Profitability Should Determine Land-Use

Walter M. McIntyre (Letters, May 27) advocates a moratorium to stop the owner of the land under the Unocal service station and Tiny Naylor’s restaurant at Ventura and Laurel Canyon boulevards from developing the site as the owner sees fit. I find that his position is self-contradictory and politically dangerous.

McIntyre’s viewpoint is self-contradictory in that he asserts the thesis that the developers are swamping our neighborhoods motivated by “greed� and the desire for profits, and that at the same time these developers are excluding from their consideration the “wants of the community and existing market forces,� and “the needs of its consumers.�

The only way that the desires of consumers are made objectively knowable is through the market process of profit and loss. Those entrepreneurs who correctly estimate the future desires of consumers are the ones who can acquire profits. The entrepreneurs who fail to forecast accurately the wants of consumers sustain losses. Developers do not build houses and shopping malls for their own amusement. They do it out of the desire for profits.

But it is the consumers who are willing to exchange their money with these developers to buy or rent what the developers produce. If the consumers do not want what the developers are offering, then these same developers will sustain losses. Thus the idea of a free-market acquisition of profits and an utter neglect of the wants of consumers is a self-contradiction.

Mr. McIntyre somehow knows that the present use of the land at Ventura Boulevard and Laurel Canyon is “supported by the community and meets the needs of its consumers.� But the “community� does not speak with one voice, and the only way the set of individuals who make up the community can make their preferences known is by way of the market (i.e., profit and loss). If indeed the development of the corner site into a “retail complex� is more profitable than leaving it as a gas station and restaurant, then Mr. McIntyre is in fact substituting his personal preferences over that of his neighbors. The only way he can act on his preferences is by calling on the coercive powers of the government.

I call upon City Councilman Joel Wachs to reject the pleas of Mr. McIntyre. I ask him to oppose the idea of a moratorium on the basis of the economic facts, as well as on the basis of the owner’s inalienable right to peacefully use his property as he determines.

RICHARD SHEDENHELM

Van Nuys