The problem identified: Homestead, in a nutshell ... by gimleteye

The economic crisis arising out of the housing boom -- involving mainly the conversion of "cheap" farmland into suburban tract housing -- infected the entire United States. The model of destruction was clearly visible in south Florida, where so much stupidity followed the massive rezoning of open space and private property defining the once magnificent Everglades; building massive wealth and powerful political constituencies to replicate the pattern and proliferate sprawl as fast as banks would finance it.

There is an interesting article in today's Miami Herald where the formula is put right into the open by John Alger, in "Homestead, farmer look to settle lawsuit with Air Force." The issue, as described, is "balancing" the rights of property ownership of farmland located very close to the US Air Force Base at Homestead.

The array of economic and political interests to convert that air base into a massive, private (and no-bid) commercial airport consumed years of my life, beginning in the mid-1990's. At its heart, the fight, joined by civic activists and conservationists from around the nation, revolved around the focus of the Herald article: the use of thousands of acres of environmentally sensitive land, owned by large land owners, as fodder to spread sprawl against the chance to restore Biscayne Bay and the Everglades.

Mr. Alger gets straight to the point in the Herald article, "We have no immediate desire for development," said Alger, a third-generation farmer. "But the development rights allow us to preserve a hypothetical value that can be used for collateral."

"Is" used for collateral is the key point. The reason Homestead became the foreclosure capital of the nation after the recent housing bust is that banks conspired to lend farmers/developers money at values and rates that offered no chance for any outcome other than pricing to transform farm acres to zero lot line housing. Homestead continues to be the most egregious example, except perhaps for towns like Stockton in California's Central Valley.

Banks and land owners across the nation have conspired to use the developable value of real estate to finance everything from lifestyles to crops, turning once rock-solid, conservative businesses adverse to risk into gambling operations no different from casinos.

There is nothing illegal in Mr. Alger's premise, but there should be. The hypothetic value, moreover, of developable real estate is not only the foundation of banking and lending practices; it is virtually enshrined by the political order. A sane society would create financial barriers protecting communities by denying banks the opportunity to lend and to conspire on "developable values" where sprawl is the highest value. But ours is not a sane society. Even after the worst economic crisis since the Great Depression, there has been no public outcry or demand for change in banking regulations. In fact, as our blog has observed: the reverse is occurring. Every economic interest in South Florida, like the founders and speculators of US Century Bank, are hoarding cash and waiting for the miracle to come: the reversion to development and land use models that catalyzed growth leading up to the crash.

Our connections to democracy -- lamented on the Herald pages by FIU president emeritus Mitch Madique as "apathy" -- have been turned to dust by encouragement of land speculation.

To see how this happens, you don't have to be a farmer or property rights champion or environmentalist: you simply have to go to the county commission and watch how decisions are made on a single zoning application at the fringe of the Urban Development Boundary. To see how speculation took root and infected Florida, you just have to watch one legislative session in Tallahassee where the Great Destroyers devise one more way to socialize risk and privatize profit; it is all about encouraging the speculators.

One can empathize with farmers who don't want to be farmers: under the best of circumstances, farming is a difficult, challenging way to make a living. (And under conditions of climate change, it could get much worse, faster than anyone is talking about ...) But economic policies that reward farmers for being land speculators -- using, for example, farmland as collateral based on its developable value as suburban sprawl -- has made some people rich and powerful while destroying public discourse.

What is also unfortunate and regrettable is that this view is never given an inch of space on the Herald OPED page. That fact alone demonstrates the influence of downtown land use law firms, like Greenberg Traurig and Holland and Knight. Miami has never known another way to accumulate wealth than formulas based on speculation. It is why casinos are held in such esteem and so many land use decisions made by local government, detached from reality.