Face the new EV

EV Grieve has been following the piecemeal clearance of all the commerce on 14th Street for some yet unknown development. Locals expect a huge high rise like the ones we saw south of Houston (The Ludlow, Blue, THOR, SVA), so I thought I'd show what is allowed there --

Photo: DCP

except maybe all glass and steel and ground floor storefronts. You can imagine which stores.

The strip from Avenue A to 1st Avenue is zoned for mixed use commercial and residential space with an 80 ft height cap and a maximum floor area ratio of 4, about the size of an Old Law 6-story tenement. It's similar to the EV/LES 2008 rezoning but without any affordable housing provision (beyond the 421a tax incentive which keeps it affordable only for about 25 years).

Will the developer get a variance to build higher? The Board of Standards and Appeals doesn't give out variances like candy -- the developer has to show some rationale. Otherwise the city wouldn't have spent millions on rezoning 120 neighbrohoods under Bloomberg. 

Right to the City

The group that started it all in Turkey was Istanbul Right to the City. The U.S. has a Right to the City too. The slogan has been around for a while. David Harvey wrote about it in a broad economic context here in the New Left Review. It raises a question: right to the city for whom? Of course, it's for residents, not for capital which preys on them. But which residents? Labor? The dispossessed? The disempowered? Artists? Professionals? Students? Gentrifiers?

The protest in Istanbul began with a confluence of middle-class interests including park conservancy and community groups: Taksim Gezi Park Protection and Beautification Association along withTaksim Solidarity and RttC, according to Jadaliyya. So do the middle-class have a right to the city? Is resistance in itself a progressive act against the powers that be, be they corporate or government or the collusion between them?

No. Community self-determination can be racist or reactionary. And it can be both regardless of class and income. I know upscale NoHo residents who support a new measure that will harass street vendors with hefty fines. (When I asked why, the answer was, there are too many. Sort of begs the question.) I attended a CB2 meeting at which Greenwich Village gentry angrily protested a small school's proposal to use a street for a playground during the day. Too much noise. I attended a meeting of low-income, subsidized residents who did not want a low-income assisted living facility next to their property. Beyond NIMBY, they asked that the facility be built in someone else's backyard a couple of blocks north -- it goes without saying that they didn't consult those residents. It made no difference to them that this assisted living facility was needed in the wider community, that two large senior facilities had just been closed not far away, and that this facility was dedicated to the disempowered and the dispossessed. Residents can be harsh and selfish. "Right to the City" is a romantic slogan. In reality, it can mean anything to anyone.

The credit goes to Istanbul RttC for seeing the park issue as more than a NIMBY issue, connecting it to a broader empowerment issue. That's what I see in NO711 -- the city-wide zoning amendment allowing community resistance to giant corporate control from afar, restricting access to capital, the Right to the City as Harvey means it, not just another reactionary NIMBY fight.

From shopping mall to political transformation

The protest in Turkey, like Occupy Wall Street, began with middle class discontent. OWS was ostensibly about money in politics, welfare for banks too big to fail and income inequality, but the pocketbook issues were student debt and unemployment. Critics thought these were spoiled, over-educated, middle-class kids, but we learned that they were economically and socially not the EV gentrifiers. When Penley tried to bring OWS to Tompkins Square Park, EV newbies howled and screamed: not in our backyard (here, also see the negative comments on Grieve's post.)

In Istanbul the protest started as a defense of a local green space from another shopping mall. It almost sounds like a bourgeois NIMBY story from Greenwich Village protesting NYU. Police repression fanned the flames into a much broader anti-government repression movement. But the central issue is still community self-determination. From RT: 

"...respect must come back to the political approach and implementation… That has to do with the way people feel fed up with the interference, micromanagement of their lifestyles." -- Istanbul-based political columnist Yavuz Baydar 

The future of NYCHA

If NYCHA follows through with its infill plan, building market-rate housing among the subsidized projects, I bet that within a decade the city will come up with a plan to give the low-income residents ownership of their apartments for minimum maintenance in the expectation that they'll sell immediately on the open market. The city will require only that it get a cut from the flip to fund the program. NYCHA projects is quality housing stock, a lot nicer than tenement housing, and it's got those river views. Where will the current residents go with their windfall? The city doesn't care, and the city won't have planned for it either. DCP plans only for upscaling and revenue-enhancing real estate raising, not for people.

Failed generalizations

Physics doesn't lack for predictive theories of physical nature, but if it were evaluated on its ability to predict the weather, we'd call it a dismal science. Economics doesn't lack for predictive theories either, it's just that we evaluate it on its ability to predict reality. Reality is only partly predictable.

Looking at the history of the LES in the 19th century, you see a consistent pattern of quality of living space declining in inverse relation to density and rent. Demand at the bottom of the social scale was sticky -- choices were limited by the lack of convenient transit and work was concentrated between the downtown docks and downtown industry. Ghetto construction was structurally uniform for each decade. Outside the immigrant quarter, amenities chased big money as you'd expect in an elastic market: a broad gradient from middle-class town houses to immense mansions. 

Both trends are economically predictable, perfect fodder for economic theory. But there's a change in the LES that doesn't fit the pattern. After around 1910, virtually nothing is built, even though the American economy continues to grow. Not surprising, the reasons for the end of development are not economic. One was a technological innovation only marginally unrelated to economic production -- the subway system, which increased mobility and commerce but not so much production. It allowed labor to live far afield. Quotas on immigration in the 1920's turned the ghetto from a high-demand exploitative rent district to a low-demand, low rent district as residents left for better living spaces and no new immigrants replaced them. Less obvious was the third tenement house New Law act, which required so much courtyard space that landlords couldn't develop on single lots anymore, curtailing single-lot development. You can see it for yourself on 1st Avenue -- rows of four- and five-story Antebellum tenements on single lots. 

Disinvestment in the ghetto was not the consequence of a shift from capital. That would be a backward analysis. Disinvestment was the consequence of political policy (labor protectionism, anti-immigrant eugenicism paralleling growing isolationism), a technological advance in mobility, and an entirely unintended consequence of a progressive movement to improve labor housing (again, politics) with the New Law that made it harder to develop downtown. 

The historical lesson I get from it: politics, technology and public policies like zoning and housing laws have had more profound local consequences than constants like capital growth. Culture plays a role as well. Gentrification can no longer be described as a single economic phenomenon if the youth culture of Williamsburg drives upscale families to seek child-friendlier neighborhoods. That has consequences for construction, schools and commercial character. Until an economist comes up with a theory that explains why a fix-wheel bike with no brakes designed for race tracks with no inclines and no stop lights would be the trend among upscale youth in urban centers filled with lights and steeply inclined bridges, economics will be stuck with "60% chance of rain today."

Will the future be like the past? You can count on the constants, so maybe that's where policy should target, always bearing in mind the law of unintended consequences rules. The most depressing documents are the urban planning proposals of the past. In retrospect they look completely wrongheaded, as if their authors didn't have a clue.

That's why local community self-determination has promise. It's not urban planning from above; it's urban needs from below where life actually happens. 

Pickets, boycotts and strikes

Labor faces a challenge in both chains and small entrepreneurs. On the one hand, there's an economy of scale for public protest against a chain. A boycott against the Gap can target many stores at once. Using social media it might even be possible for cashiers, say, across Walgreens city-wide to co-ordinate a job action. But the larger the corporation, the more resources it has, including greater mobility, which counterbalances the scale of public and the labor organizing. Stella D'Oro picked up and left NYC rather than negotiate. The garment industry left the country rather that pay a minimum wage and rent here. Retail chains can't leave, but they can hold out, and those employees that aren't unionized don't have much of a chance.

On the other hand, pickets and boycotts can succeed easily against a small business with a narrower profit margin. But it's rare to hold an action against a truly exploitative small owner because the profit margin is so narrow that the owner might have to close rather than capitulate, and closing the store puts the employees out of a job; everyone loses. So even the loudest activists somtimes have looked the other way. What made the fight against Jing Fong was the size of the restaurant.

A chain like 7-Eleven hires almost no one, so there are no benefits to the local economy to having them here. They're just easy, the way a Citibank on every corner is easy. And now you can even Citibike directly from it to 7-Eleven. Corporate heaven.

De-romanticising mom and pop

One response to Yglesias' post The Tragic Inelasticity of Bar Supply points to the great virtue of the growth model: 

It's not just bar owners and land-owners that make good money if a sport-bar becomes popular. Workers benefit to. People will probably leave bigger tips if the drinks are more expensive. And if an entrepeneur wants to keep his bar high-profile he will need to invest in hiring the best workers possible. (They might have to offer better pay then a generic fast-food chain: if you pay good money for your drink, you expect good service) Those workers will spend their extra money on all kind's of stuff which will benefit the economy.

but another posted the inevitable response: 

Nobody goes there anymore. It's too crowded. - Yogi Berra

My favorite responses to Yglesias' post: 

Learn to love chains? The chains that tend to pay as little as possible, use the cheapest products possible and charge the maximum price possible in order to increase margins and make their shareholders happy rather than the customers? No thanks!

and

Why learn to love chains? Why not just encourage more lovable local dives to start up? Aren't we better served by true small, personal businesses than big corporate impersonal monopolies?

This is a bit unfair to chains, since small businesses have to keep costs down too, including labor costs. But the old-style mom and pop bore that burden entirely on themselves and their kids. However, increasingly small businesses are not mom and pops -- they are small entrepreneurs starting up, hiring employees and even managers to handle the day-to-day.

There are still true mom and pops in the LES: shoe repair, printing/copying, bike repair, a couple of bakeries and butchers, locksmiths, a drugstore here and there, hardware, an exterminator (he keeps a tank full of a hissing Madagascar cockroaches). Most of those cannot be replaced with on-line services. It would be shame to see them replaced with chains.

Popularity or stability

Matt Yglesias pointed out on his blog yesterday that when your favorite bar or restaurant becomes popular, it typically raises its price points since it can't expand. When a chain store becomes popular, it expands into new locations, retaining its relative price. 

He's assuming that expansion is limited to individual corporations, ignoring the character of the nightlife strip: when a destination becomes popular, competitors arrive to cash in. 

He also ignores the long-term consequence of the chain: a cheap pizza chain opens next to your favorite pizza parlor either driving it out of business or driving it to produce a cheaper-quality pizza. Chains produce a race to the bottom. 

Popularity is the key here. Local-serving stores -- the so-called mom and pop -- do not draw to popularity, but to local needs. Popularity is a kind of upscale phenomenon of disposable income searching for the latest titillatory entertainment. The prototype is the roving bands of young singles flocking to a newly 'discovered' slum site cum nightlife strip. 

The invasion of the slum site is not the opportunism of development or gentrification, it's more like thrill-seeking; development will follow that disposable income, not lead it. You can see it in Chinatown, where Apotheke and Capitale opened without any gentrification. They opened because there was no gentrification. 

The success of the chain store isn't always its popularity. Sometimes it's just its price. Pinkberry, the Gap, Urban Outfitters and Red Mango belong in a different category from Costco, Ikea, Kmart and Walmart. Disposable income seeks the one, constrained income the other. 

Yglesias' observation reveals the future of commerce. The local-serving store that doesn't depend on non-local sources of demand isn't even on his youthful, upscale, trend-seeking radar. His notion of commerce is all about growth, not about community or stability. 

Beware capitalist tools

Robert Reich, Clinton's Labor Secretary, posted Monday on his blog a piece arguing limiting access to giant corporations:

If global corporations obeyed all national laws — the spirit of the laws as well as the letter of them – and didn’t use their inordinate power to dictate the laws in the first place by otherwise threatening to take their jobs and investments elsewhere, there’d be no issue.
It’s the fact of their power to manipulate laws by playing nations off against one another – determining how much they pay in taxes, as well as how much they get in corporate welfare subsidies, how much regulation they’re subject to, and so on – that raises the question of how citizens can countermand this power.
Consumer benefits may sometimes exceed such costs. But, as we’ve painfully learned over the years (the Wall Street meltdown, the BP oil spill in the Gulf, consumer injuries and deaths from unsafe products, worker injuries and deaths from unsafe working conditions, climate change brought on by carbon dioxide emissions, and, yes, manipulation of the tax laws – need I go on?), the social costs may also exceed consumer benefits....

...Comparative advantage is nice in theory, but in a world where powerful global corporations are using every strategy imaginable to maximize their profits and powerful governments are strategically employing market access to develop their economies, it’s just theory. 

 Wouldn't it be great if NO711's zoning proposal were the beginning of a wide-spread resistance against global corporate access at the ground level? Instead of relying on our failed political system to defend us from global capital, start with community self-determination growing from a grassroots movement? Could this be the second wave for Occupy -- occupy our own community?

Bike shares?

While New Yorkers battle over the new-fangled bike shares (new for New York -- they've been implemented in a lot of major cities here and abroad) and their corporate sponsorship, the Canadian economics blog with the sexy name Worthwhile Canadian Initiative (oh, that understated Canuck humor) wrote up a review of bike share claims here.

WCI's Wooley concludes that bike shares don't have much impact on health (bike sharers are mostly youngerish and already physically active), pollution or congestion, and doubts it's good for tourism (tourists are not comfortable biking in unfamiliar traffic and street patterns), but it could ease overloaded public transport since public riders are the most likely bicycle-share candidates and bikes get places faster than public transit.

The conclusion is a bit of understated humor itself. Users support bike sharing because they believe it will curb auto congestion and pollution; the mayor thinks fewer cars are better for tourists. No one is waving bike shares as a solution to public transit congestion, although it is mentioned in the NYC feasibility study.

So all this controversy was just another delay for the 2nd Avenue subway?

Shaoul, the BSA, DoB and WTF

Went to the Board of Standards and Appeals to see their response to Shaoul's request for a variance to keep the 6th floor expansion that the BSA had ruled illegally built some years ago. Shaoul's attorney made the good point that the Department of Buildings had issued a permit for the expansion, and the BSA didn't rule it illegal until after the expansion had been completed.

The BSA chair wasn't having any of it. She pointed out that the even though the building didn't have a Certificate of Occupancy, the owner had been renting the apartments illegally for years.

In reply, the attorney blamed that on the DoB for not enforcing the law. I was truly impressed with audacity of this legal argument. I really like it. If you place several hundred landlords, say, into a ship and sink it and drown them, it's the fault of the Coast Guard for not stopping you. I'm all for it.

But seriously, this attorney nailed the truth about NYC real estate: the DoB encourages illegal activity at every turn, either by issuing illegal permits (commonly permitting bulkheads that are actually intended for residential use, to skirt the zoning limits on residential space), or by failing to enforce blatantly illegal expansions, demolitions, hazardous endangerments to tenants -- literally whatever and whateverything landlords can think up.

Btw addendum: the BSA didn't rule on Shaoul's request at this hearing. They scheduled another hearing in late June and another in July to finish up. It was pretty clear that the BSA intends to deny him -- a whole bunch of elected officials signed on to a letter asking for a denial. But even if they deny, without enforcement, he'll just continue to flout the law.

Puzzling

It's supposed to be well-established that commodity prices are the inverse of interest rates. Interest rates are as low as they can be and luxury housing prices are high, for example. But the rest of the economy is not wildly inflated. Is liquidity trapped only for the 99%, and not for the luxury economy of the 1%? Anyone know?

Update with my own guess, since nobody ventured: low interest rates in a liquidity trapped recession hike luxury assets like the stock market and luxury housing, but don't stimulate the economy. Quantitative easing adds to the luxury market, since it pumps money directly to the 1% -- the banks. The underlying trouble is the lack of fiscal stimulus coming from Congress made worse by the sequester. In short, the well-established inverse relation between interest rates and commodity prices is just a generalization, not a rule. The economy is like the proverbial horse -- the Fed can flood the land with money, but it can't make that horse drink.

Call to action!

Constructing in an occupied building has become one of the most aggressive means of harassing tenants. Shaoul used it often, and Kushner, who recently bought nearly 30 parcels in our neighborhood, informed the community board last month that he intends to construct building expansions wherever he can. 

The case of 515 East 5th Street may become the precedent for all future expansion harassment. Please come to the Board of Standards and Appeals and spread the word. From GOLES:

GOOD OLD LOWER EAST SIDE, INC



TENANT ALERT!

FIGHT ILLEGAL CONSTRUCTION OF ADDITIONAL FLOOR AND PENTHOUSE ON 515 EAST 5TH STREET!

DATE: TUESDAY, MAY 21ST, 2013

TIME: 10:00 AM SHARP!

PLACE: BOARD OF STANDARDS AND APPEALS (BSA)

22 READE STREET, SPECTOR HALL

NEW YORK, NY 10007

(ONE BLOCK FROM CITY HALL)

COME TO THIS IMPORTANT HEARING AND SHOW YOUR OPPOSITION TO LANDLORD’S APPLICATION TO LEGALIZE THE ADDITIONAL FLOOR AND PENTHOUSE WHICH HE BUILT. THIS CONSTRUCTION WAS FOUND ILLEGAL IN BSA DECISIONS IN 2007 AND 2008. NOW THE LANDLORD IS SEEKING TO REVERSE THEM. IF LANDLORD IS ALLOWED TO KEEP THIS ILLEGAL CONSTRUCTION IT WILL SET A PRECEDENT FOR OTHER LANDLORDS TO DO THE SAME LEADING TO DANGEROUS CONSTRUCTION THAT CAN CAUSE DAMAGE TO STRUCTURE OF SUCH OLD TENEMENT BUILDINGS.

FOR MORE INFORMATION CALL GOLES 212-533-2541

Reviewing the 2008 rezoning

Irrational opposition to NO711 takes me back to the EV/LES rezoning. The supporters of the rezoning were as outraged at me back then as I am towards the one person who maintains polemical objections to NO711 -- not because of his polemic, which is at least interesting, sound or not, but because he lied, then supressed the truth and followed with a string of manipulations and distortions. So I wonder if, in pushing my opposition to the rezoning, I was similarly manipulative. What I said about the rezoning back then was: 

1. The rezoning is an overall upzoning. The EIS bore me out -- 53% more development under the rezoning than under the previous zoning. (Harvey Epstein fortunately managed to mitigate the upzoning plan with an IZ application over the avenues.) 

2. The upzoning of sidestreets will turn townhouses overnight into candidates for demolition and luxury redevelopment. That was an accurate prediction.

3. Developers would often choose not to take the Inclusionary Housing bonus. Also an accurate prediction, although the jury remains out with the largest developments upcoming on Mary Help of Christians and the former theater/deli on A between 6th & 7th. 

4. The height caps were too high, which allows for air rights sales, undermining the inclusionary bonus incentive. We're seeing this at play on Norfolk Street, and there will be more. 

5. The LES downzoning would drive hotel development onto the Bowery and into Chinatown. Hotel development has gone crazy on the Bowery and in Chinatown since the rezoning, although it had already begun before 2008. Hotel development would probably have continued regardless of the rezoning, so it's hard to tell how much the rezoning increased it. 

6. If the EV rezoning is implemented, there would be little political will within CB3 to protect Chinatown and the Bowery. I think I was wrong about this. CB3 eventually came around to support the Bower Alliance of Neighbors zoning plan (although CB3 still features on its website its old Bowery study that BAN rejected), and CB3 has shown support for the Chinatown Working Group's zoning efforts despite its amibitious scope. It's taken time, but it's happening. 

7. CB3 did not push hard enough to protect the Bowery. Here I was completely wrong. The city was and is intransigent on the Bowery. When CB3 members told me this, I simply didn't believe them. I wrongly assumed that they were sacrificing the Bowery for the sake of the rest of the EV. Whether they could have tried harder is irrelevant: they saw (and I did not understand at the time) that the city wouldn't budge, so pushing would get nothing but push back and trouble. So, considering the possibilities, I now think that CB3 cannot be faulted at all for the Bowery and its lack of protection, and I was wrong to fault them then. 

(In my defense, the Task Force leadership undermined its credibility by insisting that everyone had to accept the plan immediately and without change otherwise DCP would walk away from the plan. I responded, btw, that DCP had no intention of walking out. I was right about that as well: CB3 never fully approved the plan, insisting on Harvey's and Paul's 11-points of contention to the end, and yet DCP never walked. It was DCP's plan as much as the Task Force's and DCP wanted it at least as much as the Task Force leadership wanted it.) 

8. Under the previous zoning, most development in the EV was contextual; out-of-scale development was mostly south of Houston. That was true. After NY Law School and TNC, there was a lot of redevelopment in the EV, but only two rose above seven stories, one on 12th & C and one on 13th & B, both about 9 stories, one story taller than would be allowed under the rezoning. Just about everything else capped at 6 stories. 

So was I full of manipulations, distortions and absurd arguments? I'd genuinely like the rezoning supporters to explain. I'm sure I see all this still from my own perspective, so I have to rely on them for a more complete assessment.

The Death of New York

Here's the picture of the new New York: the new immigrants to New York are the American wealthy and their adult-age children. The new New York has not prepared for the new with large-scale construction, so these new migrants-of-means will gentrify this city unrecognizably throughout all five boroughs.

One of the few incentives to construct remains rent regulation. New construction is not regulated (unless the developer voluntarily accepts a cross-subsidy). When you read the nearly all economists, left, right or upside down and even the redoubtable Krugman, agree that rent regulations are bad for the housing market, what they mean is regulations across the board, including new construction. None of that holds in NYC. It's just the opposite. Rent regulations actually serve new construction. And deregulation wouldn't increase the market pool either. Regulated renters evicted by deregulation don't generally leave the pool -- they work in the city or have family here. They remain in the metro area, and wherever they go they create a tighter market there, displacing renters and upscaling neighborhoods, creating pressure both upwards and downwards. The result of deregulation is a disruptive game of musical chairs in which at best landlords at the top renovate to update deregulated spaces. (This was studied by, of all groups, Giuliani's arch-conservative Manhattan Institute, concluding that deregulation in Boston didn't lower market rate rents but actually increased market rate rents across the board.) The sum effect is a increase in the aggregate funds available for rent, and all of that goes to the landowner -- little more that a shift from the local economy where the regulated renters were spending, to the landlords. 

The moral is: keep rent regulations and construct luxury housing in upscale neighborhoods to keep the upscale out of ethnic neighborhoods, and hope that other American cites can draw the wealthy away from us. 

Demand for luxury apartments is higher than ever

Luxury apartments are rising higher now to meet increased demand. But "demand" is a gloss for at least three independent economic functions: 1) the quantity of those seeking an apartment relative to the availability of supply, 2) their willingness to part with their disposable income for living space (the "opportunity cost" of space), 3) the sheer quantity of their disposable income. There's a fourth function: a decline in use value that increases the exchange demand -- the willingness of apartment seekers to double up and share a space. Even if that doesn't directly raise prices of luxury apartments, it raises them indirectly. Raising prices down the ladder raises up top as the options narrow. 

The 19th century argument that the cost of living space would always rise as capital expands was definitively disproved in the 1960's and '70's when large swaths of Manhattan saw rental declines, in some places precipitous declines to zero and even below (landlord abandonment or arson, the city giving properties away to residents). This wasn't a shift of capital as with Detroit -- Detroit's experience gave support for Engels' warning that the immobility and economic inflexibility of home ownership for labor would be a curse as capital shifted locations, although in Engels' case he thought it wasn't so much capital shifting as that labor needed mobility to shift so it could sustain a strike by seeking work elsewhere. 

In New York it was a cultural shift to the suburbs partly encouraged by government both by construction of suburbs and of infrastructure to take residents to and from the suburbs. That's why Robert Moses is so much blamed for the bankrupting of NYC. Capital did not shift to the suburbs, leading urban dwellers out of the city; capital was still in the urban center when Moses allowed the tax base to shift to the suburbs, and capital followed. It can't be blamed on the loss of manufacturing base: New York is growing in population and in wealth and tax base, but not in manufacturing. The move to the suburbs was a government-facilitated cultural shift that eventually spiraled the city downward as the eroded tax base undermined services, and middle class flight undermined public education. Explicit race-based programs like red lining and slum clearance closed the coffin. 

The new demand for upscale housing shows distinct reflexes of its distinct functions. The quantity of apartment seekers will gentrify outer boroughs as long as central upscale development lags demand. The price of space will rise as long as the willingness and wealth is there. The draw in New York seems to be its density, safety and convenience. It's a party for the rich. 

So why do all these rich folks come here and why are they willing to pay ever more? Is it the nightlife here? Or that NYC is the chain store capital of the US? Maybe it's just NYU. 

"NO 7-Eleven: resist chains and corporate control" is winning!

7-Eleven Corp has delayed the opening of the 7-Eleven store on 11th Street & Avenue A from May 13 to November 13. That's a half year delay @ $35,000 per month.

Meanwhile NO 7-Eleven is ramping up its resistance. We're planning a demonstration in early June at the 7-Eleven doubledecker "superstore" on 5th Avenue & 23rd Street just across from the Flat Iron Building. Details soon.

An anonymous comment on EV Grieve resonated with me:

If a storefront or piece of land has been vacant because the owner is greedy ... CB 3 support them by approving a bar or lounge or a hotel or luxury housing.

Filling empty stores benefits primarily the landlord. The neighborhood is not desperate for commerce -- we've already got more chain stores than any other neighborhood in the city and a 7-Eleven provides the minimal jobs per square foot. 

So, 7-Eleven Corp and CB3, just leave it there empty. We can deal with that. The landlord? Kushner can think of it as a goodwill gesture to the community. He can afford it. 

Chin, AAFE, development, gentrification and displacement

I posted this originally as a comment at the Villager in response to an article on Margaret Chin's council campaign. 

What troubles me most about Chin is what she's been doing to Chinatown. Despite broad Chinatown protest, Chin supported a Chinatown business improvement district (BID) which will destabilize small property owners, increasing the likelihood of the selling of Chinatown properties and redevelopment that will lead to gentrification and community displacement especially of the low-income community. 

While her association with AAFE and the First American International Bank may be well-intentioned, under city zoning the construction of affordable housing brings 80% market-rate luxury housing, raising real estate values and commercial rents. NYers saw this in Williamsburg -- the community was sold an affordable housing program that resulted in wholesale transformation of the neighborhood. The affordable housing non profits can't back off the city's Inclusionary Zoning program because affordable housing development is their mission and that's what they are funded to do. The result of collusion between upscale development and non profit affordable housing is a net loss of affordable housing, deeper gentrification and low-income community displacement. 

The close relationship created in the law between those non profits and market-rate developers has placed a destructive wedge between community and the non profits that should be protecting those communities. The fault is the city administration's, but the city's gentrification program succeeds by using those non profits. AAFE strongly supported the upzoning of Chrystie Street, Houston Street and Delancey, opening the door to upscale development for the sake of 20% affordable housing, playing the city's game rather than resisting, protesting, refusing and leveraging. 

Supporting NYU development, the demolition and redevelopment of 135 Bowery (for the First American International Bank), the Chinatown BID (promoted by that same bank again) and the SoHo BID -- intended or not, it's a constellation of development and upscaling. Chin is a good-hearted, hard-working activist, but she's been caught in a game that is headed in the wrong direction for community. That's why CSWA, a Chinatown labor organization, and a Chinatown small property owners group oppose her. That's an unusual coalition spectrum -- property owners and labor. Says a lot to me.

Incisive comments from the NO 7-Eleven petition

The petition comments have been full of intelligence and succinct eloquence. Of the many brilliant, here are a couple that stood out for me:

From Mark Lepage
Aside from the killing of local businesses and character, and the other pernicious effects of corporate chains, it must be recognized that there is nothing naturally "free market" about this incursion. It is meant to redesign NYC as a massively low-wage, high-rent zone. Locals have every right to resist a backroom-mandated corporate disfiguration of the neighborhoods in which they live and raise their children.

And an exerpt from Adam Weiner:
...While evolutionary change is inevitable and healthy, mass chain invasions as explictly planned (and already executed) by the likes of Subway, 7-11, Starbucks and Dunkin' Donuts have the effect of diminishing the difference between living in New York City and living (much more cheaply!) in the 'burbs....If you want to drive me and many others out of Manhattan or out of New York City entirely, keep on letting the chains have their way with the city.

If only chain stores would drive people away from New York. Rents would decline, the tax base as well, undermining municipal services like transportation and policing, yet more of the entitled who expect services would leave, and soon we'd be back in the '70's when New York had a wild spirit and its people were here, not to file blithely into stores, be served hand and foot and spend money, but to join in the anarchic edginess of it all. If it didn't include the drug addictions and drug trade, it would be perfect. 

But chain stores will not drive the new New Yorker away. They have so much disposable income that lower costs in the suburbs do not register on them at all. They come to the city primarily to party, to socialize with each other in bars, to get laid. In ten years New York bar conversations will begin not with the excessive rents (as today) or crime (as in the '70's and '80's) but complaints about the latest chain store incursion as the downside and cost of living in New York. But it will be a complaint in name only. Underneath it'll be just a pick up line. 

NO 7-Eleven city-wide petition on line!

NO 7-Eleven: resist chains and corporate control has a city-wide petition on line. Take a look at the great comments along with the signatures. 

To the New York City Planning Commission and City Council: Allow community self-determination to resist chain stores.

To: 

The New York City Planning Commission and City Council 

There are over 7,200 chain stores in New York City with more opening every year. 7-Eleven Corp alone is planning to open 100 new stores in Manhattan by 2015. Chain stores raise commercial rents, crowd out our commercial variety, our choices our mom-and-pops and our diversity. They efface our neighborhood character, erase our ethnic roots, erode our community relationships. They leverage wages down and, once cornering their market, leverage prices up. I call on the City Planning Commission and the City Council to amend the city's zoning text to require that no corporate formula store or bank open a new location without approval from the local community board. Such a zoning amendment will not only allow communities to restrict the number and location of chain stores, but also allow community boards to negotiate legally binding stipulations on all elements of chain store character from signage and closing hours to wage scale.

Allow community self-determination on chain stores, franchises and banks.

Sincerely,
[Your name]

http://www.change.org/petitions/to-the-new-york-city-planning-commission-and-city-council-allow-community-self-determination-to-resist-chain-stores?utm_campaign=signature_receipt&utm_medium=email&utm_source=share_petition

The city is your backyard

Bob Holman mentioned yesterday that "NO 7-Eleven" is not a NIMBY issue, unless our backyard is the entire city.

I've been thinking about how NO 7-Eleven is distinct from gentrifying or gentrified neighborhood groups. It's not just that it's a city-wide effort, not just that it's calling for community say in land use for all communities. I think it goes way deeper. Chain stores are an invasion from an inaccessible source. I think that's why I'm puzzled by critics who welcome chains on the ground that it's an expression of the free market. There's nothing "free" about corporate control from afar. 7-Eleven, Walmart, Walgreens, McDonalds -- the whole lot of them -- are the Persians at the Athenian walls, the body snatchers and Big Brother all in one.

We're New Yorkers -- an immigrant, diverse, crazyquilt of communities. We're not the corporate overlords from remote locations and they're not us.

Corporate control from afar

Back in the 18th century, Henry Rutgers, a New York City landowner, contracted to have a house built on one of his lots. He specified that there be no rear house; the lot not covered by the main house should remain a yard. Rear houses couldn't be rented to people of "quality." A rear house would attract riff-raff, and Rutgers thought it more important to keep up the neighborhood than extract a bit more profit from the lot. After all, it was his land, his neighborhood.

A century later, the first apartment buildings, called tenements, were constructed in New York, all in impoverished immigrant neighborhoods. The very first drawings of these show rear tenements. It's a clear indication that the landowner has lost any faith in the neighborhood as a place where he or his associates might consider living. The purpose of the land is no longer use, but exchange, constructed not to live in but to make money from. It's the concurrence of the commodification of space and control of land use from afar. The two are inseparable.

As demand increased at the bottom of the housing market, the quality of the living space declined, to the extent that mid century tenements were unlivable, unhealthy breeding grounds of plagues of cholera and epidemics of tuberculosis. Interior rooms had no windows and multiple families might occupy a mere 300 sq ft space in a mere three tiny rooms.

Eventually government stepped in, but only after the Draft Riots, a working-class, immigrant near revolution with the riots lasting four full days. But the exploitation of housing space continues as fewer and larger landlords buy up more lots in the city, applying their legal resources to evict and harass tenants throughout their properties. As these giant corporate landlords increase their holdings, there will be less accountability and more harassment.

Similarly with city commerce. New York has seen steady increases in chain store proliferation. They limit consumer choices, limit job and entrepreneurial opportunities; they increase commercial rents because they can pay higher rents than any local service or mom and pop. The consequence was particularly evident in Hurricane Sandy when all of downtown lost electricity. The small bodegas and independent pizza shops and small restaurants and bars were all open almost immediately, sometimes giving away perishables. All the chain stores were closed and remained closed until five days later electricity was restored.

Locality is not the solution to all the woes of the world, but corporate control from afar threatens us with increasing disempowerment, loss of choice and identity and undermines community self-determination. Regaining community self-determination is the underlying motive of our group "NO 7-Eleven: resist chains and corporate control."

NO711's zoning amendment is better than a special zoning!

The NO711 zoning amendment -- to require all chains including banks go to the local community board for approval before opening -- would not only give the community board a chance to deny a chain where the community doesn't want it, but it also gives the community board leverage to negotiate with a chain store as they do with bars for their liquor approval. Stipluations could include wage scale, aesthetics, range of merchandise -- just about anything could be put on the table. It would give far-reaching power to the CB, a radical idea, but a necessary one if NYC is not to be given over entirely to corporatocracy.

So if McDonald's wanted to open two stores within a couple of blocks in a neighborhood where you have to walk a mile for a supermarket, a dry cleaner, a bike shop or ten miles to a credit union, or where there's a community center that's been waiting for an avaiable space but can't quite meet the chain-store-rent, the community board would be able to consider denying yet another McDonald's. But if Fresh & Co wanted to open on Delancey Street where the community welcomed it, the community board could still negotiate the signage, the hours, maybe even the payscale.

A special zoning that restricts chain stores (like the one CB3 is contemplating) doesn't allow for negotiations. It just says, x many is too many. Not only does that exclude any negotiation, it's also too inflexible. Times change. In ten years, any number chosen today is likely to be either too many or too few. One of the most depressing facts about urban planning documents is how quickly they become out of date, irrelevant or constraining.

But our zoning proposal can never be out of date -- it's maximally flexible. All it really says is, the community board can have a say -- any say, for or against -- if it wants. It wouldn't have to say anything. To paraphrase John Rawls, it's a piece of perfect procedural planning, a thing of urban planning beauty. 

7-Eleven at the Ideas City Festival

We had a great time at the New Museum's Ideas City festival Saturday. Here's a video from Matteo Minasi:
http://www.youtube.com/watch?v=_o5yeq0XiEQ&feature=youtu.be

7-Eleven and labor organizing

A critic of NO711 says that it's easier to organize labor in giant corporate stores than, say, in a bodega, so 7-Eleven would be better for labor than a bodega. 

But labor in a 7-Eleven is exactly as fragmented as any bodega -- two guys in a store with a manager. That's also true of Duane Reade, Dunkin' Donuts, Starbucks, Subway...the list goes on -- all the chain stores that NO711 is trying to resist. 

So this "organizing" argument is irrelevant. It's about big box stores like Walmart. Here's Human Rights Watch: "[Walmart] stands out for the sheer magnitude and aggressiveness of its anti-union apparatus." In other words, the larger they are, the more financial and legal resources to resist unionization.  And the more resilience to strikes. Why do you think labor organizes against Walmart? Because it's really bad for labor. Supporting giant corporations because it's easier to organize in them is like contracting hepatitis C in order to get on medicaid. Only an ideologue would be so stupid.  

One begins to get the impression that critics of NO711 don't have much upstairs. Think, guys. Take your slurpee straw out of your mouth....

7-Eleven and jobs

NO711 has pointed out that 7-Eleven, with its self-service model, minimizes employment. Here are the figures to compare.

[I've deleted a paragraph here. The information was not authorized. Please see instead this post.]

I ran into a local resident who owns a restaurant in the LES. It's a small space, single storefront (12.5 ft across). I asked him how many people he employs there. 20, he said. I asked how many are being paid at minimum wage. He replied with pride, none, not one. He went on about how important this is to him. It's an upscale place, so the waiters' tips are significant as well.

Since the restaurant is less than half the size of a 7-Eleven, he provides 4 to 6 times as many jobs as a 7-Eleven would in an equivalent space. 

I also looked at Fresh&Co, which is about the size of a 711: 20 people per shift, 2 shifts, including weekends, all behind-the-counter (no waiter/tips) and well over minimum wage (except the delivery guys -- they get tips so the law exempts them from the minimum wage, like waiters). Total: 56 full time equivalent positions, not counting delivery staff. It employs 5-8 times (!!) as a 7-Eleven. 7-Eleven is actually one of the worst franchises from a labor/employment point of view.

But this is kind of obvious, no? Huge store, self-service: minimal jobs, close to minimum wage. Isnt' that what 7-Eleven is all about? And corporate packaged junk food. What an asset to the global landscape!

7-Eleven and wages

It's important to consider what would replace a 7-Eleven on 11th and Avenue A. Since there are three liquor licenses within 500 feet of the site, it would be difficult for a bar owner to get passed the State Liquor License's constraints on license density. The next likely candidate would be a restaurant, judging by the local commerce in the EV. So how would a restaurant affect labor?

7-Eleven store associate hourly wage can be as low as $7.25/hr; $8.44 average (from Payscale and Glassdoor). 7-Eleven store associates are required to have English fluency: "Must be able to communicate clearly and effectively with customers and coworkers." They are also subjected to background checks -- no undocumented immigrants allowed.

Mean average for a cook's wage, nation-wide, $11.20/hr; median: $10.29/hr; lowest 10%: $8.14/hr (BLS). No language requirement, no background check. 

So replacing a 7-Eleven with a restaurant in NYC would improve the wage prospects generally, and specifically of immigrant workers, documented as well as undocumented. Unless it were a chain restaurant -- a McDonalds cook wage averages, according to Glassdoor, $7.41/hr. That's one reason among many, NO 7-Eleven is trying to curtail all giant chains and franchises. Minimum wage may be fine for a 16-year-old's first summer job, but not a way forward for labor in general. "The majority (66 percent) of low-wage workers are not employed by small businesses, but rather by large corporations." 

Is it easier to organize labor in a giant corporation? Maybe (but maybe not). Giant corps also have greater political clout the larger they are, so there is a danger of promoting corporatocracy. In one way it's the meeting of Stalinism and libertarianism -- "free" market corporatocracy replaces the totalitarian state, the "internal contradiction" of libertarianism, trading one form of control (government) for another (corporate giants). Reminds me of a Maoist friend who voted for Giuliani thinking that his reactionary policies would spark a revolution. Instead we have rampant gentrification.

NO 7-Eleven, a grassroots movement resisting the spread of chains and franchises, is holding a neighborhood-wide meeting this Wednesday. Their goal is to require that all corporate clone stores, including banks, be required to obtain approval before opening a new location so the community can have a say in the number and location of corporate chains and franchises. Details below. Please spread the word.

MEETING

NO 7-ELEVEN

Limit corporate clone stores

before they limit our food, our commerce, our labor, our streets and our New York City character

7-Eleven is opening a new location on the corner of 11th Street and Ave. A in June. 7-Eleven already opened 32 locations in Manhattan and has an additional 100 stores on the way! If you are as concerned about protecting the East Village and future of the city, please attend

Next 'No 7-Eleven' Meeting

Wednesday April 24

6:30-8:00pm

93  St. Marks Place

(Btwn 1st and Ave. A)

Web: www.no7eleven.com

Facebook: www.facebook.com/no7eleven

Twitter: www.twitter.com/no7elevennyc

New blog "Chinatown for Chinatown: a discussion board"

I started a blog about Chinatown planning called "Chinatown for Chinatown"
http://chinatownforchinatown.wordpress.com/

I've avoided blogging about Chinatown while I was involved with a Chinatown planning group. It's not the kiss-and-tell aspect -- I believe in transparency. But journalism gives the writer an unfair advantage within the group. It can bias the process or coerce it. But the Chinatown Working Group has mostly concluded its discussions, now waiting for its planning consultant to come up with recommendations to the group. So I can write as an outside observer.

I've asked several local voices and urban planners to post as regular guest bloggers. I'm hoping to see an open, broad discussion that will be of help to the planning consultants as they dig into the issues and challenges that Chinatown faces.

What's really wrong with the NYCHA plan

The complaints about NYCHA's infill losing park and air space are difficult for me to identify with. I grew up in Manhattan in a high-density urban street environment, like most Manhattanites. As a child I enjoyed that streetscape at least as much as the local public park. We played handball and boxball on the sidewalk, running around in alleyways, climbing fences. Still today I prefer to walk uptown on 1st Avenue, dull as it is, rather than walk through Stuy Town, which feels like a pristine, landscaped, anti-urban gated community. To me, the tenement street wall is attractive, comforting, neighborly and conducive to community, just as I far prefer tenements to the anonymity of elevator building compexes or the isolation of single family houses. 

So I was gratified to hear GOLES director Damaris Reyes' response last night to NYCHA's presentation to Community Board 3. She jumped on the real danger of the infill scheme: the dilution of the political base in the projects and its likely consequence, the erosion of political will to maintain the NYCHA tenants. Amidst all the NIMBY concerns -- one white gentleman with the most beautiful brown shoes I've ever seen, worried that the new rich tenants might crowd his child out of the better local public schools, a worry that drove home to me, no prejudice to him or his honest issue, just how far this community has changed -- Reyes was almost alone in speaking to the social issue of preserving the community. Bernard Marti also faced that issue, but he spoke in favor of the infill plan, expressing his hope that it would help the NYCHA properties so desperately in need of help. Everyone else demanded a better community process, which seems to me a diversion. We already know what the problem is -- the state has no commitment to public housing. How is a "community process" going to change that? 

You might object that, even without the infill, this neighborhood is developing and gentrifying anyway -- it's just a matter of time, and this infill will at worst speed it up by a few years. That's too coarse-grained an analysis. The poltical base here has remained in the older residential demographic despite demographic upscaling partly because the local housing stock of tenements is ill suited to permanent or family housing, and ideal for transient students and young singles. So the PS 64 transformation into a dorm will bring a lot of youth commerce (bars), but will not change the political base -- most students don't vote. The infill market-rate housing will bring permanent resident voters. 

I asked the NYCHA presenters privately why the state won't build the market-rate housing and give the profits to NYCHA rather than let a private developer build and own it and reap the profit. They explained that the state simply won't touch public housing. This is plain deceit on the part of the state: it builds prisons, and there's no question that prisons are, among other things, public housing, except it doesn't generate market-rate rental revenue. 

An answer for NYCHA's troubles

Our political office holders, assuming that there's no alternative to the NYCHA leasing scheme, are left complaining about the lack of "community process" on how to implement the infill leasing plan. But there is an alternative. 

Here's an op ed I wrote for Bowery Boogie explaining what the city and state can and should do. That they haven't done this suggests to me that the state has no faith in the future of public housing. That's scary. 

http://www.boweryboogie.com/2013/04/op-ed-looking-for-a-better-alternative-to-nycha-leasing/

(Bowerygals' comment on Boogie's site is also a must read.)

There’s been a furor over NYCHA’s plan to lease so-called underused properties to private developers, but there have been few alternative solutions offered. While everyone complains, the NYCHA tenants continue to suffer from hurricane damage and inadequate management. So complaints without solutions just won’t cut it.

Everyone on all sides agree that if the city would properly fund NYCHA, there’d be no need for this leasing scheme. And many are ready to fight to get that funding today. That’s heartening.

But it’s not the solution. Getting the funds today might be possible in this election year amidst the noise that the leasing scheme has raised, but what about next year, when it’s not a city election cycle year and the locals have forgotten all about NYCHA? Fighting for the funding means NYCHA tenants get services one year in every four. In between, they’ll be literally left in the cold.

NYCHA needs a steady, dedicated revenue stream protected from changing political winds, revenue that won’t be syphoned away from NYCHA and its tenants. And it needs a transparent process that will guarantee that the funds won’t disappear into someone’s personal pockets.

The current leasing scheme fails to meet that need from the start. The profit derived from the new market-rate units will go straight into private pockets by right, without even any political corruption or subterfuge. NYCHA is giving its own potential revenue away. Handing the people’s public property into private hands for their personal profit is the opposite of good government. It’s a travesty.

Why doesn’t NYCHA ask the state to intervene, construct the market-rate units itself, and give them to NYCHA? The state loves to construct — prisons, schools, more prisons. It’s easy for the state: issue a bond, the funds go to the huge construction industry, a state favorite, with lots of jobs. And market-rate housing yields a fast return, so why not? Years ago, when I sat on the CUNY Board of Trustees, I watched the state cut the tax-levy budget to shreds, but I never once saw the state deny a capital construction item.

That the city hasn’t asked and the state hasn’t offered suggests to me that neither really wants to save NYCHA housing at all. A 99-year lease will not generate enough for NYCHA’s needs in the future. Luxury housing might, if it were owned by NYCHA, not a private developer.

Should the state get into the business of luxury housing? Consider why government is viewed as a shabby landlord. Government is capable of managing quite well — look at libraries, rec centers and parks, all widely used. But when it comes to housing, government owns only low-income housing. It’s a kind of self-fulfilling prophesy. If the state owned the Upper East Side, it would be rolling in dough and well able to maintain those properties with plenty to spare to keep up its low-income properties in style. But it doesn’t own upscale properties with surplus revenue and, let’s be honest, the city just doesn’t care about its low-income residents. Certainly that’s been true under the current city administration, its mayor and city council leadership.

The new market-rate housing would rob space and air and light. NYCHA must at the very least compensate for those losses with improvements in the remaining spaces so that they are better used and more appealing. More troubling is the danger of upscaling local commerce, outpricing the low-income tenants. NYCHA has to address all these issues as well. I wonder whether the NYCHA tenants would accept these as conditions:

1. The state should issue bonds to build the market-rate units, giving the units to NYCHA so all the profits stay in NYCHA and benefit the subsidized tenants
2. NYCHA should hire a decent architect (there are plenty of brilliant young designers aching to solve urban challenges) to redesign the remaining open spaces to make them greener and better used,
3. The city should subsidize a percent of the commercial space specifically for low-income consumer services
4. Let the current tenant community set out ground rules for public use — music, noise-making (upscale partiers make a lot of noise), barbeques and such — to minimize conflicts between the new and the old.

How to ensure a transparent process that will prevent corrupt officials from stealing NYCHA funds is tough one. It’s a challenge that has to be met no matter what NYCHA chooses to do.

No escape from luxury

Btw, this is the article that Yglesias was responding to:

http://www.forbes.com/sites/stephensmith/2011/09/29/does-urban-growth-have-to-mean-gentrification/

Smith doesn't assume an upper limit on luxury demand, he thinks the upper limit is reached when overdevelopment begins to lose its attraction. It's a scary thought: the rich lose interest in bland elevator buildings, so they raid the neighborhoods without them. Their presence attract their elevator-addicted friends, so developers construct for them and transform the neighborhood, driving the upscale to seek a hipper slum to raid. It's already happened here -- the Schwimmer Manse.