[updated 10/12, to correct some Wordpress mangling of the final paras]

Lawrence Lessig argues against government transparency in the cover story of The New Republic -
How could anyone be against transparency? Its virtues and its utilities seem so crushingly obvious. But I have increasingly come to worry that there is an error at the core of this unquestioned goodness. We are not thinking critically enough about where and when transparency works, and where and when it may lead to confusion, or to worse. And I fear that the inevitable success of this movement–if pursued alone, without any sensitivity to the full complexity of the idea of perfect openness–will inspire not reform, but disgust. The “naked transparency movement,” as I will call it here, is not going to inspire change. It will simply push any faith in our political system over the cliff.
One of the points he raises is the sheer volume of information generated by transparency is at odds with our attention spans - our ability to get a complete and well-reasoned picture is not helped by having all data about all aspects of everything. He’s thinking about trust in our elected reps and gov in general, but does the same risk apply for a more data-rich approach to city planning? Or do we have a different problem, where this new wealth of data gets us better service delivery, but not better long term planning?
Joshua Tauberer makes a long tail argument about the future benefits of open data - who would have guessed about researchers listening for woodpeckers in the Library of Congress archives? And you can easily suggest city planning parallels - I’m looking forward to a decade of georeferenced Flickr to tell us about the changing neighborhoods in urban areas.
But does more data lead to better decision making now? If we decide that planners are held back from an effective response to climate change, would more data be the unblocker we need? For planners, we might imagine that the effect of more data is to make for a more informed citizenry - since the voters are wiser about an issue, the decision makers have to step up in response (a variety of sunlight-is-the-best-disinfectant). If the data were not there, the action would not have been taken.
Or maybe more data enables engagement by less traditional participants - people who might once have only signed a petition or perhaps attended a public meeting can now use apps powered by public data to participate. It’s possible to make a meaningful online or app-centric contribution to your neighborhood, if you want to (and obviously the other three quadrants are equally possible: wonderful offline neighborliness; vacant twittering online; and whatever the unplugged equivalent is - going off-topic at a CB meeting?).
Both of these applications - old-time data as exposé, data-activated citizen - are exciting and beneficial. But are they only affecting consumer-oriented issues (for want of a better term)? We’re all better off if openness leads to faster response times for city services, better placement of bike racks and fixing of potholes. Yet cities are more than those things, important as they are. A lot of critical decisions about land use and development are made the same way as before. And those decisions are the ones that shape how our urban areas turn out, especially with regard to climate change.
Open data, transparency and a thousand urban apps might be the starting point towards better planning across all levels of government, planners and non-planners alike. Or we might be swimming in a sea of data and fun apps while the same old processes carry on as before.
These are really unformed musings. Needs more thought - and perhaps some diagrams.

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While I don’t have the time up front to read the entirety of this article, I would like to defend transparency as defined in the pull quote. I see from the article there are other qualms the author has, some of which deal more with national policy and statecraft than regional planning.
We’ve already been dealing wiht data overload for a decade or more. The open source and mashup movements have evolved elegant and popular tools to address the crush of data from places like craigslist into comprehensible formats.
Before, the decisionamaking about what data to use in our long term plans was in the expensive collection itself. With survey success rates under 20%, or a day’s traffic count adjusted to represent the entire year (what if there was a sale a mile away?), planners have had to rely on imperfect data, perfectly interpreted.
With greater release of data, we need to trust that people will develop tools, many utter failures, to distill that data into useful forms. Much of what we do on the internet is predicated on the established ability to do these things. We don’t need omniscience to make good plans, just the data we need in scope. Kinda like google.