Smart Growth Versus Individual Ownership:
End of the American Dream?

Address to the
La Salle County Land Owners Association
Citizens Distinguished Service Banquet
Ottawa, Illinois
18 May 2001

Wendell Cox

Congratulations on your historic and overwhelming victory over county-wide zoning in the April election. It is fair to say that an 82 percent "no" vote sent something of a message! More importantly, by your actions you have shown that local democracy is still alive in America.

I want to take this opportunity to talk to you about the threats to individual ownership that exist at this time. A radical agenda is being advanced, under the name "Smart Growth," that could threaten the prosperity of the nation. For that reason, I have entitled my presentation, Smart Growth versus Individual Ownership: The End of the American Dream?

True to the charter of the LaSalle County Land Owners Association, I will be non-partisan this evening. I will quote a great Republican from Illinois, a great Democrat from Illinois, and even a great communist from the thank God former Soviet Union.


For most of the last 150 years, property has been considered evil by many groups, especially socialists and communists. The early communists developed a theory that private property was unnatural, and that it did not exist in primitive civilizations. All manner of evil was theorized to have had its roots in private property. There was only one problem. History did not confirm the view. History shows that private property arises very early. As the French historian, Coulanges pointed out that the anti-property history underlying communism was false:

    The widespread belief derived not from historical evidence but from the climate of opinion prevalent in late nineteenth century Europe

And look what desolation resulted from this flawed analysis --- nearly a century of communism in Russia and nearly 50 years in eastern Europe.

The anti-property crowd had their chance, and proved beyond the shadow of a doubt the bankruptcy of their philosophy. The Soviet Union produced nothing but bondage and poverty for its people. Why? Because where there is not exclusive private ownership, no one cares. As Polish commentators pointed out during their transition from communism:

    what everyone owns, no one owns

But it didn't stop there. All across Europe, socialists nationalized industries and established expensive welfare states after World War II. And there, they paid in lower standards of living, excessive taxes and high unemployment. Much of the last 15 years has been spent trying to undo the mistakes of Socialists for whom history was a stranger.

But look at what has happened in America, which respects private property less than it should, but more than any where else. We have achieved by far the greatest prosperity of any nation. Our gross domestic product, measured in purchasing power, exceeds that of all countries except Luxembourg, a major European financial center approximately the size of Fresno (For those of you not familiar with Fresno, it is a medium sized city in California). The source of our prosperity is the way we treat individual ownership.

As Mikael Gorbachev put it, after he started to figure things out:

    ... wealth has to be created before it is redistributed.

But we need to understand that all that goes by the labels of free markets or capitalism does not work. Efforts to convert communist and Latin American countries have often failed. There is a good reason, which has been identified by the Peruvian economist Hernando DeSoto. It is that clear, exclusive and predictable property rights do not exist. Wealth is a result of individual ownership, and individual ownership must be predictable and secure so that it can perform its role of expanding wealth. That is the difference in America and the other prosperous nations. And so, it is not just selfish motives that justify individual ownership --- it is the health and prosperity of society itself. The most important reason for supporting property rights is that the larger community benefits so much.


It call comes down to freedom --- the freedom to control ourselves and our property. There is a popular, but misguided view that freedom exists only where there is equality of results. Nothing could be more wrong. America does not promise equality of results, and the Soviet Union, which did, could not produce it. People are different. Why does a Michelangelo work for years and little monetary reward to produce beauty that we still enjoy centuries later? Why does a Sam Walton establish a chain of stores that lowers our prices, creates wealth and earns him a great fortune, instead of working to produce beauty? It is because people are different. All that government can and should do is promise equality under the law, equality of opportunity. Society needs both its Michelangelos and its Sam Waltons.

And so, defining freedom is very simple.

    Freedom is the right to do what you want with what you have.

And from that proceeds a fundamental principle of freedom:

    Absent a material threat to others or the community, people should be allowed to do what they like.

Don't think for a moment you can give up effective control of your property and still be its owner. It doesn't matter what it says on the deed. If government controls your property, you don't own it, the government does.


This brings me to the present threat to individual ownership and prosperity. It goes by the name smart growth, and was invoked by proponents of county-wide zoning here in LaSalle County just a few months ago.

Under the guise of environmental protection, advocates of smart growth propose all manner of new restrictions on private property. This is not to understate the necessity of protecting the environment. It is however, to perceive the difference between hysteria and reality.

The advocates of smart growth would draw urban growth boundaries outside of which no development can take place. They would force us to live closer together, in higher densities. And they would stop building highways, discourage automobile use and try to get us into public transit.

And for what? The advocates of these new restrictions on private property have an obligation to prove that their draconian strategies are justified. They have not done so.

Like the communists and socialists of old, they have misread the facts. You saw it first hand here in LaSalle County, when your planning people tried to scare you into believing that metropolitan Chicago was about to engulf you. Their population projections for the next 20 years missed by 14 times --- 14 times. That would be like NASA like shooting for Mars and hitting Venus instead.

Regrettably, similarly superficial research is the foundation of much of the fear peddled by advocates of smart growth.

They tell us that we are running out of farm land because of urban development. But not according to the US Department of Agriculture, which says that urbanization is no threat to agricultural production. Indeed, during the last 50 years, seven times as much farm land has been taken out of production in the United States as has been urbanized. The reason --- greater agricultural productivity. If you want to save farm land, the policy prescription is obvious --- outlaw mechanization.

We are told that there is not enough open space, that urbanization is sprawling all over the countryside. But if there is sprawl, it is open space sprawl. Since 1950, one and one-half acres of new rural parks have been established for each acre of urbanization. Hardly a crisis.

We are told that densifying our cities will make traffic congestion better. Talk about fairy tales --- who believes that cramming more people and more cars into a smaller area will make things less crowded? Go to Europe, where they have had smart growth for years --- higher densities, limits on development outside the cities and much higher transit ridership. If the smart growth advocates have it right, traffic should be better there. But anyone who has tried to drive across even a medium sized European city knows, traffic is much worse.

People will use transit that takes them where they want, when they want at a speed that is competitive with the automobile. The problem is that transit does this virtually only to the nation's largest downtown areas, which have barely one out of ten jobs. The automobile does it for 100 percent of jobs. The automobile is a great liberator and a generator of prosperity. The automobile has democratized mobility --- it provides low income people virtually the same mobility as those with high income.

And then there is the matter of global warming, which the smart growth advocates think they will address by packing us more densely into cities and transit. Let's get this right. Our experts cannot reliably predict next week's weather, yet we are ask to believe that the experts can predict the weather 100 years from now?

There is also a call to responsibility. We also told that by moving to the suburbs we have impoverished the central cities. It is not quite so simple.

    The cities have schools that don't teach.

    Justice systems that do not punish.

    Public services that do not serve.

    Taxes that are higher than necessary

    and, don't forget, political corruption.

That's why so many people with a choice have moved.

Things may be changing, however, There are encouraging signs on the horizon as some of our largest cities begin to rebound under improved leadership. The improvements that have been wrought by Rudi Guiliani in New York are legendary, and Rich Daley has turned around Chicago.

But, in the final analysis, the cities were the authors of their own demise. People with a choice have not been willing to send their kids to schools that don't educate and expose them to neighborhoods that are not safe.

The fact is that, with respect to the cities, the smart growth advocates have responsibility all wrong. We are not the servants of government, government is to be our servant.

Then there is the matter of regional government. All across the country there are people that want to destroy local democracy and move its functions to higher levels of government. You saw that here with the push for county wide zoning. You see it in Illinois with the campaign to eliminate township governments. Well, people would rather be governed by people they know than by people they don't know. To paraphrase that great Illinois Republican, Abraham Lincoln:

    Government of the people, by the people and for the people is government that is closer to the people.

Smart growth advocates want to impose urban growth boundaries, so that there is no new urban development except where the planners mandate. But land is like gasoline. When OPEC limits gasoline supplies, the prices go up. And, when planners limit the supply of developable land, the price goes it. This can be seen in Portland, Oregon, which has adopted the nation's most anti-individual ownership land regulation. Housing affordability over the last decade has fallen more than double that of any of the other 80 largest urban areas in the nation.

You may recall that banks used to "red-line" entire neighborhoods, barring loans to project with what they perceived to be riskier situations. Urban growth boundaries promise to replace red-lining with green-lining. By not allowing markets to operate with respect to land development, millions of households will be denied the American dream of home ownership. This is particularly perverse for a number of reasons, not least because home equity represents the largest source of wealth accumulation for many middle income households. Indeed, if Portland's planners had been in charge, Abe Lincoln's family would not have been allowed to build that log cabin.

So what is behind smart growth? Certainly not facts. It is rather doctrine . It is as if the nation is being petitioned to adopt a new state religion, call it Ecotheism. It's fundamentalist doctrines promise to take away your right to do what you like with what you own. And, it is but a small step from violating your property to violating your person. This is a lesson society learned the hard way in the Soviet Union and Nazi Germany.

And so, the basic principle of liberty with respect to land use is stated by the Lone Mountain Compact:

    Absent a material threat to others or the community, people should be allowed to live and work where and how they like.


Getting ahead is not just the American Dream.

All around the world, people buy cars as soon as they get the money and they move to a house in the suburbs as soon as they have the money. I saw if first hand on the Tokyo where I visited a tract of new houses on offer. I couldn't read the signs, but the flags and parking lot made it clear. I went in, and walked around the house like a prospective buyer would in the United States. I spoke no Japanese and the agents spoke no English, but I could read the $500,000 price stated in yen. The American Dream is no longer just the American Dream, it is the Universal Dream. It is already alive in Japan, Canada and wherever people have prospered from the operation of markets that respect property rights. I look for the day that it becomes a reality in China and India too.

As I conclude, it is appropriate to recall the words of a great Illinois Democrat, Adlai Stevenson, who ran for President in 1952 and 1956:

    Our people have had more happiness and prosperity, over a wider area, for a longer time than men have ever had since they began to live in ordered societies 4,000 years ago. Since we have come so far, who shall be rash enough to set limits on our future progress? Who shall say that since we have gone so far, we can go no farther? Who shall say that the American dream is ended?

I'll tell you who --- the fear mongering Ecotheists.

It is up to people who know the difference between hysteria and reality to turn the ride. Our future must not be determined by the prejudices and doctrines of a an elite every bit as misinformed as the communist theorists of a century ago. There is another way --- based upon the overwhelming evidence of human innovation and advancement through history. Our cities are less polluted than since before the industrial revolution began. Our health care and span of life continues to improve. The Ecotheists have proven no problem sufficient to call for surrender of our liberties.

A few moments ago, Reverend Lees gave an invocation. I suspect he would like to have delivered a sermon. He did not. I will. It was some thousands of years ago, near the end of Moses' life. Israel stood outside the promised land. They sent 12 scouts in to assess the situation. They returned with less than a unanimous decision. Ten of the scouts were frightened by what they saw. The Cannanites were big and threatening. Israel, they said, was no match for them. But two scouts, Joshua and Caleb saw it differently. There was no question in their minds that Israel was more than a match for Canaan.

Like Joshua and Caleb, let us go forward in faith, not fear.

Biographical Information

Wendell Cox is principal of Wendell Cox Consultancy, an international public policy firm specializing in urban policy and transport. He has provided consulting assistance to government and private sector clients in the United States, Canada, Australia, New Zealand, Europe, Asia and Africa. He is a signatory of the Lone Mountain Compact, which delineates market oriented principles of urban land use. His discovery of errors in the US Department of Agriculture National Resource Inventory was instrumental in withdrawal and correction of its results (2000).

Mayor Tom Bradley appointed Wendell Cox to three terms on the Los Angeles County Transportation Commission. While in that position, he was elected chairman of the American Public Transit Association Planning and Policy Committee and the Governing Boards. Mr. Cox served three years as the Director of Public Policy of the American Legislative Exchange Council, where he oversaw the development of state model legislation and policy reports.

In 1999, Wendell Cox was appointed to the Amtrak Reform Council by the Speaker of the US House of Representatives, to fill the unexpired term of New Jersey Governor Christine Todd Whitman.

Wendell Cox was born in Los Angeles and grew up in Oregon, Washington and British Columbia. He was Oregon state mile run and cross country champion and set a national junior class (school year 11) record in the two-mile run. He attended the University of Southern California and earned a bachelor's degrees in Government from California State University Los Angeles and a Master of Business Administration from Pepperdine University.

(c) 2001 --- Wendell Cox Consultancy --- Permission granted to use with attribution.
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