Following the Money

In understanding the motivations of various actors in a social economy, the mantra “follow the money” is used by analysts of many political and economic persuasions. After all, both Karl Marx and Adam Smith were materialists who saw the basic economic relations within a society as the best predictor of behavior. The corollary is that actions inspired by faith, love, loyalty, or other belief systems are less important.

Acting with cupidity

Now, we all know that you can manipulate a whole collection of belief and identity systems to get people on one political side or another in defiance of their own economic interests. That’s not what I want to talk about, because the endgame there is a political point and I want to follow the money, especially when it leads us away from the fantasy of the false dichotomy.

Money or Culture You Decide

The false dichotomy is of course the free market versus the state, and as a historian I can promise you that the one NEVER happened without the other. Indeed, following the money usually means massive private investments are following huge public investments which can occur in the form of land grants, subsidies, tax breaks, or, most commonly, infrastructural investments. Two hella ginormous examples in American history are the construction of the railroads by giving away tons of government land and the construction of the highway system by the government, which amounted to a massive subsidy of both automobiles and the trucking industry.

Land grants also funded “public” universities, many of which were subsidized by state governments, although interestingly those percentages have dropped so low at places like the University of Michigan it is hard to consider them public anymore.

They all had ag schools, which were a subsidy to the dominant industry

When we follow the money behind the recent proliferation (over 200% from 1998 to 2008) of for-profit universities the subsidy becomes obvious – student loans. These institutions are basically created to capture government investment in students, with 80 percent of their revenues coming from taxpayers and their students borrow at a much higher rate than traditional not-for-profit universities.

So what got me thinking about this was the decision this week that Northwestern University football players could unionize because they are effectively working for the university. And if you look at that famous map of the highest paid public officials in every state, you realize that it is mostly university football coaches. So here you have a massive industry that is subsidized by a.)student loans, b.)possibly state money(not at NU), c.)gate receipts from football games, d.)other receipts from said football, and e.)free labor.

Now of course the not-for-profit universities also have another subsidy – their not-for-profit status. They share this with churches, which are also subsidized, despite our Constitutional amendment that prohibits the establishment of an official religion. You ever wonder why you see so many storefront churches in the inner city? Because everyone is real religious? Because no one else is courageous enough to set themselves up there?

Follow the money. It’s because it is a lot cheaper to run a tax-free church in commercial space than an actual commercial enterprise, even though money changes hands in both scenarios.

So much of art history was crafted for churches, not because the artists were especially religious or not, but because that’s where the money was. Before the Europeans figured out ways to enslave Americans and Africans on haciendas they enslaved their own at monasteries, the plantations of the Middle Ages. Sure Henry VIII needed to get divorced and hence quit the Roman Catholic Church, but if you follow the money it was not love nor faith but the vast assets of the monasteries that made the dissolution worthwhile.

Besides they look a lot cooler as ruins. Ruins that inspired 19th century Brits to invent heritage conservation

Tax exemptions and incentives have been huge for historic preservation, although it is important to note that the incentives were crafted because the actual real estate market was biased toward new construction, a byproduct less of the nature of construction or even supply and demand, but the peculiarities of financing, especially that most revered of economic principles: certainty.

I certainly know the market. I can certainly predict the cost of the middle building, but the flankers may present unknowns

In this case the historic preservation tax incentives helps older buildings by offsetting the deficit caused by the difficulties of getting financing on the same terms as new construction. Form follows Finance, which follows subsidy, like student loans, and highways and sewers and so forth.

I live in Silicon Valley, which the economist Ed Glaeser (my blog on his book is here) called one big City of Ideas covering some three dozen municipalities over 60 miles of the Bay Area. Glaeser plays to type by whining about regulation, but he has a point in this autoclave of a real estate market, since the vast reserves of open land, parks and forests has pushed prices up in the most attractive parts of the Bay Area.

So, are the parks and climate externalities that drive up the price instead of place you could build, thereby driving down the prices? Or are the high prices in part a result of this being a really nice place to live, thanks to the parks and climate? I have often blogged before about the fundamental middle- and upper-class desire to control the environment you live in, or at least have a say in the process. The money is following the climate, and it is following the public subsidies of Big Basin and Windy Hill and Vasona Park.

Not hard to take on a daily basis

We were looking for souvenirs for our Japanese student guest last weekend and the postcards included one that pictured a wrecked wooden shack and the postcard says “Bay Area Fixer-Upper, $996,000” which is true down here in Los Gatos but probably underpriced for Palo Alto.

this one’s in good shape, but would command more than 996k

But the Bay Area market is not driven simply by supply and demand nor even by regulation and climate. The key for Glaeser is the face-to-face encounters, the logic of concentration which is in fact the logic of capital. People crafted the 21st century economy here and still do so daily with their company-subsidized lunches and their Save The Shire t-shirts. That’s why Zuckerberg came here, even though he invented Facebook in the midst the the second-greatest concentration of technology in North America. Success breeds success and money follows money.

Drones are illegal in California but this Google car has been following me for 21 months. I suppose I should be happy someone is following me, even if that someone isn’t money…

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Conservation at El Mirador

I finally had the opportunity to visit El Mirador, the longest-running Global Heritage Fund project in Guatemala. The preClassic Maya site lies in the Peten region at the northern edge of the country, in the heart of a surviving rain forest. Howler monkeys greeted our arrival by helicopter.

This is the Kan (snake) kingdom of the Maya, a series of cities and ceremonial sites that represented the most advanced civilization in North America two thousand years ago. Today many of these sites are part of the Mayan Biosphere Preserve. We are conserving BOTH culture and nature here, which is important, because you see the deforestation in the area around the park and it is disheartening.

View from La Danta, the largest pyramid at El Mirador and the largest pyramid BY VOLUME in the world.

Dr. Richard Hansen, who has been working with GHF for almost a decade, looking up La Danta

As I said in a blog not too long ago, we are seeing a confluence of heritage and natural area conservation. Not only does World Heritage recognize both (and “mixed” sites) but many of our projects are both national parks or preserves and cultural heritage sites, like Ciudad Perdida in Colombia and El Mirador. Saving the heritage helps save the rainforest.

Me on La Danta

At the same time, conservation of excavated temples and artifacts is made more difficult by the rainforest. One of our principal efforts in 2013 was to construct this shelter over the famous Popul Vuh plaster relief mural. This will help conserve this fantastic ancient artwork.

This is Hunahpu, one of the hero twins of the Popul Vuh, he is carrying the head of his father after defeating the bad guys in the ball game

Dr. Richard Hansen explaining the myth

A similar cover helps conserve the temple of the Jaguar nearby.

The site is vast, occupying a basin that stretches north of the border into Mexico and represents not only a rich and well-preserved ancient civilization, but a rare and intact stand of native rainforest. My visit was brief but the impact was great.

descending the pyramid (but not all the way into the underworld

During the summer field season over 300 workers are employed here in archaeology and conservation. The next step is to develop an ecologically sensitive way of visiting the remote jungle site – if you want to avoid the helicopter now you have to trek for two days (and there are chiggers and other nasties). Hansen’s preferred solution is to use the historic roadways, made of many layers of lime, that link the sites in the basin with the world outside the rainforest. In the meantime, work goes on and the faces carved millennia ago emerge in the jungle…

To support GHF’s work at Mirador, click here!

Yangon Heritage

Rangoon. The Garden City of the Orient. It really was, and thanks to a half-century of neglect, it still is. Sort of like Havana, Rangoon gives you that sense of stepping back in time, before the glass skyscraper shopping centers, before Rayon and ubiquitous telephony. I rarely wax nostalgic but when I walked the streets of Rangoon in May of 1986, I fell in love with the colonial architecture.

You could feel the sense of time there. I have never been to Havana, but I have experienced the sense of time frozen in architecture in a few other places – Budapest a decade ago, Georgetown (Malaysia, not D.C.) in the 80s, even Leeds back in ’82. It is an architecture that begs for preservation but not restoration. It is messy but it is literally dripping with history; with significance

I was in Chicago last week meeting with Thant Myint-U, an historian, author and leader in both the preservation movement in Burma as well as its peace process and emergent democracy. Global Heritage Fund is working with Yangon Heritage Trust because like YHT, we see conservation of architectural heritage as a vital social and economic development tool.

Thant is considered one of the 100 Leading Global Thinkers by Foreign Policy Magazine and I think it is significant that he thinks so much about preservation.

This is my photo of the great Shwedagon Pagoda, 1986.

For a couple of years now, there has been a rush to Rangoon, which sits neatly between the great South Asian cultural sphere of India and the great East Asian cultural sphere that includes China and Japan. The rush is prompted by openness, trade, and of course that time-capsule city that is just dying for redevelopment in the time-honored manner of all Asian cities….



Yum. Can’t wait.

So Thant sees a rare opportunity to preserve the best of the old – and the garden city feel crafted by the original designers and NOT LOST due to the depredations of mid-century highway engineers – while allowing Rangoon to evolve into the 21st century. Almost every other such opportunity in Asia has been lost.

Except the Bund, although it is dwarfed by the rest of Shanghai and outsmarted nightly by Pudong across the river.

Shortly after visiting Rangoon in 1986 I went to Singapore, and while it is cleaner and safer than anywhere in the U.S., my impression was: The alien shopping centers have landed and they are having a sale. Not warm and fuzzy. Not special character.

Rangoon is the last best hope for crafting a modern Asian city that respects not only a few odd landmarks, but an urban landscape, a balance of then and now, a place made humane by the urban patina of these buildings.

There are challenges – sorting out the ownership and tenancy rights, and these are primary in Thant’s mission, which seeks to secure a conservation NOT reliant on gentrification. That is a tall order, but in every important sense, he is up to that challenge and I will work to make Global Heritage Fund a partner in that effort.

Another challenge lies in the naysayers. I heard it more than once – why would the Burmese want to preserve the colonial architecture built by the British who literally conquered the country?

This is a common slam against preservation, and it ranks up there with the other fallacies used as excuses by those who find preservation HARD.

Fallacy Problem One: This assumes that the oppressed peoples IDENTIFY that architecture with oppression. They might. They might not. First thing you should do is ask them. Thant has and is acting on the answer.

Fallacy Problem Two: The architecture of oppression can become the people’s architecture in no time at all. Here is a palace of a despotic ruler:

Except they chopped his head off and opened the building to the public as the WORLD’S FIRST MUSEUM causing, well, museums.

Here is a palace of 600 years of despotic rulers:

So when radical Communists took over the country they demolished it, right? Um, no, they made it into a public museum and tourist attraction.

Here is what every NEW building in Vietnam, Cambodia and Laos looks like:

It’s French. You want to show off your newly minted middle-class status, you build a house in the style of the colonial powers. Short answer: Don’t assume what the architecture symbolizes to people until THEY TELL YOU.

Fallacy Problem Three: The embedded notion here is that people just want to get ahead and you and your fancy-pants aesthetic snobbery are preventing them from their unencumbered march into prosperity.

This is a fallacy in the developed world as well, proceeding as it does from the assumption that ANYTHING that gets in the way of redevelopment is an impediment. Like buildings. Like zoning. Like laws. Like financing. Like infrastructure.

We don’t consider zoning or financing impediments but maybe we should, because they can shut down a development project COMPLETELY. An old building CAN’T DO THAT. The worst it can do is change the FORM of the development project.

Why is that so HARD? Maybe Yangon Heritage Trust will prove that is isn’t.