Suburbs Are A Ponzi Scheme

DiamondJoe

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It can take people a while to catch on.

This is actually bringing up some interesting facts regarding the cost of suburbia. Car-centric development is very expensive and the costs are hidden. Most people don't realize this though.
...endless, ant-like conformity now affordable... new homes to be as interchangeable as their inhabitants
 

halcyondays

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By definition suburbia is not one.

Bernie Madoff, who died in prison yesterday, ran a $65 billion Ponzi Scheme. He did not invest/grow the money given him by investors. He used the money from new investors to pay a return to existing investors. His fraud fell apart during the 2008 crash. His own children turned him in.

Autos + superhighways created urban & suburban sprawl. As long as the demand continues suburban sprawl will continue.

A major factor in this continued growth is that most of the Boomer, GenX and Millennial cohorts grew up in suburbia, expect and want that lifestyle and are raising their kids (Gen Y & Z) there who will want the same when they grow up.

Example. We grew up in the exurbs where houses ended and farm fields began. One of my sisters married a city boy. After a decade she divorced him and moved to the burbs. She never felt comfortable or safe in the city. He did. The irony is that he had to commute all the way out to an exurb to work and she bought a house in the same burb!

Another factor is the high cost of living in some city centers. Suburbia is often the only choice economically.
 

DiamondJoe

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By definition suburbia is not one.

Bernie Madoff, who died in prison yesterday, ran a $65 billion Ponzi Scheme. He did not invest/grow the money given him by investors. He used the money from new investors to pay a return to existing investors. His fraud fell apart during the 2008 crash. His own children turned him in.

Autos + superhighways created urban & suburban sprawl. As long as the demand continues suburban sprawl will continue.

A major factor in this continued growth is that most of the Boomer, GenX and Millennial cohorts grew up in suburbia, expect and want that lifestyle and are raising their kids (Gen Y & Z) there who will want the same when they grow up.

Example. We grew up in the exurbs where houses ended and farm fields began. One of my sisters married a city boy. After a decade she divorced him and moved to the burbs. She never felt comfortable or safe in the city. He did. The irony is that he had to commute all the way out to an exurb to work and she bought a house in the same burb!

Another factor is the high cost of living in some city centers. Suburbia is often the only choice economically.
Ahh, Bernie Madoff! The exception to prove the rule that the more you steal the more likely you are to get away with it
 

ConanTheBarber

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Suburban living is scandalously self-indulgent. Much better for the environment to live in relatively high-density cities. And for the human spirit — well, lots of people (e.g., Jane Jacobs) think that humans, on the whole, actually thrive on a much higher level of population density that we see in the suburbs (but of course they're speaking of cities of real neighbourhoods).

But is it a Ponzi scheme? Isn't a Ponzi scheme something that, among other things, is sure to ultimately fail? And I'm just not sure that the suburbs, as they are now, would fail if we stopped extending them. We would have a lot of debt to pay, perhaps in cascading quantities — but we pay a lot of debt. So what would change? Where is the near-certain looming collapse?

One problem with the article is that, though it reads well (imo, anyway), it has very little in the way of evidence or justification, especially projected costs under a range of scenarios.

I find I'm scratching my head and saying, "Yeah, this is sorta interesting — but what the hell can I say about its actual merit?"

EDIT: On reflection, maybe I'm just using the term 'Ponzi scheme' too literally. It did have real uses in walking the reader through the argument of the article.
 
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Drifterwood

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By definition suburbia is not one.

There is a reasonable definition by which it is.

The investment gains value so long as the demand remains and government money supply policy remains.

The money supply is a false market. Well, until it isn't and then the stack of cards collapses, rather like a ponzi scheme.

Mortgages both deliver money supply off the back of citizens and tie them to conformity.
 

halcyondays

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There is a reasonable definition by which it is.

The investment gains value so long as the demand remains and government money supply policy remains.

The money supply is a false market. Well, until it isn't and then the stack of cards collapses, rather like a ponzi scheme.

Mortgages both deliver money supply off the back of citizens and tie them to conformity.

By this definition the entire world economy is a Ponzi scheme.
 

wallyj84

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By definition suburbia is not one.

Bernie Madoff, who died in prison yesterday, ran a $65 billion Ponzi Scheme. He did not invest/grow the money given him by investors. He used the money from new investors to pay a return to existing investors. His fraud fell apart during the 2008 crash. His own children turned him in.

Autos + superhighways created urban & suburban sprawl. As long as the demand continues suburban sprawl will continue.

A major factor in this continued growth is that most of the Boomer, GenX and Millennial cohorts grew up in suburbia, expect and want that lifestyle and are raising their kids (Gen Y & Z) there who will want the same when they grow up.

Example. We grew up in the exurbs where houses ended and farm fields began. One of my sisters married a city boy. After a decade she divorced him and moved to the burbs. She never felt comfortable or safe in the city. He did. The irony is that he had to commute all the way out to an exurb to work and she bought a house in the same burb!

Another factor is the high cost of living in some city centers. Suburbia is often the only choice economically.

But if the suburbs require constant growth in order to remain financially solvent, isn't that kinda similar to a ponzi scheme?

The more important question though is whether or not this is a sustainable form of development. If a community requires constant growth and an influx of outside money and subsidies then there is a problem. This is the main point of this argument.
 

wallyj84

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Suburban living is scandalously self-indulgent. Much better for the environment to live in relatively high-density cities. And for the human spirit — well, lots of people (e.g., Jane Jacobs) think that humans, on the whole, actually thrive on a much higher level of population density that we see in the suburbs (but of course they're speaking of cities of real neighbourhoods).

But is it a Ponzi scheme? Isn't a Ponzi scheme something that, among other things, is sure to ultimately fail? And I'm just not sure that the suburbs, as they are now, would fail if we stopped extending them. We would have a lot of debt to pay, perhaps in cascading quantities — but we pay a lot of debt. So what would change? Where is the near-certain looming collapse?

One problem with the article is that, though it reads well (imo, anyway), it has very little in the way of evidence or justification, especially projected costs under a range of scenarios.

I find I'm scratching my head and saying, "Yeah, this is sorta interesting — but what the hell can I say about its actual merit?"

EDIT: On reflection, maybe I'm just using the term 'Ponzi scheme' too literally. It did have real uses in walking the reader through the argument of the article.

A lot of people, myself included, are focussing too much on the ponzi scheme part of the article. I wanted to focus more on thhe iddas presented and bot get bogged down in the details of it literally is a ponzi scheme.

Here a video about the growth ponzi scheme. I think it does a good job of pointing out how financially insolvent these suburbs are.

 

firsttimecaller

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Suburban living is scandalously self-indulgent. Much better for the environment to live in relatively high-density cities. And for the human spirit — well, lots of people (e.g., Jane Jacobs) think that humans, on the whole, actually thrive on a much higher level of population density that we see in the suburbs (but of course they're speaking of cities of real neighbourhoods).

Not everyone is happy living in a concrete jungle, 5 feet away from thousands of other people.
 

Drifterwood

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These sprawling suburbs look like a very poor investment right now. To the cost of maintenance you can also add the likely change in the automobile love affair. In the 15 minute city, most people won't bother with a privately owned vehicle. This will create something of a vicious circle for the cost etc of vehicles. Auto driving electric Ubers will be a quarter of the cost per mile of owning your own vehicle. In a fifteen minute city, you can at least halve the number of vehicles on the road and soon, most will be electric. Life without vehicle smog, I can't wait.