pushingformer renters in those neighborhoods out

of single-family homes and into multifamilyhousing.65 “People who don’t have choicesare getting pushed out as rents go up,” sayscity commissioner Eric Sten.66

Although planners never actually said theywanted to increase housing prices, it is notclear that they see high prices as a problem. “Ifpeople want a compact urban area,” saidMetro’s chief land-use planner in 1996, “someincrease in the price of housing is going tooccur.”67 Higher prices would discourage peo-ple from living in homes with large yards andencourage more people to live in multi-familyhousing, which planners considered to be agood thing. In 2005, planners were elated tofind that land and housing prices had gone sohigh that—without any subsidies—developerswere tearing down suburban homes andreplacing them with high-density housing.68

Yet high housing prices cause several seriousproblems. First, they deny low-income familiesthe opportunity to achieve the American dreamof homeownership. “Insidiously, the burden ofsite-supply restrictions will fall disproportion-ately on poor and minority families,” saysPortland economist Randall Pozdena. Pozdenaestimates that if Portland’s planning measureshad been applied nationwide during the 1990s,more than a million young and low-incomefamilies would have been prevented from buy-ing homes.69

High housing prices may create windfallprofits for some homeowners—but it is mere-ly a paper profit unless they plan to sell andthen move to a lower-cost region or a smallerhome. However, this windfall, too, isinequitable, as the people buying their firsthomes tend to be less wealthy than thosewho already own their homes.

High housing prices also slow the growth ofurban areas. Silicon Valley saw an exodus offirms to the Portland area in the early 1990s,when Portland was still affordable. But by2000, Portland’s high housing prices led manypotential employers to look to Boise, Omaha,or other affordable communities.

Research in Britain, which has practicedgrowth management since 1947 and suffersfrom some of the highest housing prices in

12

In 2005, plannerswere elated to

find that, thanksto housing that

they made unaffordable,

developers werevoluntarily

tearing down suburban homes

and replacingthem with

high-densityhousing.

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the world, found that neighborhoods withhigh homeownership rates tend to havehigher unemployment rates than communi-ties with high rental rates.70 High housingprices make the cost of moving unaffordable,effectively immobilizing the population.

Harvard economist Edward Glaeser hasfound that growth management makes bothhousing prices and local employment ratesmore volatile. “In the long run, firms general-ly leave high-cost areas,” says Glaeser, so“places with rapid price increases over onefive-year period are more likely to haveincome and employment declines over thenext five-year period.”71 It is not surprising,then, that in much of 2001 and 2002Portland had some of the highest unemploy-ment rates of any major metropolitan area.72

Problem #2: Congestion

Between 1982 and 2003, the amount oftime the average commuter wasted in trafficincreased more rapidly in Portland than inAtlanta, Boston, Denver, Los Angeles, NewYork, Phoenix, or San Francisco—more, infact, than in almost any other U.S. urbanarea.73 This was not an unintended conse-quence of Portland’s planning—in fact, it waspart of the plan.

Increased congestion will “signal positiveurban development,” says a 1996 report fromPortland’s Metro.74 Three years later, Metro’sregional transportation plan declared, “trans-portation solutions aimed solely at relievingcongestion are inappropriate.”75 In fact, Metrohas decided that “level of service F”—the trans-portation engineer’s term for near gridlock—is“acceptable” during rush hour throughoutmost of the Portland area. Why? Because, saysMetro’s leading transportation planner, relievingcongestion “would eliminate transit ridership.”76

Following are just a few examples of howPortland planners are letting congestion increase.

• The biggest bottleneck in the Portlandarea is on Interstate 5 between Portlandand Vancouver, just south of the bridge

crossing the Columbia River, where thethree southbound lanes shrink to twolanes for just 0.8 miles. The result ishuge traffic backups as all the Portlandworkers who found affordable housingin Vancouver try to get to work eachmorning. Metro’s 1995 transportationplan estimated that it would cost only$10 million to add a third lane to thissegment, but to this date nothing hasbeen done.77 In 1998, Henry Hewitt,chair of the Oregon TransportationCommis-sion, told a legislative commit-tee that Metro had asked the depart-ment not to fix the bottleneck.78

• U.S. Representative David Wu (D), whorepresents west Portland, earmarkedfederal funds to expand state highway217, which may be the second-mostcongested freeway in the Portland areaafter I-5. Metro turned the moneydown, saying it had other priorities.79

• Portland’s 82-year-old Sellwood Bridge,the busiest two-lane bridge in Oregon,is structurally failing and was closed totrucks and buses in 2004. The BechtelCorporation offered to replace thebridge by 2010, but Metro andMultnomah County (which owns thebridge) turned them down. Due totheir lengthy planning processes, theydon’t even expect to begin constructionbefore 2010.80 When they finally do,they almost certainly will not addcapacity for anything except bicycles.

• Rather than increase roadway capacity,Portland is actively reducing the capac-ity of many arterials and collectors tohandle traffic. Speed humps and curbextensions have been added to suchcollectors as Belmont and Stark streets,while arterials such as Sandy, Barbur,and McLoughlin have been slated forboulevarding, also known as arterialtraffic calming, which means removingright- and left-turn lanes.

The Texas Transportation Institute esti-mates that congestion cost Portland-area

13

When U.S.RepresentativeDavid Wu (D)earmarked fundsto expand one ofthe most congest-ed freeways inOregon,Portland-areaplanners turnedthe money down.

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commuters more than $500 million in wast-ed time and fuel in 2003, a 1900-percentincrease from 1982.81 A study prepared forMetro and the Portland Business Allianceestimates that the cost of congestion to busi-nesses is of the same order of magnitude.82

In its 2020 regional transportation plan(published in 2002), Metro predicted that itsplans would increase the amount of timePortlanders waste sitting in traffic more than6.6 times.83 Congestion would increase despiteall of the region’s land-use and transit plansbecause those programs, predicted planners,would attract no more than about 4 percent ofauto drivers to other modes of travel.84 Whenasked about those predictions, which were inhis own agency’s report, Mike Burton, Metro’selected executive, told a legislative committee,“Nobody believes those numbers.”85

In 2007, the Federal Highway Administra-tion chastised Metro for its anti-auto trans-portation plans. “It is difficult to find thetransportation focus” in Metro’s regionaltransportation plan. Metro “should acknowl-edge that automobiles are the preferred modeof transport by the citizens of Portland,”added the agency. “They vote with their carsevery day.”86 Based on that “vote,” “The trans-portation solution for a large and vibrantmetropolitan region like metropolitanPortland should include additional highwaycapacity options.”87

Problem #3:Increased Taxes/Reduced

Urban ServicesOn September 17, 2006, developer Homer

Williams was eating dinner on the patio atthe Bluehour, the ritziest restaurant in thePearl District, when he saw police subdue aman on the sidewalk outside. Williams latertold police he was struck by the “casualness”of the situation.88

It was anything but casual for JamesChasse, the man in custody. A talented musi-cian who had schizophrenia, Chasse was fineas long as he took his medications. But a

nonprofit mental health clinic received areport on September 15 that he was not eat-ing and had probably stopped taking hismedicine. When someone working for theclinic tried to find him, Chasse fled in panic.

Two days later, police officer ChristopherHumphries saw Chasse and assumed he wasdrunk or on drugs. When Humphries tried toapproach, Chasse ran away. Humphries tack-led him and, according to witnesses, punchedand kicked him several times.89 While in cus-tody, Chasse died of chest injuries.

Portland mental health advocates wereoutraged that many of the programs thatcould have saved Chasse’s life had sufferedrecent budget cuts: community policing,90 acrisis triage center,91 and the city’s mentalhealth program.92 Yet the city continues tospend tens of millions of dollars a year subsi-dizing high-density developments. “So whilesome poor mentally ill guy lay there with hislife ebbing away,” blogger Jack Bogdanskiscathingly comments, “the big-shot real-estate sharpie sat with his cloth napkin on,eating his braised veal ravioli with truffles.”93

Between 10-year property tax waivers forhigh-density housing and tax-incrementfinancing for transit-oriented developments,Portland has diverted tens of millions of dol-lars of tax revenues a year from schools,police, fire, public health, and other urbanservices. This has contributed to fundingcrises for many of those services, even asdevelopers like Homer Williams continue toenjoy hundreds of millions of dollars in sub-sidies for their projects.

As of 2003 nearly $1.4 billion worth ofproperty had received tax waivers inMultnomah County (where most ofPortland is located). About $214 million ofthat was specifically for Portland’s high-den-sity or transit-oriented plans, representinglost tax revenues of about $4 million per year.Another $600 million is for improvementsand renovations to historic properties. About60 percent of these improvements, by value,are near the light-rail or streetcar lines, andmany were counted by Portland planners asdevelopments stimulated by rail transit.94

14

“While somepoor mentally ill

guy lay there withhis life ebbingaway,” blogger

Jack Bogdanskiscathingly

comments, “the big-shot

real-estatesharpie sat withhis cloth napkin

on, eating hisbraised veal ravioli with

truffles.”

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Portland has 10 urban-renewal districts, atleast 7 of which were created specifically to sup-port rail transit and transit-oriented develop-ments. The city uses tax-increment financing(TIF), a technique first developed to promoteurban renewal in California in 1953. Sincethen, TIF has become the primary means offinancing urban renewal in every state butArizona. Tax-increment financing provides thefunds used for eminent domain in urban-renewal areas; without TIF, cases like Kelo v. Cityof New London would never have happened.

Originally, urban renewal was supposed tobe a way for cities to kick-start development inareas so blighted that property owners anddevelopers would not invest in improvements.Today, it is often used by planners to shapedevelopment in areas that developers wouldgladly invest in without subsidies.95 Plannersuse the TIF money to subsidize developmentsthat are less marketable but more politicallycorrect than the ones developers would buildwithout subsidies. Often, that means high-density, mixed-use developments.

Under tax-increment financing, the exist-ing property taxes collected from an urbanrenewal district are frozen, meaning they aredistributed, as before, to schools and otherservices. All property taxes collected on newimprovements—the increment—are used tosubsidize those improvements. In most cases,planners estimate the revenues they will getfrom those improvements, then sell bondsthat will be repaid by those revenues. Thebonds are used to pay for infrastructure,below-market land sales, and sometimesdirect grants to the developers.

Portland has authorized the sale of $1.7 bil-lion worth of TIF bonds to support its 10 urbanrenewal districts. About $1.2 billion of thebonds are for the seven districts created specifi-cally for rail and transit-oriented development.They include the River District (created for thestreetcar and the Pearl; $234 million), AirportWay (created for the airport light rail andCascade Station; $73 million), North Macadam(created for the South Waterfront/aerialtram/streetcar; $289 million), Interstate (creat-ed for the Interstate light-rail; $335 million),

Gateway (created for the airport light-rail; $164million), Lents (created for a proposed light railto Clackamas County; $75 million), andCentral Eastside (created for a proposed light-rail line and transit-oriented developments; $66million).96 It is likely that bonding authority forthe Central Eastside and Lents districts willincrease as plans for those areas progress.

At least some of the money spent on thedistricts not created specifically for rail tran-sit and TODs has still gone to support thoseactivities. The streetcar was built with thehelp of $7.5 million of the $144 million inbonds for the South Park Blocks District.97

Many of the improvements in that districtand the Convention Center District ($168million) were counted by planners as invest-ments generated by rail transit.98

According to Multnomah County, the actu-al taxes diverted to Portland urban renewaltotaled $66 million in 2006, $41 million ofwhich went to the rail-TOD districts.99 Thatamounts to about 6 to 7 percent of total prop-erty tax collections in Multnomah County.100

Many of Portland’s suburbs, includingGresham, Wilsonville, and Tualatin, have theirown urban-renewal districts used to subsidizetheir own transit-oriented developments.

The Chasse tragedy symbolized the manyproblems caused by the diversion of fundsfrom schools, police, public health, and otherservices. Portland’s schools are particularlysqueezed by tax breaks and urban renewal.

Due to Portland’s high housing prices, adisproportionate number of families with chil-dren have moved to suburban or exurban areaswhere they can afford a house with a yard. As aresult, only 21 percent of city of Portland resi-dents are under the age of 18, compared to 27percent of Portland’s suburban residents.101

While suburban school districts are buildingnew schools, Portland’s is closing five to sevenschools per year. Despite the closures,Portland’s school district projected a $57 mil-lion shortfall in its 2007 budget. Such short-falls are only driving more families with chil-dren to the suburbs.102 When Portland’s mayorsuggested a city income tax to help schools, theidea sank like a lead aerial tram.103

15

Tax-incrementfinancing provides themoney for eminent domainin urban-renewalareas; withoutTIF, cases likeKelo v. City of NewLondon wouldnever have happened.

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All of these diversions have raised the ireof the public employees’ unions and otherswho work for or rely on the services that arebeing cut. These groups are engaged in “ahuge battle for the control of the Rose City,”observes writer Phil Stanford, author ofPortland Confidential, a book about corrup-tion in the 1950s and ‘60s. “What’s left of theold Neil Goldschmidt machine,” saysStanford, is “struggling to maintain the holdit’s had on the city’s purse strings.”104

One of the leading opponents of theGoldschmidt program, City CommissionerRandy Leonard, represented firefighter unionsbefore being elected. Since Portland firefight-ers get more than 90 percent of their fundsfrom property taxes, they are understandablyconcerned about tax-increment financing.105

Another opponent, Amanda Fritz—who chal-lenged an incumbent Goldschmidt supporterfor city council in 2006—has represented nurs-es unions. Although Fritz did not win, Leonardsurvived a strong challenge from a Goldschmidtsupporter in the same election.

Most recently, groups ranging from theLeague of Women Voters to the chair of theMultnomah County Commission are oppos-ing an extension of the Portland streetcar thatwould require more TIF money. The Leagueworries that TIF saps spending on schools andsocial services. Multnomah County says thaturban renewal costs it $14 million per year.106

In any case, says Stanford, “it looks like thepolitical machine that’s called the shots inPortland for almost 50 years is crumbling.”107

Problem #4: Business-Unfriendly EnvironmentColumbia Sportswear, one of Oregon’s

largest companies, was headquartered inNorth Portland but wanted to relocate to alarger space. In 2000 it found a location inthe Central Eastside urban-renewal district,and the city of Portland was pleased to wel-come the company there.

After making plans for the new office, how-ever, the company was told by Portland plan-

ners that it could not have any surface parkingat the site because “it’s a light-rail station.”There is no light-rail line anywhere nearby,and voters had turned down funds to buildsuch a line, but the city hoped to eventuallybuild the line anyway, so it declared the park-ing rule to be “nonnegotiable.”108 The compa-ny moved to suburban Washington Countyinstead, and its CEO blasted the city for itsanti-business climate.109

Homer Williams may find Portland to bea business-friendly environment. But forthose who cannot hire a Neil Goldschmidt tosmooth their way to riches, the cost of doingbusiness in the Portland area is high. Thatcost includes

• The high cost of land for office, indus-trial, or retail operations;

• The cost of overcoming Oregon’slengthy and onerous land-use planningprocess when siting such operations;

• The cost of congestion, especially forbusinesses that make daily deliveries ofgoods and materials;

• The cost of paying workers enough sothat they can afford housing and otherconsumer costs; and

• The high tax rates needed to support railtransit and other expensive programs.

Portland seemed to have a business-friend-ly environment in the early 1990s. Housingwas still very affordable, especially when com-pared to housing in California. In 1993, thestate legislature was prompted by Intel to passa law allowing cities and counties to tax onlythe first $200 million of the value of chip-mak-ing plants, which were often worth $1 billionor more. This seemed reasonable to manybecause such factories did not consume anymore public services than, say, sawmills orother pre-silicon plants.

As a result, at least 10 chip factories locatedin the Portland area, each employing thousandsof people. Between 1992 and 1998, the regiongained nearly 200,000 new jobs, a 26-percentincrease. Then job growth slowed as high pricesfor land and housing led employers to look to

16

Though there wasno light rail near

ColumbiaSportswear’s

proposed officebuilding and voters turned

down funds tobuild it, Portland planners wanted

to build it anywayso they told the

company it couldnot provide

surface parkingbecause “it’s a

light-rail station.”

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Boise and other low-cost regions to site newfacilities. At its peak, in December 2000, thePortland area had just under a million jobs. ByJanuary, 2004, employment had fallen nearly 8percent to less than 920,000 jobs. Since then,employment has recovered but today standsonly slightly above the 2000 peak.110

Conclusions andRecommendations

Portland planning did not start out as a realestate scheme aimed at enriching NeilGoldschmidt and his friends and clients, but itended up that way. Portland’s planningprocess was conceived by ideologues who dis-liked the automobile and wanted to preserveall of Oregon’s abundant open space no matterwhat the cost. It was endorsed by politicianswho refused to believe, or simply ignored, pre-dictions that it would hugely increase conges-tion and housing costs. And it was manipulat-ed by a cabal of politically connected business-es seeking to divert the flow of tax dollars intotheir own pockets. The opportunities for suchmanipulation were so obvious that, if NeilGoldschmidt had not started the light-railmafia, it would have been someone else; and ifit were not for Goldschmidt’s statutory rape,many Portland-area residents never wouldhave learned about this cabal.

The results have been a disaster for theaverage Portland-area resident. The light-railand streetcar lines, vibrant downtown streets,and scenic vistas outside the urban-growthboundary may seem attractive to visitors. Butresidents have to live in unaffordable hous-ing, creep along in traffic congestion, and payhigher taxes or suffer reduced urban servicesso that the region’s political leaders can fundtheir rail transit and transit-oriented devel-opment schemes.

Portlanders always hoped that planningwould save their region from becoming likeLos Angeles, the nation’s most congested,most polluted urban area. When Portlandplanners were in the midst of writing theirplan for densifying and railifying the region,

they examined the nation’s 50 largest urbanareas to see which was closest to the visionthey had for Portland.

It turned out that one region almost pre-cisely matched that vision. The nation’s dens-est urban area was also the major urban areawith the fewest number of miles of freewayper capita. That same area also happened tobe spending billions of dollars building newrail transit lines. Which urban area was that?Why, Los Angeles.

Despite the popular belief that LosAngeles is the epitome of urban sprawl, it isactually the densest urban area in America—about one third denser than the New Yorkurban area (which includes southwesternConnecticut and northeastern New Jersey).The Los Angeles urban area (which includesPasadena and much of Orange County) alsohas only about 53 freeway miles per millionresidents, compared with a national urbanarea average of 108 miles. Los Angeles is con-gested because it packs so many people into asmall area and doesn’t have enough roads forthem to drive on. It is polluted because carspollute the most in stop-and-go traffic.

“In public discussions we gather the gen-eral impression that Los Angeles represents afuture to be avoided,” wrote Metro in 1994.Yet “with respect to density and road percapita mileage it displays an investment pat-tern we desire to replicate” in Portland.Rather than see this as a sign that theremight be something wrong with their plan,planners merely attributed this to a differ-ence between “perception and reality.”111

Portland and Oregon can take severalsteps to remedy Portland’s problems beforethey get any worse:

• Portland-area voters should dissolveMetro, the regional planning agency,and return planning functions to localgovernments.

• The state legislature should repeal theland-use planning laws that are drivingup housing prices and immobilizingthe region’s transportation systems.

• As an intermediate step, the state should

17

The opportunities formanipulating thesystem were soobvious that, ifNeil Goldschmidthad not startedthe light-railmafia, someoneelse would have.

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pass legislation requiring Metro or localgovernments to make enough land avail-able for development at marketable densi-ties to maintain a 20-year supply of land.Similar legislation is currently being con-sidered by the California legislature.112

• As suggested by University of Marylandpublic policy professor Robert Nelson,the state could also pass legislation giv-ing groups of homeowners andlandowners the ability to opt out of localland-use planning and zoning by creat-ing a homeowners’ or landowners’ asso-ciation that writes its own plans and pro-tective covenants.113

• The state should also create a regionaltollroads authority that can sell bondsbacked to tolls to build highways tomeet the demand as measured bymotorists’ willingness to pay tolls thatare priced to minimize congestion.

• The region should halt construction ofrail transit lines and other transporta-tion projects that are not cost effectivein relieving congestion.

• The legislature should eliminate or strict-ly limit the ability of local governmentsuse tax-increment financing. At the veryleast, such financial support should beprovided to developers only if an area is soblighted that no development would takeplace without initial financial support.

Until these changes are made, cities outsidethe Portland area should scrutinize Portland’sclaims with skepticism. People who want to seetheir regions remain affordable, uncongested,and livable should look at Portland only as anexample of how not to plan.

Notes1. William Yardley, “City That Loves Mass TransitLooks to the Sky for More,” New York Times, January29, 2007, p. A15, tinyurl.com/3byffn.

2. Sayeeda Warsi, “Where the Car Is Not King,”BBC News, August 15, 2006, tinyurl.com/2mmku4.

3. Alan Ehrenhalt, “The Great Wall of Portland,”

Governing, May 1, 1997, pp. 20–24.

4. Auditor’s Office, City of Portland, Oregon, “CitySlogan: ‘The City That Works,’” tinyurl.com/3yf287.

5. U.S Census Bureau, 1990 Census, Table P107A(median-family incomes) and Table H061A(median home values).

6. George M. Smerk, The Federal Role in Urban MassTransportation (Bloomington: Indiana UniversityPress, 1991), pp. 120–21.

7. Susan Brody, director, Department of LandConservation and Development, “Status ofTransportation Planning Rule,” memorandum toGovernor Goldschmidt, July 31, 1989, p. 1,tinyurl.com/3ey585.

8. 1000 Friends of Oregon, “Making the Connec-tions: A Summary of the LUTRAQ Project,” 1997,pp. 8–10.

9. Land Conservation and Development Commis-sion, Transportation Planning Rule, Salem, OR:LCDC, 1991-012-0035(4). A 1998 amendment re-duced the 30-year goal to 15 percent, tinyurl.com/2gyf4c.

10. Transportation Planning Rule, Land Conserva-tion and Development Commission, OAR 660-012-0045.

11. John W. Frece, “Twenty Lessons from Maryland’sSmart Growth Initiative,” Vermont Journal of Environ-mental Law 6 (2004–2005), tinyurl.com/8sj28.

12. Nigel Jaquiss, “Who Knew: Long Before NeilGoldschmidt’s Secret Became Public, Many Influen-tial Oregonians Knew Something About It,”Willamette Week, December 15, 2004, tinyurl.com/yoxcuy.

13. Jim Redden, “Neil’s Network,” Portland Tribune,May 21, 2004, tinyurl.com/2lcesn.

14. Nick Budnick, “Power Connection: Kulongoski’sAppointment for Powerful Investment Council RaisesQuestions,” Willamette Week, June 7, 2005, tinyurl.com/29fmkx.

15. Redden, “Neil’s Network.”

16. Bob Young, “Big Dog,” Willamette Week, August 26,1998, tinyurl.com/2n4gah.

17. Jack Bogdanski, “You See This Sign?” Jack Bog’sBlog, March 20, 2007, tinyurl.com/36v2j7.

18. Warsi.

18

People who wantto see their

regions remainlivable should

look at Portlandonly as an

example of hownot to plan.

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19. Yardley.

20. Federal Transit Administration, “Service Suppliedand Consumed,” National Transit Database(Washington: U.S. Department of Transportation,various years); Federal Highway Administration,Highway Statistics (Washington: U.S. Department ofTransportation, various years), table HM72.

21. U.S. Census Bureau, 1970 Census, table 82,“means of transportation to work,” for urbanizedareas; U.S. Census Bureau, 1980 Census, table118, “means of transportation to work,” forurbanized areas.

22. U.S. Census Bureau, 1990 Census, table P049,“means of transportation to work,” for urbanizedareas; U.S. Census Bureau, 2000 Census, tableP30, “means of transportation to work,” forurbanized areas.

23. Portland Business Alliance, “2005 DowntownPortland Business Census and Survey” pp. 3, 11,tinyurl.com/29l38p.

24. Nick Budnick, “TriMet Feels Its Own Squeeze,”Portland Tribune, June 6, 2006, tinyurl. com/27t6z6.

25. American Public Transportation Association,“Americans Take More Than 10 Billion Trips onPublic Transportation for the First Time inAlmost Fifty Years” press release, March 12, 2007,tinyurl.com/35a36h.

26. American Public Transportation Association,“APTA Transit Ridership Report: Fourth Quarter2006,” p. 25, tinyurl.com/2kgt8y.

27. Portland Metro (Metro), “Recommended Alterna-tive Technical Appendix,” 1994, transportation tables.

28. Quotes from the October 23, 1996, city councilmeeting are taken from a videotape of that meetingmade by the city of Portland, a synopsis of which isavailable at tinyurl.com/2nhgnj.

29. John Charles, “The Mythical World of Transit-Oriented Development,” Cascade Policy InstitutePolicy Perpective no. 1019, October 2001, tinyurl.com/336pt6.

30. Ibid.

31. Aaron Fentress, “Beaverton Pays to Save Round,”The Oregonian, July 23, 1999, p. C1.

32. Richard Colby, “Stalled Project Gets AnotherChance,” The Oregonian, June 13, 2001, p. C1.

33. David Anderson, “Opposite Angles on the Round,”The Oregonian, September 21, 2006, p. 12.

34. John Charles and Michael Barton, The MythicalWorld of Transit-Oriented Development: Light Rail and theOrenco Neighborhood, Cascade Policy Institute,Portland, Oregon, April 2003, tinyurl. com/2kh6s.

35. Randy Gragg, “The New Urbanism: LaboratoryPortland,” The Oregonian, June 11, 2000, p. E10.

36. Bruce Podobnik, “Portland Neighborhood SurveyReport on Findings from Zone 2: Orenco” (Portland,Oregon, Lewis & Clark College, 2002), p. 1,tinyurl.com/2hhmwo.

37. Kennedy Smith, “Cascade Station Stops Shortof New Urbanism,” Daily Journal of Commerce,December 5, 2005.

38. “Wandering Coyote Booted from Airport Hopsa Train Instead,” The Scoop, February 15, 2002,tinyurl.com/2gmtat.

39. Jennifer Anderson, “Welcome to Portland? ManyEagerly Have Awaited Ikea, But Some Critics SayAny Big-Box Store Is a Bad Idea,” Portland Tribune,March 27, 2007, tinyurl.com/38k3ke.

40. G. B. Arrington, “At Work in the Field of Dreams:Light Rail and Smart Growth in Portland”(Portland, OR: TriMet, 1998), tinyurl. com/394bsd.

41. G. B. Arrington, “Beyond the Field of Dreams,”TriMet, 1996, tinyurl.com/2umsjv.

42. Portland Office of Transportation, “PortlandStreetcar Development Oriented Transit,” 2006,p. 1.

43. Hal Bernton, “Portland Tram Takes Off,” SeattleTimes, January 27, 2007.

44. William J. Clinton, Executive Order no.12988, Civil Justice Reform, February 5, 1996,and Executive Order no. 13006, LocatingFederal Facilities on Historic Properties in OurNation’s Central Cities, May 21, 1996; BarbaraRoberts, Executive Order no. 94-07, Siting StateOffices in Oregon’s Community Centers, June7, 1994.

45. City of Portland, Office of Transportation, pp.10–13.

46. Charles.

47. Quoted from the October 23, 1996, city coun-cil meeting taken from a videotape of that meet-ing made by the city of Portland. Transcript avail-able at tinyurl.com/2nhgnj.

48. Charles Hales and Robert Cone, “Streetcars Bring-ing People, Businesses Back to the City,” HDR

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TransitLine, 2006, tinyurl.com/2nx6x5.

49. Andy Guy, “The Little Trolley That Could . . .and Did,” Michigan Land Use Institute,November 29, 2006, tinyurl.com/39wt3o.

50. U.S. Census, 1990 Census, table CPH-1 forurbanized areas; U.S. Census Bureau, 2000Census, table GCT-PH1 for urbanized areas.

51. U.S. Census Bureau, 1990 Census , table CPH-1 for urbanized areas; U.S. Census Bureau, 2000Census, table GCT-PH1 for urbanized areas.

52. Clifton R. Chestnut and Shirley Dang, “SuburbsDrain City Schools,” The Oregonian, October 12,2003, p. A1.

53. U.S. Census Bureau, 1990 Census, table P-001for places; U.S. Census Bureau, 2000 Census,table P1 for places.

54. Randal O’Toole, “The Planning Penalty: HowSmart Growth Makes Housing Unaffordable,”American Dream Coalition, 2006, p. 44, tinyurl.com/24eksw.

55. Warsi.

56. Judie Hammerstad, chair, Clackamas CountyCommission, letter to Metro regarding Oak Grove,July 24, 1996.

57. R. Gregory Nokes, “Milwaukie Recall Wake-UpCall for Region’s Planners,” The Oregonian,December 22, 1997, p. A14.

58. I was threatened with arrest for passing out mytestimony at a hearing on April 8, 1998. Metro plan-ners called sheriff’s deputies, but by the time theyarrived I had given a copy to everyone who wantedone. At the next hearing, on April 13, Metro deniedthat it threatened anyone with arrest.

59. City of Portland, “Welcome to VisionPDX,”tinyurl.com/3d43kp.

60. Joseph Rose, “Survey Finds Have, Have-NotGap,” The Oregonian, February 15, 2007.

61. Ken Dueker, “Portland’s Love Affair with LightRail: Assessing the Risk Factors,” Portland StateUniversity Center for Urban Studies DiscussionPaper no. 95-6, 1995.

62. Foster Church, “Portland Becomes Pricey,” TheOregonian, July 31, 1995, p. A1.

63. R. Gregory Nokes, “Portland Housing Ranks as2nd Least Affordable in U.S.,” The Oregonian, July 19,1997, p. A1.

64. Jonathan Brinckman, “Builder Thrives withinBoundaries,” The Oregonian, September 1, 2005.

65. Portland Coalition for a Livable Future, “Displace-ment: The Dismantling of a Community,” 1999, p. 21.

66. Chestnut and Dang, p. A1.

67. R. Gregory Nokes, “Battle Builds on HousePrices,” The Oregonian, April 13, 1996, p. A1.

68. Dana Tims, “Land Value ‘Tipping Point’ HitsSuburbs,” The Oregonian, October 20, 2005.

69. Randal J. Pozdena, “Smart Growth and Its Ef-fects on Housing Markets: The New Segregation,”National Center for Public Policy Research,November 2002, p. 40, tinyurl.com/38ybkt.

70. Andrew Oswald, “Theory of Homes and Jobs,”working paper, University of Warwick, September18, 1997, tinyurl.com/2pfwvv.

71. Edward Glaeser, “The Economic Impact of Re-stricting Housing Supply,” Rappaport Institute,2006, p. 1, tinyurl.com/rmynm.

72. Bureau of Labor Statistics, “Metropolitan AreaEmployment and Unemployment: January 2002,”tinyurl.com/2eeq9b.

73. David Schrank and Tim Lomax, “The 2005 UrbanMobility Report,” Texas Transportation Institute,May 2005, p. 18, tinyurl.com/3bbr79.

74. Metro, Regional Transportation Plan Update,1996, p. 1-20.

75. Metro, 1999 Regional Transportation Plan, 1999,p. 638.

76. Metro, “Minutes of the Metro Council Transpor-tation Planning Committee Meeting,” July 18, 2000,p. 7.

77. Metro, Regional Transportation Plan, 1995, p. 5–17.

78. Henry Hewitt, chair, Oregon TransportationCommission, Testimony before the State SenateNatural Resources Committee, April 1, 1998.

79. James Mayer, “Wu’s Offer of Highway MoneyCreates a Pileup,” The Oregonian, July 3, 2006, p. E1.

80. Anna Johns, “This Bridge Is Building Bridges,”Portland Tribune, November 28, 2006, tinyurl.com/yoewq3.

81. David Schrank and Tim Lomax, “PerformanceMeasure Summary for Portland,” Texas Transpor-tation Institute, 2005, p. 2.

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82. Economic Development Research Group, “TheCost of Congestion to the Economy of the PortlandRegion,” December 2005, p. ES-1.

83. Metro, 2020 Regional Transportation Plan,2002, p. 5–4.

84. Metro, Region 2040.

85. Mike Burton, executive officer, Metro RegionalGovernment, Testimony before the State SenateNatural Resources Committee, April 1, 1998.

86. James Mayer, “Where Are the Roads? U.S. AsksMetro,” The Oregonian, January 30, 2007.

87. Jim Redden, “Metro at Odds with Officials onHighways,” Portland Tribune, February 13, 2007.

88. Portland Police Bureau, “Death Investigation:Interview with Homer Williams,” tinyurl.com/22czks.

89. Steve Duin, “The Fix Is In,” The Oregonian, Octo-ber 21, 2006; tinyurl.com/ 2rzcnm.

90. City Club of Portland, “Community Policingin Portland,” 2003, p. iii; tinyurl.com/yh9jk6.

91. Rosie Sizer, “The Death of James Chasse Jr.,” TheOregonian, October 25, 2006, tinyurl.com/yme6bz.

92. Maxine Bernstein, “Files Detail Chasse’s FinalDays,” The Oregonian, November 10, 2006, tinyurl.com/y5oeu6.

93. Jack Bogdanski, “Tale of Two Cities,” November13, 2005, tinyurl.com/2wqyto.

94. Multnomah County, Oregon, Assessor’s Office,“Specially Assessed and Tax-Exempt Properties,”2006.

95. Jennifer Lang, “New Urban Renewal in Colorado’sFront Range,” Independence Institute, 2007, p. 5.

96. Portland Development Commission, “Urban Re-newal History Appendix, 2006, tinyurl.com/yo2zde.

97. City of Portland, “Portland Streetcar Capital andOperations Funding,” 2007, p. 1, tinyurl.com/32jruj.

98. Portland Development Commission.

99. Multnomah County Tax Supervising andConservation Commission, Annual Report 2006–07, pp. 49–53, tinyurl.com/366rm4.

100. Ibid.

101. Census Bureau, 2000 Census, table QT-P1 forPortland and Portland-Vancouver urbanized area.

102. Paige Parker, “Middle Class Losing Faith inSchools, City,” The Oregonian, March 5, 2006, p. A1.

103. Jim Parker, “Portland Public School LeadersBack Away from Mayor’s School Tax Plan,” KGWNews, February 9, 2006, tinyurl.com/2qzzfp.

104. Phil Stanford, “Bitter End Is Near for PoliticalMachine,” Portland Tribune, March 3, 2006, tinyurl.com/26ly33.

105. Multnomah County Tax Supervising andConservation Commission, p. 19.

106. Nick Budnick, “Adams’ Plan Has Critics,” PortlandTribune, March 13, 2007, tinyurl.com/ 27ttt4.

107. Stanford.

108. Jim Pasero, “The City That Shrinks,”BrainstormNW, March 2002, tinyurl.com/7kpql.

109. Helen Jung. “Tim Boyle Faces Off with TomPotter over the City’s Business Climate,” TheOregonian, May 19, 2005, A1.

110. Bureau of Labor Statistics, Portland-Vancouver-Beaverton MSA Nonfarm Employment, seriesSMU4138900000000001, tinyurl.com/2mubygb.

111. Metro, “Metro Measured,” May 1994, p. 7.

112. Housing Affordability Act, S303, February16, 2007, tinyurl.com/2d2jzm.

113. Robert Nelson, “Privatizing the Neighbor-hood: A Proposal to Replace Zoning with PrivateCollective Property Rights to Existing Neighbor-hoods,” George Mason Law Review 7, no. 4(Summer 1999), pp. 827–80.

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OTHER STUDIES IN THE POLICY ANALYSIS SERIES

595. The Massachusetts Health Plan: The Good, the Bad, and the Ugly by David A.Hyman (June 28, 2007)

594. The Myth of the Rational Voter: Why Democracies Choose Bad Policiesby Bryan Caplan (May 29, 2007)

593. Federal Aid to the States: Historical Cause of Government Growth andBureaucracy by Chris Edwards (May 22, 2007)

592. The Corporate Welfare State: How the Federal Government Subsidizes U.S.Businesses by Stephen Slivinski (May 14, 2007)

591. The Perfect Firestorm: Bringing Forest Service Wildfire Costs under Control by Randal O’Toole (April 30, 2007)

590. In Pursuit of Happiness Research: Is It Reliable? What Does It Imply for Policy? by Will Wilkinson (April 11, 2007)

589. Energy Alarmism: The Myths That Make Americans Worry about Oil by Eugene Gholz and Daryl G. Press (April 5, 2007)

588. Escaping the Trap: Why the United States Must Leave Iraq by Ted Galen Carpenter (February 14, 2007)

587. Why We Fight: How Public Schools Cause Social Conflict by Neal McCluskey (January 23, 2007)

586. Has U.S. Income Inequality Really Increased? by Alan Reynolds (January 8,

585. The Cato Education Market Index by Andrew J. Coulson with advisersJames Gwartney, Neal McCluskey, John Merrifield, David Salisbury, andRichard Vedder (December 14, 2006)

584. Effective Counterterrorism and the Limited Role of Predictive Data Mining by Jeff Jonas and Jim Harper (December 11, 2006)

583. The Bottom Line on Iran: The Costs and Benefits of Preventive Warversus Deterrence by Justin Logan (December 4, 2006)

341402r1 PA596.qxp 6/25/2007 1:59 PM Page 22

2007)

582. Suicide Terrorism and Democracy: What We’ve Learned Since 9/11 by Robert A. Pape (November 1, 2006)

581. Fiscal Policy Report Card on America’s Governors: 2006 by Stephen Slivinski (October 24, 2006)

580. The Libertarian Vote by David Boaz and David Kirby (October 18, 2006)

579. Giving Kids the Chaff: How to Find and Keep the Teachers We Needby Marie Gryphon (September 25, 2006)

578. Iran’s Nuclear Program: America’s Policy Options by Ted Galen Carpenter(September 20, 2006)

577. The American Way of War: Cultural Barriers to Successful Counterinsurgency by Jeffrey Record (September 1, 2006)

576. Is the Sky Really Falling? A Review of Recent Global Warming Scare Stories by Patrick J. Michaels (August 23, 2006)

575. Toward Property Rights in Spectrum: The Difficult Policy ChoicesAhead by Dale Hatfield and Phil Weiser (August 17, 2006)

574. Budgeting in Neverland: Irrational Policymaking in the U.S. Congress and What Can Be Done about It by James L. Payne (July 26, 2006)

573. Flirting with Disaster: The Inherent Problems with FEMA by Russell S. Sobel and Peter T. Leeson (July 19, 2006)

572. Vertical Integration and the Restructuring of the U.S. ElectricityIndustry by Robert J. Michaels (July 13, 2006)

571. Reappraising Nuclear Security Strategy by Rensselaer Lee (June 14, 2006)

570. The Federal Marriage Amendment: Unnecessary, Anti-Federalist, and Anti-Democratic by Dale Carpenter (June 1, 2006)

569. Health Savings Accounts: Do the Critics Have a Point? by Michael F. Cannon (May 30, 2006)

568. A Seismic Shift: How Canada’s Supreme Court Sparked a Patients’ Rights Revolution by Jacques Chaoulli (May 8, 2006)

567. Amateur-to-Amateur: The Rise of a New Creative Culture by F. Gregory Lastowka and Dan Hunter (April 26, 2006)

341402r1 PA596.qxp 6/25/2007 1:59 PM Page 23

566. Two Normal Countries: Rethinking the U.S.-Japan Strategic Relationship by Christopher Preble (April 18, 2006)

565. Individual Mandates for Health Insurance: Slippery Slope to National Health Care by Michael Tanner (April 5, 2006)

564. Circumventing Competition: The Perverse Consequences of the Digital Millennium Copyright Act by Timothy B. Lee (March 21, 2006)

563. Against the New Paternalism: Internalities and the Economics of Self-Control by Glen Whitman (February 22, 2006)

562. KidSave: Real Problem, Wrong Solution by Jagadeesh Gokhale andMichael Tanner (January 24, 2006)

561. Economic Amnesia: The Case against Oil Price Controls and Windfall Profit Taxes by Jerry Taylor and Peter Van Doren (January 12, 2006)

560. Failed States and Flawed Logic: The Case against a Standing Nation-Building Office by Justin Logan and Christopher Preble (January 11, 2006)

559. A Desire Named Streetcar: How Federal Subsidies Encourage Wasteful Local Transit Systems by Randal O’Toole (January 5, 2006)

558. The Birth of the Property Rights Movement by Steven J. Eagle (December 15, 2005)

557. Trade Liberalization and Poverty Reduction in Sub-Saharan Africa by Marian L. Tupy (December 6, 2005)

556. Avoiding Medicare’s Pharmaceutical Trap by Doug Bandow (November30, 2005)

555. The Case against the Strategic Petroleum Reserve by Jerry Taylor and Peter Van Doren (November 21, 2005)

554. The Triumph of India’s Market Reforms: The Record of the 1980s and 1990s by Arvind Panagariya (November 7, 2005)

553. U.S.-China Relations in the Wake of CNOOC by James A. Dorn(November 2, 2005)

552. Don’t Resurrect the Law of the Sea Treaty by Doug Bandow (October 13,2005)

551. Saving Money and Improving Education: How School Choice Can Help States Reduce Education Costs by David Salisbury (October 4, 2005)

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PA Masthead.indd 2PA Masthead.indd 2PA Masthead.indd 2PA Masthead.indd 2PA Masthead.indd 2PA Masthead.indd 2PA Masthead.indd 2PA Masthead.indd 2PA Masthead.indd 2PA Masthead.indd 2PA Masthead.indd 2PA Masthead.indd 2PA Masthead.indd 2PA Masthead.indd 2PA Masthead.indd 2PA Masthead.indd 2PA Masthead.indd 2PA Masthead.indd 2PA Masthead.indd 2 2/9/06 2:08:35 PM2/9/06 2:08:35 PM2/9/06 2:08:35 PM2/9/06 2:08:35 PM2/9/06 2:08:35 PM2/9/06 2:08:35 PM2/9/06 2:08:35 PM2/9/06 2:08:35 PM2/9/06 2:08:35 PM2/9/06 2:08:35 PM2/9/06 2:08:35 PM2/9/06 2:08:35 PM2/9/06 2:08:35 PM2/9/06 2:08:35 PM2/9/06 2:08:35 PM2/9/06 2:08:35 PM2/9/06 2:08:35 PM2/9/06 2:08:35 PMUntitled-2 2 2/7/06 4:35:00 PM