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The Cities That Are Benefiting The Most From The Economic Recovery

Mon, 10/06/2014 - 22:38

It is painfully clear that the current U.S. economic recovery has been a meager one, with the benefits highly concentrated among the wealthiest. The notion that “a rising tide” lifts all boats has been sunk, along with the good ship middle class.

Geographically as well, the recovery has been concentrated in a relative handful of regions. Nationwide, real per capita GDP rose a meager 3.8% from 2010 through 2013, according to new Bureau of Economic Analysis numbers. An analysis of the data by urban expert Aaron Renn shows that a handful of metropolitan areas have enjoyed much faster growth. For the most part, these are areas that have cashed in on the current technology or energy booms, and in some cases, both. Also, surprisingly, there have been some very good gains in some of the nation’s long-distressed industrial heartland metro areas, as the combination of energy development and a resurgent automobile industry have boosted regional GDP.

Tech Capitals

Of the nation’s 52 largest metropolitan statistical areas, many of the top performers have strong tech economies, led by the No. 2 metro area on our list, San Jose-Sunnyvale-Santa Clara, aka Silicon Valley, where real per capita GDP expanded 11.5% from 2010-13. Perhaps more surprising is the strong, tech-fuelled performance of No. 3 Portland-Vancouver-Hillsboro, Ore., where real per capita GDP grew 9.2%. The prime contributor has been the robust performance of late of Intel, the state’s largest private employer, which employs about 17,000 in Portland’s western suburbs around the town of Hillsboro, the company’s largest concentration of workers anywhere.

Other less heralded tech centers have also performed well, including No. 4 Columbus, Ohio (8.2% growth), and No. 8 Salt Lake City (7.3%), both of which are also benefiting from the surge in oil and gas production. Among smaller cities with strong tech communities, Fargo, N.D., and Provo-Orem, Utah, have enjoyed better than 10% real per capita GDP growth since 2010.

Energy Regions

Per capita growth in the energy states has been even more impressive. Placing first on our big cities list is Houston-the Woodlands-Sugarland, Texas, where per capita GDP rose 13.2% from 2010-13, a major achievement in a region whose population continues to grow rapidly. Zooming out to all 381 U.S. MSAs, no places come close to the two Texas oil towns that rank first and second overall, Midland (sizzling 38.8% growth since 2010) and Odessa (34.1%). Both lie in the Permian basin, an oil-rich geological formation that was first tapped in the 1920s and has seen a marked revival in production recently due to advances in extraction techniques like horizontal drilling and fracking. Also notable, the southern Texas town of Victoria clocked over 21% growth.

Among the largest metro areas, energy hubs also did well, including Oklahoma City (7th, 7.5%) and Dallas-Ft. Worth-Arlington (13th,  6.5%) and the San Antonio area (16th), which is benefiting from a gusher in the Eagle Ford Shale play. Economist estimate its development has pumped $87 billion into the south Texas economy.

Rust Belt Revives

The booms in tech and energy are well-known. But the most surprising wrinkle in our survey of per capita GDP growth is the revival of auto manufacturing, which benefits both from technological improvements and lower energy costs. Among the larger metro areas, the key winners have been Grand Rapids-Wyoming (fifth, 7.8%) and Detroit (tied for ninth, 7.2%), as well as the surprising 15th place ranking for Cleveland-Elyria.

These gains are heartening, but the real question may be how long this will continue. In part, the strong 2010-13 numbers reflect a recovery from very poor economic performance that has stretched on for decades, and population losses, which tend to skew per capita GDP numbers upwards. But signs of health in the nation’s long disdained midsection deserve applause.

Surprising Laggards

The recovery has not lifted most regions, just as it has not helped most Americans. Per capita income growth has been slow in most of the nation’s largest cities outside Texas. Given the enormous financial bailout from the federal government, as well as the massive spike in stock and real estate prices, one would have expected far better performance from New York, which ranks a middling 33rd out of the 52 largest MSAs, with below average 2.3% growth since 2010.

Chicago-Naperville-Elgin ranked 26th; Los Angeles-Long Beach-Anaheim, 38th, and  Philadelphia, 40th. Perhaps the biggest disappointment is 51st place Washington D.C.-Arlington-Alexandria, which had been a high-flier through the Recession amid strong federal spending. Per capita GDP since 2010 has fallen 3.4%. This disturbs some pundits, such as Richard Florida, but no doubt Washington’s fall from grace would be widely welcomed by most Americans.

And What About Poverty

Increasingly, many question not only the relative lack of growth, but that the growth we are experiencing is doing very little for the vast majority of Americans. Former Clinton adviser Bill Galston has noted that this recovery has “left almost everybody” out.

No group has been harder hit than the poor. The nation’s population below the poverty line has expanded a full percent since 2010. An analysis by demographer Wendell Cox shows that poverty declined in just seven of the nation’s 52 largest metropolitan areas from 2010-13: Louisville, Ky.; Oklahoma City; Nashville, Tenn.; Columbus Ohio; Grand Rapids; and Texas’ Austin and San Antonio.

Most of the areas with the strongest growth in per capita GDP posted smaller than average increases in poverty. In Houston the share of the population living in poverty rose 0.6% from 2010-13 to 16.4%, 11th highest among the nation’s biggest metro areas.

The results in California suggest strongly that the tech boom has not done much to relieve poverty in the Golden State, despite the much ballyhooed “California comeback” trumpeted by the likes of Paul Krugman. In reality it’s poverty, not prosperity, that’s on the march in most California cities outside the Bay Area. Since 2010, the percentage of the population of San Diego living in poverty has grown 1.3% to 15.2%, while that of Riverside-San Bernardino rose 1.7% to 18.2%, the third highest rate among the 52 largest metro areas in the country. Meanwhile the poverty rate in Los Angeles, the state’s dominant urban region, has risen 1.8% to 17.6% (fifth worst), and Sacramento, the state capital, has seen a 2.0% increase in poverty to 16.6% (10th).

This suggests that, for the most part, what has passed for growth has been too meager to reduce poverty. In many places, even ones growing rapidly, such as the Silicon Valley hub of San Jose, the number of poor continue to increase. Since 1999, poverty in the valley has jumped  from 7.6% to 10.5%. This also likely is a low figure, given the extraordinarily high cost of living in the Bay Area, as well as the rest of coastal California. According to the Census Bureau, California’s poverty rate is the highest in the nation when adjusted for the state’s exorbitant cost of housing.

For the most part, poverty has been reduced, or at least has grown less, in lower-cost regions that have ties to the energy and manufacturing revival, which tend to create opportunities for middle- and working-class residents. Until we figure out how to get growth whose benefits are widely shared, and reduce poverty, the one measurement likely to go up is cynicism about the efficacy of our current economic policies.





Real Metropolitan Area GDP Per Capita (2010-2013) Rank Metropolitan Area 2010 2013 2010-2013 Change 1 Houston-The Woodlands-Sugar Land, TX  $  63,816  $    72,258 13.2% 2 San Jose-Sunnyvale-Santa Clara, CA  $  89,806  $  100,115 11.5% 3 Portland-Vancouver-Hillsboro, OR-WA  $  63,025  $    68,810 9.2% 4 Columbus, OH  $  50,370  $    54,493 8.2% 5 Grand Rapids-Wyoming, MI  $  41,248  $    44,482 7.8% 6 Charlotte-Concord-Gastonia, NC-SC  $  51,819  $    55,802 7.7% 7 Oklahoma City, OK  $  45,993  $    49,441 7.5% 8 Salt Lake City, UT  $  57,790  $    62,008 7.3% 9 Nashville-Davidson--Murfreesboro--Franklin, TN  $  50,464  $    54,112 7.2% 10 Detroit-Warren-Dearborn, MI  $  46,314  $    49,653 7.2% 11 Pittsburgh, PA  $  48,710  $    52,053 6.9% 12 Cincinnati, OH-KY-IN  $  48,841  $    52,063 6.6% 13 Dallas-Fort Worth-Arlington, TX  $  57,032  $    60,730 6.5% 14 Birmingham-Hoover, AL  $  46,108  $    49,034 6.3% 15 Cleveland-Elyria, OH  $  52,169  $    55,430 6.3% 16 San Antonio-New Braunfels, TX  $  37,202  $    39,280 5.6% 17 San Francisco-Oakland-Hayward, CA  $  75,103  $    78,844 5.0% 18 Seattle-Tacoma-Bellevue, WA  $  71,404  $    74,701 4.6% 19 Minneapolis-St. Paul-Bloomington, MN-WI  $  59,168  $    61,711 4.3% 20 Sacramento--Roseville--Arden-Arcade, CA  $  43,905  $    45,764 4.2% 21 Austin-Round Rock, TX  $  50,094  $    52,110 4.0% 22 Denver-Aurora-Lakewood, CO  $  59,284  $    61,595 3.9% 23 Phoenix-Mesa-Scottsdale, AZ  $  43,156  $    44,803 3.8% 24 Boston-Cambridge-Newton, MA-NH  $  71,936  $    74,643 3.8% 25 San Diego-Carlsbad, CA  $  55,921  $    57,955 3.6% 26 Chicago-Naperville-Elgin, IL-IN-WI  $  55,727  $    57,752 3.6% 27 Providence-Warwick, RI-MA  $  41,698  $    42,994 3.1% 28 Louisville/Jefferson County, KY-IN  $  46,710  $    48,048 2.9% 29 Tampa-St. Petersburg-Clearwater, FL  $  39,066  $    40,153 2.8% 30 Buffalo-Cheektowaga-Niagara Falls, NY  $  41,497  $    42,550 2.5% 31 Baltimore-Columbia-Towson, MD  $  55,907  $    57,294 2.5% 32 Indianapolis-Carmel-Anderson, IN  $  58,590  $    60,038 2.5% 33 New York-Newark-Jersey City, NY-NJ-PA  $  67,499  $    69,074 2.3% 34 Riverside-San Bernardino-Ontario, CA  $  26,509  $    27,094 2.2% 35 St. Louis, MO-IL  $  47,876  $    48,738 1.8% 36 Milwaukee-Waukesha-West Allis, WI  $  55,767  $    56,734 1.7% 37 Miami-Fort Lauderdale-West Palm Beach, FL  $  44,386  $    45,145 1.7% 38 Los Angeles-Long Beach-Anaheim, CA  $  58,211  $    59,092 1.5% 39 Kansas City, MO-KS  $  52,916  $    53,677 1.4% 40 Philadelphia-Camden-Wilmington, PA-NJ-DE-MD  $  58,696  $    59,339 1.1% 41 Memphis, TN-MS-AR  $  46,534  $    47,014 1.0% 42 Richmond, VA  $  50,977  $    51,498 1.0% 43 Rochester, NY  $  44,825  $    45,202 0.8% 44 Atlanta-Sandy Springs-Roswell, GA  $  51,830  $    52,178 0.7% 45 Virginia Beach-Norfolk-Newport News, VA-NC  $  48,395  $    48,708 0.6% 46 Raleigh, NC  $  51,820  $    51,673 -0.3% 47 Las Vegas-Henderson-Paradise, NV  $  43,351  $    43,079 -0.6% 48 Jacksonville, FL  $  42,068  $    41,752 -0.8% 49 Hartford-West Hartford-East Hartford, CT  $  68,005  $    66,870 -1.7% 50 Orlando-Kissimmee-Sanford, FL  $  47,023  $    45,855 -2.5% 51 Washington-Arlington-Alexandria, DC-VA-MD-WV  $  76,035  $    73,461 -3.4% 52 New Orleans-Metairie, LA  $  61,325  $    56,943 -7.1% Analysis by Aaron M. Renn

 

This piece first appeared at Forbes.

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.

Photo by w:Flickr user Bill Jacobus [CC-BY-2.0], via Wikimedia Commons

Battle of the Upstarts: Houston vs. San Francisco Bay

Sun, 10/05/2014 - 22:38

“Human happiness,” the Greek historian Herodotus once observed, “does not abide long in one place.” In its 240 years or so of existence, the United States has experienced similar ebbs and flows, with Boston replaced as the nation’s commercial capital first by Philadelphia and then by New York. The 19th century saw the rise of frontier settlements—Cincinnati, Pittsburgh, Cleveland, and finally Chicago—that also sought out the post position. In the mid 20th century, formerly obscure Los Angeles emerged as New York’s most potent rival.

Today we are seeing yet another shuffling of the deck among American regions. New York remains the country’s preeminent city, but its most powerful rivals are likely to be neither Chicago nor Los Angeles, but rather two regions rarely listed in the hierarchy of influential regions: the San Francisco Bay Area and Houston.

Making of a new pecking order

The Bay Area does not rank among the 20 top global cities in most studies, such as the 2014 A.T. Kearney listings. In the respected rankings of the London-based Globalization and World Cities Network, the Bay Area stood below not only Chicago, which is considered an “alpha” global city, but also such places as Toronto and Mexico City.

Yet such rankings vastly underestimate the power now being wielded by the San Francisco region. As the headquarters for the largest concentration of cutting edge tech firms in the world, the Bay Area increasingly shapes the operations of companies from manufacturing and marketing to retail and media. And given that roughly half the nation’s venture capital is still being lavished on area start-ups, it is not surprising that Silicon Valley ranks number one in the world as a place to launch tech ventures, according to the Startup Genome.

Tech dominance, according to a recent study on global cities conducted by my firm NewGeography, explains why the San Francisco Bay Area nudges out much larger Los Angeles for bragging rights on America’s Pacific Rim. Technology leaders, including Intel, Apple, Oracle, Google, and Facebook, are based in Silicon Valley, while Asian global tech firms such as Samsung also have North American headquarters there. Top technology firms from other cities often have their key R&D functions in the Bay Area. Even a frugal firm like Wal-Mart is enlarging its Silicon Valley presence.

The current social media bubble will surely pop, but as Michael S. Malone and others have noted, the Bay Area’s preeminence will likely continue, fueled by its unique concentration of engineers, entrepreneurs, and risk capital. As a lure for the ambitious, Silicon Valley and San Francisco are replacing Wall Street. Google alone has 1,200 employees who formerly worked for large U.S. investment banks, and migration from the Big Apple to California is now at its highest level since 2006.

Much of the appeal of the Bay Area is a result of happy coincidence of history and geography. The Bay Area—where I went to school and got my start in journalism, and where parts of my family have resided since the ’50s—has been blessed with excellent higher education and is centered around what is arguably America’s most beautiful city. Good weather, beautiful vistas, and access to nature have made the Bay Area a natural lure for people who can afford to live wherever they want.

The Energy Capital

Houston, where I have been working as a consultant, hardly qualifies as one of the most physically attractive or temperate cities. San Francisco may well have been, as Neil Morgan suggested a half century ago, “the Narcissus of the West,” but Houston, in most accounts, has been widely disparaged as hot, steamy, ugly and featureless. Yet despite this, its ascendency is no less compelling than that of the Bay Area.

Houston’s trump card, like the Bay Area’s, resides in its control of one strategic industry, in this case energy. The majority of traded foreign oil majors, such as London-based Shell and British Petroleum, have their U.S. headquarters in Houston, and even companies based elsewhere boast a significant Houston presence. For example, Exxon, although it has its headquarters in Dallas-Fort Worth, is opening a massive Houston campus that will be home to 10,000 employees. Additionally, a majority of the world’s largest oil services companies, such as Baker Hughes, Schlumberger, and FMC Technologies, are based in Houston.

Altogether, more than 5,000 energy-related companies call Houston home. The city employs three times more people in energy than its second place rival, Dallas-Ft. Worth, and more than the next five cities combined. This growth is likely to accelerate because foreign companies, notably from Germany, have begun buying up energy firms in the area, including Siemens’s recent $7.6 billion dollar purchase of the Dresser Rand Group, an energy equipment firm.

 Houston has added more than 10 percent more jobs since 2008, almost twice the increase in the Bay Area. Since 2000 Houston’s employment figures have shot up 32 percent, while the Bay Area has grown by barely 4 percent. And it’s not just energy that’s driving things—Houston is now the nation’s largest export port and boasts the world’s largest medical center. It has also become, by some measurements, the most ethnically diverse (PDF) region in the country. In the last decade, for example, Houston increased its foreign-born population by 400,000, second only to New York and well ahead of much larger Los Angeles.

The big losers: LA and Chicago—but also New York

In the past century New York and Los Angeles have dominated American media. This is being severely undermined by the Bay Area’s digital economy. Since 2001, notes Mark Schill at Praxis Strategy (where I am a senior fellow), book, periodical, and newspaper publishing—all traditionally concentrated in the New York area—have lost some 250,000 jobs, while Internet publishing and portals generated some 70,000 new positions, many of them in the Bay Area or Seattle.

Google and Yahoo are already among the largest media companies in the world. (Yahoo now refers to itself as a digital media company rather than a technology company). With the ubiquity of its iTunes platform, Apple exercises ever greater control over consumer distribution of entertainment products such as music and video; Netflix, Hulu, and YouTube could become the studios of the future. This could shift global media decision-making from its familiar New York-Los Angeles axis to the Bay Area.

This is particularly bad news for Los Angeles, whose grip on the entertainment industry was weakening even before Silicon Valley’s rise. Since 2004, LA’sentertainment industry lost roughly 11 percent of its jobs, as production shifted to Canada, Louisiana, and other locales.

The decline in media employment comes on the heels of a rapid industrial decline—the area has lost more than 90,000 aerospace jobs since the end of the Cold War. The situation is so dismal that a report issued by many of the region’s top business and political leaders concluded that the city “is barely treading water while the rest of the world is moving forward.”

Chicago’s situation is arguably even worse, but it is more threatened by Houston, which has already passed the Windy City in numbers of corporate headquarters. Since 2010, when U.S. industry began recovering, Houston manufacturing employment expanded by more than 17 percent, compared to flat growth in Chicago.

“Houston is the Chicago of this era—like the old Chicago,” remarks David Peebles, who runs the Texas office of Odebrecht, a $45 billion engineering firm based in Brazil. “In the ’60s you had to go to Chicago, Cleveland, and Detroit. Now Houston is the place for new industry.”

With its industrial base eroding, Chicago is no longer a strategic hub for any key industry. Outside of trading commodities, it also no longer serves as a major global financial center. Regional population growth has been meager over the past decade, and the city’s own pension issues may be worse than Detroit’s.

Chicago retains its brilliant skyline, great cultural institutions, powerful political influence, and a strong business community. But its days of America’s number two city are long gone, and, as we enter the mid-2000s, it is falling behind not only Los Angeles and New York but the two rising Texas cities, Houston and Dallas, both expected to pass the “city of big shoulders” in population by mid-century, or earlier.

Engineering the Future

In the coming decades, New York will remain the nation’s top global city, due to its remarkable urban legacy, the power of Wall Street, and the entrenched traditional media. But its Achilles heel is a lack of the engineering power necessary to address key challenges such as the digitization of industry, energy efficiency or climate change. New York is profoundly weak in engineering talent (PDF)—ranking 78th out of 85 metropolitan areas in engineers per capita.

In contrast, the Bay Area represents the epitome of engineering power, with the San Jose area boasting the largest per capita concentration of engineers of any major metropolitan area. The Bay Area’s power to develop new technologies and its almost unfathomable wealth will continue to undermine traditional institutions, from Hollywood and Wall Street to business services, tourism, automotive, and even aerospace industries.

Far less appreciated, Houston, rather than being a southern city of duller wits, actually ranks second in engineers per capita. If the Bay Area is master of the digital economy, Houston ranks as the technological leader of the material one; it is the capital for the energy-driven revival of U.S. industry, not only in Texas but throughout the old industrial heartland. Revealingly, Houston actually has seen far more rapid growth in both college educated and millennial population since 2000 than the Bay Area, as well as New York, Chicago, and Los Angeles.

Rival Approaches to Urbanism

The Bay Area, for all its vaunted progressivism, increasingly resembles a “gated community” whose high prices repel most potential newcomers, particularly families. Already by far the nation’s least affordable city—only 14 percent of current residents can possibly afford to buy a home—it represents a growth model that is by definition exclusive, almost a throwback to medieval forms where the rich clustered inside the city gates.

High housing prices, notes economist Jed Kolko, account for the fact that, despite the boom, population growth in the Bay Area remains well below national averages. From 2000 to 2013, the region lost approximately 550,000 domestic migrants. Despite sizable immigration, the regional population growth rate has fallen below the national average.

In contrast, Houston is among the fastest growing regions in the country, with rapid increases both in domestic migrants and newcomers from abroad. This stems from both lower housing prices and a growth model that is far more amenable to higher paid blue collar and middle management positions. Since 2000, Houston’s population has grown by 30 percent compared, three times that of the Bay Area.

Ironically, Houston’s growth has been more egalitarian than that of the notionally super-progressive San Francisco region. A recent Brookings report found that income inequality has increased most rapidly in what is probably the most left-leaning big city in America, where the wages of the poorest 20 percent of all households have actually declined amid the dot com billions.

This inequality has a distinct racial element. The Bay Area gap between white residents (who dominate the tech economy) and minorities is among the highest in the nation while, during the boom, income has fallen for Hispanics and African-Americans, according to Joint Venture Silicon Valley.

This racial divergence is far less pronounced in Houston, while the growth of poverty since 2000 has been slower, increasing at one third the rate of New York and San Francisco, and half that of Los Angeles. The Texas city may lack the great views of San Francisco, but Houston has turned out to be a better city for middle class minorities. Homeownership among African Americans stands at 42 percent and for Latinos at more than 53 percent; this compares to 32 and 37 percent in the Bay Area.

Perhaps the biggest differences can be seen in families. Of the nation’s 52 largest metropolitan areas, the Bay Area has the lowest percentage, 11.5 percent, of people ages 5 to 14. In Houston, 23 percent of the population fits this age category. In particular San Francisco is notoriously inhospitable to families, with the lowest percentage of kids of any major city.

The two regions also reflect very different urban forms. The Bay Area’s leadership has opted to favor dense “in fill” growth and sought to restrict suburbandevelopment. Houston has taken a different tack. As its population has expanded, so too has the metropolitan area. This includes the development of many planned communities that appeal to middle class families and many immigrants. In 2013, Houston alone had more housing starts than the entire state of California.

But it would be wrong to dismiss Houston’s model as merely “sprawl.” Instead it is better seen as simply expansive. In fact, arguably no inner ring in the country has seen more rapid growth, with high-rise, mid-rise and townhouse development in many long neglected districts. The increase in high-density housing tracts (more than 5,000 per square mile) since 2000 has been almost ten times higher than the Bay Area.

The Political Battle for the Future

Increasingly America’s future will be determined by these two cities, with the issue of addressing climate change at the fore. Much of the Bay Area’s leadership—led by the likes of Google Chairman Eric Schmidt and investor Tom Steyer—have all but declared war on the oil and gas industry. Several colleges and universities in the region, including Stanford, have shed their energy holdings, and Silicon Valley has nurtured movements such as Bill McKibben’s 350.org that seek to revoke the “social license” of big oil, a tactic used previously against the tobacco companies and firms that did business in apartheid South Africa.

The elites of Silicon Valley and San Francisco are not just interested in saving the earth; they wish to profit from a change in the nation’s energy economy. Google, Sun Microsystems founder Vinod Khosla, and top venture capitalists such as John Doerr have bolstered their already ultra-thick wallets by capitalizing on “green energy” subsidies and outright grants from various levels of government. Given these investments, it’s easier to understand the Valley’s support for draconian climate change legislation, complete with attempts to demonize “Texas oil.” (One won’t see such populist zeal on , say, increasing capital gains rates.)

The Valley’s hostility to fossil fuel energy, and its jihad to destroy an entire industry, is only barely recognized in Houston. I also have never heard anyone there suggest that Silicon Valley should be closed down as a danger to the planet (or at least a threat to the attention span of younger Americans). Houstonians, particularly in the energy industry, generally lack media savvy, which is one reason why energy is widely rated as the country’s least popular industry. Also missing, thankfully, is the sense of entitlement and self-congratulation one finds in the Bay Area. But once the intention to devastate the oil and gas industry is better understood, expect the energy capital to square off against the tech center, generating what may be the regional battle royal of our era.

This piece originally appeared at The Daily Beast.

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.

Photos courtesy of University of Texas Health Science Center at Houston Office of Communications and Vincent Bloch.

Orlando Arts Scene: It's An Urban Bus Trip

Fri, 10/03/2014 - 22:38

Artists are bus riders. With day jobs to keep food on the table, they often forego luxuries, using feet and bicycles, as well as buses, instead of cars. They travel alongside many people for whom the bus is an absolute necessity. Too often, the bus is a class marker in America, and a racial marker in the South. Many do not want to cross the threshold of the bus. With artists increasingly passing through this doorway, the Transit Interpretation Project began, first in Orlando, Florida and now in Roanoke, Virginia. It is painting a new picture of the bus, revealing the reality behind the myths, and the humanity behind the faceless term “mass transit” that is so often used as a shorthand for problems and class divisions in our country.

Taking the bus in the South still has a stigma. Since Rosa Parks’ era, the bus has remained an unfortunate symbol, reinforced by the waves of immigrants that have swelled the region's population in recent decades. Many who move to the South seek the prosperous life of the American Dream, and the bus is not part of that pursuit.

For many here in Orlando, Florida, the bus doesn't register any significance in their lives. Its association with poverty and the working-class South remains visible, if a bit faded.

I’ve ridden buses in Orlando and cities all over the country, and in a few other countries, too. Here in the South, the stigma still exists. I decided to ride a bus in Orlando during the summer, and learn firsthand what is happening on these lumbering behemoths of metal that steams along our crowded streets.

My participation began on the #50, a bus route from downtown Orlando to Disney World. I sat alongside Judy, a night worker who left her house at 6:30PM to get to her night shift job starting at 10PM. Petite but hard-edged, Judy and her fellow night workers’ three-and-a-half hour commute each way is not for the leisure class. Coming back late at night, I joined a bus full of uniformed employees, droopy and exhausted from their service to the world travelers who come to play in Orlando.

My own little blog to report my experiences became part of this project, along with art by photographers, writers, painters and sculptors. For example, Nathan Selikoff, a digital artist, made several animated computer graphics out of his bus ride experiences, including one based on my blog.

The Transit Interpretation Project, TrIP for short, is an ongoing effort. The project’s work was exhibited at the Gallery at Avalon Island in downtown Orlando in August 2014. The result is an artist’s eye on the shared social space of the city.

TrIP was the brainchild of Pat Greene, the current Director of the Gallery at Avalon Island. He recently spoke to me about the project. “Initially, when commuter rail was being proposed in Orlando, people parroted a lot of misinformation,” he said, “both for and against it. Train planners were using very analytical arguments, and contrarians were mostly being emotional about their protest. Both sides were very confident, but in many cases, both sides were also very wrong”.

Orlando’s commuter rail opened this summer to the public with much fanfare, and has generated controversy. Greene, like many others, listened with skepticism to advocates’ claims that it will reduce traffic, because it rides on a nineteenth-century spine through a multipolar, twenty-first century, dispersed urban area. He also listened to opponents who decried it as costly and useless. He decided neither side had all the facts, and wanted to see for himself what buses and trains were really like in Orlando.

Greene received two bus passes from friend. He invited artists to use them, and then write, paint, photograph, or make anything inspired by the experience, and post it to his website. The site remains open; anyone can participate by emailing their entry to Pat Greene at hearsay@gmail.com. Contributors need not have any credentials, they need only to ride the bus and react.

Greene carried his experiment to a colleague in Roanoke, Virginia. There, Jeremy Holmes, the director of a Ride Solutions Program that helps commuters find bus and carpool routes through the city, began a similar project. The results were displayed at Roanoke’s Marginal Arts Festival this year, illuminating another Southern town’s bus rider population.

Analysts and talking heads don’t much ride the bus and therefore have little firsthand knowledge of the experience. On one bus ride in Orlando, an African-American man asked artist Jessica Earley to teach him how to pray; you can see her blogpost, labeled Unaffiliated Grace. On another, artist Greg Leibowitz had to convince security guards that taking photographs was not a crime; in spite of this, he captured marvelous portraits of riders. Artist Bethany Mikell sewed a dress from the images she gathered on the #8. Colombian Ivan Riascos mused, “What does this city have to offer me?” as he looked out the window of the #41. Each post, whether in writing or in images, adds a dimension to the individuals of the city.

While the quality of the Orlando contributions is uneven, the point is not to critique the exhibition as art. It is, rather, to provide an opportunity to join a large-scale investigation into the meaning of twenty-first century public space in an American city of medium size. The space isn’t consistently crowded and hectic, nor is it consistently vacant. TrIP doesn't consistently represent artists or riders who are black, white, brown, or any specific race or class. Instead, the blog posts build up a narrative of a rainbow rhythm marked by a gentle diversity, much common agreement about the miserable time-cost of the working person’s commute, and a view of a unique collection of humans that make up Central Florida’s specific and localized condition.

This narrative gains its power from mining an overlooked, shared public space of the city: the inside of buses and trains. Greene eschewed officialdom in activating this project. “If I had approached Lynx [Orlando’s bus system] about doing it, I would have been in endless meetings with lawyers,” he commented. Instead, he just got on the bus and started chronicling what he saw, and encouraged other artists to do so as well.

In a world where class privilege increasingly isolates people, transit is about the only vestige of the old urban experience where a broad cross-section of society can mix. It is a space that is owned by all of us, just a little bit. Sidewalks, if anyone has noticed, are usually empty in most cities today, making one less place where we can spontaneously encounter strangers. We’ve moved our social time online, building safer and safer little cocoons to prevent rubbing elbows with other classes. Artists seeking human portraits would have wasted their time on street corners in Orlando.

On the bus, time with strangers revealed a great deal of warmth and emotion. The resulting portraits reveal the dignity of those who ride the bus. It makes me, as a resident of this town, feel a little closer to its soul.

Richard Reep is an architect with VOA Associates, Inc. who has designed award-winning urban mixed-use and hospitality projects. His work has been featured domestically and internationally for the last thirty years. An Adjunct Professor for the Environmental and Growth Studies Department at Rollins College, he teaches urban design and sustainable development; he is also president of the Orlando Foundation for Architecture. Reep resides in Winter Park, Florida with his family.

Photo by the author: "Judy".

Orlando Arts Scene: It's an Urban Bus Trip

Fri, 10/03/2014 - 21:04

Artists are bus riders. With day jobs to keep food on the table, they often forego luxuries, using feet and bicycles, as well as buses, instead of cars. They travel alongside many people for whom the bus is an absolute necessity. Too often, the bus is a class marker in America, and a racial marker in the South. Many do not want to cross the threshold of the bus. With artists increasingly passing through this doorway, the Transit Interpretation Project began, first in Orlando, Florida and now in Roanoke, Virginia. It is painting a new picture of the bus, revealing the reality behind the myths, and the humanity behind the faceless term “mass transit” that is so often used as a shorthand for problems and class divisions in our country.

Taking the bus in the South still has a stigma. Since Rosa Parks’ era, the bus has remained an unfortunate symbol, reinforced by the waves of immigrants that have swelled the region's population in recent decades. Many who move to the South seek the prosperous life of the American Dream, and the bus is not part of that pursuit.

For many here in Orlando, Florida, the bus doesn't register any significance in their lives. Its association with poverty and the working-class South remains visible, if a bit faded.

I’ve ridden buses in Orlando and cities all over the country, and in a few other countries, too. Here in the South, the stigma still exists. I decided to ride a bus in Orlando during the summer, and learn firsthand what is happening on these lumbering behemoths of metal that steams along our crowded streets.

My participation began on the #50, a bus route from downtown Orlando to Disney World. I sat alongside Judy, a night worker who left her house at 6:30PM to get to her night shift job starting at 10PM. Petite but hard-edged, Judy and her fellow night workers’ three-and-a-half hour commute each way is not for the leisure class. Coming back late at night, I joined a bus full of uniformed employees, droopy and exhausted from their service to the world travelers who come to play in Orlando.

My own little blog to report my experiences became part of this project, along with art by photographers, writers, painters and sculptors. For example, Nathan Selikoff, a digital artist, made several animated computer graphics out of his bus ride experiences, including one based on my blog.

The Transit Interpretation Project, TrIP for short, is an ongoing effort. The project’s work was exhibited at the Gallery at Avalon Island in downtown Orlando in August 2014. The result is an artist’s eye on the shared social space of the city.

TrIP was the brainchild of Pat Greene, the current Director of the Gallery at Avalon Island. He recently spoke to me about the project. “Initially, when commuter rail was being proposed in Orlando, people parroted a lot of misinformation,” he said, “both for and against it. Train planners were using very analytical arguments, and contrarians were mostly being emotional about their protest. Both sides were very confident, but in many cases, both sides were also very wrong”.

Orlando’s commuter rail opened this summer to the public with much fanfare, and has generated controversy. Greene, like many others, listened with skepticism to advocates’ claims that it will reduce traffic, because it rides on a nineteenth-century spine through a multipolar, twenty-first century, dispersed urban area. He also listened to opponents who decried it as costly and useless. He decided neither side had all the facts, and wanted to see for himself what buses and trains were really like in Orlando.

Greene received two bus passes from friend. He invited artists to use them, and then write, paint, photograph, or make anything inspired by the experience, and post it to his website. The site remains open; anyone can participate by emailing their entry to Pat Greene athearsay@gmail.com. Contributors need not have any credentials, they need only to ride the bus and react.

Greene carried his experiment to a colleague in Roanoke, Virginia. There, Jeremy Holmes, the director of a Ride Solutions Program that helps commuters find bus and carpool routes through the city, began a similar project. The results were displayed at Roanoke’s Marginal Arts Festival this year, illuminating another Southern town’s bus rider population.

Analysts and talking heads don’t much ride the bus and therefore have little firsthand knowledge of the experience. On one bus ride in Orlando, an African-American man asked artist Jessica Earley to teach him how to pray; you can see her blogpost, labeled Unaffiliated Grace. On another, artist Greg Leibowitz had to convince security guards that taking photographs was not a crime; in spite of this, he captured marvelous portraits of riders. Artist Bethany Mikell sewed a dress from the images she gathered on the #8. Colombian Ivan Riascos mused, “What does this city have to offer me?” as he looked out the window of the #41. Each post, whether in writing or in images, adds a dimension to the individuals of the city.

While the quality of the Orlando contributions is uneven, the point is not to critique the exhibition as art. It is, rather, to provide an opportunity to join a large-scale investigation into the meaning of twenty-first century public space in an American city of medium size. The space isn’t consistently crowded and hectic, nor is it consistently vacant. TrIP doesn't consistently represent artists or riders who are black, white, brown, or any specific race or class. Instead, the blog posts build up a narrative of a rainbow rhythm marked by a gentle diversity, much common agreement about the miserable time-cost of the working person’s commute, and a view of a unique collection of humans that make up Central Florida’s specific and localized condition.

This narrative gains its power from mining an overlooked, shared public space of the city: the inside of buses and trains. Greene eschewed officialdom in activating this project. “If I had approached Lynx [Orlando’s bus system] about doing it, I would have been in endless meetings with lawyers,” he commented. Instead, he just got on the bus and started chronicling what he saw, and encouraged other artists to do so as well.

In a world where class privilege increasingly isolates people, transit is about the only vestige of the old urban experience where a broad cross-section of society can mix. It is a space that is owned by all of us, just a little bit. Sidewalks, if anyone has noticed, are usually empty in most cities today, making one less place where we can spontaneously encounter strangers. We’ve moved our social time online, building safer and safer little cocoons to prevent rubbing elbows with other classes. Artists seeking human portraits would have wasted their time on street corners in Orlando.

On the bus, time with strangers revealed a great deal of warmth and emotion. The resulting portraits reveal the dignity of those who ride the bus. It makes me, as a resident of this town, feel a little closer to its soul.

Richard Reep is an architect with VOA Associates, Inc. who has designed award-winning urban mixed-use and hospitality projects. His work has been featured domestically and internationally for the last thirty years. An Adjunct Professor for the Environmental and Growth Studies Department at Rollins College, he teaches urban design and sustainable development; he is also president of the Orlando Foundation for Architecture. Reep resides in Winter Park, Florida with his family.

Photo by the author: "Judy".

Seniors Dispersing Away from Urban Cores

Wed, 10/01/2014 - 22:38

Senior citizens (age 65 and over) are dispersing throughout major metropolitan areas, and specifically away from the urban cores. This is the opposite of the trend suggested by some planners and media sources who claim than seniors are moving to the urban cores. For example, one headline, "Millions of Seniors Moving Back to Big Cities" is at the top of a story with no data and anecdotes ranging that are at least as much suburban (Auburn Hills, in the Detroit area) and college towns (Oxford, Mississippi and Lawrence, Kansas), as they are big city. Another article, "Why Seniors are Moving to the Urban Core and Why It's Good for Everyone," is also anecdote based, and gave prominence to a solitary housing development in downtown Phoenix (more about Phoenix below).

Senior Metropolitan Growth Trails National

Between 2000 and 2010, the nation's senior population increased approximately 5.4 million, an increase of 15 percent. Major metropolitan areas accounted for approximately 50 percent of the increase (2.7 million) and also saw their senior population increase 15 percent. By contrast, these same metropolitan areas accounted for 60 percent of overall growth between 2000 and 2010, indicating that most senior growth is in smaller metropolitan areas and rural areas.

Senior Metropolitan Population Dispersing

The number of senior citizens living in suburbs and exurbs of major metropolitan areas (over 1,000,000 population) increased between 2000 and 2010, according to census data. The senior increases were strongly skewed away from the urban cores. Suburbs and exurbs gained 2.82 million senior residents over the period, while functional urban cores lost 112,000. The later suburbs added 1.64 million seniors. The second largest increase was in exurban areas, with a gain of 0.88 million seniors. The earlier suburbs (generally inner suburbs) added just under 300,000 seniors (Figure 1).

During that period, the share of senior citizens living in the later suburbs increased 35 percent. The senior citizen population share in the exurbs rose nearly 15 percent. By contrast, the share of seniors living in the functional urban cores declined 17 percent. Their share in the earlier suburbs declined 11 percent.

This is based on an analysis of small area data for major metropolitan areas using the City Sector Model.

City Sector Model analysis avoids the exaggeration of urban core data that necessarily occurs from reliance on the municipal boundaries of core cities (which are themselves nearly 60 percent suburban or exurban, ranging from as little as three percent to virtually 100 percent). It also avoids the use of the newer "principal cities" designation of larger employment centers within metropolitan areas, nearly all of which are suburbs, but are inappropriately joined with core municipalities in some analyses. The City Sector Model" small area analysis method is described in greater detail in the Note below.

Pervasive Suburban and Exurban Senior Gains

The gains in functional suburban and exurban senior population were pervasive. Among the 52 major metropolitan areas, there were gains in 50. In two areas (New Orleans and Pittsburgh), there were losses. However, in each of these cases there was an even greater senior loss in the functional urban cores. In no case did urban cores gain more or lose fewer seniors than the suburbs and exurbs. Eight of the functional urban cores experienced gains in senior population, while 44 experienced losses (Figure 2)

Largest Urban Cores

The major metropolitan areas with the largest urban cores (more than 20 percent of the population in the functional urban cores),  would tend to be the most attractive to seniors seeking an urban core lifestyle. But they  still saw their seniors heading  to the suburbs and exurbs (Figure 3). Senior populations declined in the functional urban cores of all but two of these nine areas, New York and San Francisco. However, in both of these metropolitan areas, the increases in suburban and exurban senior populations overwhelmed the increases in the urban cores. All of these nine major metropolitan areas experienced increases in their suburban and exurban senior populations.

Moreover, the Phoenix anecdote cited above is at odds with the reality that the later suburbs and exurbs gained 165,000 seniors between 2000 and 2010. The earlier suburbs lost 7,000 seniors (No part of Phoenix has sufficient density or transit market share to be classified as functional urban core).

Consistency of Seniors Trend with Other Metropolitan Indicators

As has been indicated in previous articles, there continues to be a trend toward dispersal and decentralization in US major metropolitan areas. There was an overall population dispersion from 1990 to 2000 and 2000 to 2010, which continued trends that have been evident since World War II and even before, as pre-automobile era urban cores have lost their dominance. Jobs continued to follow the suburbanization and exurbanization of the population over the past decade away as cities became less monocentric, less polycentric and more "non-centric." As a result, work trip travel times are generally shorter for residents where population densities are lower. Baby boomers and Millennials have been shown to be dispersing as well, despite anecdotes to the contrary (Figure 4). The same applies to seniors.

Note: The City Sector Model allows a more representative functional analysis of urban core, suburban and exurban areas, by the use of smaller areas, rather than municipal boundaries. The more than 30,000 zip code tabulation areas (ZCTA) of major metropolitan areas and the rest of the nation are categorized by functional characteristics, including urban form, density and travel behavior. There are four functional classifications, the urban core, earlier suburban areas, later suburban areas and exurban areas. The urban cores have higher densities, older housing and substantially greater reliance on transit, similar to the urban cores that preceded the great automobile oriented suburbanization that followed World War II. Exurban areas are beyond the built up urban areas. The suburban areas constitute the balance of the major metropolitan areas. Earlier suburbs include areas with a median house construction date before 1980. Later suburban areas have later median house construction dates.

Urban cores are defined as areas (ZCTAs) that have high population densities (7,500 or more per square mile or 2,900 per square kilometer or more) and high transit, walking and cycling work trip market shares (20 percent or more). Urban cores also include non-exurban sectors with median house construction dates of 1945 or before. All of these areas are defined at the zip code tabulation area (ZCTA) level.

----

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: Later Suburbs of Cincinnati (where most senior growth occurred from 2000 to 2010). By Author

The Death of Nassau Coliseum: A Harbinger of Suburban Decline?

Tue, 09/30/2014 - 22:38

Nassau Veterans Memorial Coliseum is one of the last remaining old time hockey rinks. But this will be the last year that the New York Islanders play there. The old barn has long been slated for replacement. It is an old building that requires expensive repairs. Many attempts were made to reach an agreement for a new arena with Nassau County. Sadly, the team’s new location will be at the Barclay’s Center in Brooklyn; on Long Island physically, but not a part of the island’s suburban tradition. The team will retain the name, but Long Island effectively is losing its team.

Suburban Decline, Urban Ascent?

Some observers, like Mark Byrnes in CityLab, see this shift as further evidence of suburban life and the elevation of the urban core.1 But instead it is another frustrating case of a small, highly visible not in my backyard (NIMBY) movement in suburbia on one hand, and, on the other, an unwanted development foisted upon urban residents without due process through eminent domain.

Two Arenas

The New York Islanders haven’t been very newsworthy for the last decade – save for their volatile ownership situation, but their transition from one of the National Hockey League’s oldest buildings in Long Island to a new building in Brooklyn has been a very public ordeal. It’s a story that involves local politicians thwarting construction of a new arena that would have cost taxpayers nothing, a failed referendum to finance an alternative proposal that would have required public funding, and ends with the Islanders moving out of Long Island into the controversial Barclay Centre. Even if the Barclay Centre proves to be a viable and enjoyable venue for the Islanders, it will forever remain one of the most disastrous developments in the history of professional sports.

The Old Barn

Nassau Coliseum is the second oldest active building in the National Hockey League. The arena was built on the site of decommissioned Army/Air force base Mitchell Field.2 Nassau County acquired the land in 1960, a year after closure. Nassau Coliseum officially opened on February 11, 1972.3 The cost of the project was $32 million ($179 million, adjusted for inflation).4 The Coliseum sits on 5 acres of a 77-acre plot in Uniondale, the rest of which is mainly surface parking.5

The site is intersected by two major roadways, and is across the street from Hofstra University and a golf course. It is right down the street from Levittown, the prototypical post-war American suburb. It is the type of place where one might assume that building large scale projects should be relatively simple.

The Lighthouse Project

In 2000, software billionaire Charles Wang bought the Islanders for $190 million.6  High end estimates suggest that Wang might have lost as much as $208 million between 2000 and 2009 on the team in large part due to   having one of the least favourable lease agreements in professional sports.7.8 “The need to refurbish the ageing building provided a perfect opportunity to put the team on a solid financial footing.

Wang proposed a plan to develop the area surrounding the arena. The Lighthouse Project was expected to take 8-10 years to complete at a cost of roughly $3.74 billion.9 The plan included a renovation of the Coliseum, a 60-story tower designed to look like a lighthouse, housing, athletic facilities, a new minor league baseball stadium, restaurants, and a new hotel.10 The transformation of the Coliseum would have entailed lowering the floor of the ice rink to accommodate additional seats, increasing capacity from 16,300 to 17,500 during hockey games, 18,500 for basketball games and 20,000 for concerts, while adding 50 luxury boxes.11

The proposal would also have brought a 125,000-square-foot athletic complex including two ice rinks (a practice rink for the Islanders, and another for the public), a basketball court, and a fitness club where the Islanders and the Arena Football League’s New York Dragons (also owned by Wang) would have trained.12

The project would also have included moderately priced housing, which is lacking in Long Island. Long Island County was also exploring enhanced public transportation to the future development, including bus rapid transit.13

Phase two of the project would have included a conference center, a sports technology building, residences, and the 60-story lighthouse (including a 500 room luxury hotel).14

Building a new arena on such a large parcel of land surrounded by sparse, low density development should have theoretically faced few obstacles, given that the owner was willing to finance the entire project. Unfortunately, the project drew the ire of some local residents. Robert Zafonte, president of the 3500 member East Meadow Civic and Community Association, had this to say:

''The high-rise disturbs me,'' he said. ''It seems to be totally out of character with the nature of the suburban area here. It is not consistent with what Long Island is all about – residential, small homes. I don't think it belongs here.15''

The Lighthouse Project was approved by the county in 2006, but stalled when Wang was unable to secure zoning approvals from the Town of Hempstead.16 Republican Town of Hempstead Supervisor Kate Murray, lobbied intensely by a small group of local residents, decided that the project would result in too much traffic.

Not in My Backyard

In an attempt to salvage the project, Charles Wang and the Lighthouse Development Group partnered with Rexcorp to create a scaled down version of the project. The most notable change was that the Lighthouse would now be 30 stories, rather than 60.17

But as Pearl M. Kamer, chief economist of the Long Island Association pointed out, “When you cut density on any project, you cut revenue.” He argued that under the proposal, scaled back to meet Murray’s demands, it would be difficult if not impossible to generate enough revenue to finance the project.18 This meant that the new proposal would likely require public funding, in contrast to the original proposal which would have been entirely privately funded.

Wang eventually reached an agreement with Nassau County to build a scaled down version of the Lighthouse Project, pending an August 2011 referendum. Since the stripped down project would have yielded less revenue than the original proposal, the project would only have been viable with $400 million in public financing.19 The funding would have necessitated a 4 percent property tax increase. Voters rejected the proposal by a 57-43 margin.20

The End of the Lighthouse Project

With the end of the Lighthouse Project, Wang entered into a 25 year lease with the Barclay Centre soon after. The Islanders will begin playing at the building in 201521, though they already played their first exhibition game at the arena on September 21st, 2013.

Losing the Islanders will result in significant economic losses to the county. Nassau County’s comptroller estimated that had last year’s NHL lockout lasted a full season, the county would have lost $62.2 million in economic activity, and the Nassau County treasury would have lost $1.1 million in  of ticket taxes, as well as a share of concessions and parking fees.22  Those are substantial loses for a county of less than 1.4 million residents.

While Charles Wang has frequently been blamed for the relocation, NHL Commissioner Gary Bettman lays the blame squarely at the feet of local politicians.

"This is a situation that is not of the Islanders' making,” he said. “The responsibility for what's happened really lies with Nassau County and the Town of Hempstead. For the fans in Nassau, not just of the Islanders, but of circuses and rock concerts and the like, it's a shame.23

The Uncertain Future of the Coliseum

Though this seems like the end of the Nassau Coliseum saga, the future of the arena is still up for debate. Barclay Centre part-owner Bruce Ratner has proposed a $229 redevelopment plan for the arena. The project would include renovating the Coliseum, building restaurants, an ice rink, bowling alley, movie theater and other facilities.24  

The Ratner proposal faces many hurdles, including luring an American Hockey League (NHL farm team) club to replace the Islanders. The Islanders AHL affiliate, the Bridgeport Sound Tigers (also owned by Wang), could potentially move from Connecticut to fill that void. Additionally, the Islanders are still slated to play 6 home games (out of 41) per year at the Coliseum.25 One columnist at Forbes has speculated that Ratner, who would own both the Nassau Coliseum and part of the Barclay Centre, might well decide to keep the Islanders in Long Island after all if he can secure approval for the new project.26  

Imposing an Arena on Brooklyn

The Barclay Centre differs dramatically from the failed Lighthouse Project. The Barclay Centre was part of the $4.9 billion Atlantic Yards project built in run down commercial area of Brooklyn, despite local opposition. Mayor Bloomberg used eminent domain to seize the “blighted” land to allow for construction.

Brooklyn had been without a sports franchise since 1957, when the Brooklyn Dodgers moved to Los Angeles.  

The Barclay Centre was initially proposed in 2004 when real estate developer Bruce Ratner purchased the New Jersey Nets for $300 million. Ratner planned to move the franchise out of New Jersey and into the lucrative Brooklyn market. The project was initially projected to open in 2006.

The attempt to use eminent domain to seize the land was brought before the New York Supreme Court, delaying the process. The court eventually ruled in Ratner’s favour.

Ratner’s years of frustration with the project lead him to sell a majority share of the Nets to Russian businessman Mikhail Prokhorov for $200 million.

Due to construction delays, the Nets signed a deal to play in Newark at the Prudential Centre until the Barclay’s Centre was complete.

Construction of the $1 billion arena began in January of 2010. The Barclay’s Centre was open to the public on September 21, 2012. Just over a month later, the Islanders announced their agreement to play at the Barclay’s Centre.

The Barclay Compromise

The Barclay’s Centre wasn’t a bad solution to the stalemate in Nassau County. The arena is new, and Brooklyn is a lucrative sports market. The Long Island Railroad provides direct service to Atlantic Terminal, meaning it will be more convenient for many Long Island residents to access the Barclay’s Centre than Nassau Coliseum. However, the 15,813 seating capacity is far short of most modern NHL arenas, and many seats have partially obstructed views.

At the same time, the failed Lighthouse Project was a missed opportunity for Nassau County. The community still hasn’t rebounded to its 1970 population, which fell by 100,000 during the 1970s. Estimates suggest that the $4.4 billion of private investment into the Lighthouse project would have created 75,000 construction jobs and 19,000 permanent jobs thereafter.27 Moreover, it would have resulted in expanded public transit options on Long Island. Lawrence Levy, executive director of the National Centre for Suburban Studies at Hofstra University in a 2009 interview described the project as “potentially a game-changer.”

Even ignoring the direct economic losses, the failure of the Lighthouse Project sent a clear message to businesses that Long Island will only accept investment on its own terms. The fallout is impossible to measure.

Wither Suburbia?

There is an ongoing dialogue between observers over whether suburbia is a “market outcome”, or whether it is an artificial creation of government policy. The truth is likely in the middle. Suburban communities are regulated, subsidized, and taxed in many different ways. Zoning restricts the ability to build corner stores and cafes in residential neighbourhoods. Wasteful road projects connect many uneconomic housing developments to cities. Land-use regulations drive up land prices, which are passed on to homebuyers. Suburbia is certainly a market outcome in the sense that decreased transportation costs, dispersed entertainment and communications options, and preferences for larger backyards mean that many people would happily pay the market cost of suburban housing. But its particular shape is not a market outcome. Neither, for that matter, is the shape of any geographical area.  

There are good reasons for regulating land-use. Separating factories that emit noxious odours from residential communities makes sense. The trouble is that land-use planning has gone from a health and safety measure to an economic tool. In Uniondale it was used to ensure that additional traffic didn’t impose costs on drivers, who would prefer not to bear the costs of congestion. In Brooklyn, it was used to ensure that developers and the municipal government could extract value from property that wasn’t on the market. The market outcome would have been allowing the Lighthouse Project to proceed, and the New Jersey Nets to remain in New Jersey (or perhaps to move to Uniondale). The Barclay’s Centre doesn’t represent a triumph of the city. It is the net result of contrasting political meddling in two different jurisdictions.

Perhaps There Are No Real Lessons Here

While we shouldn’t read too much into isolated incidents, there does seem to be an increasing propensity for suburban communities to prevent dense development – from the Bay Area to suburban Toronto –  and for cities to use eminent domain to ram through those same types of developments.  

This is a story about politics, not economics. And sometimes politics leads to some really bad outcomes. That may well be all there is to it. Either way, the Islanders will be moving to Brooklyn next year. Fans should enjoy the old barn while it lasts. It is the last of a dying breed.

Steve Lafleur is a public policy analyst with the Frontier Centre for Public Policy, an independent think tank based in Winnipeg, Manitoba. His primary research interests are housing and land use policies, transportation and infrastructure, criminal justice policy, immigration, inter-governmental fiscal relations, and municipal finances. His work has been featured in most Canadian newspapers including the Toronto Star and the National Post.

1 http://www.citylab.com/politics/2012/11/islanders-move-harbinger-suburba...

2 http://nysea.bizland.com/nysea/publications/proceed/2012/Proceed_2012_p2...

3 http://nysea.bizland.com/nysea/publications/proceed/2012/Proceed_2012_p2...

4 http://nysea.bizland.com/nysea/publications/proceed/2012/Proceed_2012_p2...

5 http://query.nytimes.com/gst/fullpage.html?res=9D01E5DD1538F930A35753C1A...

6 http://nysea.bizland.com/nysea/publications/proceed/2012/Proceed_2012_p2...

7 http://nysea.bizland.com/nysea/publications/proceed/2012/Proceed_2012_p2...

8 http://sports.espn.go.com/nhl/news/story?id=4129484

9 http://en.wikipedia.org/wiki/The_Lighthouse_Project

10 http://en.wikipedia.org/wiki/The_Lighthouse_Project

11 http://query.nytimes.com/gst/fullpage.html?res=9D01E5DD1538F930A35753C1A...

12 http://query.nytimes.com/gst/fullpage.html?res=9D01E5DD1538F930A35753C1A...

13 http://query.nytimes.com/gst/fullpage.html?res=9D01E5DD1538F930A35753C1A...

14 http://query.nytimes.com/gst/fullpage.html?res=9D01E5DD1538F930A35753C1A...

15 http://query.nytimes.com/gst/fullpage.html?res=9D01E5DD1538F930A35753C1A...

16 http://www.newsday.com/long-island/nassau/inside-the-deal-to-remake-nass...

17 http://en.wikipedia.org/wiki/The_Lighthouse_Project

18 http://www.nytimes.com/2010/07/25/realestate/25lizo.html?adxnnl=1&adxnnl...

19 http://www.nytimes.com/2011/08/02/nyregion/nassau-voters-reject-proposal...

20 http://www.nytimes.com/2011/08/02/nyregion/nassau-voters-reject-proposal...

21 http://www.nydailynews.com/sports/hockey/ice-job-brooklyn-nhl-islanders-...

22 http://nysea.bizland.com/nysea/publications/proceed/2012/Proceed_2012_p2...

23 http://www.newsday.com/sports/hockey/islanders/gary-bettman-says-he-like...

24 http://www.newsday.com/long-island/nassau/inside-the-deal-to-remake-nass...

25 http://www.lighthousehockey.com/2013/5/2/4293850/ratner-brooklyn-islande...

26 http://www.forbes.com/sites/tomvanriper/2013/08/16/brooklyn-islanders-no...

27 http://www.nytimes.com/2009/06/18/nyregion/18towns.html?_r=0

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.

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