Frozen Faces and Frozen Minds

The facades of New York's buildings are like faces. Behind those faces are the minds of the architects and engineers who built them and the minds of the businessmen and residents who work and live in them. Those facades -- the face of the city -- have changed remarkably over the past 125 years. Before the first steel skyscrapers were built around the turn of the last century, building heights were practically limited to not much more than ten stories, and typically much less. Four to six stories was most common.

Despite the emergence of skyscrapers, walk around many streets of New York and, apart from the sight of cars parked on the street and people dressed in modern clothes and talking on their cell phones, you could still swear you were in the 1880s.

That 1880s vista has been frozen in place throughout much of Manhattan by New York City's "landmarking" laws. Those laws ban nearly all construction in the large and growing landmarked zones of the city. If any building is to be allowed, it must be a clone of existing building styles. Although some construction ends up getting built on a vacant lot or at the site of a building that must be razed because it is ready to collapse, no new tall buildings are ever permitted. The rare new building in these landmarked zones, as a rule, must be short and blend in with its ancient surroundings.

The city's landmarked neighborhoods often possess a certain charm. In fact, the Landmarks Commission seeks out the charming neighborhoods to landmark. As of this writing, there are 45 landmarked zones in Manhattan. In addition to the landmarked zones, 1100 individual buildings have been landmarked. While it is difficult to say what percentage of Manhattan's 23 square miles is now essentially off-limits to development, one can get a sense of this number by looking at the sheer size of some of these landmark districts:

The Greenwich Village Historic District (established 1969) covers 86 city blocks.

The Upper East Side Historic District covers 57 city blocks.

The Upper West Side Historic District covers 51 city blocks.

The Tribeca Historic Districts cover 49 city blocks.

The Ladies Mile Historic District covers 19 city blocks.

The Noho Historic District covers 14 city blocks.

These are some of the larger districts. 45 of them now encompass much of Manhattan. New districts and buildings are being added every year.

Interestingly, the formation of these districts tends to coincide with a rise in property values of the frozen regions. Each new landmarked building or neighborhood in New York diminishes the potential supply of new places to live and work. As a result, the value of existing property tends to go up.

New Yorkers who already own property feel wealthier because the value of their property has gone up. Moreover, they marvel at the charming neighborhoods of the city that have been preserved seemingly in perpetuity for their enjoyment.

All of this comes at a price. That price is the violation of their property rights. What of the New Yorker who wants to sell his building to a developer who wants to put up a skyscraper on that land? It is forbidden. What if the owner of a crumbling 1880s-era building wants to replace it with a modern, comfortable building with central air, well-insulated walls and skylights? He can't do it, unless the building he lives in is in imminent danger of collapse. In fact, city officials may require him to install expensive bracing to keep his ancient brickpile aloft. If even expensive retrofitting can keep his building standing, he must employ those methods before he will ever get permission to tear it down or simply let it collapse. If one looks closely, you can see these teetering braced, nearly-ready-to-collapse buildings around the city.

One person's beautiful historic landmark is an uncomfortable, expensive to cool and heat, dreary building to another. Some find 1880s row houses beautiful. Others prefer a gleaming 100-story skyscraper. Regardless, the real debate is not about building esthetics. It is about rights. By what right does one person forbid another the disposition of his property as he sees fit?

Economically, as one would expect, violations of property rights are not without consequences. In the case of New York, as its neighborhoods become expensive "Disneylands for adults" as an unknown commentator described it, businesses and people are being priced out of the city. As the city becomes an uneconomic place to live and work, businesses and people leave the city, or simply do not move here in the first place.

This is not a new trend in New York. The rise of landmarking parallels the rise of other destructive policies that have made New York an expensive place to be for businesses and people. Rent control, imposed at the end of World War II, has made New York's housing the most expensive in the country. Clever and grasping taxes such as taxes on commuters and city taxes on the global earnings of corporations have led most of the Fortune 500 companies that were headquartered here as late as the 1960s to flee the city long ago. To pay for a city-run welfare program including the largest program of free and subsidized municipal public housing in the country, New Yorkers pay the highest taxes in the country, including a combined city and state top marginal income tax rate of 13%. The city's top rate kicks in at incomes that would be considered "middle class."

Like all actions, these actions have consequences, even if they are not obvious to some right now. Eventually, a tipping point will be reached, when the costs of being here become too great. When that day arrives, the owners of their landmarked residences in their charming neighborhoods may find that their property values are falling, instead of rising. They will find that their charming neighborhoods have become less so, now that graffitti is spraypainted on walls and gangs of unemployed hooligans (who live in city housing projects) terrorize them with crime.

New York is, or should be, a city of skyscrapers. Freeze it with landmarking laws and eventually the faces behind those frozen facades will begin to have one expression on them. That expression will be terror.