How Should We Really Count the Cost of a City? | The Ideal City ①

We will publish three articles on how, under the vision of an “ideal city,” we should face the many problems of cities — and how we should think about them.

Horizon Media (Wenjing for short) is a publishing house. Over the past few years it has put out books such as Great Country, Great City (《大国大城》), Stoner, The Logic of the Market, A Strangeness in My Mind and The Art of the Mind (《心术》). Its editors noticed that all of these books quietly share one subject: the city.

So for this year's “Arts and Letters Season” forum in Beijing, Horizon Media made the city its theme. “The city occupies an ever more important place in society, and the rise of the educated and middle classes inside cities — along with the anxiety and confusion of city dwellers — is bound up with all of that. We wanted to return to the city itself, and let the city's own trajectory of life, and the people in it, speak,” the moderator said in his opening remarks.

Over the past year or two, though, the city has been a subject full of arguments — and full of helplessness too.

Beijing cracked down on “wall-breaking and hole-punching” (knocking doorways and windows into street-facing residential walls to open shops) and launched a campaign to turn wet markets into supermarkets. Shanghai restored its historic districts and reworked its mixed residential-commercial buildings. There were crackdowns on “group renting,” the clearing of basements, the redevelopment of urban villages, the “plan for the millennium” to build the Xiong'an New Area, the wave of new-district plans springing up across the country, citizens scrambling for homes in good school districts, the sense of insecurity ordinary people feel about simply getting by under high housing prices, and the clearing-out of the so-called “low-end population” from big cities.

All of it has to do with the city.

Officials and policymakers, whether later proven right or wrong, have all weighed the gains and losses in terms of a city's costs. Different understandings of cost decide the path taken by cities like Shanghai and Beijing, which routinely hold more than 20 million people — muddled or wise, ignorant or rational — and the effect on the future is enormous.

At the breakout session titled “What Is an Ideal City?,” architect Tang Keyang, who holds a doctorate in design from Harvard, said: “A city is made of diversity. A city without diversity has no vitality and cannot be healthy. The question isn't beauty, it's efficiency — at every moment, things exist in order to be used. Once you have enough efficiency, the city can leave more room for beauty.”

Lu Ming, a chair professor at the Antai College of Economics and Management at Shanghai Jiao Tong University, argued: “The basic principle of a market economy is that supply keeps adapting to demand. How do you make a city more competitive? The most important thing is to cut costs — you need a more flexible labor market, you need the land market to keep up with where people move, and you need more infrastructure and public services. Only then can our cities move closer to being ideal cities.”

The series of forums on the city ran from July 22 to 23 at Art 8 in Beijing's Dongcheng district, the former site of the Sino-French University. Most of the speakers worked hard to avoid commenting on current policy, but showed their usual passion and sense of responsibility when it came to thinking about cities rationally.

Lu Ming is known to the public for his bestseller Great Country, Great City. He has been active in debates on urban public policy in recent years, and he took part in this forum. So did the planner Mao Mingrui, founder of Urban Quadrant, who once gave a talk on the speaking platform Yixi titled “Data and Urban Justice: How to Solve the Problem of Huilongguan Residents Being ‘Hollowed Out.’” Tang Keyang, who works in both academia and industry, is at once a curator, an architect and an art critic; he was curator of the China Pavilion at the 12th Venice Architecture Biennale in 2010 and has written 《从废园到燕园》 (From a Ruined Garden to Yan Garden), 《长安的烟火》 (The Fires of Chang'an) and 《美术馆十讲》 (Ten Lectures on Art Museums). The architecture critic Shi Jian, a partner in the research-driven architecture media outlet Archiposition, joined as well. All four were guests at the “What Is an Ideal City?” session.

The forum was called “The City: Looked Up To and Forgotten,” after the Chinese title of a book by the American nonfiction writer Gay Talese — 《被仰望与被遗忘的》, published in English as Fame and Obscurity. Horizon Media brought out the book this year; it tells “all sorts of strange anecdotes and curious bits of information” about New York, describes “many peculiar professions and people with character,” and records both the city's “glory, past and present” and its “countless forgotten corners.”

QDaily followed the forum from beginning to end and interviewed several of its speakers. We will publish three articles on how, under the vision of an ideal city, we should face the many problems of cities and how we should think about them — and, more important, on why we need to care about the future city we depend on, since it is where we will grow up.

1. Why Have Nanny Wages in Beijing and Shanghai Shot Past Hong Kong's?

In his talk, Lu Ming told a story: one of his MBA students, who had paid more than 300,000 yuan in tuition, could not afford a nanny. In big cities like Beijing and Shanghai, a nanny now earns around 8,000 yuan a month — twice what a nanny costs in Hong Kong, and far more than some college graduates, or even master's graduates, are paid.

The reason is simple: “because we have the demand but not the supply,” Lu Ming said. In his view, the population structure of China's big cities is irrational as it stands — there are nowhere near enough people working in low-end services.

He pointed to American cities, where high-end and low-end labor in a big city's population split roughly one to one. What's more, when one high-end worker (a tech worker, a lawyer, a doctor) arrives in a city, he or she typically creates three jobs: a supermarket cashier, a domestic worker and a restaurant server.

In China, though, “what big cities lack today isn't college graduates — it's people with less than a middle-school education,” Lu Ming said. So highly skilled people may well leave Shanghai or Beijing for Hong Kong or Singapore, because the services they need in daily life cost too much. That works against the competitiveness of cities like Shanghai and Beijing.

2. Why Is Shanghai's Per Capita Income a Third of Hong Kong's, While a Bowl of Noodles Costs About the Same?

The logic is the same as with nannies. Lu Ming said: “The cost of the noodles you eat isn't the price of the noodles, it's the price of the service. And what we are doing today is pushing that cost up. Once it goes up, where does your income stand? Take Shanghai, the most developed place in China — per capita income there is still only a third of Hong Kong's. How are you supposed to compete for so-called talent?”

3. Is It the Population That's Low-End, or the Way the Government Manages?

After the talk, someone in the audience asked: as people move from a rural society, a society of acquaintances, into a city, a society of strangers, how does their life change?

Lu Ming replied that “this process is no small matter,” then answered from four angles: the individual, the countryside, the city and public policy.

“For the individual, the biggest change is in your life and your social capital. In a rural society you deal only with fellow villagers, and mostly on the basis of custom; in the city that shifts to informal institutions. In a village, if you owe me a little money today, I may feel too awkward to ask for it back, because tomorrow I may need to borrow from you. In a society of strangers, if you owe me money today, then I'm sorry, you have to pay me back.

There was a post online recently: ‘Why do people flee back to Beijing, Shanghai and Guangzhou?’ Relatively speaking, the institutions of big cities are more standardized. That is exactly why — the institutions of big cities are built on strangers. In a big city people split the bill, and after the meal they may never see each other again.

From the countryside's side: among rural residents moving into big cities, there is a group who are born and raised in the village when young and then grow up in the city. The biggest shift they have to make is learning to respect institutions. Take the recent case in Shandong of people power-walking on the highway. It's a very typical example. Our society has to use the rule of law to decide that people may not walk on a highway, but our behavior is still stuck in a rural society — I do as I please, and I can even put on a reflective vest and walk down the highway. That is a way of not respecting institutions. We haven't learned to respect the new rules of the city.

From the city's side, you have to see that urbanization is a huge and inevitable force behind the development of society and the economy as a whole, and that inclusiveness matters enormously. In economic development, in social development, in making public policy, you have to get rid of the idea of status. It is in agricultural society that status matters, because each of us is governed by our own customs. So if a person does something bad, I take that as my standard for judging him: a young man who has done something bad will probably do something bad again. The most important thing about modern society is that none of that matters anymore — if I do something bad today, I can start over, because nobody knows me. That is what modern society is.

But the thinking of city residents today, and the thinking behind public policy, has gone wrong on exactly this point. We are forever labeling people: peasant, migrant worker. Now whenever something happens, the television report says a migrant worker from Anhui or Jiangxi did such-and-such. If you're reporting the event, report the event — why does it matter whether he is a migrant worker or a city resident? Is the crime rate among city residents really lower than among peasants?

Or take public policy. If outsiders driving for ride-hailing services in our city causes all sorts of problems, does it cause none when locals do it? And yet we have handed the right to drive for ride-hailing services to local residents. There's a phenomenon now where the car that turns up has a different plate from the one you booked. Why? Ask around and you find that, under the government's rules, an outsider pays a Shanghai resident to register a car in the Shanghai resident's name — but the car actually being driven still carries an out-of-town plate, and the driver is still an outsider.

What does that example show? If you don't understand how an economy and a society basically work, you may think you are improving public order, but what you are really doing is managing society in a backward way, with the methods of an agricultural society. Set against the problems it solves, it may create more problems, and produce more injustice.”

4. Don't Believe Technology Will Cut Down Face-to-Face Encounters.

Besides the move from country to city, one audience member was curious about what business and technology might change in our city lives.

Lu Ming answered: “Many people think better information technology will flatten cities and make density unimportant. Plenty of things that once had to be done face to face can now be done through technology. To discuss a problem we used to have to meet; now we can phone, use WeChat, even livestream.

Does that happen? Yes. But it's only half the picture. You see that information technology has replaced some human activities, but you haven't noticed that it is more likely to complement face-to-face contact than to substitute for it.

Information technology doesn't just make density unimportant — it also makes density more important. Look at what people do: the more advanced information technology becomes, the larger the share of all economic activity taken by industries whose core competitiveness lies in information, knowledge and technology. And where does that work have to happen? In the dense cities where meeting face to face is easiest.

Information technology is advancing fast, and people have not left the big cities; they are concentrating in them more than before. They keep moving back to the city center. Don't they know housing is more expensive there? They still want to go back. What does that show? That what they gain from meeting face to face is worth more than the higher rent they pay for it. And the reason behind that is that complementarity outweighs substitution.”

5. The Fundamental Question: Are There Really Too Many Outsiders in China's Big Cities?

Lu Ming answered this one with some passion. He began with New York and London as a yardstick for a city's population: “All over the world, big cities are getting bigger, and people keep concentrating in them.”

“I call global cities cities of migrants. As of 2008, 36 percent of New Yorkers were born outside the United States, and 48 percent of New Yorkers did not speak English at home. In London's 2011 census, 37 percent of residents were born outside the UK — very close to New York's figure. Now look at nationality: 24 percent of New York's permanent residents hold foreign citizenship, and note that ‘foreign’ here means citizenship, not hukou.

In China today, permanent residents without local hukou make up 40 percent of the population in Beijing and Shanghai, and we keep saying there are too many outsiders. By that logic we should be saying New York and London have too many foreigners. But nobody says that. Now look at skin color: the share of white Britons has fallen from above 50 percent in 2000 to below 50 percent today. London has already become a city where non-white residents are the dominant part of the population.”

He then used empirical data on China to show that, as a matter of fact, the population is concentrating along the coast and in big cities, including around the provincial capitals of central and western China. Economic forces are doing this.

Unfortunately, “when we make public policy, we have not noticed that objective laws are driving this growth of city populations,” Lu Ming said.

So how big should a country's urban population be? Lu Ming's answer: “How large a country's urban population is has to do with how large that country's population is.”

Analyzing data on the total population and the largest-city population of 142 countries, Lu Ming again reached the same conclusion: Shanghai's population is not too large. It is too small.

“This is a very simple, basic fact. If we really want Shanghai and Beijing, and Shenzhen and Guangzhou too, to lead China and to stand for the country in competition with the world's other global cities, with world-class competitiveness, then the first thing you have to attract is the top talent from home and abroad. That shows up first in your population structure. Seen that way, what we are building today is still a long way from a global city. As for what has been happening lately, I don't need to spell it out here — look at what's going on around you and you'll know.”

More important still: “In talking about development we always say how many problems these people” — he meant the low-end population — “cause once they arrive: congestion, pollution.

First, are these urban problems really caused by having too many people? If they were, why is it that in the developed cities of developed Western countries the population has multiplied several times over without congestion and pollution getting worse? You would expect congestion and pollution to rise several-fold in proportion. They don't.

Second, if everybody truly believes these problems come from having too many people, then drive out everyone earning more than a million yuan a year. People with incomes over a million want to drive cars and live in big houses; they take the better share of public resources. Drive them out and you can guarantee the city won't be congested. Instead you drive out the low-end population first — the people selling fried dough sticks, the people selling vegetables. Do they live in big houses? Do they drive? Some of them don't even take the subway. How much of the city's ills does driving them out actually cure? Think through the logic and you'll see that a lot of what's said today is questionable.

In a de-globalizing world, when the tide seems to be going out everywhere, China should be doing the opposite — playing to the advantage of a large population, using the economies of scale of its cities, treating people as a resource. Combining an effective market with an effective government should mean letting supply adapt more closely to demand while, judging by the future of human development and the common experience of societies, insisting on fairness and equity in public services. Public services must not be a privilege handed to people with a special status, such as local hukou holders. That is not a fair market economy,” Lu Ming said.

6. How Can a City Attract High-End Talent?

What should a city do if it wants to become more competitive?

“We have a market economy now. If you want to attract talent, that talent votes with its feet — everyone is choosing which city to live and work in. If you start from respecting people's freedom to choose, whether a person leaves a city or stays comes down to two variables. The first is my income (including things like a pleasant environment) — how much I can earn in this city. The second is my spending (including things like commuting time). The more my income exceeds my spending, the more attractive the city is to me.

On the spending side, two things matter most for the cost of living in a city: housing, and the price of services. Both are tied to the city's land policy and its population policy.

In our country, land supply is tightened in the places people are moving to, so housing prices rise. In those same places we restrict the population — and the people we restrict are precisely the ones working in daily-life services, or consumer services, the ones we call ‘low-end.’ In our own lives, the higher your income, the more likely you are to eat out, and to hire a nanny. Who does that work? Exactly the people you call ‘low-end,’ a word with discrimination built into it,” Lu Ming said in his talk.

7. Beijing's Crackdown on “Wall-Breaking and Hole-Punching”: What Exactly Went Wrong?

None of the guests answered this one directly; they spoke in broader terms instead. Lu Ming, for instance, said: “The basis of any public policy is really finding the greatest common denominator. The question is whether your denominator includes everyone. What does finding it mean? It means giving everyone connected to the matter the right to make a choice, and that right should be equal for all of them.

The problem isn't whether the outcome is good. It's whether, in the course of this happening, the views of everyone involved were genuinely heard. Did we, while it was happening, fully describe both the good and the bad in what existed before? After it happened there were improvements — the mess and the grime are gone, say — but there was damage too: daily life became less convenient for residents, and the ability to create jobs shrank. Was there a channel through which the negative effects of this policy could be fully expressed? That, I think, is the key question.”

8. A Crowded City Is Not Necessarily a Sick City.

To Mao Mingrui, crowding in a city is like a person's weight: there is no absolute fat or thin, you have to take height and other things into account. He said in his talk: “When people talk about cities falling short of the ideal, everyone can reel off examples — congestion, pollution, mess and grime, disorder. Crowding above all is put first by mayors and officials in every city, named as urban illness number one.

Does population density necessarily bring urban illness? If we treat a city's congestion index as the problem, the comparable measure is a person's weight. Is weighing more a disease? Weighing more doesn't mean you are ill. You might simply be tall. When we look at someone heavy we can't take one indicator, the weight, and declare him sick; we have to combine it with height and body-fat percentage to see whether he is.

By the same logic, a city's crowding works like a person's weight: it is only a status indicator, and it doesn't mean the city is sick. Whether a city is sick can't be judged by crowding alone. You have to look at density per person, resource consumption per person and the level of public services, and only by putting these together can you tell. Some cities have low population density and heavy traffic; others have high density and traffic that's no worse, or the same. Those two cities are not equally healthy. You can't see that a city is crowded and pronounce it ill. But plenty of officials think exactly that: the city is crowded, there's a jam in the morning rush, so the city is sick — and then they start prescribing strong medicine, and they kill the city. I started with the city that falls short of the ideal, but in fact such a city has its ideal side too. It depends on how you look at the question of urban illness.”

9. Both Cities Are Full of Cars. Why Is Beijing More Congested Than Zunyi, Guizhou?

Mao Mingrui also shared a study he had done recently, comparing crowding and conditions in Beijing and in Zunyi, Guizhou.

He put up a photograph of cars parked all over the sidewalk in Beijing's core capital-function district. “Pedestrians have no dignity here,” he said. In Zunyi that doesn't happen; the streets have “vitality.” “Even at peak hours, every crosswalk on Zunyi's main roads has two traffic police whose job is to stop the cars. That is dignity,” Mao Mingrui said.

Then came housing and shop prices. “Compare it with Beijing. In Zunyi, in a comparable location, an apartment costs 4,000 yuan a square meter, but a street-level shop costs 40,000 yuan a square meter — while in Beijing's Guorui City it's 44,000 a square meter. That shows the same amount of urban space generates more cash flow in Zunyi. In Beijing, residential and retail prices are inverted; in Zunyi, shops cost 10 times what apartments do,” Mao Mingrui said.

His conclusion: “For a sustainable city, Zunyi may be crowded, but it is a city that can generate cash flow, a city that is healthier and more efficient economically. And Zunyi can manage to put traffic police at the two crosswalks on a main road to keep things moving.

Why? Because at the same population density, the city's managers can cover a smaller area, which makes fine-grained management possible. Beijing has spread itself over a vast area, and as we disperse the population further and shrink its size, management gets beyond us and management costs keep rising. That's why our sidewalks are full of parked cars and Zunyi's are not.

And in Zunyi's densest sub-district, population density reaches 70,000 people per square kilometer, yet Zunyi is no more congested than Beijing. Zunyi's urban area has a million motor vehicles and Beijing has more than 5 million, and still Zunyi is no more congested.”

When the session called “What Is an Ideal City?” ended, the four guests had reached no consensus on what an ideal city is. They had only laid out possibilities.

They did agree on one thing, though: there are many kinds of ideal city, and every one of them starts from respecting the individual's right to choose freely.

“The most important thing isn't to hand the city a definition of the ideal city. It's that each person's ideal life is his or her own. What matters more is respecting each individual's choice. It isn't that the outcome of individual free choice is bound to be the best one. But if you take individual free choice away, the outcome society arrives at is certainly not going to be good. You may say that even with free choice there is still planning, still government regulation — but you cannot get away from the fact that this society is built on each person's right to choose the way of life that is more ideal for him. The most important function of a city is to give ordinary, unremarkable people the chance to create their dreams,” Lu Ming said.

“Respect diversity, respect people's choices, and don't let our urban planners or government officials substitute their own values about the city for each person's free choice. We should trust that ordinary people's pursuit of a good life includes maximizing their own welfare — and not assume that the choices you make for them are better than the ones they would make themselves.”

Cover image via Wikipedia