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Diverging Fortunes in Portland

Mon, 09/29/2014 - 22:38

A recent New York Times Magazine had a story on Portland that featured Yours Truly. I recapitulated a few observations I’ve had over the years, including that it’s truly remarkable how a small city like Portland has captured so many people’s imagination, and also that “people move to Portland to move to Portland.”

A Portland writer named Steve Duin appears to have had an aneurysm over the piece and, among other things, criticized my statement about why people move to Portland, saying:

She quotes Aaron Renn, an urban-affairs analyst, who insists that while Los Angeles attracts starlets and New York the financiers, “People move to Portland to move to Portland,” as if the city is a space between Pacific Avenue and Park Place on the Monopoly board, not a vibrant, creative, accessible and accommodating urban scene.

Which only proves that he completely missed the point. All I’m saying is what he’s saying in different words, namely that people move to Portland for its lifestyle and amenities. This is exactly what every Portland booster claims, namely that what they’ve created is attractional. I’m simply pointing out the obvious: people move to Portland primarily for lifestyle and leisure, not career or economic reasons. People move to Portland because they want to live there.

Portland’s economy has actually picked up of late. Its unemployment fell below the national average in 2013 after having been above it for 14 straight years. But I want to highlight a disconnect between a couple measures of economic performance.

I’ve written many times that Portland has done very well in terms of per capita GDP. In fact, from 2001 to 2013 (the maximum range of data available from the feds), Portland was #1 out of all 52 large metros in the US in its percentage increase in real per capita GDP.

On the other hand, looking at how much of that economic value ends up in people’s pockets tells a different story. From 2001 to 2012 (I don’t think 2013 has been released yet), Portland only ranked 40th out of 52 in its percentage increase on this metric. Portland declined from a per capita income of 104.9% of the US average in 2001 to 98.6% in 2012.

I threw this divergence into a quick chart:



It would be interesting to dig into these numbers. I did a quick back of the envelop calculation of total GDP growth by industry. Only a few industry totals are available, but the biggest gainer was Manufacturing, up 300%. Education, Health, and Social Assistance were #2, followed by Professional and Business Services. Natural Resources, Retail. Information, and FIRE were at the bottom.

Speaking of San Jose, I see an even more remarkable divergence there. It was #2 in per capita GDP growth over the 2001-2013 time frame. Looking at the overall Bay Area total real GDP, it increased by 30.1% from 2001 to 2013. Keep in mind I’m using the inflation adjusted figured here, so there’s no inflation in that metric. But at the same time the Bay Area lost 2.4% of its jobs.

The Bay Area grew its economy by almost a third while shedding over 75,000 jobs. Pretty remarkable.

Aaron M. Renn is an independent writer on urban affairs and the founder of Telestrian, a data analysis and mapping tool. He writes at The Urbanophile, where this piece originally appeared.

"Portland Oregon" by Jamidwyer - Own work. Licensed under Public domain via Wikimedia Commons

When Patrimony Trumps Political Preference

Sun, 09/28/2014 - 22:38

Jews, despite their above-average affluence and their entrepreneurial bent, have long been among the most loyal constituencies of the Democratic Party. Half of American Jews earn more than $100,000 annually, three times the national average and far more than typical members of mainline Protestant churches. The only real competition, economically, comes from another outsider group: Hindus.

In 2008, President Obama received roughly 80 percent of the Jewish vote and, four years later, his percentage remained just under 70 percent, even though the alternative candidate was clearly more pro-Israel and enjoyed the support of some Jewish billionaires.

Some Republicans point out that Mitt Romney’s show of support among Jews was the strongest since Ronald Reagan ran against Walter Mondale in 1984. They suggest that Jews may finally be shifting toward the center and even to the Right.

Change on the left

Changes in attitudes toward Israel, and Jews, could hasten this process. After all, it is painfully obvious that opposition to Israel has now shifted from the traditionally anti-Semitic Right to the multicultural Left, and its various offshoots in the media and on campuses. The growing disconnect between left-leaning Jews, such as Peter Beinart, Jon Stewart, Max Blumenthal and Ezra Klein, and Israel makes such a shift easier.

This reflects a growing change in the nature of opposition to Israel, and anti-Semitism, in the West, from the old Right to the liberal-dominated media and the academy. Universities, for example, serve as ground zero for powerful boycott and divestment campaigns against Israel. The campaigns’ purpose is not only to hurt Israel’s economy, or protest its sometimes-unwise policies (such as expanding settlements), but also to cast her as a pariah state.

This is intriguing, indeed, since there seems to be no academic campaign to rein in such huge human-rights abusers – whether against Christians, females, gays or other minorities – as Syria, Saudi Arabia, Iran or Egypt. Only crimes by the Jewish state seem to qualify.

This clear inconsistency appears not to have slowed the divestment campaigns which, if not openly anti-Semitic, justify prejudice as a natural result of Israeli policies. Indeed, a Stanford professor writing in Salon placed responsibility for rising anti-Semitism on “the actions of the state of Israel in staging a brutal, prolonged attack on the Palestinian people.” This was echoed by another pro-divestment professor who suggested that “Zionists” were “transforming ‘anti-Semitism’ from something horrible into something honorable since 1948.”

To be clear, there is nothing wrong with opposing specific Israeli policies, as we both do. But you also cannot ignore the fact that anti-Zionism often morphs into eliminationist anti-Semitism.

“From the [Jordan] River to the [Mediterranean] Sea, Palestine will be free,” protesters chanted outside the U.S. Courthouse in Fort Lauderdale, Fla., during an event co-sponsored by, among others, the Council on American-Islamic Relations and the Broward Green Party.

Only a fool would think that a Hamas takeover of all Palestine would result in anything other than a second Holocaust. But such associations don’t seem to embarrass many progressives, who write for such publications as the Daily Kos. With anti-Israel policies now an accepted part of the progressive agenda, some Democrats may be forced to gradually shift their views – as has occurred in issues from climate change to foreign policy – to conform to the new accepted line.

Hostile Europe

This is already happening across the Atlantic. The two dominant parties in Scotland, Labor and the Scottish Nationalists, notes the National Interest, “try to outdo each other in their radicalism” against Israel and Zionism. Some Labor MPs have even revived old notions of a “cabal of Jewish advisers” who determine British foreign policy. To many on the left of the Labor Party, it’s basically impossible to be both openly Jewish and in the “progressive movement.”

This new attitude is, if anything, stronger throughout the rest of the European Union. Changing demographics explains part of this. France, long the home of Western Europe’s largest Jewish community, now has many times that number of Muslims. Much the same can be said of Germany, the Netherlands and other European countries. Parties on the left often covet these voters and play to their sympathies.

This means an embrace of an increasingly harsh view of Jews, not only among Muslim extremists, but also well-placed non-Muslim leftists. The publisher of L’Express, France’s leading left-of-center magazine, recently attacked French Jews for their support of Israel and chastised them for forming self-defense organizations to protect their community from attack. Not surprisingly, many French Jews are considering an exodus to Israel, Canada, Australia or the United States.

This process, thankfully, is only nascent in the United States, where Muslim and Jewish populations are roughly even. But racial divisions could speed up the dissolution of progressive support for Israel. Although perhaps less than one in five Americans hold strongly anti-Semitic views, that tendency is stronger among both African Americans and foreign-born Hispanics, two key and growing components of the Democratic coalition. This situation may worsen due to well-publicized efforts, particularly in the left-leaning media, to draw close comparison between the recent racial rioting in Ferguson, Mo., to Israel’s attacks on Hamas in Gaza.

Given these pressures, it is certainly possible that, over time, more Jews may flee to the Right, following the path already trod by many Italians, Irish and other immigrant groups. Yet, if this happens, it won’t do so quickly. Historical inertia still favors the Democrats by a wide margin.

Shifts among Jews

What finally may drive this change, more than anything else, are evolving Jewish demographics. More American Jews – who left the former Soviet Union, Arab countries, Iran, even South America – do not share the old left-leaning narrative embraced by the bulk of Jews whose families left Europe before World War II. Among Americans who self-identify as Jews, roughly three-quarters, according to one survey, still consider Israel an important issue.

Economics and local issues, like public safety and schools, could also accelerate this movement to the right. Jews have tended to support more centrist or conservative candidates, such as Mayors Rudy Giuliani in New York or Richard Riordan in Los Angeles. Take the social issues of the Right – abortion, opposition to gay rights, school prayer – out of the mix, and many Jews may, indeed, vote a bit more like mainline Protestants, or even Mormons.

But at the same time, Jews’ electoral clout – whatever their party – seems certain to diminish. As more secular Jews intermarry and eschew child bearing, their ties to Judaism tend to fade and clearly will not be passed to nonexistent offspring. At the same time, solidly Jewish-identified communities, such as the Israelis, evidence little interest in local or American politics, outside of issues affecting their native country. Ironically, the Israeli immigrants reflect the old stereotypes of Jews as sojourners, people who are inward looking and not committed to their current place of residence.

Jews of Iranian, Russian or Sephardic descent – who have chosen to settle here for the long term and are not likely to return “home” – may be more likely to engage for Israel and Jewish culture, but, so far, few have emerged politically. Orthodox Jews, another growing group, are very parochial, and hold social views at variance with the vast majority of their co-religionists. They are unlikely to lead mainstream Jews toward the center or right.

All this suggests a difficult political future for Jews in America. As the old commonalities – memories of European repression, the Holocaust and Israel – continue to fray, the community’s political influence seems destined to weaken. Those who care about Israel, or traditional Jewish values, may find themselves forced to partner, often uncomfortably, with conservatives with whom they tend to have many disagreements.

But this strategy of at least considering a conservative linkage could, at a minimum, compel liberals – particularly in heavily Jewish areas like New York or Southern California – to confront the consequences of their growing alliance with anti-Zionists, as well as with blatant anti-Semites. In the end, as the sage and scholar Hillel suggested 2,000 years ago, Jews need to be for themselves, ready to defend their culture and patrimony, as well as Israel. To do this they may find their best allies – at least for now – may be fellow Americans who stand somewhat to their right.

This piece originally appeared at The Orange County Register.

Joel Kotkin is executive editor of NewGeography.com and Roger Hobbs Distinguished Fellow in Urban Studies at Chapman University, and a member of the editorial board of the Orange County Register. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is author of The City: A Global History and The Next Hundred Million: America in 2050. His most recent study, The Rise of Postfamilialism, has been widely discussed and distributed internationally. He lives in Los Angeles, CA.

Rory Cohen is assistant deputy editor of the Orange County Register’s Opinion pages.

New Commuting Data Shows Gain by Individual Modes

Fri, 09/26/2014 - 22:38

The newly released American Community Survey data for 2013 indicates little change in commuting patterns since 2010, a result that is to be expected in a period as short as three years. Among the 52 major metropolitan areas (over 1 million population), driving alone increased to 73.6% of commuting (including all travel modes and working at home). The one mode that experienced the largest drop was carpools, where the share of commuting dropped from 9.6% in 2010 to 9.0% in 2013. Doubtless most of the carpool losses represented gains in driving alone and transit. Transit grew, increasing from a market share of 7.9% in 2010 to 8.1% in 2013 in major metropolitan areas; similarly working at home increased from 4.4% to 4.6%, an increase similar to that of transit (Figure 1). Bicycles increased from 0.6% to 0.7%, while walking remained constant at 2.8%.

Transit: Historical Context

Transit has always received considerable media attention in commuting analyses. Part of this is because of the comparative labor efficiency (not necessarily cost efficiency) of transit in high-volume corridors leading to the nation's largest downtown areas. Part of the attention is also due to the "positive spin" that has accompanied transit ridership press releases. An American Public Transportation Association press release earlier in the year, which claimed record ridership, have evoked a surprisingly strong response from some quarters: For example, academics David King, Michael Manville and Michael Smart wrote in the Washington Post:"We are strong supporters of public transportation, but misguided optimism about transit’s resurgence helps neither transit users nor the larger traveling public." They concluded that transit trips per capita had actually declined in the past 5 years. 



Nonetheless, transit remains well below its historic norms. The first commute data was in the 1960 census and indicated a 12.6% national market share for transit for the entire U.S. population. By 1990, transit's national market share had dropped to 5.1%. After dropping to 4.6% in 2000, transit recovered to 5.2% in 2012. But clearly the historical decline of transit's market share has at least been halted (Figure 2).

Even so, in a rapidly expanding market, many more people have begun driving alone than using transit. More than 47 million more commuters drive alone today than in 1980, while the transit increased about 1.4 million commuters over the same time period.

The largest decline occurred before 1960. Transit's work trip market share was probably much higher in 1940, but the necessary data was not collected in the census, just before World War II and the great automobile-oriented suburbanization. In 1940, overall urban transit travel (passenger miles all day, not just commutes) is estimated to have been twice that of 1960 and nearly 10 times that of today.

Transit's 2010-2013 Trend

To a remarkable extent, transit continues to be a "New York story." Approximately 40% of all transit commuting is in the New York metropolitan area. New York's 2.9 million transit commuters near six times that of second place Chicago. Transit accounts for 30.9% of commuting in New York. San Francisco ranks second at 16.1% and Washington third at 14.2%. Only three other cities, Boston (12.8%), Chicago (11.8), and Philadelphia (10.0%) have transit commute shares of 10% or more. 

From 2010 to 2013, transit added approximately 375,000 new commuters. Approximately 40% of the entire nation's transit commuting increase occurred in the New York metropolitan area. This was included in the predictable concentration (80%) of ridership gains in the transit legacy metropolitan areas, which are the six with transit market shares of 10% or more. Combined, these cities added 300,000 commuters, 89%, on the large rail systems that feed the nation's largest downtown areas.

Perhaps surprisingly, Seattle broke into the top five, edging out legacy metropolitan areas (Figure 3) Philadelphia and Washington. Seattle has a newer light rail and commuter rail system. Even so, the bulk of the gain in Seattle was not on the rail system. Approximately 80% of its transit commuter growth was on non-rail modes. Seattle has three major public bus systems, a ferry system and the newer Microsoft private bus system that serves its employment centers throughout the metropolitan area. All of the new transit commuters in eighth ranked Miami were on non-rail modes, despite its large and relatively new rail system. New rail city Phoenix (10th) also experienced the bulk of its new commuting on non-rail modes (93%). Rail accounted for most of the gain in San Jose (9th), with a 58% of the total  The transit market shares in Miami, San Jose and Phoenix are all below the national average of 5.2%.

Outside the six transit legacy metropolitan areas, gains were far more modest, at approximately 75,000. Seattle, Miami, San Jose, and Phoenix accounted for nearly 60,000 of this gain, leaving only 15,000 for the other 42 major metropolitan areas, including Los Angeles, which had a 5,000 loss. Los Angeles now has a transit work trip market share of 5.8%, below the 5.9% in 1980 when the Los Angeles County Transportation Commission approved the funding for its rail system (the result of my amendment, see "Transit in Los Angeles"). Los Angeles is falling far short of its Matt Yglesias characterization as the "next great mass-transit city."

Since 2000, the national trend has been similar. Nearly 80% of the increase in transit commuting has been in the transit legacy metropolitan areas, where transit's share has risen from 17% to 20%. These areas accounted for only 23% of the major metropolitan area growth since 2000. By contrast, 77% of the major metropolitan area growth has been in the 46 other metropolitan areas, where transit's share of commuting has remained at 3.2% since 2000. There are limits to how far the legacy metropolitan areas can drive up transit's national market share.

Prospects for Commuting

At a broader level, the new data shows the continuing trend toward individual mode commuting, as opposed to shared modes. Between 2010 and 2013, personal modes (driving alone, bicycles, walking and working at home) increased from 82.3% to 82.7% of all commuting. Shared modes (carpools and transit) declined from 17.7% of commuting to 17.3%. These data exclude the "other modes" category (1.2% of commuting) because it includes both personal and shared commuting. None of this should be surprising, since one of the best ways to improve productivity, both personal and in the economy, is to minimize travel time for necessary activities throughout the metropolitan area (labor market).

Wendell Cox is principal of Demographia, an international public policy and demographics firm. He is co-author of the "Demographia International Housing Affordability Survey" and author of "Demographia World Urban Areas" and "War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life." He was appointed to three terms on the Los Angeles County Transportation Commission, where he served with the leading city and county leadership as the only non-elected member. He was appointed to the Amtrak Reform Council to fill the unexpired term of Governor Christine Todd Whitman and has served as a visiting professor at the Conservatoire National des Arts et Metiers, a national university in Paris.

Photograph: DART light rail train in downtown Dallas (by author)

The Sick Man Of Europe Is Europe

Thu, 09/25/2014 - 14:11

The recent near breakup of the United Kingdom — something inconceivable just a decade ago — reflects a deep, pervasive problem of identity throughout the EU. The once vaunted European sense of common destiny is decomposing. Other separatist movements are on the march, most notably in Catalonia, Flanders and northern Italy.

Throughout the continent, public support for a united Europe fell sharply last year. Opposition to greater integration has emerged, with anti-EU parties gaining support in countries as diverse as the United Kingdom, Greece, Germany and France.

The new reality is epitomized by France’s ascendant far-right political figure, Marine Le Pen, who is now leading in many polls to win the next presidential election. “The people have spoken loud and clear … they no longer want to be led by those outside our borders, by EU commissioners and technocrats who are unelected,” she declared recently. “They want to be protected from globalization and take back the reins of their destiny.”

These attitudes suggest that the EU could be devolving from a nascent super-state to something that increasingly resembles the Holy Roman Empire, a fragmented landscape of small, unimportant states wrapped in a unitary, but ephemeral crepe. This challenges the view of some Americans, particularly but not only on the left, who see Europe as a role model for the U.S.

Not long ago progressive authors like Jeremy Rifkin could project the European Union to be one of the world’s great and admirable powers. Today, Rifkin’s 2005 tome “The European Dream,” and a host of similar tracts, seem absurd amid growing political unrest and spreading economic stagnation.

Economic Decline

Some pundits, such as Paul Krugman, routinely describe Europe’s approach to economic, environment and social policy as more enlightened than America’s. Wherever possible, progressives push for European-style action in areas such as curbing carbon emissionsand rapidly converting to “green” energy.

Yet these policies are not working. The one large relatively fast-growing economy in Europe (excluding Turkey) is Poland.

Several years ago Germany and the Netherlands were exemplars as opposed to the much-disdained PIGS (Portugal, Italy, Greece and Spain). But German growth rates have plummeted, going negative in the last quarter, along with France and Italy. More stagnation is likely as energy costs surge and key export markets, notably in Russia and China, begin to contract. Today, the “sick man” of Europe is not any one country, or collection of countries; the “sick man of Europe” is Europe.

Europe’s poor economy stems in large part from policy. The strong welfare state so admired by progressives here has also made Europe a very expensive place to do business. High taxes and welfare costs, long tolerable in an efficient economy like Germany, have a way of catching up with companies and countries. This has been particularly notable after the financial crisis; since 2008 the unemployment rate has shot up 5 percentage points while dropping steadily in the Untied States.

The European-wide embrace of “green” energy policies has been tough particularly for manufacturers. Under Chancellor Merkel, Germany has embraced a massive shift to green energy that has helped raise electricity costs for companies by 60% over the past five years to double the rates in the United States.

The Russians, Europe’s one relatively inexpensive energy source, may have calculated that, in the long run, China may prove a better customer than the Europeans. Ironically, some European countries, including Germany, have been forced to boost their use of coal, certainly not much of a climate change win, to make up for shortfalls created by shuttering nuclear plants and overreliance on often erratic green energy.

Ultimately, high energy prices tend to fall most painfully on the middle and working classes in the form of higher electricity bills. Some may see their jobs threatened as European employers look forlower-cost alternatives, such as in the energy rich South and middle of the United States.

Demographic Disasters

The young are arguably the biggest losers in Europe’s decline. Even though birthrates are very low throughout much of Europe from Germany, Italy and Spain to the eastern countries, those now coming into the workforce face extraordinarily high levels of unemployment, topping 50% in some places. It’s no wonder that some are dubbing them a “lost generation.”

The combination of low birth rates and declining prospects contribute to rising concerns about immigration. Immigration has always been a more contentious issue in Europe, where many countries are dominated by a single ethnic group and the residents prefer something closer to homogeneity. This nativism has been painfully evidenced in recent decades from everything from the violent breakup of Yugoslavia and the far more civilized dismantling of Czechoslovakia to assaults on the Roma in France, the Czech Republic, Greece and other countries.

In Britain, the anti-immigrant and anti-EU U.K. Independence Party’s recent strong showing in the European Parliament elections reflected this concern. Diversity in London, which by some counts has the world’s largest concentration of immigrants, thrills London’s media and business communities but stirs great resentment, particularly among working and middle-class voters. The fact that by some estimates that most new jobs generated in the recovery have gone to immigrants has not warmed sentiments.

A Region Without Meaning

Chancellor Merkel has noted that “multi-culturalism” in Germany has “utterly failed.” Muslims in Europe drifting to ISIS is just one reflection of the continent’s weakness. The slow integration of immigrants into the economy, even in relatively prosperous, enlightened countries like Sweden, reflects also the inability of Europeans to integrate the newcomers who could help provide a workforce and consumer base in the future.

Perhaps the greatest challenge to Europe is not demographics, economics or energy, but one of identity. In highly secularized Europe, Christianity, which bound the continent around some similar values, is increasingly rarely practiced or believed. More Czechs, for example, believe in UFOs than in God. Outside of some vaguely anti-American, neo-druid communitarianism among some, there’s not much holding Europeans together.

All this suggests that Americans would do better than look to Europe for future solutions to our own problems. However attractive the European model may seem to our pundit class, the reality on the ground shows something more to be avoided than embraced.

This piece originally appeared at Forbes.

Joel Kotkin is executive editor of NewGeography.com and Distinguished Presidential Fellow in Urban Futures at Chapman University, and a member of the editorial board of the Orange County Register. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is author of The City: A Global History and The Next Hundred Million: America in 2050. His most recent study, The Rise of Postfamilialism, has been widely discussed and distributed internationally. He lives in Los Angeles, CA.

Will Lindsay Lohan Save Greece?

Wed, 09/24/2014 - 22:38

It's September, but island beaches from the Aegeans to Zante are still buzzing in Greece. Mykonos has been the summer's Go-To spot for superstars and supermodels; the mainland and cities are also seeing the British and Europeans coming back.

Greece's reemergence on the tourist circuit and the celebrity-watch sites has brought travel revenue, which accounted for 12 billion euros through April, actually above the previous peak in 2008. And, based on arrivals, the national tourism agency predicts that visitors will account for 13 billion euros this year.

So did the appearance of Lindsay Lohan and friends in the Greek isles signify, as one newspaper put it, a template for Greece's economic recovery?

It didn't. It's even still possible that Greece's economic troubles have yet to hit bottom — no one really knows. There is one definite, though. Even with a dramatic increase in its significant tourism industry, the dance floor under Greece's summer parties has been resting on a breathtakingly shaky foundation.

The debt-ridden economy has now endured 24 quarters of negative output. Young Greeks continue to flee, straining the country's pension system.

Extreme austerity regime policies — fiscal tightening — have resulted in the most extreme unemployment rate in Europe, 27 percent.

Private investment remains in a free fall, with a decline of more than 10 percent over 2013. Financial institutions are barely lending. The gross total of doubtful and nonperforming loans by major banks is up from 5 percent to 25 percent since 2010.

And, while tourists are crowing about Greece's fantastic bargains, those low prices are partly a reflection of the salary squeeze on Greek workers. Wage deflation is at a pace never before experienced in a post-WWII era developed country, even as household taxes continue to rise.

Those facts are just shorthand — an almost random selection from the reams of data we've compiled and analyzed at the Levy Economics Institute that document the continued precariousness of the economy.

This isn't the first time in recent months that a seemingly positive sign in Greece has been wrongly celebrated as the start of a recovery. The country's return to the bond markets in April was cheered as the end of a four-year exile. But the exercise was a public relations play. Demand for the bonds reflected the state of excess global liquidity, not investor confidence in Greece as a good risk. (Not to mention that the bonds were implicitly guaranteed by the European Central Bank.)

The improvement in tourism isn't a sham like the bond market show. It's real — but it's such a small portion of the overall picture that it's having only a minimal impact on the terrible employment problem, and on Greece's balance of payments.

Millions of tourists may keep landing at Greece's airports. I hope they do. But don't expect ordinary Greeks to be planning their own luxury vacations anytime soon.

Dimitri Papadimitriou is president of the Levy Economics Institute of Bard College. The publications, conferences, workshops and congressional testimony of the institute have a wide international audience.

Flickr photo by efilpera: Clouds over Mykonos, September 2014.

Millennials: A Powerful, Suburban Living Generation

Tue, 09/23/2014 - 22:38

The latest survey data on the  living preferences of the Millennial generation (born 1982-2003) once again validates the picture of a cohort  that, contrary to urban legend, actually prefers the suburbs, even as they prepare to shape the suburbs in their own image. We and others have previously made this data-based point on this website. The results of the survey challenges the often wishful thinking of academics and ideologues who yearn for a more urbanized, denser America. 

The Demand Institute commissioned the Nielsen company, to survey 1000 Millennial households about where and how they plan to live over the next five years, The results suggest a major transformation of the country’s housing markets is about to take place that will benefit those who know and understand Millennials and respond to their desires.

There are 13.3 million households headed by Millennials today. During the next five years that number is projected by the Demand Institute to increase by over 60% to 21.6 million as many Millennials take their first steps toward marriage and family formation. While only 30% of the 18-29 year olds interviewed were now married, seven out of ten said they expected to be within the next five years. A majority (55%) also anticipate becoming parents during this period. As a result, 71% of those interviewed said, that over the next five years, they planned on moving to a  better home or apartment; about half expect to “own, not rent” their new home.   

This burst of family formation, of course, is quite typical for thirty-year olds, a plateau that millions of Millennials will reach in the next half-decade. And, rather than diverge from the pattern, Millennials are following it in their own way. This is good news long term for the economy since their major lifestyle changes will lead to a burst of spending by Millennials. The Demand Institute’s report suggests that, between now and 2018 the generation will spend $1.6 trillion on home purchases and $600 billion in rent. The big questions are where will they spend all that money and what will they spend it on?

The Suburbs is the clear answer to the first question. Forty-eight percent of the Millennials interviewed said they planned on moving to the suburbs, while only 38% said they would be moving into large urban areas.  A scant 14% planned to move to rural environments.

The type of suburban living these Millennials favor, however, is a little different than many of the developments builders are planning to offer. Sixty-one percent say they are looking for more space in their next home than they currently enjoy. An additional 24% want at least the same amount of space. A mere 15% express a desire to live in less space, something often assumed by retro-urbanists, in a presumably more crowded urban environment. Furthermore, although substantial numbers prefer having major amenities within walking distance, most Millennials say they are willing to take a “short drive” to restaurants (54%), grocery stores (61%), and even shopping centers (57%). This suggests that new “walkable” suburbs, including large planned developments on the fringe and Millennial-“gentrified” close in suburbs, all with single family homes, are likely to be the places that benefit most from this wave of Millennial family formation and spending on housing.  

The single biggest barrier to the country enjoying this burst of new spending remains the Millennial generation’s unique burden of student debt. While three-fourths of Millennials believe home ownership is both an important long term goal and a good investment, only 36% believe they will be able to buy their next home, rather than rent. The impact of student debt on this purchasing decision can clearly be seen in the current behavior of 30-35 year old Millennials.  Only half of those with student debt now own homes, while two-thirds of those lucky enough to graduate college without such debt are home owners. This clearly indicates that student debt reform is the single most important issue facing realtors and home builders future success. It should be their priority in Washington.

In the meantime, there may be some creative ways to confront this problem; 69% of the four-in-ten Millennials who believe they could not qualify for a traditional mortgage are open to leasing a new home with an option to buy it later.  

The results of this survey make it clear that the nation’s housing future remains in its suburbs. Those communities which can offer Millennials the type of lifestyle they desire will be rewarded with growth. Those that cling to outdated notions of what constitutes urban or suburban living will find it difficult to compete for the Millennial generation’s housing dollar and the vibrant economic activity that will flow from their choices.

Morley Winograd and Michael D. Hais are co-authors of the Kindle book Millennial Majority, along with Millennial Momentum: How a New Generation is Remaking America and Millennial Makeover: MySpace, YouTube, and the Future of American Politics and fellows of NDN and the New Policy Institute.

Metro Area Gross Domestic Product

Mon, 09/22/2014 - 22:38

The Bureau of Economic Analysis is out with the preliminary numbers for 2013 metro area GDP (see the press release). Here is a spreadsheet with per capita GDP data for all large metros.

We’ve now got enough data that it’s worthwhile to start tracking the trend vs. a 2010 base instead of 2000. With that, here are the top ten large metros by real per capita GDP:





Rank Metro Area 2013 1 San Jose-Sunnyvale-Santa Clara, CA 100,115 2 San Francisco-Oakland-Hayward, CA 78,844 3 Seattle-Tacoma-Bellevue, WA 74,701 4 Boston-Cambridge-Newton, MA-NH 74,643 5 Washington-Arlington-Alexandria, DC-VA-MD-WV 73,461 6 Houston-The Woodlands-Sugar Land, TX 72,258 7 New York-Newark-Jersey City, NY-NJ-PA 69,074 8 Portland-Vancouver-Hillsboro, OR-WA 68,810 9 Hartford-West Hartford-East Hartford, CT 66,870 10 Salt Lake City, UT 62,008

San Jose cracks the $100,000 barrier, though that’s in part to the Bay Area being split into two metros, and the base year for constant dollar calculations getting switched from 2005 to 2009. But still impressive.

This list is similar to what we’ve seen before. But how are things changing? Let’s look at the top ten large metros for percent change in their real per capita GDP from 2010 to 2013:

Rank Metro Area 2010 2013 Pct Change 1 Houston-The Woodlands-Sugar Land, TX 63,816 72,258 13.23% 2 San Jose-Sunnyvale-Santa Clara, CA 89,806 100,115 11.48% 3 Portland-Vancouver-Hillsboro, OR-WA 63,025 68,810 9.18% 4 Columbus, OH 50,370 54,493 8.19% 5 Grand Rapids-Wyoming, MI 41,248 44,482 7.84% 6 Charlotte-Concord-Gastonia, NC-SC 51,819 55,802 7.69% 7 Oklahoma City, OK 45,993 49,441 7.50% 8 Salt Lake City, UT 57,790 62,008 7.30% 9 Nashville-Davidson–Murfreesboro–Franklin, TN 50,464 54,112 7.23% 10 Detroit-Warren-Dearborn, MI 46,314 49,653 7.21%

A full map of this metric is below.



Percent change in real per capita GDP, 2010-2013.

Houston’s #1 showing is very impressive. This is a per capita value remember, so they aren’t on top just by virtue of adding lots of people. And they are in the top ten for 2013 per capita, so it’s not like they started on a low base or something.

Portland and San Jose continues their strong showing in this metric (more on these metros to come next week). Two metros in Michigan made the top ten, though some of that I’d speculate must come from the auto industry recovery, meaning it’s cyclical in nature.

I’ll throw in the total real GDP figures as well, but obviously these heavily align to population. Here are the ten biggest metro GDPs in 2013 (amounts in millions of dollars):

Row Geography 2013 1 New York-Newark-Jersey City, NY-NJ-PA 1,377,989 2 Los Angeles-Long Beach-Anaheim, CA 775,967 3 Chicago-Naperville-Elgin, IL-IN-WI 550,793 4 Houston-The Woodlands-Sugar Land, TX 456,177 5 Washington-Arlington-Alexandria, DC-VA-MD-WV 437,085 6 Dallas-Fort Worth-Arlington, TX 413,627 7 Philadelphia-Camden-Wilmington, PA-NJ-DE-MD 358,091 8 San Francisco-Oakland-Hayward, CA 356,081 9 Boston-Cambridge-Newton, MA-NH 349,652 10 Atlanta-Sandy Springs-Roswell, GA 288,175

And the top ten in total real GDP growth percentage, 2010-2013.

Rank Metro Area 2010 2013 Pct Change 1 Houston-The Woodlands-Sugar Land, TX 379,595 456,177 20.17% 2 San Jose-Sunnyvale-Santa Clara, CA 165,435 192,184 16.17% 3 Austin-Round Rock, TX 86,546 98,126 13.38% 4 Portland-Vancouver-Hillsboro, OR-WA 140,717 159,266 13.18% 5 Charlotte-Concord-Gastonia, NC-SC 115,229 130,318 13.09% 6 Oklahoma City, OK 57,856 65,246 12.77% 7 Nashville-Davidson–Murfreesboro–Franklin, TN 84,572 95,124 12.48% 8 Dallas-Fort Worth-Arlington, TX 368,015 413,627 12.39% 9 Salt Lake City, UT 63,090 70,719 12.09% 10 San Antonio-New Braunfels, TX 80,101 89,463 11.69%

Richard Florida posted some thoughts on this data over at City Lab. I’m less bothered than he is by Washington, DC’s poor performance, however. Much like Detroit’s cyclical upswing, I think short term turbulence in DC from the sequester and fiscal challenges was to be expected.

Aaron M. Renn is an independent writer on urban affairs and the founder of Telestrian, a data analysis and mapping tool. He writes at The Urbanophile.

Why Suburbia Irks Some Conservatives

Sun, 09/21/2014 - 22:38

For generations, politicians of both parties – dating back at least to Republican Herbert Hoover and Democrat Franklin Roosevelt – generally supported the notion of suburban growth and the expansion of homeownership. “A nation of homeowners,” Franklin Roosevelt believed, “of people who own a real share in their land, is unconquerable.”

Support for suburban growth, however, has ebbed dramatically, particularly among those self-styled progressives who claim FDR’s mantle. In California, greens, planners and their allies in the development community have supported legislation that tends to price single-family homes, the preference of some 70 percent of adults, well beyond the capacity of the vast majority of residents.

Less well-noticed is that opposition to suburbs – usually characterized as “sprawl” – has been spreading to the conservative movement. Old-style Tories like author-philosopher Roger Scruton do not conceal their detestation of suburbia and favor, instead, European-style planning laws that force people to live “side by side.” Densely packed Paris and London, he points out, are clearly better places to visit for well-heeled tourists than Atlanta, Houston or Dallas.

There may be more than a bit of class prejudice at work here. British Tories long havedisliked suburbs and their denizens. In a 1905 book, “The Suburbans,” the poet T.W.H. Crossland launched a vitriolic attack on the “low and inferior species,” the “soulless” class of “clerks” who were spreading into the new, comfortable houses in the suburbs, mucking up the aesthetics of the British countryside.

Not surprisingly, many British conservatives, like Scruton, and his American counterparts frequently live in bucolic settings, and understandably want these crass suburbanites and their homes as far away as possible. Yet, there is precious little concern that – in their zeal to protect their property – they have also embraced policies that have engendered huge housing inflation, in places like greater London or the San Francisco Bay Area, that is among the most extreme in the high-income world.

Of course, the conservative critique of suburbia does not rest only on aesthetic disdain for suburbs, but is usually linked to stated social and environmental concerns. “There’s no telling how many marriages were broken up over the stress of suburb-to-city commutes,” opines conservative author Matt Lewis in a recent article in The Week. In his mind, suburbs are not only aesthetically displeasing but also anti-family.

What seems clear is that Lewis, and other new retro-urbanist conservatives, are simply parroting the basic urban legends of the smart-growth crowd and planners. If he actually researched the issue, he would learn that the average commutes of suburbanites tend to be shorter, according to an analysis of census data by demographer Wendell Cox, than those in denser, transit-oriented cities. The worst commuting times in America, it turns out, to be in places such as Queens and Staten Island, both located in New York City.

Other conservatives also point to the alleged antisocial aspect of conservatism, a favored theme of new urbanists everywhere. A report co-written by the late conservative activist Paul Weyrich supported forcing “traditional designs for the places we live, work and shop,” which “will encourage traditional culture and morals,” such as community and family.

Once again, however, a serious examination of research – as opposed to recitation of planners’ cant – shows that suburbanites, as University of California researchers found, tend to be more engaged with their neighbors than are people closer to the urban core. Similarly, a 2009 Pew study recently found that, among the various geographies in America, residents in suburbia were more “satisfied” than were either rural or urban residents.

In working against suburbia, these conservatives are waging a war on middle-class America, not necessarily a smart political gambit. Overall, conventional suburban locations are home to three-quarters of the metropolitan population. And even this number is low, given that large parts of most large American cities – such as Los Angeles, Phoenix, Dallas, Kansas City and Houston – are themselves suburban in character, with low transit use and a housing stock primarily made up of single-family residences built during the auto-dominated postwar period. Only approximately 15 percent of residents in major metropolitan areas actually live in dense, transit-oriented communities.

Given these numbers, one might think conservatives would take issue with progressive plans to circumvent preferences and market forces by constraining suburban and single-family home growth. They might spot a strategic opening to secure the urban periphery, the one area still up for grabs in American politics. In contrast, the blue core cities and red countryside have, for the most part, chosen sides, and both return huge consistent majorities to their preferred party.

Lured by their own class prejudice, some conservatives nevertheless seem willing to abandon market forces, a supposed conservative virtue. In reality, imposing Draconian planning is not even necessary for the growth of density. In places that are have both liberal planning regimes and economic growth, such as Houston and Dallas, there has been a more rapid increase in multifamily housing than in such cities such as Boston, Los Angeles, San Francisco or New York. The cost is just much lower.

Unfortunately, few mainstream conservatives apparently bother to study such things, and, as prisoners of the conventional wisdom, embrace the notion that, on economic grounds, suburbs are becoming irrelevant. Some, such as the libertarian economist Tyler Cowen, suggest that a stagnating post-recession America has to adjust to what has been described as a “new normal” of declining expectations.

With middle-class opportunity seen as largely moribund, many financial interests see America becoming a “rentership” society; for these rent-seeking capitalists, the death of suburbs would be not only morally correct, but also economically advantageous.

It’s hard for me, even as a nonconservative, to see how this trajectory works for the Right.

Renters, childless households, highly educated professionals, as well as poor service workers, clustering in dense cities are not exactly prime Republican voters. Without property, and with no reasons to be overly concerned with dysfunctional schools, the new urban population tilts increasingly, if anything, further to the left.

Meanwhile, the middle-class homeowner, and those who aspire to this status, increasingly find themselves without a party or ideology that champions their interests. In exchange for the approval of the cognitive elites in the media, in academia and among planners, conservatives will have, once again, missed a chance to build a broad popular coalition that can overcome the “upstairs, downstairs” configuration that increasingly dominates the Democratic Party.

Yet, there remains a great opportunity for either party that will appeal to, and appreciate, the suburban base. Conservative figures such as Ronald Reagan and Margaret Thatcher understood the connection between democracy and property ownership and upward mobility. Much the same could be said for traditional Democrats, from Roosevelt and Harry Truman, all the way to Bill Clinton.

For all their faults, suburbs represent the epitome of the American Dream and the promise of upward mobility. That they can be improved, both socially and environmentally, is clear. This is already happening in new, mostly privately built, developments where the “ills” of suburbia – long commute distances, overuse of water and energy – are addressed by building new town centers, bringing employment closer to home, the use of more drought-resistant landscaping, promoting home-based business and developing expansive park systems. This seems more promising than following a negative agenda that seeks simply to force ever-denser housing and create heat-generating concrete jungles.

The abandonment of the suburban ideal represents a lethal affront to the interests and preferences of the majority, as well as their basic aspirations. The forced march towards densification and ever more constricted planning augurs not a return to old republican values, as some conservatives hope, but the transformation of America from a broadly based property-owning democracy into something that more clearly resembles feudalism.

This piece originally appeared at The Orange County Register.

Joel Kotkin is executive editor of NewGeography.com and Distinguished Presidential Fellow in Urban Futures at Chapman University, and a member of the editorial board of the Orange County Register. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is author of The City: A Global History and The Next Hundred Million: America in 2050. His most recent study, The Rise of Postfamilialism, has been widely discussed and distributed internationally. He lives in Los Angeles, CA.

Apocalypse Soon? Uneasiness with The Economy

Fri, 09/19/2014 - 08:58

Seven in 10 Americans say the country is on the wrong track. Americans are unhappy, worried and pessimistic, and their spending is down according to a University of Michigan report. But the same report shows that consumer sentiment is up. Consumer confidence is up, according to the Conference Board, and our own Consumer Demand Index indicates that spending plans are up.

What accounts for this dichotomy? Perhaps it could be the normalcy bias, a desire for “normalcy” so strong as to feed a willingness to overlook contrary evidence. Or perhaps our uneasiness is an example of the “wisdom of crowds”, James Surowiecki's theory that in aggregate, opinions of a wide cross-section of people are more accurate than those of experts.

Frankly, I'm uneasy, unhappy, worried, and pessimistic.

The protracted and uneven recovery from the Great Recession has led most Americans to conclude that the US economy has undergone a permanent change for the worse, according to a new national study by scholars at Rutgers University. Seven in 10 Americans now say the recession's impact is permanent, up from half in 2009 when the recession officially ended.

Despite sustained job growth and lower levels of unemployment, most Americans do not think the economy has improved in the last year or that it will in the next. Just one in six Americans believe that job opportunities for the next generation will be better than theirs have been; five years ago, four in 10 held that view.

Much of the pessimism is rooted in direct experience. Fully one-quarter of the public says there has been a major decline in their quality of life owing to the recession, and 42% say they have lower salary and less savings than when the recession began, while just 30% say they have more.

The public also paints an extremely negative picture of American workers as unhappy, underpaid, highly stressed, and insecure about their jobs. Americans are also pessimistic about the future, and sharply critical of Washington policymakers. Only a quarter think economic conditions in the United States will get better in the next year, and just 40% believe their family's finances will get better over the next year.

The Economy gets a downgrade: The updated budget and economic outlook recently released by the nonpartisan Congressional Budget Office (CBO) contained good news about
corporations, but bad news about the rest of the economy. According to Harry Stein of the Center for American Progress, the CBO now estimates that the economy will grow even more slowly than it expected in its previous economic outlook. It now expects that wages and salaries will comprise a smaller portion of that reduced economic pie.

The report suggests that troubling long-term trends in our economy are getting worse. Those trends include the stagnation of middle-class wages, which has gone on for over a decade. In addition, during the last 50 years overall employee compensation – including health and retirement benefits – has fallen to its lowest share of national income in more than 50 years, while corporate profits have climbed to their highest share.

Yet corporations are paying a much smaller portion of the total federal tax burden than they did in the past: about 10% today, vs. 30% in 1953.

While this is not an immediate emergency, since the annual budget deficit is very low right now, deficits will become unsustainable in the future, according to the CBO.

But there is a crisis for middle-class and low-income families right now: stagnant wages are not keeping up with rising expenses. American productivity has increased, but those gains are not making it to low- and-middle wage workers.

There has not been a real deleveraging: For several years, media headlines have been filled with references to a “deleveraging,” or a reduction in the level of US debt. But while the US financial system and banks are better capitalized, there has been no deleveraging in the broader economy. Consider these three points, courtesy of BlackRock investment strategist Russ Koesterich:

• US household debt remains high: Thanks to a significant write-off of mortgage debt, the debt burden of US consumers has been modestly reduced. By most measures, however, household debt levels are still too high. The past several years have witnessed a huge surge in student and auto loans. Overall, US household debt still stands at 103% of disposable income.

• Fueled by cheap credit, corporations have been adding new debt. Since the third quarter of 2010, corporate debt has increased every quarter. Over the past six quarters, corporate debt has been growing at an average annualized rate of around 9.5%, well above the pre-crisis average of 7.5%.

• Federal government debt has exploded. Outside of debt held by the Social Security Trust Fund, federal debt has risen by roughly $7.3 trillion over the past six years, an increase of 140%.

The net result is that non-financial debt has actually risen significantly since the financial crisis. Six years ago, notes Koesterich, non-financial debt was around 227% of GDP. Today, it's at a record 250%.

Does rising non-financial debt matter for the economy and for investors? Long-term, the answer is yes: implications include slower growth, a persistent headwind for consumers and vulnerability to even a modest rise in interest rates (this is particularly true for the federal government).

This is not a real economic recovery: Wages have been stagnant since the start of the supposed recovery. Real household income has fallen by 7%.

• The S&P 500 has increased 196% in five years; stock market valuations have been higher only three times in history: 1929, 1999, and 2007. But average Americans are not participating in the markets’ gains. They have instead parked record levels of cash ($10.8 trillion) in no-interest bank and money market accounts.

• The economy has added a few million jobs, but 11 million people have permanently left the labor market.

• The Federal Reserve balance sheet was $900 billion before the 2008 financial crisis; today it stands at $4.4 trillion. The correlation between that increase and the stock bubble is self-evident. So is the true purpose of quantitative easing: to save Wall Street, not Main Street.

• The housing market is worse for real people than it was in 2009. The national home price increase — 25% just since 2012 — has been centered in the usual speculative markets, aided and abetted by the Fed’s easy money, managed by the Wall Street hedge funds, and exacerbated by late-arriving flippers, who now account for 34% of all home sales. Mortgage rates have been falling for the past year, home builders have been reporting soaring confidence about the future, and the National Association of Realtors keeps predicting a surge in home buying any minute now.

Yet as analyst James Quinn points out, mortgage applications are in free fall, new home sales are at 1991 levels, and existing home sales are falling. Home prices have peaked and are beginning to roll over.. Home sales will be stagnant for the next decade, he predicts.

This will not end well: Crashes are coming, concludes Quinn. Quantitative easing will cease come October, unless the Fed and Wall Street can manufacture a new crisis to cure by printing more money. By every valuation measure, he writes, stocks are overvalued by at least 50%. By historical measures, home prices are overvalued by at least 30%.

Ten-year Treasuries are yielding 2.4%, while true inflation is north of 5%. With real interest rates deep in negative territory, the bond market is even more overvalued than stocks or houses. These simultaneous bubbles have been created by the Federal Reserve in a desperate attempt to keep this debt laden ship afloat. Their solution to a ship listing from too much debt has been to load it down with trillions more in debt. The ship is taking on water rapidly.

We had a choice, says Quinn: “We could have bitten the bullet in 2008 and accepted the consequences of decades of decadence, frivolity, materialism, delusion and debt accumulation. A steep sharp depression which would have purged the system of debt and punishment of those who created the disaster would have ensued. The masses would have suffered, but the rich and powerful bankers would have suffered the most. Today, the economy would be revived… Instead, the Wall Street bankers won the battle and continue to pillage and loot the national wealth while impoverishing the masses.

Discontent among the masses grows by the day. When the stock, bond and housing bubbles all implode simultaneously, all hell will break loose in this country. It will make Ferguson, Missouri look like a walk in the park.”

I fear he may be right; so like I said, I’m uneasy.

Dr. Roger Selbert is a trend analyst, researcher, writer and speaker. "Growth Strategies" is his newsletter on economic, social and demographic trends. He is economic analyst, North American representative and Principal for the US Consumer Demand Index, a monthly survey of American households’ buying intentions.

Flickr photo by Brendan Murphy, The last sunset on earth, taken "somewhere close to the ends of the earth - White Cliffs in NSW".

Paving Over Hunan? The Portland Model for China

Tue, 09/16/2014 - 22:38

For two centuries, people have crowded into urban areas, seeking higher standards of living than prevail in the rural areas they abandoned. Nowhere is this truer than in China. In just four decades, it has risen from 17.4 percent to 55.6 percent urban, adding nearly 600 million city residents. This has been accomplished while lifting an unprecedented number of people out of poverty.  

Yet in the future, China faces tough urbanization challenges. The United Nations forecasts that another 200 million residents will be added to the cities by 2035, increasing the urban population by nearly another one-third.

Los Angeles Style Suburbs in China?

For years, western planners have sought to impose their visions of the future on China's cities (see: China Should Send the Western Planners Home). There are more recent rumblings from Britain. Writing in The Guardian, Bianca Bosker finds considerable fault with Chinese cities. In criticizing China's perceived copying of US and European models, her article conveys an impression that detached housing (called "villas in China) makes up a large part of China's suburbs, as in the United States ("Why Haven't China's Cities Learned from America's Mistakes?" with an intriguing subtitle "Faceless estates. Sprawling suburbs. Soulless financial districts ... are in vogue in China").

Having traveled widely within all but two of China's 25 largest cities, I would have to disagree. You have to look hard to find detached housing in China. This is quite unlike the case in US suburbs, as well as those of Japan, Britain, France, Germany, Canada, Australia and elsewhere.

In fact, the suburban areas of Chinese cities are largely high-rise and mid-rise multi-family buildings, with their attendant high densities. Detached housing has accounted for between 4 and 6 percent of new housing floor space. The actual percentage of detached units is probably smaller, since their average floor space of detached housing is greater. The type of housing in the photographs at the bottom of the article (Figures 2 through 6) is typical of China's suburbs.

Bosker also criticizes about China's "towers in the park" high-rise development, noting that "The desire to escape sardine conditions in these superblocks, where greenery often consists of sickly shrubs gasping between six-lane roads, has in turn multiplied the number of land-devouring compounds like Rancho Santa Fe." In fact, villa developments like Rancho Santa Fe, nearby Shanghai's Honquiao Airport, are very high income enclaves, and small. Rancho Santa Fe itself occupies less than 90 acres and the gross average lot size is approximately one-quarter acre (1/10 hectare), smaller than the average middle income suburban lot in the United States. No ordinary “tower in the park" resident can afford to move to the pricey villa developments.

California's High Urban Densities

The article also condemns the "urban sprawl" of Los Angeles and California (this is nothing new).  However, the reality is that Los Angeles is the most dense major urban area in the United States (and thus the least sprawling) and nearly as dense as Toronto. Further, California has the highest urban density of any state, leading even New York. The average urban density of the state and even that of smaller California cities, such as Fresno, Stockton, Modesto and Salinas, is more than that of urban planning Nirvana Portland (below).

Los Angeles: Land of Gridlock?

The article calls Los Angeles the "land of gridlock," and there is no doubt that its traffic is intense. Yet, Los Angeles ranks only in a 20th place tie with Paris out of 125 cities in the latest Tom Tom Traffic Index. Traffic is worse in Brussels and Rome, almost as bad in London and far worse in places like Moscow, Istanbul, Rio de Janeiro, Mexico City and Sao Paulo. In spite of the traffic congestion, Los Angeles has the shortest work trip travel times of any world megacity for which there is data, the result of its dispersed residential and employment pattern (call it "sprawl" if you like).

In Los Angeles, suburban residents have shorter work travel times than people living in the urban cores, which is the general situation among US major metropolitan areas (more than 1,000,000 population). This is to be expected, since lower densities are associated with less traffic congestion and shorter travel times.

Paving Over Hunan?

Ms. Bosker suggests that China may be poised to follow the "Portland model." A planner is quoted: “Portland is a really great model.” That, I would suggest, depends on your perspective.

The Portland model has its philosophical roots in the British Town and Country Planning Act of 1947. As early as 1973, Sir Peter Hall and his colleagues characterized the Act having had the "reverse effect" an important policy goal, to benefit less affluent households, by virtue of the house price escalation that ensued.

Portland has drawn an urban growth boundary around the city beyond which development is generally prohibited, and within which there is insufficient space to maintain competitive land prices. Portland has also has sought to attract people out of their cars by both building an extensive light rail system and   loath to provide new highway capacity to meet demand.

After more than 30 years of its urban containment ("smart growth") policy, Portland's urban density remains at only 1,350 per square kilometer (3,500 per square mile), less than one-quarter that of China's cities with more than 500,000 population (5,750 per square kilometer/14,900 per square mile). Los Angeles is twice as dense as Portland. Portland's urban density is closer to that of the world's most sprawling large urban area, Atlanta, than it is to that of Los Angeles. Planning whipping boy Houston is only 15 percent less dense than Portland.

To equal Portland's density, Chinese cities would need to expand their footprints by 210,000 square kilometers (80,000 square miles). This would require the equivalent of paving over Hunan province (Figure 1), the state of Minnesota or the combination of England and Scotland.

Portland is no model to copy, unless all you care about is inputs (like light rail and not building freeways and suburban housing). The outputs tell a completely different story. In 1980 (the last data before the first light rail line was opened) 65.1 percent of commuters drove alone to work. By 2012, that figure had increased to 70.8 percent. Transit was down from 8.4 percent to 6.0 percent. Approximately one-quarter as many people worked at home as commuted by transit in 1980 (2.2 percent). By 2012, more people in the Portland metropolitan area worked at home than rode transit (6.4 percent).

This is not surprising. Portland's "model" transit system (now with five light rail lines) can get the average commuter to only 8 percent of the jobs in 45 minutes. This is not very attractive in contrast to travel by automobiles, which provides access to virtually 100 percent of the jobs in less time (30 minutes).

Meanwhile, Portland's anti-highway policies have been rewarded with some of the most rapidly increasing traffic congestion in the United States. In the early 1980s, Portland ranked 47th worst out of the 101 US urban areas ranked by the Texas A&M Transportation Institute. By 2011, Portland's traffic congestion had deteriorated to sixth worst, a stunning failure for a city with a population that doesn't even rank the top 20. Meanwhile, Houston, castigated for its wide freeways, has improved from the worst traffic congestion in the middle 1980s to four positions better than Portland (10th), despite adding having added three times as many new residents as Portland.

American Cities

If outputs are more important than inputs (which I suggest is true), then US cities do very well. They have the highest incomes in the world, occupying 36 of the top 50 positions in gross domestic product per capita. They have some of the most affordable housing in the world, if cities following the Portland model are excluded. They have shorter work trip commutes and less traffic congestion than their peers in other high income world nations. And, they are poised for huge progress in environmental protection. The US Department of Energy forecasts large reductions in gross greenhouse gas emission from the national automobile fleet in the coming decades.

Overwhelmingly, the growth of cities happened because rural residents sought higher standards of living and an escape from lower incomes and poverty, in rural areas. Few, if any moved to cities for wise urban planning, for "soulful financial districts" or to commute by light rail. Overall, US city outputs correspond very well with the purpose of cities --- which is why they attracted residents.

China: Setting its Own Course

No one could have predicted China's urban progress that was to follow in the decades following Deng Xiao Ping's assumption of power. China's cities have provided for their growing number of citizens. By that standard, both Chinese and American cities have done very well. China has charted its own urbanization course and seems likely to do so in the future. It is unlikely to seek to follow the advice of western critics whose plans fail the needs of their own citizens, much those in a complex, rapidly changing place like China.

Top photograph: Suburban development, Changsha, Hunan. (All photographs by author).

Wendell Cox is principal of Demographia, an international public policy and demographics firm. He is co-author of the "Demographia International Housing Affordability Survey" and author of "Demographia World Urban Areas" and "War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life." He was appointed to three terms on the Los Angeles County Transportation Commission, where he served with the leading city and county leadership as the only non-elected member. He was appointed to the Amtrak Reform Council to fill the unexpired term of Governor Christine Todd Whitman and has served as a visiting professor at the Conservatoire National des Arts et Metiers, a national university in Paris.

Brooklyn is Getting Poorer

Mon, 09/15/2014 - 22:38

I’m trying to make more of an effort, whenever I write or talk about gentrification, to point out that the real issue is larger: that gentrification is only one aspect of income segregation – specifically, the part where the borders between rich and poor neighborhoods shift – and that the real problem is that we have such sharply defined rich and poor neighborhoods to begin with.

I might also throw in that income segregation used to be much less severe.

Anyway, one problem with our obsession with gentrification as the end-all of urban equity issues is that it discourages us from talking about other important things happening in our cities. In some instances, gentrification has become such a dominating narrative that it has completely erased broader trends that we really ought to be concerned about.

Case in point: Brooklyn is getting poorer.

Does that shock you? Were you under the impression that all of Brooklyn was in the process of becoming one giant pickle boutique? That would be forgivable, given that nearly every article filed from Brooklyn for a decade or so has been about gentrification. But no.

I recently ran across a post from data-crunching blog extraordinaire Xenocrypt, which noted that from 1999 to 2011, median household income in Brooklyn fell from $42,852 to $42,752. That’s not a huge drop, obviously. The national median income fell from $56,000 to $50,000, so Brooklyn is actually catching up, sort of, to the country as a whole. But it still got poorer in absolute terms.

Moreover, if you map (as Xenocrypt did) the borough’s neighborhoods by change in median income, you get a really striking picture:




Credit: Xenocrypt.blogspot.com

…which is that, indeed, a good three-fifths or so of Brooklyn is actually getting poorer. Have you read any articles about that? No, I will wager that you have not. Neither have I. I strongly suspect that is because they don’t exist – at least not in any outlet that might be considered mainstream.

And what about housing prices?




Credit: http://www.citylimits.org/

So in large parts of Brooklyn, real estate prices are falling.

I have nothing particularly intelligent to say about this – these maps were news to me – except that it’s maybe the most dramatic example I’ve seen yet of just how limiting our fixation on gentrification is. I mean that both in a sort of journalistic sense, in that we’re being deprived of an accurate sense of what is actually going on in our cities, as well as from an advocate’s perspective: how can we claim to be working for fairer, more equitable, etc., cities, if we’re ignorant of their most basic economic and demographic changes?

This post originally appeared in City Notes on May 3, 2014. Daniel Hertz is a masters student at the Harris School of Public Policy at the University of Chicago.

Lead photo: "BK" by Theeditor93 - Own work. Licensed under CC BY-SA 3.0 via Wikimedia Commons.

Southern California Becoming Less Family-Friendly

Sun, 09/14/2014 - 22:38

The British Talmudic scholar Abraham Cohen noted that, throughout history, children were thought of as “a precious loan from God to be guarded with loving and fateful care.” Yet, increasingly and, particularly, here in Southern California, we are rejecting this loan, and abandoning our role as parents.

This, of course, is a process seen around the high-income world, and even in some developing countries. But, here in America, some regions are moving in this post-familial direction faster than others, and, sadly, Southern California, for the most part, is leading the trend.

Historically, Southern California, as a lure first for domestic migrants and, later, for foreign immigrants, has been an incubator of families. As recently as 2000, the proportion of population ages 5-14 in Los Angeles and Orange counties stood at 16 percent, the sixth-highest level among the nation’s 52 largest metropolitan areas. Thirteen years later, that proportion had dropped to 12.8 percent, ranking 33rd. The area experienced a 20 percent drop in its share of youngsters, the largest decline among U.S. metro areas.

Of course, not everywhere in Southern California has experienced such a precipitous shift. The Inland Empire, which stands apart in census data, remains a relative bastion of familialism, with 15.3 percent of the population between ages 5-14. Yet even the Inland Empire is slipping somewhat, from having the highest percentage of children to a ranking of fourth, and experiencing a 17 percent decline in children’s share of the population, the fourth-largest percentage drop in the nation.

If we try to focus even more closely, the patterns of decline, and the few bright spots, become more clear. Using 2010 U.S. Census data for specific regions (more up-to-date numbers are not yet available at the local level), it’s clear where much of this loss is concentrated.

The most precipitous declines have been in the inner city, notably Central Los Angeles, which experienced a net loss of 87,000 youngsters from 2000-10. Although their rate of loss was not as severe as in the core, other, once family-rich parts of the region – the San Fernando and San Gabriel valleys, Santa Ana/Anaheim, Long Beach and Whittier-Southeast Los Angeles County – all posted double-digit percentage drops in children.

Only a few areas of Southern California experienced growth in the number of children. Much of the growth was in the vast, outer suburbs and exurbs – places such as the Victor Valley, San Bernardino, Perris-Temecula, Santa Clarita-Antelope Valley and Riverside-Moreno Valley, as well as decidedly more upscale Irvine-South Orange County.

In a sense, these numbers tell several stories. To be sure, high housing prices seem to have a direct impact on family formation, pushing people further out to the periphery or, in some cases, out of the region entirely. Overall, according to recent analysis of census data, high-cost areas tend to repel families; almost all the most expensive areas in the country, such as the Bay Area, New York and Boston, have all experienced strong drops in numbers of children.

This has resulted, as demographer Ali Modarres has demonstrated, in a gradual emptying out of families from the poor, but still expensive, inner core of Los Angeles. These areas tend to be heavily immigrant, and once were seen as the generators of a new generation of Angelenos. Now, however, as Modarres suggests, these areas are also “getting old,” with grandparents remaining but the new generation headed to other locales within or beyond the region. This process, he notes, has been accelerated by a decline in immigration to the region, particularly among Latinos, who long settled in these areas.

Housing prices are not the only determinant. Prices are even higher in the Bay Area, which has seen a falling number of children, but not as severe as in Los Angeles.

One likely explanation is the Southland’s relatively weak economy, which continues to create jobs sluggishly, and an unemployment rate, particularly in Los Angeles County, well above the state and national averages. High prices repel families, but this is particularly true in a region generating relatively little economic opportunity.

There are other factors, particularly for middle-class families, who tend to have more choice where to locate. One seems to be education. For example, Irvine-South Orange County does well in this regard, but its housing costs are beyond the budgets of most other than upper-middle-income households, which tend to be Asian or non-Hispanic white. Irvine has a national reputation for excellent schools, a major lure to families who wish to avoid the expense of private education.

For some in Southern California, particularly those pushing high-density and rental housing, these shifts may be considered a boon. After all, households with children, even more than most people, tend to prefer single-family homes and tend to embrace the notion of ownership. Single people are more likely to choose – by preference or because of cost – rental properties. The vision of Southern California as primarily dominated by high-density rentals correlates with requirements of state law and plans of the Southern California Association of Governments.

At the same time, the economic languor of this region may make many of these bold designs untenable. People without decent – or any – employment do not make ideal tenants any more than they constitute potential homeowners. Given the high costs of high-density construction, this suggests that many units will be rentable only by aging former homeowners or by several families sharing a unit.

Sadly, the decline in homeownership and the single-family housing market may contribute long term to the region’s continued relative economic eclipse. Single-family home construction is among the most reliable contributors to local economic growth and job creation. In contrast, each multifamily unit constructed contributes 60 percent less to the GDP.

More important still, the loss of families presages a future that we can already see in many European and east Asian countries. There is the development of an aging, inner core, made up largely of retirees, both poor and affluent, sprinkled among areas dominated by young, mostly childless, people. Over time, this leads to a less-dynamic region, as the workforce and consumer base shrinks, and politics shift emphasis from economic growth to redistribution. Meanwhile, many of the poor and working-class families are forced out toward the furthest periphery, often far from employment and relatives.

Can this process be reversed? Certainly a stronger economy, with more middle-wage jobs, might encourage people to have families, and give them the incentive, as well as the wherewithal, to buy a house. It would provide parents, and potential parents, with the notion that they can create a new generation with reasonable economic prospects.

The other key factor is a radical reordering of our education systems. It is clear from the data that areas with good schools, such as Irvine, continue to attract families, even at very high housing price points. If middle-class families feel they can access a decent public education in the older, settled areas, such as the San Fernando Valley, L.A.’s Westside or North Orange County, they might be more willing to put down roots in these places, which would help create the greater stability generally associated with families, especially homeowners.

Sadly, political leadership in most of Southern California and Sacramento seems blissfully unaware of these trends, or the potential danger to the area’s economic, as well as its demographic, vitality. Perhaps a region dominated by aging populations, and fewer families, by nature tends to look backward and neglect the kind of infrastructure investment, including in education, that families and business require.

A resurgent hipster economy may not require much economic growth, or changes in the political system, but the region’s families need a thorough reversal in course if this region hopes to retain its appeal as an incubator of future generations.

This piece originally appeared at The Orange County Register.

Joel Kotkin is executive editor of NewGeography.com and Distinguished Presidential Fellow in Urban Futures at Chapman University, and a member of the editorial board of the Orange County Register. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is author of The City: A Global History and The Next Hundred Million: America in 2050. His most recent study, The Rise of Postfamilialism, has been widely discussed and distributed internationally. He lives in Los Angeles, CA.

Baby photo by Bigstock.

The Rise of Urban Riverfronts

Fri, 09/12/2014 - 22:38

I recently moved from Cincinnati to Providence, Rhode Island, although I still think of the Detroit area as my hometown. All of these cities are based on their access to water. Providence, despite its location at the mouth of an Atlantic bay, is still a river-town at heart. Chicago mayor Rahm Emanuel has plans for a new and improved riverwalk, too. What can these cities learn from each other?

In the '80s, downtown Providence was a much less vibrant and destination-worthy place than it is now. Its urban rivers were buried beneath cement, rail-lines, and acres of concrete until a public-private revitalization effort gained enough traction. Today, in its place, the 11-acre Waterplace Park hosts numerous attractions, including the well-loved Waterfire events, and is a long, winding string of paths and bridges that sprawls through Providence’s downtown.

What's best about its place-making design is its versatility. The riverfront offers commutable routes between destinations, areas to picnic or socialize during lunch breaks, and event space throughout the seasons. Gondola rides, kayaking, and even viral pop-up installations all thrive here, making it multi-functional and inviting to a range of citizens.

Chicago, much like Providence, has revealed renderings of parks that show multi-functional, inviting public spaces for rest, socializing, jogging, and enjoying attractive outdoor landscapes. Chicago is also poised to offer kayak rentals, which would allow visitors to interact with the water’s surface, rather than simply admire it. Mayor Emanuel has plans for the riverwalk to stretch “from Lake Michigan to the confluence of the three branches,” or about 1.3 miles.

That would add a key element: in addition to being multi-functional and inviting, the riverwalk, at least within its blueprints, will be interconnected and able to serve as a pathway between all types of destinations within the city, much like Boston’s incredible Emerald Necklace. The Mayor also recognizes the huge potential for retail expansion along this stretch, something that Providence can certainly attest to.

Detroit, too, has been actively improving its waterfront. The shores of the Detroit River now include a long, inviting path for walking, jogging, or biking, with parks and features along the way. The transformation from its earlier state is reminiscent of Providence’s overhaul efforts of the '80s, pushing the space from neglected and utilitarian to a pedestrian-focused destination for anyone in the downtown area. A Great Lakes-themed waterpark has recently been put into place, making the riverfront even more attractive to families and young people. In addition to being a long-time hub for local fishermen, the riverfront is now a destination for joggers, dog-walkers, families, and those on their lunch break in a newly recovering downtown business district.

What Chicago should strive to institute is a core of riverfront events and attractions. Like Providence’s Waterfire, Detroit hosts events on its riverfront during the summer — even given that it only uses one side of a river it shares with Windsor, Ontario — including the hugely popular River Days concert series and festival.

Many cities have access to only one side of a major river, including Cincinnati. But Chicago, like Providence, has the full body of its rivers. This asset is huge, considering how big a draw water-based or focused events can clearly be for visitors, and how great a reason for locals to meet up and enjoy their city together. This is part of what Chicago can learn from Detroit and Providence.

Still, Providence has a great deal of room for improvement. What Chicago and Detroit have realized is that a river’s waterfront isn’t exactly a connector for separate parks. It can be one space where different areas bloom larger than the others. That is, that the entire riverfront can be a destination, even between established attractions.

Currently, Providence is preparing for the development of what’s being called The Link, an area of open land where I-195 used to cut through the downtown, Jewelry District, and Fox Point neighborhoods. Part of the grassy scar has been designated to become a riverfront park with a pedestrian bridge, and is expected to connect by bike/walk path to the nearby Roger Williams Park and Zoo. This is a big step toward a holistic riverfront that can be accessed from a several neighborhoods.

Providence also offers the vaguely inviting Promenade, with a bike lanes on each side and a pedestrian bridge/plaza. But the Promenade is cut off from Waterplace Park by the mall and the interstate rumbling overhead. From there, looking west, the river is largely ignored before reemerging as the Woonasquatucket River Greenway, which offers a newly installed boat launch and a winding bike path. Utilizing the riverfront along this entire span, not just at certain hotspots, is a key task and goal for Providence and cities like it.

During the blossoming years of metropolises, a river waterfront meant shipping and transportation opportunities. Today, with competition for dynamic downtown areas, the riverfront offers something else, too. Locals gain opportunities and reasons to come together as a community, and visitors, find places to enter and connect with a place… as long as riverfront cities use what they’ve got.

Flickr photo by yuan2003: WaterFire Panorama1; Waterplace Park, Providence, Rhode Island, June, 2014.

C.J. Opperthauser is a poet and urban thinker who blogs here.

Baby Boomtowns: The U.S. Cities Attracting The Most Families

Fri, 09/12/2014 - 06:02

With the U.S. economy reviving, birth rates may be as well: the number of children born rose in 2013 by 4,700, the first annual increase since 2007. At the same time new household formation, after falling precipitously in the wake of the Great Recession, has begun to recover, up 100,000 this June from a year before.

This impacts the economy strongly in such areas as single-family home construction, the supply of labor and consumer demand.

For cities, being family friendly may become increasingly important as the large millennial generation starts entering their 30s, the primary years for raising children. In order to identify the parts of the country where new families are being formed most rapidly, we turned to demographer Wendell Cox. He crunched the data on the changes in the number of 5- to 14-year-olds since 2000 in the nation’s 52 largest metropolitan statistical areas.

We picked this age range because it encompasses when parents often move due to such issues as school quality, the cost of housing and long-term economic security. A toddler can do quite well in a small apartment, but when it’s time to go to school, or if the parents decide to have a second or a third child, many parents are forced to make what are often difficult and long-lasting choices about where to live.

Baby Boomtowns

Virtually all the metro areas where there has been the strongest growth in families from 2000 to 2013 are highly suburban, highly affordable and located in the South and Intermountain West. If they also have a strong economy, like top-ranked Raleigh, N.C., they are even more attractive. In concert with strong net in-migration, the number of children in the Raleigh metro area between the ages of 5 and 14 grew by 63,600 from 2000-13, or 55.7%. That’s roughly 10 times the national growth rate of 0.5% for this demographic.

The same combination of affordable housing and economic growth has helped No. 2 Austin, Texas, where there were 86,200 more children in 2013 than in 2000, growth of 49.3%, as well as  No. 4 Charlotte, N.C. (+82,100, 32.9%).

Several of the high-ranked metro areas on our list are housing bubble hot spots that experienced rapid population growth in the first half of the last decade but then stalled out in the Recession.  No. 3 Las Vegas posted 35% growth among 5 to 14 year olds from 2000 to 2010. Since 2010 its child population has expanded at a modest 2.3% rate. A similar pattern can be observed in No. 5 Phoenix.

In most of the top 10 metro areas on our list kids in the age range we looked at account for over 14% of the total population, compared to a national average of 13%. The city with the largest share of kids is No. 12 Salt Lake City, where 16.2% of the residents are between the ages of 5 and 14.

The Great American Kiddie Desert

The largest declines in the 5 to 14 cohort since 2000 have almost all occurred in the large coastal metropolitan centers, led by Los Angeles, 46th out of the 52 cities on our list, where the child population has dropped by 303,000, or 15.3%, since 2000. In the New York metro area (40th), the number of 5- to 14-year-olds fell by 238,000.

Economics alone does not explain this. Some of these metro areas, notably New York and Boston (38th, -8%), have done fairly well in the aftermath of the Great Recession. Yet they are only doing marginally better in attracting families than the (mostly) hard-hit metro areas at the bottom of our list: Buffalo and Rochester, N.Y. , Pittsburgh and Detroit. (New Orleans actually ranked last behind Buffalo, but that’s a function of population flight due to Hurricane Katrina.)

So why are otherwise thriving areas losing families? One possible explanation may come from cultural and political factors. As Austrian demographer Wolfgang Lutz has pointed out, an increasingly childless society creates “self reinforcing mechanisms” that make childlessness, singleness and one-child families increasingly predominant. In this process, which is further advanced in Japan, much of East Asia and throughout large parts of Europe, civic priorities often favor adult cultural amenities over things like parks and schools that are more important to families. Many areas that are increasingly child-free also often embrace density-oriented land use policies that lead to less affordable housing.

Of course, there’s a steady drumbeat in the media proclaiming that families with children are returning to dense cities and expensive regions. In reality, the numbers don’t add up.  Among the 10 large metro areas with the lowest percentage of children are New York, Boston and San Francisco-Oakland, where the percentage of 5- to 14-year-olds is 11.5%, the lowest in the nation except for Pittsburgh (10.8%).

All else being equal, high housing prices, particularly for single-family homes, drive people with young children away. Across the country, the biggest decline in child populations found in the 2010 Census took place in the urban core and close-in suburbs of expensive metro areas, while net increases were counted almost exclusively in further out suburbs. In Los Angeles, the central city and older suburbs have had large declines in children while almost all family growth has occurred in suburbs like the Inland Empire , Irvine , the Antelope Valley and Valencia.

A Different Kind Of Divide?

Much has been written about the various divides — political, racial, cultural, religious — afflicting the country. The geography of family formation poses yet another. In some parts of the country families appear to be proliferating, notably the Southeast and Intermountain West. In others, mostly in coastal California and the Northeast, they seem to be becoming rarer.

To some extent, this parallels the “red” and “blue” divide, but not entirely. Some bluish regions have enjoyed growth in their 5 to 14 population, most notably No. 2 Austin, although this is helped largely by the booming Texas economy and liberal land regulation, particularly in the burgeoning suburban ring. Only three others slipped into the top 20 of our list: Denver (13th), greater Washington, D.C. (17th),  and Portland, Ore. (20th). Washington’s government driven job growth is doubtless a factor. Denver and Portland are more than 90% suburban and exurban, and boast housing that is relatively affordable compared to the Bay Area, Los Angeles or New York.

Far more than politics, the interplay of economics and affordability tend to drive family migration. Take San Francisco-Oakland (33rd), which has had a robust economy over the past five years, but high housing prices have slowed the growth of families. Since 2000, the number of 5- to 14-year-olds in the metro area has dropped 2.7%.  A recent real estate survey showed a million dollars would buy only 1,500 square feet in San Francisco, 2,000 in Boston, 2,198 in Washington and roughly 2,300 in either New York or Los Angeles. In contrast, that amount of money could purchase over 10,000 square feet in Houston and 8,850 in Raleigh.

Perhaps more important, high housing prices also make moving into a desirable area — particularly one with good schools — very difficult. In some core cities like Los Angeles, generally only the wealthiest areas have reliably decent public schools. In other parts of the country, you can still purchase a nice house for under $250,000 and be close to excellent schools. Unless the more expensive urban areas can expand their educational choices, many families will continue to look elsewhere for the critical combination of affordable housing and decent education for their children.

Ultimately, these metro areas, so favored in the media, will face increased competition from those that can better attract young families. Even most hipsters eventually grow up, start a family, seek to buy a house and aspire to a middle-class life. Places that can attract young families will have several things going for them compared to their increasingly child-free rivals: a growing adult labor force, an expanding consumer market and a spur to the local construction industry. If demography is destiny, nowhere is this more likely the case.

No. 1: Raleigh, N.C. MSA

Rise In No. Of Children Aged 5-14, 2000-13: 55.7%

No. Of Children Aged 5-14, 2013: 177,886

Percentage Of Children Aged 5-14 In Total Population, 2013: 14.6%

No. 2: Austin, Texas

Rise In No. Of Children Aged 5-14, 2000-13: 49.3%

No. Of Children Aged 5-14, 2013: 261,199

Percentage Of Children Aged 5-14 In Total Population, 2013: 13.9%

No. 3: Las Vegas

Rise In No. Of Children Aged 5-14, 2000-13: 39.0%

No. Of Children Aged 5-14, 2013: 275,663

Percentage Of Children Aged 5-14 In Total Population, 2013: 13.6%

No. 4: Charlotte, N.C.

Rise In No. Of Children, 2000-13: 32.9%

No. Of Children, 2013: 331,956

Percentage Of Children In Total Population, 2013: 14.2%

No. 5: Phoenix, Ariz.

Rise In No. Of Children, 2000-13: 29.3%

No. Of Children, 2013: 633,123

Percentage Of Children In Total Population, 2013: 14.4%

No. 6: Dallas-Ft. Worth, Texas

Rise In No. Of Children, 2000-13: 28.2%

No. Of Children, 2013: 1.05 million

Percentage Of Children In Total Population, 2013: 15.4%

No. 7: Atlanta, Ga.

Rise In No. Of Children, 2000-13: 26.1%

No. Of Children, 2013: 808,811

Percentage Of Children In Total Population, 2013: 14.6%

No. 8: Houston, Texas

Rise In No. Of Children, 2000-13: 25.8%

No. Of Children, 2013: 965,259

Percentage Of Children In Total Population, 2013: 15.3%

No. 9: Nashville, Tenn.

Rise In No. Of Children, 2000-13: 22.7%

No. Of Children, 2013: 237,119

Percentage Of Children In Total Population, 2013: 13.5%

No. 10: Orlando, Fla.

Rise In No. Of Children, 2000-13: 22.6%

No. Of Children, 2013: 288,091

Percentage Of Children In Total Population, 2013: 12.7%

This piece originally appeared at Forbes.

Joel Kotkin is executive editor of NewGeography.com and Distinguished Presidential Fellow in Urban Futures at Chapman University, and a member of the editorial board of the Orange County Register. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is author of The City: A Global History and The Next Hundred Million: America in 2050. His most recent study, The Rise of Postfamilialism, has been widely discussed and distributed internationally. He lives in Los Angeles, CA.

Are Cool Downtowns the Solution to Suburban Ennui?

Wed, 09/10/2014 - 22:38

Recently, former Nassau County Executive Tom Suozzi took a turn answering The Foggiest Five, a new segment that asks influential Long Islanders five questions regarding the future of the Nassau-Suffolk region. His answers gave an interesting look at our issues, and I appreciate the time he took answering the questions.

Suozzi served Nassau’s County Executive from 2002 to 2009. Since Nassau is an older, first ring suburb, the County has limited opportunities for a complete overhaul of its physical imprint. In recent years, their redevelopment efforts have been skewed towards infill and revitalizing already-existing areas.

His answers reflected Suozzi’s unique experience gained thanks to the years he ran Nassau County. When asked about the biggest change he’s witnessed on Long Island, Suozzi highlighted property taxes as a “root of all evil” of sorts concerning our regional problems. Suozzi gave five causes to our tax problem:

1)Waste, Fraud and Abuse, 2) Long Island residents pay much more in income taxes to the federal and state governments that we get back in federal and state aid, 3) unfunded state mandates, 4) too many governments, and 5) lack of growth.

It’s hard to argue with the realities Suozzi laid out. While we often squabble about our local land usage, the reality is that our costs are unsustainable. Further – we are getting diminishing return on our sky-high costs of living. Our infrastructure is still crumbling and inadequate, and our water quality is still being degraded.

One possible solution, according to Suozzi, lies in his “cool downtowns” approach, building off  of the clusters, corridors and centers theory that has been mentioned for Long Island --- and much of the nation --- since the 1960s and early 70s. Suozzi writes:

We have a few cool downtowns now but not enough. Rockville Centre, Garden City, Westbury and Great Neck have downtown rentals, offices, restaurants and shops that are all near train stations. Long Island residents flock to these parts for entertaining and relaxation. Mineola, Farmingdale, Glen Cove, Hempstead, Freeport and Long Beach are trying to create cool downtowns but to be successful, we need more of them. We need to create at least 20 cool downtowns so it will make sense to link them by bus and mass transit. 

The planning theory behind Suozzi’s solution makes some sense, given the existence of numerous village-like nodes through the county. In Nassau, his vision for cool downtowns works easier than it does in neighboring Suffolk, mainly because of their limitations in infrastructure and generally later development. Further, economic and housing realities must be addressed.

Simply put, Nassau is where the infrastructure is more conducive to mini-downtown intensification. However, what Suffolk lacks in infrastructure, it gains the advantage in sheer space. Suffolk’s developmental destiny isn’t fully charted yet as it is in Nassau. This means two things: it’s not too late to execute sound land use planning, and that we still have the opportunity to take action to reverse our fortunes, which would resonate across Route 110 into Nassau as well.

It is important to realize that Suozzi’s downtown solution in of itself should not be an excuse to merely increase density on Long Island for the sake of increasing density. There will always be pressure from developers to densify well beyond local wishes, and seek subsidies to do so. These “cool downtowns” must mesh with comprehensive and regional strategies for attracting jobs to these targeted areas that take advantage of Long Island’s educated workforce.

Also we should look at the quality of the density. Urban-like density alone does not create the atmosphere of a village; anyone who has spent time in the dense suburbs of cities like Seoul or even Los Angeles can tell you that. Tall structures and related commercial developments tend to be inhabited by generic stores with little resonance with the history and culture of their communities. Village systems work best when they develop organically, and grow, as much as possible, within the confines of already existing architecture or in new buildings that fit with local styles.

Form also matters. There is a difference between the “little” downtown areas of Long Island that have charm, which is in a direct contrast to dense, almost urban centers. In our pursuit for suburban renewal, we cannot lose sight of what makes Long Island special, it terroir, if you will, of small communities that in many cases have been in existence for well over a century. Long Island may be expensive by national standards, but the staggering price increases in New York City for similarly appointed residential units, makes the Island comparatively affordable, and with excellent access to the city.

While New York City has a variety of urban centers, Long Island’s approach to suburban revitalization should build off of Suozzi’s cool downtowns, but in a suburban manner. Part of the Island’s charm isn’t so much its Queens-like centers, but rather, villages such as Rockville Centre, Babylon and Patchogue – low slung, vibrant areas with good access to transit and the infrastructure needed to support their growth. By just blindly throwing density at Long Island’s regional issues, we are at risk of creating urban problems in a suburban environment.

Long Island has other assets, particularly in terms of better schools. Many people who live in the city in their twenties and early thirties tend to look towards areas with good public schools, ample parks, and high levels of public safety. This is already leading to the much discussed growth of “hipsturbia” in the Hudson Valley river towns. Long Island could be a strong competitor for these people if it understands its’ primary appeal. 

Finally for “cool downtowns” to work you must address the fundamental economic and demographic challenges facing the region. Although it can’t hope to compete head-to-heard with Manhattan for some very high end jobs, the area should be attractive to a lot of back office and specialized companies. If employment opportunities expand, then you might be able to more easily persuade younger workers to move to the Island, creating a consumer market for cool downtowns. Being “hip” isn’t enough, but getting more competitive and richer might work.

Richard Murdocco writes regularly on land use, planning and development issues for various publications. He has his BA in both Political Science and Urban Studies from Fordham University, and his MA in Public Policy from Stony Brook University, and studied planning under Dr. Lee Koppelman, Long Island's veteran planner. You can follow Murdocco on Twitter @TheFoggiestIdea, Like The Foggiest Idea on Facebook, and read his collection of work on urban planning at TheFoggiestIdea.org.

"19 Main St Roslyn jeh" by Jim.henderson - Own work. Licensed under Creative Commons Zero, Public Domain Dedication via Wikimedia Commons

Wrong Way Cities

Wed, 09/10/2014 - 05:12

In a New York Times column entitled "Wrong Way America," Nobel laureate Paul Krugman again reminds us of the high cost of overzealous land-use regulations. Krugman cites the work of Harvard economist Ed Glaeser and others in noting that "high housing prices in slow-growing states also owe a lot to policies that sharply limit construction." He observes that "looser regulation in the South has kept the supply of housing elastic and the cost of living low" (Note 1).

Supply is the Issue

Krugman specifically cites Houston, Atlanta and the Sunbelt for their lower house prices and less restrictive housing regulation. In contrast, he points to New York and California as having high house prices and greater housing regulation. Krugman further observes that the secret of growth is "not getting in the way of middle- and working-class housing supply." 

This concern about housing supply is echoed by former World Bank principal planner Alain Bertaud who notes that the solution to the housing affordability problem "is to increase the supply of land" (Note 2). Bertaud further points out that "Restricting land supply and imposing too many controls also stifles business growth."

Wrong Way Cities

However, the real problem is not a "Wrong Way America" that "gets in the way of middle- and working-class housing supply, but "Wrong Way Cities" (metropolitan areas) that have adopted land use regulations severely restrict the supply of land for urban development. The price increasing policies are often referred to as "smart growth" or "urban containment" and routinely involve restricting the supply of land for development through urban growth boundaries, large lot suburban, and exurban zoning and other strategies.

This destroys what Brookings Institution economist Anthony Downs (p. 36) calls the "competitive supply of land." The result is higher house prices, because, all things being equal, the price of a good or service is likely to increase if its supply is severely limited. Otherwise, OPEC oil supply restrictions would never have raised concern.

Where more traditional, liberal land use policies remain, housing remains affordable. For example, during the housing bubble, an analysis by the Federal Reserve Bank of Dallas attributed the lower, and still affordable house prices in Atlanta, Dallas-Fort Worth, and Houston to avoiding more restrictive land use polices: "... these markets have weathered the increased demand largely with new construction rather than price appreciation because of the ease of building new homes."

Housing and the Standard of Living

Housing is the largest category of household expenditure. Moreover, housing costs vary far more between metropolitan areas than other expenditure categories, such as transportation, food and apparel. As a result, housing is the most important driver of the standard of living, especially for middle and lower income households. Where house prices are higher compared to incomes, households have less in discretionary income --- the amount left over after taxes and necessities. With less left over, a lower standard of living and greater poverty is inevitable.

The differences are even greater for young households moving to metropolitan areas with restrictive land use policies. These households must pay elevated house prices, not having benefited from the lower housing costs that longer-term residents were able to lock in by purchasing years ago.

The higher housing costs prices can more than offset higher wages. Thus, a prospective domestic migrant may choose to move to Houston rather than New York, because Houston's wages, although lower, translate into higher discretionary incomes and a higher standard of living.

These price increases create a "double hit" to the standard of living. Not only do households have to pay higher house prices, but they usually get less, as house size and lots are reduced in size as a result of the more restrictive regulations. Indeed, regulations in California are being interpreted to make it difficult, if not impossible to build the detached housing most Americans prefer (See: California Declares War on Suburbia). The irony is that smart growth advocates claim this increases "housing choice," an Orwellian turn of phrase if there ever was one.

It is no wonder that young and aspiring households are drawn to metropolitan areas where housing is more affordable. Meanwhile, house prices have escalated strongly in the restrictively regulated metropolitan areas of California and the Northeast despite low demand. This has much to do with the significant domestic migration loss, as Paul Ganong and Daniel Shoag of Harvard have indicated. Between 2000 and 2013, more than 4,000,000 loss in net domestic migrants between 2000 and 2013, according to Census Bureau data.

The problem is acute for lower income households, which are disproportionately minority. The Thomas Rivera Institute, a Latino oriented research organization, found that California's land regulations "are making it particularly difficult for Latino and African American households to own a home."

The Consensus

There is virtual agreement that more restrictive policies are associated with higher house prices. The only issue in dispute is the extent of the impact. But even seemingly small differences can be important. Downs (p. 36) characterizes a modest 10 percent differential to be socially significant, because of the number of households that the higher prices made ineligible for home purchase.

In fact, the differences in house prices relative to incomes are substantial, ranging up to a nearly 250 percent difference between Atlanta and San Francisco. The differences are so significant as to attract the attention of economists like Krugman, Glaeser and others for their influence on domestic migration.  This is socially significant.

The Risks

No city in the United States can expect immunity from low housing affordability due to overly restrictive land use regulation, even in more depressed areas with lower housing demand. This is illustrated by Liverpool, in the United Kingdom, where smart growth policies are well entrenched. Liverpool has lost a larger percentage of its population since 1950 than any of the other 1,700 urban areas in the world with more than 300,000 population. Yet Liverpool has seen its housing affordability deteriorate to among the worst in the UK, US, Canada, Australia or New Zealand.

The smart growth planning philosophy now pervades virtually all of the urban planning community, which seeks its spread to virtually everywhere (Note 3). Current targets include Minneapolis-St. Paul (see Thrive 2040: Toward a Less Competitive Minneapolis-St. Paul), and San Antonio and the rest are on the list. The research is clear, where there is more restrictive land use policy, house prices can be expected to rise relative to incomes.

Cities for People

Current urban policy is misdirected and needs correction. Fundamentally, urban policies should be aligned with the purpose of cities. Cities are for people. People have moved to cities principally for economic reasons, as they aspire to better standards of living. Public policies that raise the price of housing substantially interfere with the reason that cities exist.

There is a need for a paradigm shift. Currently in-vogue urban policy focuses on tactics, such as urban form, legally mandated higher densities, mode of transport and urban design ("place-making"). Economist Glaeser writes that "Bad policy puts place-making above helping people..." Bad policy should be discarded. The focus should instead be on the fundamental objectives of improving the standard of living and reducing poverty. At a minimum, this requires housing that is affordable (See Toward More Prosperous Cities).

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Note 1: In the column, Krugman suggests that differences in housing regulation are more important than business regulation and taxation in explaining the migration patterns that have people generally moving from higher cost areas with higher housing costs to lower cost areas. There is strong research on both issues, and both issues are important.

Note 2: Housing affordability refers to the price of houses across the entire spectrum of income, not just low income housing.

Note 3: Perhaps the most frequently cited justification for restrictive land use policies is greenhouse gas (GHG) emission reduction. A growing body of research indicates that urban land use policies are a generally minor and expensive means to that objective and that technological improvements are far more effective. Smaller scale strategies are also better than "one-size-fits-all" land use regulation. It is notable that the most comprehensive US review (Jones and Kammen at the University of California, Berkeley) of GHG emissions at the local level (zip codes) found: "Generally ... no evidence for net GHG benefits of population density in urban cores or suburbs when considering effects on entire metropolitan areas." They suggest "an entirely new approach of highly tailored community strategies."

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Wendell Cox is principal of Demographia, an international public policy and demographics firm. He is co-author of the "Demographia International Housing Affordability Survey" and author of "Demographia World Urban Areas" and "War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life." He was appointed to three terms on the Los Angeles County Transportation Commission, where he served with the leading city and county leadership as the only non-elected member. He was appointed to the Amtrak Reform Council to fill the unexpired term of Governor Christine Todd Whitman and has served as a visiting professor at the Conservatoire National des Arts et Metiers, a national university in Paris.

Photo: Minneapolis-St. Paul, by author

Class Issues, Not Race, Will Likely Seal the Next Election

Sun, 09/07/2014 - 13:53

Recent events in Ferguson, Missouri and along the U.S.-Mexico border may seem to suggest that race has returned as the signature issue in American politics. We can see this already in the pages of mainstream media, with increased calls for reparations for African-Americans, and expanded amnesties for the undocumented. Increasingly, any opposition to Obama’s policies is blamed ondeep-seated white racism.

Yet in reality, race will not define the 2014 election, or likely those that follow. Instead the real defining issue—class—does not fit so easily into the current political calculus. In terms of racial justice, we have made real progress since the ’60s, when even successful educated minorities were discriminated against and the brightest minority students were often discouraged from attending college. Today an African-American holds the highest office in the land, and African Americans also fill the offices of U.S. attorney general and national security advisor. This makes the notion that race thwarts success increasingly outdated.

But at the same time that formal racial barriers have been demolished, the class divide continues to grow steeper than in at any time in the nation’s recent history. Today America’s class structure is increasingly ossified, and this affects not only minorities, who are hit disproportionately, but also many whites, who constitute more than 40 percent of the nation’s poor. Upward mobility has stalled under both Bush and Obama, not only for minorities but for vast swaths of working class and middle class Americans. Increasingly, it’s not the color of one’s skin that determines one’s place in society, but access to education and capital, often the inherited variety.

Worries about upward mobility have been mounting for a generation, and according to Pew, only one-third of Americans currently believe the next generation will do better than them. Indeed, in some surveys pessimism about the next generation stands at an all-time high.

But race is not the main determinant in looking to the future. The greatest dismay, in fact, is felt among working class and middle class whites, who are generally much more pessimistic about the future for themselves than are either African-Americans or Hispanics.

This pessimism—for all the discussion on campuses about “white privilege”—is even more deeply seated among young whites. According to a poll conducted by the left-leaning advocacy group Demos, only 12 percent of whites 18 to 34 believe they will do better than their parents, compared to 31 percent for African-Americans and 36 percent among young Hispanics.

This suggests that the issue of restoring upward mobility has more widespread resonance than a more narrow race-based approach. The political party that best addresses this concern will be in the strongest position to dominate the political landscape not only in 2014, but well beyond.

The problem for the Democrats in this regard: the record of the last six years. President Obama has presided over an economy that, even when healing, has done little to improve the economic conditions of most Americans. The incomes of middle class Americans have remained stagnant, or shrunk, even as we have seen record corporate profits, a soaring stock market, and huge run ups in elite property markets.

This failure may explain why some Democrats and progressives feel tempted to go back to race-related issues—as well as social concerns such as gay and abortion rights—to stir their political base. The president’s suggestion of executive action on immigration would be in part to “galvanize” support among Latinos, many of whom can relate personally to the dilemma faced by the undocumented.

The stirring of resentment among African-Americans has become the critical component of race-based Democratic strategy. The president’s embrace of hoary racial warlord Reverend Al Sharpton, a well-known charlatan and occasional anti-semite, as his “go to guy” demonstrates the administration’s willingness to use the tragedy of the Ferguson shooting case to rally African-American voters for the off-year election.

These tactics may have some political efficacy, but it’s doubtful that ’60s progressive bromides of race-based politics or calls for redistribution can seriously address inequality or poverty. Certainly the idea that greater dependence on government handouts—the main social focus of modern progressives—has not aided minority uplift or promoted upward mobility. The Great Society may have reduced poverty initially, but in the past decade poverty rates have risen to the highest level since the ’60s.

If anything, under the most progressive-dominated regime since at least the New Deal, things have gotten even worse. African-American youth unemployment is now twice that of whites while according to the Urban League, the black middle class, once rapidly expanding, has essentially lost the gains made over the past 30 years.

In the same vein, Hispanic income also has declined relative to whites. Latino poverty rates now stand at 28 percent. The administration’s leniency that permits impoverished kids to flock here from Central America may make moral or political sense, but its actual impact on communities could prove problematical.

Indeed one has to question the viability of new mass immigration of poor, poorly educated kids at a time when poverty among Latino children already here has risen since 2007, according to the American Community Survey, from 27.5 percent to 33.7 percent in 2012, an increase of 1.7 million. Given their own economic problems, and the vital need to improve their educational performance one has to wonder whether African-Americans or even many Latinos, as opposed to the activist base, actually would welcome a fresh infusion of impoverished refugee children from Central America into the country. A recent Pew survey found that not only half of all whites, but nearly two-fifths of African Americans and roughly a third of Hispanics approved of increased deportations of the undocumented.

Some Latino and African-American Democrats have already departed from the party line on immigration. Texas Rep. Henry Cuellar, a moderate border district Democrat, has called “the border incursion” “Obama’s Katrina moment” and he is co-sponsoring legislation with Republican Sen. John Cornyn of Texas to speed up the deportation process for kids detained at the border.

Perhaps even more serious are divisions among Democrats on key economic and regulatory issues. In California, for example, Latino Democrats, particularly from the hard hit interior, have revolted against their party’s “cap and trade” policies, which will lead to ever higher energy costs, and threaten industries that tend to employ working class Latinos. Similarly some unions in the interior, notably the Teamsters and Laborers, have taken strong positions favoring energy development, notably the Keystone pipeline, in sharp opposition to the president’s core supporters.

And then there’s the reality that blue states—with all the usual progressive policies—suffer the widest gap between the classes. Indeed, notes demographer Wendell Cox, New York City now has an income distribution that approaches that of South Africa under apartheid.

Similarly a recent Brookings report found the greatest income disparity in such bastions of progressivism as San Francisco, Miami, Boston, Washington D.C., New York, Oakland, Chicago and Los Angeles. Oddly enough, minorities seem to do better, relative to whites, in states that have had more conservative governance, in part because they also tend to have lower costs of living.

This disconnect between progressive aims and reality stems from the shift in the Left’s class and geographic base. Once dependent on industrial and construction workers, many of them unionized, the party increasingly depends for support from green activists, urban land speculators, and “creative class” workers in expensive regions where regulatory constraints tend to discourage industrial and housing growth. In contrast many red state metros such as Houston, Oklahoma City, Salt Lake, and Dallas-Ft. Worth tend to produce more higher paid, blue collar growth.

Given these realities, perhaps progressives need to move away from symbolic issues, such as reparations and racial name-calling, and instead directly address middle class and working class concerns. Yet this creates a potential for internecine conflict with other key party constituencies, which seem more interest in suppressing middle class aspirations than fulfilling them.

It should be clear by now that regulatory and tax regimes imposed in blue states tend to stunt middle and working opportunities, with the worst effects on minorities and working class whites. Blue-state progressive can whine about race, inequality, and poverty with the best of them, but they would contribute far more if they started to address these issues with something other than well-rehearsed indignation and rhetoric.

But while progressive attempts to address the class divide have been less than successful, can the Republicans fill the breach? Already working class whites are arguably the GOP’s strongest base and Republicans should be able to exploit class resentment toward the increasingly gentrified Democratic leadership. Yet to date, they have shown a remarkable inability to do so, in part due to the ideological constraints and racial baggage of the increasingly Southern-oriented GOP.

Republicans, particularly those closest to Wall Street, also seem to have a problem even admitting the existence of the class issue. Conservatives economists repeatedly downplay ever greater insecurity about jobs, the affordability of decent housing and generally lower net worths for all but the highly affluent. Convinced that any discussion about these issues constitutes unseemly “class warfare,” the right’s intellectual leadership seems incapable of addressing these concerns.

What would a policy that addresses inequality look like? Some steps would offend some Republicans, such as restarting a modern version of the Depression era Works Progress Administration. Instead of a stimulus directed at government workers and crony-capitalists, as Obama employed in 2009, a program that brought young people into the work force would help them gain needed practical skills while repairing our increasingly woeful infrastructure.

Other reforms would include a major overhaul of the tax system, particularly equalizing capital gains and income taxes. Whatever the benefits we may have seen from lower capital gains rates in the past, the current, incredibly unequal recovery undermines the legitimacy of this approach. Rather than stir investment and create middle income jobs, capital gains have become a ruse for the rich to get even richer, largely through asset inflation. Companies, notes a new Harvard Business Review study, have used the low interest bonanza and access to cheap money to boost profits, not by expanding employment but by buying back their own stock.

Ultimately, the best way to address class concerns, as well as those of minorities, would be to spark strong economic growth, particularly in the energy, manufacturing, and construction sectors, which tend to offer higher wage employment for them. Both Latinos and African-American made their biggest economic strides when the economy was booming under Presidents Reagan and Clinton, both of whom have been criticized for “trickle down” policies.

A growth agenda is a winning one for the party that embraces and effectively advocates it. A recent analysis (PDF) of public opinion by the Global Strategy Group found that although roughly half of Americans believe inequality per se is a major issue, more than three-quarters believe that faster economic growth should be the main priority.

In the old Democratic Party, from Truman to Clinton, this approach would be an easy sell. A policy that encouraged building new water facilities, expanding domestic energy , manufacturing and construction, particularly single family homes, would have widespread appeal to working and middle class voters. But a growth agenda likely would face much opposition from the president’s green gentry base, who seem perfectly content with an economy that rewards insiders, venture capitalists, and companies that employ few people, largely the best educated and positioned.

Republicans could seize the momentum here, but to do so would require shedding some ideological baggage, as well standing up to some of their more ruthless backers on Wall Street and the corporate community. Similar a return to a more traditional growth oriented liberalism would help hard pressed Democrats, particularly in red states, who desperately need to recapture some of their traditional working class backers. It will be here, in the nexus of policy and class, not racial posturing, the political future of the country may well be determined.

This piece originally appeared at The Daily Beast.

Joel Kotkin is executive editor of NewGeography.com and Distinguished Presidential Fellow in Urban Futures at Chapman University, and a member of the editorial board of the Orange County Register. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is author of The City: A Global History and The Next Hundred Million: America in 2050. His most recent study, The Rise of Postfamilialism, has been widely discussed and distributed internationally. He lives in Los Angeles, CA.

On The Pitfalls of Urban Food Production

Fri, 09/05/2014 - 22:38

In her August 21 pieces “Can Urban Agriculture Work on a Commercial Scale?” and “Five Urban Farms that are Growing Big” published in Citiscope, journalist Flavie Halais enthuses over the potential for  small scale urban agriculture, vertical farming, and innovative ways to connect producers and consumers. In doing so, she ignores some very real pitfalls that have long relegated urban food production to the realm of hobbyists.

Pitfall #1: Urban land is too valuable to be devoted profitably to food production

Until a century ago many foods that did not travel well, or benefitted from organic waste (primarily horse manure) generated in cities, were still produced in and around large urban agglomerations.

For instance, in the late 19th century Parisian maraîchers grew more than 100,000 tons of produce annually by using about one-sixth of the city’s land area.1 Beginning in the 1820s with green asparagus, many of them managed to grow several things year round and a few even became pineapple producers. Unlike today’s locavores, who advocate eating locally-produced foods, they always sought the best customers and exported some of their harvests to   markets as distant as London. 

In the absence of modern technologies such as electricity, refrigeration, and synthetic pesticides though, this de facto “organic” system required much human labor. Accounts describe how most Parisian producers worked between 18 and 20 hours a day during their busiest months and between 14 and 16 the rest of the year. Much of their time was spent in or around horse manure and was devoted to controlling pests and irrigating crops manually.  

Urban agriculture in Paris and elsewhere quickly faded away at the turn of the twentieth century. The development of new technologies such as the railroad, refrigeration and improved fertilizers made it possible to grow food much more cheaply where nature provided more sunshine, heat, water and better soils. The movers and shakers in more profitable industries that benefitted from an urban location were willing and able to pay more for land while urban agricultural workers moved in ever-increasing numbers into more lucrative manufacturing operations. These realities haven’t changed. Urban farming simply does not create enough return on investment from scarce capital relative to other activities in cities.

Pitfall #2: The productions costs of vertical farming are prohibitive

The fundamental problem with growing food in high-rise buildings has always been that the additional costs (from building and powering to lighting and heating them) quickly negate any benefits attributable to an urban location. As the agricultural economist Dennis Avery observed a few years ago in a discussion of a 59-story proposal of this kind:2

•    500,000 such skyscrapers would be needed to make up for the 400 million acres of American farmland;

•    Buying a comparable amount of Iowa cropland would cost about $5 million, a sum that would at best buy about an acre of land in Manhattan, on top of which a very costly high rise structure would need to be built;

•    Each floor of the vertical farm would have to support about 620,000 pounds of either water or water-soaked soil (by comparison, 200 people and their office furniture weigh about 40,000 pounds);

•    Replacing sunlight with “grow lights” and heating the structure in winter would require gigawatts of power (ask the illegal marijuana growers about their need for a lot of electricity);

•    Feeding livestock (typically chickens and pigs) in vertical farms requires trucking in large amounts of animal feeds (typically a four-to-one weight ratio in the case of pigs) while the current alternative is simply to transport pork chops into cities;

•    City taxes and labor costs are always much higher than in the countryside.

Other problems with vertical farms and rooftop operations include the facts that they can never be as convenient and generate the same economies of scale as large land-based operations (try using a tractor on a rooftop). They might also mandate the nearby construction of additional processing operations if these cannot be incorporated in the original structure. Imagine the impracticalities and the smell of a vertical slaughterhouse and the additional traffic problems that would result from moving livestock between buildings in a downtown area.  

In the best case scenario, vertical farming can only ever hope to be profitable through the production of high-end/higher-margin plant items that cater to a wealthy customer base – typically one that believes in the alleged benefits of reducing food miles or the superior nutritional value of organic products, and can afford to pay the higher prices necessary for such productions.3 This is a far cry from the affordable and abundant food promised by local food activists.

Pitfall #3: Undervaluing wholesalers and retailers  

A foundational pillar of the local food creed, Halais reminds her readers, is the desire to “limit the number of intermediaries along the supply chain”. Unfortunately, many idealistic producers whose heart was in producing things rather than selling them quickly found themselves drowning “under marketing and distribution costs” and “struggling to find retail channels for their products.”  “Getting food to consumers,” Halais adds, typically turned into “a logistical nightmare.”

There is another obvious question: How is it that wholesalers and retailers are now as important as ever when no producer is ever forced to deal with them?  In reality, the   benefits of intermediaries is so obvious that they were even noted in Plato’s Republic more than two millennia ago. As one philosopher observed to another, permanent salesmen used “money-token for purposes of exchange” to facilitate transactions between “those who desire to sell” and “those who desire to buy” when individuals could not meet in person.4

Closer to us, in 1815 Benjamin Constant wrote approvingly of the middleman class found “between the grain producer and the consumer.” These people benefitted society, he argued, because they had “more funds than the producer and more resources for setting up warehouses.” Because they dealt “solely with this trade,” they could “study better the needs they undertake to meet” and “free the farmer from having to get involved in speculations which absorb his time, divert his resources, and drive him into the middle of towns.” While these middlemen had “to be paid for their trouble,” so did “the farmer himself” although “at greater cost” because he was not as effective and skillfull. “This extra expense,” Constant observes, “comes back to the consumer, whom [anti middlemen] people thought they were helping.”5

Pitfall #4: An urban location does not keep agricultural pests at bay   

Halais further tells us that the founders of Lufa Farms, a Montreal based urban agriculture firm, have developed an approach that “exclude pesticides, herbicides or fungicides” while using “biological pest control to get rid of harmful bugs.” Not surprisingly, the reader later learns that they had never worked on a farm or in the food industry before launching their business.

Suffice it to say that insecticides, rodenticides, herbicides, fungicides and other pesticides were developed because of the very real shortcomings of biological methods. Although they are costly, all commercial agricultural operations (including organic ones) feel compelled to use some of them because they deliver value for money. Given enough time, agricultural pests will show up in Lufa Farms’s greenhouses and they will need to be dealt with quickly, cheaply and efficiently. After all, insects and plant diseases found their way in the Biosphere 2 project, a self-contained ecosystem in the middle of the Arizona desert, where they ruined the experiment.6 When this happens, these sustainability pioneers will understand why commercial producers use means they do not approve of.

Pitfall #5: Failure to learn from failure

Halais  doesn’t ask whether pretty much anything that can be achieved in an urban context could be done for much less money in rural areas. She  does not discuss the failure of past local food movements as well as more recent high tech urban farming operations.

The history of all advanced economies over the last two centuries is replete with local food initiatives triggered by either economic recessions (to boost regional economic activity or as a form of protection against price inflation), wars or their threat (to increase local food security), romantic impulses during relatively prosperous times (for environmental and social considerations),  alleged excessive commodity travel (meaning too much transit between various points as opposed to a more straightforward distribution itinerary between producers and final consumers), and unnecessary handling by too many profit-seeking intermediaries.7 Yet, none of these ever survived the end of armed conflicts, economic recovery or competition from more efficient commercial operations.

At the same time, projects similar to those described by Halais have already gone out of business. Indeed, had she written her report out of Vancouver instead of Montréal she would have had to mention and analyze the bankruptcy of the heavily subsidized parking lot rooftop greenhouse run by Alterrus Systems about a year after its launch.8

Failure to analyze failures can only result in more failures. History may not repeat itself, but can be instructive as we learn from the failures of others.

The More Things Change…

What today’s enthusiastic locavores ultimately fail to understand is that their “innovative” ideas are not only up against the Monsantos of this world, but also in a direct collision course with regional advantages for certain types of food production, economies of scale of various kinds in all lines of work and the fact that pretty much anything they can achieve in urban environments can be replicated at lower costs in the countryside. These basic realities defeated sophisticated local food production systems in the past and will do so again in the foreseeable future.

While no one argues against the notion that our modern food production system can be improved, and entrepreneurs are always searching how to do so, the desire to make urban agricultural a viable commercial reality distracts from more serious issues such as international trade barriers and counterproductive domestic agricultural subsidies. The sooner well-intentioned activists understand these realities, the better.  

Pierre Desrochers Associate Professor of Geography at the University of Toronto and co-author of The Locavore’s Dilemma. In Praise of the 10,000-mile Diet, PublicAffairs, 2012.



1 See, among others, G. Stanhill. 1977. “An Urban Agro-Ecosystem. The Example of Nineteenth Century Paris.” Agro-Ecosystems 3: 269–284.

2 D. Avery. 2010. “City Farming – Pigs in the Sky” Center for Global Food Issues (October 19) http://www.cgfi.org/2010/10/city-farming%e2%80%94pigs-in-the-sky-by-dennis-t-avery/

3 On why many customers are wrong on these topics, see among others G. Edwards-Jones. 2010. "Does Eating Local Food Reduce the Environmental Impact of Food Production and Enhance Consumer Health?" Proceedings of the Nutrition Society 69 (4): 582-591; P. Desrochers and H. Shimizu. 2012. The Locavore’s Dilemma. In Praise of the 10,000-mile Diet. http://www.globavore.org , Public Affairs; L. Bergström, H. Kirchmann and G. Thorvaldsson. 2008. "Widespread Opinions about Organic Agriculture - Are They Supported by Scientific Evidence?" In H. Kirchmann and L. Bergström (eds). Organic Crop Production - Ambitions and Limitations. Springer, pp. 1-12; and C. Smith-Spangler et al. 2012. "Are Organic Foods Safer or Healthier than Conventional Alternatives? A Systematic Review." Annals of Internal Medicine 157 (5): 348-366.

4 Plato’s Republic was written around 360 BCE. The quotes can be found in the second book of Plato’s Republic written around 360 BCE http://classics.mit.edu/Plato/republic.3.ii.html

5 B. Constant. 1815. Principles of Politics Applicable to all Governments, trans. Dennis O’Keeffe, (Indianapolis: Liberty Fund, 2003). Chapter Four: On Privileges and Prohibitions  http://oll.libertyfund.org/title/861/109045/2279752 on 2013-03-10

6 D.V Marino, T. R. Mahato, J. W. Druitt, L. Leigh, G. Lin, R. M. Russell and F. N. Tubiello. 1999. “The Agricultural Biome of Biosphere 2: Structure, Composition and Function.” Ecological Engineering 13: 199-234

7 For a discussion of such initiatives in the American context, see among others L. J. Lawson. 2005. City Bountiful: A Century of Community Gardening in America. University of California Press. For a few additional international cases, see P. Desrochers and H. Shimizu. 2012. The Locavore’s Dilemma. In Praise of the 10,000-mile Diet.  http://www.globavore.org, PublicAffairs.

8 CBC News. 2014. “Parking Lot Greenhouse Goes Bankrupt in Vancouver. Alterrus Opened North America's First 'Vertical Farm' Just over One Year Ago.” (January 24)  http://www.cbc.ca/news/canada/british-columbia/parking-lot-greenhouse-goes-bankrupt-in-vancouver-1.2510245

Traffic Congestion in the World: 10 Worst and Best Cities

Thu, 09/04/2014 - 22:38

The continuing improvement in international traffic congestion data makes comparisons between different cities globally far easier. Annual reports (2013) by Tom Tom have been expanded to include China, adding the world’s second largest economy to previously produced array of reports on the Americas, Europe, South Africa and Australia/New Zealand. A total of 160 cities are now rated in these Tom Tom Traffic Index Reports. This provides an opportunity to provide world 10 most congested and 10 least congested cities lists among the rated cities.

Tom Tom provides all day congestion indexes and indexes for peak hours (heaviest traffic peak morning and evening hour). The traffic indexes rate congestion based on the additional time necessary to make the trip compared to those under free flow conditions. For example, an index of 10 indicates that a 30 minute trip would take 10 percent longer, or 33 minutes. An index of 50 means that a 30 minute trip will, on average, take 45 minutes.

Congestion in Peak Hours: 10 Most Congested Cities

This article constructs an average peak hour index, using the morning and evening peak period Tom Tom Traffic Indexes for the 125 rated metropolitan areas with principal urban areas of more than 1,000,000 residents. The peak hour index is used because peak hour congestion is generally of more public policy concern than all day congestion. This congestion occurs because of the concentration of work trips in relatively short periods of time. Work trips are by no means the majority of trips, but it can be argued that they cause the most congestion. Many cities have relatively little off-peak traffic congestion.

The two most congested cities are in Eastern Europe, Moscow and Istanbul (which stretches across the Bosporus into Asia). Four of the most congested cities are in China, three in Latin America (including all that are rated) and one is in Western Europe (Figure 1).

Moscow is the most congested city, with a peak hour index of 126. This means that the average 30 minute trip in free flow conditions will take 68 minutes during peak hours. Moscow has a limited freeway system, but its ambitious plans could relieve congestion. The city has undertaken a huge geographical expansion program, with the intention of relocating many jobs to outside the primary ring road. This dispersion of employment, if supported by sufficient road infrastructure could lead to improved traffic conditions.

Istanbul is the second most congested city with a peak hour traffic index of 108. The average free flow 30 minute trip would take 62 minutes during peak hours.

Rio de Janeiro is the third most congested city him with a peak hour traffic index of 99.5. The average free flow 30 minute trip takes 60 minutes due to congestion during peak hours.

Tianjin, which will achieve megacity status in 2015, and which is adjacent to Beijing, is the fourth most congested city, with an index of 91. In Tianjin, the peak hour congestion extends a free flow 30 minute trip to 57 minutes.

Mexico City is the fifth most congested city, with a peak hour traffic index of 88.5. The average free flow 30 minute trip takes 57 minutes due to congestion.

Hangzhou (capital of Zhejiang, China), which is adjacent to Shanghai, has the sixth worst traffic congestion, with a peak period traffic index of 87. The average 30 minute trip in free flow takes 56 minutes during peak hours.

Sao Paulo  has the seventh worst traffic congestion, with a peak hour index of 80.5. The average 30 minute trip in free flow takes 54 minutes during peak periods. Sao Paulo's intense traffic congestion has long been exacerbated by truck traffic routed along the "Marginale" near the center of the city. A ring road now is mostly complete, but the section most critical to relieving traffic congestion from trucks is yet to be opened.

Chongqing has the eighth worst traffic congestion, with a peak hour index of 78.5. As a result, a trip that would take 30 minutes in free flow conditions takes 54 minutes during peak hours.

Beijing has the ninth worst traffic congestion, with a peak hour index of 76.5. As a result a trip that should take 30 minutes in free flow is likely to take 53 minutes during peak hour. In spite of recent reports of its intense traffic congestion, Beijing rates better than some other cities. There are likely two causes for this. With its seventh ring road now planned, Beijing has a top-flight freeway system. Its traffic is also aided by its dispersion of employment The lower density government oriented employment core , is flanked on both side by major business centers ("edge cities") on the Second and Third Ring Roads. This disperses traffic.

Brussels has the 10th worst peak hour traffic congestion, with an index of 75. A trip that would take 30 minutes at free flow takes 53 minutes in peak hour congestion.

Seven of the 10 most congested cities are megacities (urban areas with populations over 10 million). The exceptions are Hangzhou, Chongqing and Brussels. Brussels has by far the smallest population, at only 2.1 million residents, little more than one-third the size of second smallest city, Hangzhou.

Most Congested Cities in the US and Canada

The most congested US and Canadian cities rank far down the list. Los Angeles ranks in a tie with Paris, Marseille and Ningbo (China), at a peak hour congestion index of 65. It may be surprising that Los Angeles does rank much higher. Los Angeles has   been the most congested city in the United States, displacing Houston in the 1980s. The intensity of the Los Angeles traffic congestion is driven by its highest urban area density in the United States and important gaps in the planned freeway system that were canceled. Nonetheless, Los Angeles is aided by a strong dispersion of employment, which helps to make makes its overall work trip travel times the lowest among world megacities for which data is available). Part of the Los Angeles advantages is its high automobile usage, which shortens travel times relative to megacities with much larger transit market shares (such as Tokyo, New York, London and Paris).

Vancouver is Canada's most congested city, with a pea period index of 62.5 and has the 27th worst traffic congestion, in a tie with Stockholm. Vancouver had exceeded Los Angeles in traffic congestion in the 2013 mid-year Tom Tom Traffic Index report.

Least Congested Cities

All but one of the 10 least congested large cities in the Tom Tom report are in the United States. The least congested is Kansas City, with a peak period index of 19.5, indicating that a 30 minute trip in free flow is likely to take 36 minutes due to congestion. Kansas City has one of the most comprehensive freeway systems in the United States and has a highly dispersed employment base. US cities also occupy the second through the sixth least congested positions (Cleveland, Indianapolis, Memphis, Louisville and St. Louis). Spain's Valencia is the seventh least congested city, while the eighth through 10th positions are taken by Salt Lake City, Las Vegas and Detroit.

Cities Not Rated

There are a number of other highly congested cities that are not yet included in international traffic congestion ratings. Data in the 1999 publication Cities and Automobile Dependence: A Sourcebook indicated that the greatest density of traffic among rated cities was in Seoul, Bangkok and Hong Kong. Singapore, Kuala Lumpur, Jakarta, Tokyo, Surabaya (Indonesia), while Zürich and Munich also had intense traffic congestion. Later data would doubtless add Manila to the list. The cities of the Indian subcontinent also experience extreme, but as yet unrated traffic congestion. It is hoped that traffic indexes will soon be available for these and other international cities.

Determinants of Traffic Congestion

An examination (regression analysis) of the peak period traffic indexes indicates an association between higher urban area population densities and greater traffic congestion, with a coefficient of determination (R2) of 0.48, which is significant at the one percent level of confidence (Figure 2). This is consistent with other research equating lower densities with faster travel times and an increasing automobile use in response to higher densities.

At the regional level, a similar association is apparent. The United States, with the lowest urban population densities, has the least traffic congestion. Latin America, Eastern Europe and China, with higher urban densities, have worse traffic congestion. Density does not explain all the differences, however, especially among geographies outside the United States. Despite its high density, China's traffic congestion is less intense than that of Eastern European and Latin American cities. It seems likely that this is, at least in part due to the better matching of roadway supply with demand in China, with its extensive urban freeway systems. Further, the cities of China often have a more polycentric employment distribution (Table).




Traffic Congestion & Urban Population Density Urban Poulation Density Peak Hour Congestion Per Square Mile Per KM2 Australia & New Zealand 49.2                4,600              1,800 Canada 49.4                5,000              1,900 China 64.9              15,700              6,100 Eastern Europe 80.8              11,800              4,500 Latin America 89.5              19,600              7,600 United States 37.1                3,100              1,200 Western Europe 47.4                8,700              3,400 South Africa 52.4                8,300              3,200 Peak Hour Congestion: Average of Tom Tom Peak Hour Congestion Indexes 2013 Population Densities: Demographia World Urban Areas

 

Both of these factors, high capacity roadways and dispersion of population as well as jobs are also important contributors to the lower congestion levels in the United States.

Wendell Cox is principal of Demographia, an international public policy and demographics firm. He is co-author of the "Demographia International Housing Affordability Survey" and author of "Demographia World Urban Areas" and "War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life." He was appointed to three terms on the Los Angeles County Transportation Commission, where he served with the leading city and county leadership as the only non-elected member. He was appointed to the Amtrak Reform Council to fill the unexpired term of Governor Christine Todd Whitman and has served as a visiting professor at the Conservatoire National des Arts et Metiers, a national university in Paris.

Photo: On the Moscow MKAD Ring Road

America's Fastest-Growing Small Cities

Wed, 09/03/2014 - 07:20

Coverage of America’s changing urban scene tends to focus heavily on large metropolitan areas and the “megaregions” now often said to dominate the economic future. Often missed has been a slow, but inexorable, shift of migration and economic growth to smaller cities, a geography usually ignored or dismissed, with the exception of college towns, as doomed to lag behind by urban boosters.

Part of the problem is that analysts often assume that the decline of small towns, which have been losing population, also means small cities are in trouble. Yet this is simply not true. Since 2000 small cities with between 100,000 and 250,000 residents have enjoyed a 13.6% population growth rate, more than twice that of New York, Los Angeles and Chicago, and roughly 10% faster than the national growth rate. The main driving force, notes demographer Wendell Cox, appears to be domestic migration, which is negative in the largest cities as well as in small towns. However the 167 metropolitan statistical areas with between 100,000 to 250,000 in population have added a net 675,000 people due to domestic migration since 2000.

This performance is also seen in the economic sphere. All five of the nation’s fastest growing economies in 2013 were small cities, which, despite their smaller size, possess the basic infrastructure — hospitals, schools, airports, broadband — that are essential to economic growth.

Of course, not all small cities are doing well. Many, particularly in the industrial heartland, continue to suffer; virtually all the bottom 10 small cities on our list are in old industrial areas in the Great Lakes, the Southeast and Massachusetts,  the birthplace of America’s first manufacturing boom.

In order to determine which small metro areas are booming, and help us understand why, we asked Mark Schill at the Praxis Strategy Group to rank them based on four factors: population growth (2000-13), job growth (2001-14), real per capita personal income growth (2000-12), and growth of regional GDP per job (2001-12) — if GDP per job is increasing, it’s an indicator that the metro area is adding high-value, productive industries to its economy, as opposed to lower-wage jobs.

Boomer Boomtowns

Over the next decade, one major driver for growth in small cities may be demographic factors, notably the aging of the baby boom generation. Contrary to popular press accounts that suggest boomers are gravitating to big cities, demographic evidence suggests the opposite is the case. Demographer Cox says boomers appear to be, on net, leaving both big cities and older suburbs in favor either of exurbs or smaller cities.

Some small cities already appear to benefiting from this trend, including the top-ranked city on our list: The Villages, Fla. This relatively new community, which focuses on “active” seniors has doubled in population since 2000, and last year was the nation’sfastest-growing metropolitan area. The area also has expanded its job base by 186% since 2001. Yet as much of the employment is in services, growth in economic productivity has been lackluster. Critically, this does not mean the area has been getting poorer. Personal income growth, largely from assets owned by seniors, has soared by some 60% since 2000, 10 times the national average growth rate of 6%.

Thriving senior-oriented economies can be found throughout Florida, but they are also emerging elsewhere. St. George, Utah, which ranks 12th on our list, has long attracted downshifting boomers from the West Coast as well as the rest of the Intermountain West. This has helped to power its construction sector, a key element of the local economy. Another hot spot for boomers is No. 17 Bellingham, Wash., which is home to Western Washington University. In the coming decade, we can expect a growing competition among smaller towns for boomer residents, and their sometimes significant assets.

Energy Towns

The oil and gas industry doesn’t need bright lights, but sometimes its presence can create some. Of our top 10 fastest-growing small cities, five are energy-driven boom towns. This includes No. 2 Midland, Texas, which has logged 60% job growth since 2001 and 30% population growth since 2000. The west Texas  city, located in the heart of the booming Permian Basin is also getting richer, with personal income growth of over 96.7% since 2000, a rate well above the national average of 6% and the median for small cities of 10.2%. Last year, Midland led the nation in GDP growth at 14%.

Other high-ranked energy cities include No. 3 Odessa, Texas,  and No. 8 Houma-Thibadaoux, La., which this February boasted the lowest unemployment rate in the nation at 2.8%.

College Towns

One would expect this list to be chock full of university towns, but to our surprise, only one made the top 10: Fargo, North Dakota-Minnesota. The metro area has caught our eye before. Fargo is far more than home to North Dakota State, with almost 15,000 students, but the school’s  expertise in engineering and energy dovetails perfectly with the state’s boom not only in energy but it’s rapidly growing tech and manufacturing sectors. Since 2010, manufacturing employment is up 18% in Fargo, to go along with 21% growth at corporate managing offices, 20% in wholesale trade, 17% in finance, and 14% in professional services.

Perhaps a better example of a small city benefiting from university connections is  No. 12 Morgantown, W.V. The metro area of 135,000 is home to the nearly 30,000 people working or studying at the University of West Virginia. Other college towns that made it to the upper tier include No. 11 Hammond, home to Southeast Louisiana University , with 15,000 students; No. 13 Logan, Utah, which hosts Utah State’s 28,000 students; and No. 25 Auburn, Alabama, home to the 25,000-student university of the same name.

Government Centers

Throughout the Bush years and in the first years of the recession, government centers — such as greater Washington, D.C., Madison, Wisc., as well as towns with military bases — out-performed the overall economy. Today many of the small cities that are thriving remain largely dependent on government spending, including  No. 5 Jacksonville, N.C., home to the Marine Corps’ Camp Lejeune.

Given the long-term fiscal crisis facing many communities, this dependence on government spending could prove problematic, leaving a metro area’s fate in the hands of others. Planned cuts in military spending could undermine growth in many of these communities and is already raising the hackles of some public sector unions.

The Road Ahead

These trends suggest that the future of small city America may be far brighter than suggested by many urban pundits. The movement of boomers and the growth of resource-based industries seem likely to accelerate this trend, although declines in government, and particularly military, spending may impact some communities negatively. Like big cities, their small brethren seem to be divided between those that are thriving and those that are not.

Perhaps the biggest challenge facing small cities will be retaining or attracting enough young families. Already roughly two out of every five millennials lives in one of the country’s smaller communities, and proportionately this population grew faster in these small metro areas than in either core cities or suburbs. In the future the key question is how to get more of them, particularly the better educated, to stay.

Economically, these areas also need to diversify, taking advantage of new technologies that allow many businesses to operate remotely. Too great dependence on government spending, or on boomer migration, tends to distort local economies by fostering too much dependence on Washington or  creates a labor market overly tilted towards low-paying service workers. These smaller places still have their work cut out from them, but their prospects may overall be brighter than many suspect.



Fastest Growing Small Cities Rank Region (MSA) Score Growth GDP/Job, 2001-2012 Job Growth, 2001-2014 PCPI Growth, 2000-2012 Population Growth, 2000-2013 1 The Villages, FL 76.4 2.0% 186.0% 59.2% 99.2% 2 Midland, TX 60.4 15.8% 59.7% 96.7% 30.3% 3 Odessa, TX 54.4 32.9% 45.0% 49.4% 23.8% 4 Fargo, ND-MN 43.4 24.8% 28.4% 23.5% 27.7% 5 Jacksonville, NC 41.8 15.3% 27.2% 42.2% 22.9% 6 Longview, TX 41.1 29.7% 18.0% 25.0% 11.5% 7 Bismarck, ND 41.0 15.2% 35.5% 34.9% 22.5% 8 Houma-Thibodaux, LA 40.7 18.0% 22.0% 49.7% 7.9% 9 Watertown-Fort Drum, NY 39.9 22.1% 19.8% 39.5% 6.9% 10 Madera, CA 39.4 20.1% 25.6% 22.0% 23.3% 11 Hammond, LA 39.1 18.6% 20.5% 25.2% 24.5% 12 Morgantown, WV 39.1 19.8% 22.7% 23.9% 22.3% 13 Logan, UT-ID 39.0 23.1% 23.8% 12.4% 25.7% 14 Las Cruces, NM 38.7 20.0% 21.0% 23.2% 21.9% 15 Elizabethtown-Fort Knox, KY 37.9 27.8% 9.9% 18.6% 12.6% 16 St. George, UT 36.9 -2.0% 48.7% 6.4% 62.1% 17 Bellingham, WA 35.2 15.8% 20.1% 15.7% 23.1% 18 Rochester, MN 35.1 24.7% 7.0% 12.7% 14.2% 19 Sioux Falls, SD 34.9 13.6% 19.7% 13.0% 29.3% 20 California-Lexington Park, MD 34.7 12.6% 20.0% 17.0% 26.7% 21 Hanford-Corcoran, CA 34.7 10.2% 12.0% 36.6% 16.3% 22 Sherman-Denison, TX 34.4 27.7% 3.1% 9.4% 10.3% 23 College Station-Bryan, TX 33.8 9.0% 26.1% 16.5% 27.5% 24 Elkhart-Goshen, IN 33.4 31.9% 3.8% -3.1% 9.4% 25 Auburn-Opelika, AL 33.3 8.7% 33.9% 7.3% 30.8% 26 St. Joseph, MO-KS 33.1 24.8% 8.7% 14.4% 3.0% 27 Tuscaloosa, AL 32.7 19.4% 11.0% 10.2% 15.2% 28 Billings, MT 32.6 13.2% 16.1% 17.3% 18.0% 29 Grand Forks, ND-MN 32.3 13.5% 8.6% 34.2% 3.4% 30 Hattiesburg, MS 32.3 13.3% 13.7% 15.9% 19.0% 31 Idaho Falls, ID 32.3 10.8% 12.0% 10.6% 30.5% 32 Charlottesville, VA 31.6 12.8% 12.7% 16.0% 17.5% 33 Lawton, OK 31.5 15.4% 7.1% 23.2% 7.7% 34 Burlington-South Burlington, VT 31.4 20.0% 4.9% 14.2% 7.6% 35 Coeur d'Alene, ID 31.3 6.9% 23.9% 7.1% 31.8% 36 Alexandria, LA 31.2 16.6% 4.8% 21.8% 6.6% 37 Daphne-Fairhope-Foley, AL 31.2 3.2% 27.3% 5.9% 38.3% 38 Johnson City, TN 31.2 19.5% 1.6% 13.2% 10.5% 39 Bend-Redmond, OR 30.6 2.4% 23.9% 2.6% 42.4% 40 Yuma, AZ 30.4 8.7% 13.1% 11.4% 25.3% 41 Waterloo-Cedar Falls, IA 30.0 15.2% 6.8% 21.6% 3.5% 42 El Centro, CA 30.0 -0.2% 28.2% 21.9% 24.0% 43 Binghamton, NY 30.0 27.1% -10.5% 11.1% -1.7% 44 Grand Junction, CO 30.0 12.2% 13.7% 2.0% 25.4% 45 Jonesboro, AR 29.9 9.8% 11.9% 17.0% 16.2% 46 Eau Claire, WI 29.7 15.8% 9.3% 10.1% 10.7% 47 Sierra Vista-Douglas, AZ 29.7 7.1% 8.2% 30.0% 9.6% 48 State College, PA 29.6 10.6% 3.5% 20.2% 14.3% 49 Iowa City, IA 29.6 6.3% 21.1% 12.4% 21.9% 50 Winchester, VA-WV 29.6 9.7% 12.2% 4.3% 27.4% 51 Greenville, NC 29.4 6.8% 13.6% 6.3% 29.8% 52 Lafayette-West Lafayette, IN 29.0 17.6% 5.8% -0.9% 16.8% 53 Tyler, TX 28.8 5.8% 16.4% 11.3% 23.0% 54 Bowling Green, KY 28.4 9.2% 16.8% 4.5% 20.8% 55 Bloomington, IN 28.2 15.0% 8.5% 2.5% 14.3% 56 Champaign-Urbana, IL 28.2 17.5% -5.0% 6.9% 11.7% 57 Yakima, WA 27.9 9.0% 12.9% 14.5% 11.0% 58 Homosassa Springs, FL 27.9 8.7% 11.2% 9.5% 17.4% 59 Carbondale-Marion, IL 27.8 13.7% 0.8% 16.9% 4.8% 60 Rapid City, SD 27.8 4.9% 7.7% 19.0% 17.4% 61 Panama City, FL 27.6 4.5% 15.7% 15.1% 17.1% 62 Anniston-Oxford-Jacksonville, AL 27.5 17.7% -5.2% 10.0% 5.1% 63 Columbia, MO 27.3 2.5% 20.8% 6.7% 25.6% 64 La Crosse-Onalaska, WI-MN 27.3 11.9% 6.1% 13.8% 6.7% 65 Chico, CA 27.2 10.5% 6.5% 13.6% 9.0% 66 Abilene, TX 27.1 7.7% 10.2% 21.8% 4.5% 67 Yuba City, CA 27.1 6.8% 4.4% 10.2% 20.9% 68 Terre Haute, IN 27.0 18.8% -2.7% 8.7% 0.8% 69 Kahului-Wailuku-Lahaina, HI 27.0 1.4% 13.0% 13.0% 24.2% 70 St. Cloud, MN 26.9 8.0% 10.7% 10.8% 13.8% 71 Chambersburg-Waynesboro, PA 26.9 7.5% 17.1% 4.7% 17.2% 72 Oshkosh-Neenah, WI 26.8 15.4% 1.4% 5.3% 7.9% 73 Dover, DE 26.6 -2.8% 23.0% 6.0% 33.2% 74 Texarkana, TX-AR 26.6 12.4% -0.3% 15.1% 4.5% 75 Dothan, AL 26.4 9.6% -2.5% 13.4% 12.7% 76 Lake Havasu City-Kingman, AZ 26.3 2.8% 8.5% 3.9% 30.0% 77 Lawrence, KS 26.3 10.2% 2.0% 7.9% 14.0% 78 Fairbanks, AK 26.3 1.3% 8.5% 15.8% 21.0% 79 Missoula, MT 26.3 5.4% 13.7% 9.4% 16.3% 80 Joplin, MO 26.2 12.0% 2.0% 6.6% 11.1% 81 Owensboro, KY 26.2 11.4% 5.2% 11.5% 5.8% 82 Lake Charles, LA 26.2 6.8% 5.4% 22.4% 4.4% 83 Williamsport, PA 26.2 12.5% 0.4% 20.0% -2.6% 84 San Angelo, TX 26.1 5.0% 5.4% 20.1% 10.1% 85 Flagstaff, AZ 26.0 6.2% 9.3% 8.3% 16.9% 86 Glens Falls, NY 25.9 8.6% 3.7% 19.5% 3.4% 87 Cumberland, MD-WV 25.8 9.6% 0.3% 22.4% -0.6% 88 New Bern, NC 25.8 9.8% -1.1% 11.2% 10.9% 89 Beckley, WV 25.7 6.2% 3.3% 28.7% -1.7% 90 Bloomington, IL 25.5 9.5% -2.6% 8.4% 14.0% 91 Longview, WA 25.4 12.2% -5.4% 8.2% 9.5% 92 Kingston, NY 25.3 9.5% -4.7% 20.9% 1.8% 93 Wheeling, WV-OH 25.3 14.2% 0.7% 14.7% -4.7% 94 Florence-Muscle Shoals, AL 25.1 12.0% -0.7% 11.4% 3.0% 95 Dalton, GA 25.1 19.3% -15.8% -10.6% 17.6% 96 Sioux City, IA-NE-SD 25.1 10.5% 0.7% 16.2% 0.6% 97 Sebastian-Vero Beach, FL 25.0 1.9% 12.8% 2.4% 25.3% 98 Wenatchee, WA 24.8 1.3% 17.1% 11.5% 14.2% 99 Blacksburg-Christiansburg-Radford, VA 24.8 6.9% 3.4% 12.4% 9.0% 100 Harrisonburg, VA 24.7 3.8% 7.7% 6.2% 19.1% 101 Albany, OR 24.5 9.8% 2.6% -0.8% 15.3% 102 Battle Creek, MI 24.2 17.5% -9.7% 6.1% -2.2% 103 Ithaca, NY 24.2 3.1% 5.9% 18.3% 7.3% 104 Warner Robins, GA 24.1 -3.9% 13.5% 7.2% 28.6% 105 Lebanon, PA 24.0 0.9% 13.0% 13.0% 12.6% 106 Goldsboro, NC 23.9 7.8% -2.2% 9.2% 9.6% 107 Monroe, LA 23.8 6.7% -2.5% 15.6% 5.0% 108 Lewiston-Auburn, ME 23.7 9.1% 0.3% 9.9% 3.6% 109 Sumter, SC 23.6 9.1% -9.1% 15.1% 3.2% 110 Prescott, AZ 23.4 -3.7% 11.5% 5.4% 27.6% 111 Vineland-Bridgeton, NJ 22.9 3.5% -0.4% 14.9% 7.6% 112 Wichita Falls, TX 22.8 6.5% -9.7% 21.3% -0.4% 113 Jackson, TN 22.8 6.5% 3.8% 6.6% 7.0% 114 Decatur, AL 22.8 12.2% -7.7% 2.4% 5.0% 115 Cleveland, TN 22.7 2.7% 7.5% 5.6% 13.6% 116 Janesville-Beloit, WI 22.5 11.0% -3.7% 1.4% 5.4% 117 Napa, CA 22.3 0.1% 15.0% 6.2% 12.7% 118 Decatur, IL 22.3 11.6% -9.6% 12.2% -4.6% 119 Sheboygan, WI 22.2 6.1% -3.1% 13.7% 1.9% 120 Athens-Clarke County, GA 22.2 -3.3% 17.9% 5.3% 18.7% 121 Kankakee, IL 21.9 7.1% -1.8% 3.2% 8.0% 122 Morristown, TN 21.8 6.9% -4.8% 0.9% 12.1% 123 Brunswick, GA 21.7 3.9% -4.9% -3.1% 21.9% 124 Medford, OR 21.6 0.3% 7.9% 4.4% 14.7% 125 Topeka, KS 21.4 6.4% -4.2% 7.7% 4.2% 126 Wausau, WI 21.3 4.9% -1.6% 5.9% 7.5% 127 Hilton Head Island-Bluffton-Beaufort, SC 21.3 -8.7% 8.4% -2.7% 38.8% 128 Mount Vernon-Anacortes, WA 21.3 -1.3% 8.2% 6.0% 14.9% 129 East Stroudsburg, PA 21.1 -0.3% 7.3% -1.1% 19.6% 130 Bangor, ME 21.1 3.4% -0.9% 9.4% 5.8% 131 Valdosta, GA 21.0 -6.2% 6.7% 11.6% 19.4% 132 Gadsden, AL 20.9 5.1% -2.2% 11.0% 0.6% 133 Jefferson City, MO 20.9 3.6% -1.4% 6.7% 7.3% 134 Altoona, PA 20.8 6.7% -1.2% 9.2% -2.1% 135 Appleton, WI 20.8 -0.6% 5.5% 5.2% 13.5% 136 Gettysburg, PA 20.7 2.2% 6.3% 1.0% 11.0% 137 Staunton-Waynesboro, VA 20.5 0.9% -3.2% 9.3% 9.5% 138 Michigan City-La Porte, IN 20.3 11.8% -12.6% -0.8% 1.1% 139 Lima, OH 19.9 12.6% -11.3% -0.6% -3.0% 140 Springfield, IL 19.7 8.1% -12.6% 0.0% 5.0% 141 Fond du Lac, WI 19.6 3.8% -1.5% 3.7% 4.5% 142 Charleston, WV 19.5 3.4% -9.0% 16.9% -4.6% 143 Redding, CA 19.0 -2.1% -1.6% 8.5% 9.4% 144 Pueblo, CO 18.9 -4.2% 6.5% 3.6% 13.9% 145 Farmington, NM 18.8 -15.5% 9.6% 28.5% 10.8% 146 Gainesville, GA 18.8 -12.1% 13.9% -3.4% 33.2% 147 Jackson, MI 18.3 7.8% -7.0% -4.0% 1.1% 148 Monroe, MI 18.1 5.9% -5.8% -3.1% 2.7% 149 Bay City, MI 18.1 9.4% -10.9% -2.1% -3.0% 150 Florence, SC 18.0 -2.3% -3.4% 8.0% 6.7% 151 Santa Fe, NM 17.9 -5.4% 4.5% 3.2% 13.7% 152 Niles-Benton Harbor, MI 17.4 4.7% -9.0% 5.3% -4.4% 153 Burlington, NC 17.3 -0.6% -6.2% -7.8% 17.5% 154 Racine, WI 17.2 0.4% -5.4% 3.6% 3.2% 155 Johnstown, PA 17.0 0.1% -6.0% 14.5% -7.6% 156 Muncie, IN 16.7 7.2% -13.8% -4.1% -1.1% 157 Punta Gorda, FL 16.3 -11.2% 12.9% 2.0% 15.8% 158 Mansfield, OH 15.6 5.2% -16.6% 1.3% -5.5% 159 Rocky Mount, NC 15.6 -0.1% -13.7% -0.1% 5.3% 160 Pittsfield, MA 15.3 -5.7% -1.4% 13.2% -3.8% 161 Barnstable Town, MA 15.3 -10.8% 3.2% 21.1% -3.6% 162 Weirton-Steubenville, WV-OH 13.8 -1.6% -15.8% 9.0% -7.4% 163 Albany, GA 13.7 -9.5% -5.7% 13.8% -1.2% 164 Springfield, OH 13.1 -2.7% -10.4% 4.0% -5.8% 165 Saginaw, MI 11.8 -1.3% -10.6% -4.0% -6.4% 166 Muskegon, MI 10.8 -9.7% -4.1% -0.7% 0.4% 167 Macon, GA 9.1 -18.3% -3.1% 5.6% 4.0%

Analysis by Mark Schill, mark@praxissg.com. Measures are normalized and equally weighted. Sources: U.S. BEA (GDP/Job, PCPI growth), EMSI (employment growth), U.S. Census Population Estimates Program (population growth).

This piece originally appeared at Forbes..

Joel Kotkin is executive editor of NewGeography.com and Distinguished Presidential Fellow in Urban Futures at Chapman University, and a member of the editorial board of the Orange County Register. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is author of The City: A Global History and The Next Hundred Million: America in 2050. His most recent study, The Rise of Postfamilialism, has been widely discussed and distributed internationally. He lives in Los Angeles, CA.

Fargo photo by David Kohlmeyer.

Joel on Reason.tv

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"Greenurbia is the suburbs of the future. The suburbs of the 1950s were bedroom communities for people who commuted into the city. Today, there’s much more employment in the suburbs, and the big change is the number of people working full-time or part-time at home. Having people commute from one computer screen to another doesn’t make sense."

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Kotkin has a striking ability to envision how global forces will shape daily family life, and his conclusions can be thought-provoking as well as counterintuitive. It's amazing there isn't more public discussion about the enormous changes ahead, and reassuring to have this talented thinker on the case. — Jennifer Ludden, NPR national desk correspondent

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