New Geography

Author: Joel Kotkin

  • The Triumph of Suburbia

    The “silver lining” in our five-years-and-running Great Recession, we’re told, is that Americans have finally taken heed of their betters and are finally rejecting the empty allure of suburban space and returning to the urban core.

    “We’ve reached the limits of suburban development,” HUD Secretary Shaun Donovan declared in 2010. “People are beginning to vote with their feet and come back to the central cities.” Ed Glaeser’s Triumph of the City and Alan Ehrenhalt’s The Great Inversion—widely praised and accepted by the highest echelons of academia, press, business, and government—have advanced much the same claim, and just last week a report on jobs during the downturn garnered headlines like “City Centers in U.S. Gain Share of Jobs as Suburbs Lose.”

    There’s just one problem with this narrative: none of it is true. A funny thing happened on the way to the long-trumpeted triumph of the city: the suburbs not only survived but have begun to regain their allure as Americans have continued aspiring to single-family homes.

    Read the actual Brookings report that led to the “Suburbs Lose” headline: it shows that in 91 of America’s 100 biggest metro areas, the share of jobs located within three miles of downtown declined over the 2000s. Only Washington, D.C., saw significant growth.

    To be sure, our ongoing Great Recession slowed the rate of outward expansion but it didn’t stop it—and it certainly didn’t lead to a jobs boom in the urban core.

    “Absent policy changes as the economy starts to gain steam,” report author and urban booster Elizabeth Kneebone warned Bloomberg, “there’s every reason to believe that trend [of what she calls “jobs sprawl”] will continue.”

    The Hate Affair With Suburbia

    Suburbs have never been popular with the chattering classes, whose members tend to cluster in a handful of denser, urban communities—and who tend to assume that place shapes behavior, so that if others are pushed to live in these communities they will also behave in a more enlightened fashion, like the chatterers. This is a fallacy with a long pedigree in planning circles, going back to the housing projects of the 1940s, which were built in no small part on the evidently absurd, and eventually discredited, assumption that if the poor had the same sort of housing stock as the rich, they would behave in the same ways.

    Today’s planning class has adopted what I call a retro-urbanist position, essentially identifying city life with the dense, highly centralized and transit-dependent form that emerged with the industrial revolution. When the city—a protean form that is always changing, and usually expands as it grows—takes a different form, they simply can’t see it as urban growth.

    In his masterwork A Planet of Cities, NYU economist Solly Angel explains that virtually all major cities in the U.S. and the world grow outward and become less dense in the process. Suburbs are expanding relative to urban cores in every one of the world’s 28 megacities, including New York and Los Angeles.  Far from a perversion of urbanism, Angel suggests, this is the process by which cities have grown since men first established them.

    In the U.S., the hate affair with suburbs and single-family housing, even in the city, dates to their rapid growth in the American boom after the first World War. In 1921 historian and literary criticic Lewis Mumford described the expansion of New York’s outer boroughs as a “dissolute landscape,” “a no-man’s land which was neither town or country.” Decades later, Robert Caro described the new rows of small, mostly attached houses—still the heart of the city’s housing stock—built in the post-war years as “blossoming hideously” as New Yorkers fled venerable, and congested, parts of Brooklyn and Manhattan for more spacious, tree-lined streets farther east, south, and north.

    In the 1950s, the rise of mass-produced suburbs like Levittown, New York, and Lakewood, California, sparked even more extreme criticism. Not everyone benefited from the innovation that allowed the Levitts to pioneer homes costing on average just $8,000—African-Americans were excluded from the original development—but for many middle- and working-class American whites, the housing and suburban booms represented an enormous step forward. The new low-cost suburbia, wrote Robert Bruegmann in his compact history of sprawl, “provided the surest way to obtain some of the privacy, mobility and choice that once were available only to the wealthiest and most powerful members of society.”

    The urban gentry and intelligentsia, though, disdained this voluntary migration. Perhaps the most bitter critic was the great urbanist Jane Jacobs. An aficionado of the old, highly diverse urban districts of Manhattan, Jacobs not only hated trendsetter Los Angeles but dismissed the bedroom communities of Queens and Staten Island with the memorable phrase, “The Great Blight of Dullness.” The 1960s social critic William Whyte, who, unlike Jacobs, at least bothered to study suburbs close up, denounced them as hopelessly conformist and stultifying. Like many later critics, he predicted in Fortune that people and companies would tire of them and return to the city core.

    More recent critiques of suburbia have focused as well on their alleged vulnerability in an energy-constrained era. “The American way of life—which is now virtually synonymous with suburbia—can only run on reliable supplies of cheap oil and gas,” declares James Howard Kunstler in his 2005 peak oil jeremiad, The Long Emergency. “Even mild to moderate deviations in either price or supply will crush our economy and make the logistics of daily life impossible.”

    Too often, the anti-surbanites seem to take a certain perverse comfort in any development, no matter how grim, that “helps” protect Americans from the “wrong choice” of aspiring to space of their own. The housing crash of 2007 was cheered on in some circles as the death knell of the suburban dream, as when theorist Chris Leinberger declared in the Atlantic that soon, poor families would be crowding into dilapidated McMansions in the “suburban wastelands.”

    For retro-urbanists such as Richard Florida the reports, however premature, of the death of the suburbs, confirmed deeply held notions about the superiority of dense, urban living.  He summarily declared the single-family house archaic, and the quest for homeownership one of the “countless forms of over-consumption that have a horribly distorting affect on the economy."

    The Real Geography of America

    But the simple fact remains that the single-family home has remained the American dream, with sales outpacing those of condominiums  and co-ops despite the downturn.

    Florida has suggested that simply stating the numbers makes me a sprawl lover While he and other urban nostalgists see the city only in its dense urban core, and the city’s role as intimately tied with the amenities that are supposed to attract the relatively wealthy members of the so-called “creative class,” I see the urban form as ever changing, and consider a city’s primary mission not aesthetic or simply economic but to serve the interests and aspirations of all of its residents.

    Clearly the data supports a long-term preference for suburbs. Even as some core cities rebounded from the nadir of the 1970s, the suburban share of overall share of growth in America’s 51 major metropolitan areas (those with populations  of at least one million) has accelerated—rising from 85 percent in the ’90s to 91 percent in the ’00s. There’s more than a tinge of elitism animating the urban theorists who think that urban destiny rides mostly with the remaining nine percent matters. Overall, over 70 percent of residents in the major metropolitan areas now live in suburbs.

    Surveys, including those sponsored by the National Association of Realtors, suggest roughly 80 percent of Americans prefer a single family house to an apartment or a townhouse. Only 8 percent would prefer to live in an apartment. Yet just 70 percent of households live in a single-family house, while 17 percent live in apartments—suggesting the demand for single-family houses is still not being met. Such housing may be unaffordable, particularly in high-cost urban cores, but there is a fundamental market demand for it.

    To be sure, the Great Recession did slow the growth of suburbs and particularly exurbs—but recent indicators suggest a resurgence. An analysis last October by Jed Kolko, chief economist at the real estate website Trulia, reports that between 2011 and 2012 less-dense-than-average ZIP codes grew at double the rate of more-dense-than-average ZIP codes in the 50 largest metropolitan areas. Americans, he wrote, “still love the suburbs.”

    The Future Demographics of Suburbia

    Ultimately the question of growth revolves around the preferences of consumers. Despite predictions that the rise of singles, an aging population and the changing preferences of millennials will create a glut of 22 million unwanted large-lot homes by 2025, it seems more likely that three critical groups will fuel demand for more suburban housing.

    Between 2000 and 2011, there has been a net increase of 9.3 million in the foreign born population, largely from Asia and Latin America, with these newcomers accounting for about two out of every five new residents of the nation’s 51 largest metropolitan areas. And these immigrants show a growing preference for more “suburbanized” cities such as Nashville, Charlotte, Houston and Dallas-Fort Worth. An analysis of census data shows only New York—with nearly four times the population—drew (barely) more foreign-born arrivals over the past decade than sprawling Houston. Overwhelmingly suburban Riverside–San Bernardino expanded its immigrant population by nearly three times as many people as the much larger and denser Los Angeles–Orange County metropolitan area.

    Clearly, immigrants aren’t looking for the density and crowding of Mexico City, Seoul, Shanghai, or Mumbai. Since 2000, about two-thirds of Hispanic household growth was in detached housing. The share of Asian arrivals in detached housing is up 20 percent over the same span. Nearly half of all Hispanics and Asians now live in single-family homes, even in traditionally urban places like New York City, according to the census’s American Community Survey.

    Nowhere are these changes more marked than among Asians, who now make up the nation’s largest wave of new immigrants. Over the last decade, the Asian population in suburbs grew by about 2.8 million, or 53 percent, while that of core cities grew by 770,000, or 28 percent.

    Aging boomers, too, continue to show a preference for space, despite the persistent urban legend that they will migrate back to the core city. Again, the numbers tell a very different story.

    A National Association of Realtors survey last year of buyers over 65 found that the vast majority looked for suburban homes. Of the remaining seniors, only one in 10 looked for a place in the city—less than the share that wanted a rural home. When demographer Wendell Cox examined the cohort that was 54 to 65 in 2000 to see where they were a decade later, the share that lived in the suburbs was stable, while many had left the city—the real growth was people moving to the countryside. Within metropolitan areas, more than 99 percent of the increase in population among people aged 65 and over between 2000 and 2010 was in low-density counties with less than 2,500 people per square mile.

    With the over-65 population expected to double by 2050, making it by far America’s fastest-growing age group, they appear poised to be a significant source of demand for suburban housing.

    But arguably the most critical element to future housing demand is the rising millennial generation. It has been widely asserted by retro-urbanists that young people prefer urban living. Urban theorists such as Peter Katz have maintained that millennials (the generation born after 1983) have little interest in “returning to the cul-de-sacs of their teenage years.” 

    To bolster their assertions, retro-urbanist point to stated-preference research showing that more than three quarters of millennials say they “want to live in urban cores.” But looking at where millenials actually live now—and where they see themselves living in the future—shows a very different story. In the nation’s major metropolitan areas, only 8 percent of residents aged 20 to 24 (the only millennial adult age group for which census data is available) live in the highest-density counties—and that share has declined from a decade earlier. What’s more, 43 percent of millenials describe the suburbs as their “ideal place to live”—a greater share than their older peers—and 82 percent of adult millenials say it’s “important” to them to have an opportunity to own their home.

    And, of course, as people get older and take on commitments and start families, they tend to look for more settled, and less dense, environments. A 2009 Pew study found that 45 percent of Americans 18 to 34 would like to live in New York City, compared with just 14 percent of those over 35. As about 7 million more millenials—a group the Pew surveys show desire children and place a premium on being good parents—hit their 30s by 2020, expect their remaining attachment to the city to wane.

    This family connection has always eluded the retro-urbanists. “Suburbs,” Jane Jacobs once wrote, “must be difficult places to raise children.” Yet suburbs have served for three generation now as the nation’s nurseries. Jacobs’s treatment of the old core city—particularly her Greenwich Village in the early 1960s—lovingly portrayed these places as they once were, characterized by class, age, and some ethnic diversity along with strong parental networks, often based on ethnic solidarity.

    To say the least, this is not what characterizes Greenwich Village or in Manhattan today. In fact, many of the most vibrant, and high-priced urban cores—including Manhattan, San Francisco, Chicago, and Seattle—have remarkably few children living there. Certainly, the the 300-square-foot “micro-units” now all the rage among the retro-urbanist set seem unlikely to attract more families, or even married couples.

    The Persistence of the Suburban Economy

    As Americans have voted with their feet for the suburbs, employers have followed.

    Despite the attention heaped on a handful of companies like United Airlines and Quicken Loans that have moved “back to the city,” the suburbanization of the overall American economy has continued apace. Historically, suburbs served largely as residential areas, so-called bedroom communities, but their share of steadily.

    Job dispersion is now a reality in virtually every metropolitan area, with twice as many jobs located 10 miles from city centers as in those centers. Between 1998 and 2006, as 95 out of 98 metro areas saw a decrease in the share of jobs located within three miles of downtown, according to a Brookings report. The outermost parts of these metro areas saw employment increase by 17 percent, compared to a gain of less than 1 percent in the urban core. Overall, the report found, only 21 percent of employees in the top 98 metros in America live within three miles of the center of their city.

    This decentralization of jobs was slowed somewhat by the Great Recession, which hit more dispersed industries like construction, manufacturing and retail particularly hard. Yet an analysis of jobs in 2010 by the Rudin Center for Transport Policy and Management found that dispersion had continued. Between 2002 and 2010 only two of the top 10 metropolitan regions (New York and San Francisco) saw a significant increase in employment in their urban core.

    Some observers claim that job growth is coming to the urban core in response to the changing preferences of younger workers, particularly in high-tech fields and as much media attention has been given to a few prominent social media start ups in New York and San Francisco. Similar pronouncements were  made during the great dot-com boom of the late 1990s, and burst along with the bubble. In fact, the number of urban core country tech jobs actually shrank over the past decade, according to an analysis of Science, Technology, Engineering and Management (STEM) jobs by Praxis Strategy Group.

    While companies in walking distance of big-city reporters make news out of all proportion to their importance, virtually all the major tech concentrations in the country—including Silicon Valley—are suburban. San Jose is a postwar suburban core municipality, having experienced the vast bulk of its growth since 1940. Virtually all the nation’s top tech companies—Apple, Google, Hewlett-Packard, Intel, Oracle and even Facebook—are located in suburban settings 45 minutes or more from San Francisco. Apple’s recent plans to construct its new corporate campus in bucolic Cupertino elicited anger from the Environment Defense Fund and other smart-growth advocates, but reflects the fact that the vast majority of the tech industry is located, along with the bulk of its workforce, in the suburbs.

    Apple employs many experienced engineers, many of whom have families and prefer to live in suburbs. In 2012 San Francisco had a significantly lower share of STEM jobs per capita than Santa Clara County. And the new rising stars of the tech world—Austin and Raleigh-Cary—are even more dispersed and car-dependent than San Jose. 

    What Really Matters

    While they’ve weaved a compelling narrative, the numbers make it clear that the retro-urbanists only chance of prevailing is a disaster, say if the dynamics associated with the Great Recession—a rise in renting, declining home ownership and plunging birthrates—become our new, ongoing normal. Left to their own devices, Americans will continue to make the “wrong” choices about how to live.

    And in the end, it boils down to where people choose to live. Despite the dystopian portrays of suburbs, suburbanites seem to win the argument over place and geography, with far higher percentages rating their communities as “excellent” compared to urban core dwellers.

    Today’s suburban families, it should be stressed, are hardly replicas of 1950s normality; as Stephanie Coontz has noted, that period was itself an anomaly. But however they are constituted—as blended families, ones headed up by single parents or gay couples—they still tend to congregate in these kinds of dispersed cities, or in the suburban hinterlands of traditional cities. Ultimately life style, affordability and preference seem to trump social views when people decide where they would like to live.

    We already see these preferences establishing themselves, again, among   Generation X and even millennials as some move, according to The New York Times,toward “hipsturbia,” with former Brooklynites migrating to places along the Hudson River. The Times, as could be expected, drew a picture of hipsters “re-creating urban core life” in the suburbs. While it may be seems incomprehensible to the paper’s Manhattan-centric world view by moving out, these new suburbanites are opting not to re-create the high-density city but to leave it for single-family homes, lawns, good schools, and spacious environments—things rarely available in places such as Brooklyn except to the very wealthiest. Like the original settlers of places like Levittown, they migrated to suburbia from the urban core as they get married, start families and otherwise find themselves staked in life. In an insightful critique, the New York Observerskewered the pretensions of these new suburbanites, pointing out that “despite their tattoos and gluten-free baked goods and their farm-to-table restaurants, they are following in the exact same footsteps as their forebears.”

    So, rather than the “back to the cities” movement that’s been heralded for decades but never arrived, we’ve gone “back to the future,” as people age and arrive in America and opt for updated versions of the same lifestyle that have drawn previous generations to the much detested yet still-thriving peripheries of the metropolis.

    Joel Kotkin is executive editor of NewGeography.com and a distinguished presidential fellow in urban futures at Chapman University, and a member of the editorial board of the Orange County Register. 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.

    This piece originally appeared in the The Daily Beast.

    Suburbs photo by BigStock.

  • Class Warfare for Republicans

    As a Truman-style Democrat left politically homeless, I am often asked about the future of the Republican Party. Some Republicans want to push racial buttons on issues like immigration, or try to stop their political slide on gay marriage, which will steepen as younger people replace older people in the voting booth. Others think pure market-oriented principles will, somehow, win the day. Ron Paul did best among younger Republican voters in the primaries.

    Yes, ideas do matter, but a simple defense of free markets is not likely to have broad-enough appeal. What Republicans need is a transformative issue that can attract a mass base – and that issue is class.

    Of course, the whole idea of appealing to class may be repellant to most libertarian-conservative or country-club remnants of the Republican Party. Yet, it’s the issue of the day, as President Obama recognized when he went after patrician Mitt Romney. It also may be the issue Obama now most wants to avoid, which explains his current focus on secondary issues like gun control and gay marriage.

    For their part, Republicans need to make Obama own the class issue since his record is fairly indefensible. The fortunes of the middle quintiles of Americans have been eroding pretty much since Obama took office in 2009.

    There’s nothing fundamentally unRepublican about class warfare. After all, the party – led by what was then called Radical Republicans – waged a very successful war against the old slave-holding aristocracy; there’s nothing to be ashamed of in that conquest. Republicans under Abraham Lincoln also pushed for greater landownership through such things as the Homestead Act, which supplied 160 acres of federal land to aspiring settlers.

    No one expects the Republicans to turn socialist, but they can reap benefits from anger over the crony capitalism that has become emblematic of the Obama era. Wall Street and its more popular West Coast counterparts, the venture capital "community," consistently game the political system and, usually, succeed. They win, but everyone else pretty much has to content themselves with keeping up with the IRS.

    This is where the opportunity lies. Republican opposition to Wall Street is already evident in the rise of Texas Republican Rep. Jeb Hensarling to the chairmanship of the House Banking Committee. He and Iowa GOP Sen. Charles Grassley’s attack on "too big to fail" banks are a stark contrast to the likes of New York Democratic Sen. Charles Schumer, the Capitol consigliere of the Wall Street oligarchs, or the prince of gentry liberals and defender of billionaires everywhere, New York City Mayor Michael "luxury city" Bloomberg.

    Who’s angry and ready to raise their raise their pitchforks? Try the self-employed, who are now, according to Gallup, the large constituency most alienated from the present regime. Even the hapless Romney picked up their support against Obama.

    The new core constituency of the GOP can best be identified as the enterprise base. They include small property owners, mainly in the suburbs, those who are married or aspiring to be so. They are more suburban than urban, and likely to work for someone else or themselves as opposed to working for the state. Combine the top half of private employees, over 50 million people, add some 10 million self-employed and you get to a serious economic, and political, base.

    This group also includes many immigrants, particularly Asians, a constituency that should be tilting GOP but still isn’t. They, too, increasingly live in the suburbs, own homes as well as business. And rarely do they benefit from the prevailing crony capitalism.

    The enterprise base is by nature not ideologically rigid. Most, if you talk to them, would generally support sensible infrastructure improvement as well as repairs; they also tilt towards restrained taxation and a lighter regulatory hold. It’s a movement for "Let’s get this fixed and get on with our lives."

    This new orientation would define the Republicans where they are strongest and the administration weakest – on the economy. The new wedge issues must be for a "level playing field" for entrepreneurs and the middle class and definitely not social issues, like opposition to gay rights, or support for old and new unwise wars.

    An enterprise approach, and a focus on restarting real growth, could put the Democrats on their heels and worrying about their own base. Minorities, for example, have done far worse under this administration than virtually any in recent history, including that of George W. Bush. For many, this has been what the Fiscal Times has called "a food stamp recovery."

    Among Obama’s loyalist core, African Americans, unemployment now stands at the highest level in decades; blacks, while 12 percent of the nation’s population, account for 21 percent of the nation’s jobless. The picture is particularly dire in Los Angeles and Las Vegas, where black unemployment is nearly 20 percent, and Detroit, where’s it’s over 25 percent.

    Of course, Republicans have their work cut out for them among African-Americans. But remember that Barack Obama will not be on any future ballots. A return to what Ishmael Reed has called "neo-classical" Republicanism – the same spirit that freed the slaves and fought for equal rights – could make some inroads.

    Latinos, the other major part of the party’s "downstairs" coalition, also have fared badly under Obama and could be even more amenable to a smarter GOP message. They have seen their incomes drop 4 percent over the past three years, and suffer unemployment two full points above the national average. Overall, the gap in net worth of minority households compared with whites is greater today than in 2005. White households lost 16 percent in recent years, but African-Americans dropped 53 percent and Latinos a staggering 66 percent of their precrash wealth.

    But the most critical potential constituency may prove the millennial generation, who hitherto have been a strong constituency for both the president and his party. They continue to suffer the most of any age cohort in this persistently weak economy. Already, the first wave of millennials are hitting their thirties and may be getting restless about being permanent members of "Generation Rent."

    Let’s say, in two or four years, they are still finding opportunity lagging? Cliff Zukin at Rutgers John J. Heidrich Center for Workforce Development, predicts that many will "be permanently depressed and will be on a lower path of income for probably all their [lives]." One has to wonder if even the college-educated may want to see an economy where their educations count for more than a job at Starbucks. Remember: Baby boomers, too, once tilted to the left, but moved to the center-right starting with Ronald Reagan and have remained that way.

    Yet, despite these threats, Democrats may still be rescued by perennially misfiring Republicans. There’s no Stu Spencer, Michael Deaver or Peter Hannaford on the blue team to plot strategy. Missteps remain endemic: A group of North Carolina Republicans recently proposed a measure to establish Christianity as the state religion, only to blocked by the state’s leadership.

    Others think opposing gay marriage is the ticket to revival, even though public opinion, particularly among the young, is swinging in the other direction. Some 70 percent of millennials – people in their early thirties and younger – support gay marriage, twice the rate of those over 50. Social conservatives are also gearing up on the abortion issue even though three in five Americans, according to the latest Pew survey, oppose overturning Roe v. Wade. North Dakota could be showing that America can work, literally and figuratively, but instead the state passes abortion laws that are among the strictest in the country.

    Yet, there’s still hope that some Republicans will recognize this opportunity. I would like to see this, in part, because I have seen one-party politics in action here in California, and it doesn’t work. Even more so, I’d like to see Republicans wage class warfare on behalf of the "enterprise" constituency because Democrats then would have to offer something in response, which could only have good consequences for the rest of us.

    Joel Kotkin is executive editor of NewGeography.com and a distinguished presidential fellow in urban futures at Chapman University, and a member of the editorial board of the Orange County Register. 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.

    This piece originally appeared in the Orange County Register.

    Lincoln Memorial photo by Bigstock.

  • Fracking Offers Jerry Brown a Watershed Moment

    The recent announcement that Jerry Brown is studying "fracking" in California, suggests that our governor may be waking up to the long-term reality facing our state. It demonstrates that, despite the almost embarrassing praise from East Coast media about his energy and green policies, Brown likely knows full well that the state’s current course, to use the most overused term, is simply not politically and economically sustainable.

    Although largely a prisoner of basic green dogma, Brown also is a former Jesuit, with that order’s sense of rationality, order and, well, philosophical flexibility. Unlike many of his progressive idolaters and legislative allies, Brown may well be intelligent enough to look past the rhetoric of the environmental movement and consider its often unexpected ill-effects.

    Brown needs to balance "California comeback" stories – including one that gushingly describes "California beaming" – with the actual realities. Good times, and the current technology bubble, may be blessing Silicon Valley, but as Walter Russell Mead points out, this comeback is being pushed "over the heads of the poor and the jobless." This, he adds, "is not how progressives used to think."

    The chasm between the effects of "noble" green politics and the interests of most Californians is becoming evident, if not widely recognized in the mainstream media. Editorial writers at the New York Times may believe we are losing our need for oil and gas, but this transition should be more difficult than they suggest and, if achieved through often-thoughtless Draconian measures, could have profound impacts on the overall economy.

    Let’s start with the supposed "up" side of the purist renewable policies hitherto embraced by Brown. The governor’s 2010 election promise about creating 500,000 "green jobs" – his economic rationale for his energy and other environmental policies – increasingly looks far-fetched. With electric car maker Fisker, backed by well-connected Democratic venture capitalists and Al Gore, now perhaps ready to follow solar-panel maker Solyndra into bankruptcy, the pitch about a green economy seems unlikely, even bizarre.

    The state-driven "green" policies have also created huge losses for the giant state-employee retirement fund CalPERS, one of whose managers at a recent conference confided that renewable–energy investments have negative returns approaching 10 percent.

    Certainly, neither green energy nor even the current Silicon Valley bubble are creating enough jobs to make up for the enormous shortfall in employment since the recession. This is particularly evident in urban areas like Los Angeles and Oakland – where Brown was mayor from 1999-2006 – as well as most of the state’s interior. Overall, the state vies for last-place honors with the likes of Rhode Island, Nevada and Mississippi for the nation’s highest unemployment rate. The damage is greatest in the state’s more blue-collar interior. Working-class Stockton just was allowed to enter bankruptcy and other municipalities seem likely to join the queue.

    Progressive journalists, eager to pronounce the state’s comeback to justify their ideology, seem utterly unaware of the seriousness of the overall situation in the state. One wonders what they would say if Pete Wilson or Meg Whitman were governor. Compare Texas, which is 550,000 jobs ahead of its 2007 number, to California, which, despite recent gains, remains down 560,000 jobs from its peak. Perhaps unemployment is not a big issue in the progressive reserve of Palo Alto, where the jobless rate is about the same as in North Dakota, but it is a constant in much of Los Angeles, San Jose and Santa Ana, as well as the Central Valley. If this suggests a "comeback" to New York Times columnist Paul Krugman, perhaps we need a new definition for that word.

    These comparisons seem particularly relevant to the discussion of fracking – oil and gas extraction using a technique called hydraulic fracturing. In the environmental scheme of things, oil and even natural gas, once widely favored by progressives, now constitute an utter evil. This is true even though gas has been the primary reason for the country’s reduced carbon emissions by replacing coal as a source for generating electricity. Some of the state’s well-heeled greens would like to ban the process entirely.

    Brown must be aware he is not just governor of the public sector or of his admirers among the coastal rich. He has to consider the unimaginable: removing mandates that force the state to rely on expensive, often-unreliable renewables, notably, solar. These have helped push California electricity prices well above the national average, and much higher than in prime economic competitors such as Washington state, Utah, Texas, Arizona and Nevada. Economist John Husing suggests this is one reason why California not only completely missed the recent national revival in manufacturing jobs – 500,000 the past two years – but actually lost 10,000 more such jobs.

    We are clearly missing the party here. California’s energy policies reflect what is already happening in Europe, where anti-fracking ideology, sometimes supported by the no-doubt-disinterested Russians, have largely won the day. But the costs of green policies have already convinced hard-pressed Spain to abandon its widely praised renewable program.

    Far more economically healthy Germany also is rethinking its renewables mandates. One reason: German companies like Bayer and BASF consider moving to cheaper locales, such as along the U.S. Gulf Coast, where electricity is one-third the price. Texas, Utah and Arizona are to California’s hard-pressed manufacturers what the Gulf Coast is to Germany’s.

    And, then, there are the effects of the budget. Unlike his East Coast admirers, Brown must know that the budget situation is hardly rosy over the longer term. The state auditor recently released a report showing the state’s net worth to be negative by some $127 billion, in large part due to often out-of-control pension costs. There are already indications that the return from last year’s hike in income taxes may not be as large as expected and that what was, during the election, promised to schools will likely end up, as widely predicted, covering rising pension obligations.

    Companies and individuals may not leave California in droves, as some have suggested, but investors certainly can put their money someplace more fiscally responsible. A longer-term problem may be that the higher-income earners, who generate the vast majority of income-tax revenue, are also those most likely to change behavior or find effective income-hiding strategies; remember, Facebook paid no income taxes last year.

    Given these prospects, reviving California’s fossil-fuel industry could prove a critical boost to the budget. A deal to raise some energy taxes while allowing more exploration and development would go a long way to filling the state’s coffers.

    Energy taxes play a big role in financing higher education in many states, including North Dakota, Louisiana and Texas. Oil money, ironically, has allowed Texas to fund universities, particularly the main University of Texas campus in Austin, as a competitor to the perennially hard-pressed University of California system. An energy boom in California, whose energy resources may exceed those of all these states, might offend most academics, but, my hunch is, they might take the money.

    Perhaps more important, a pragmatic shift on energy would also help, as columnist Tim Rutten puts it, "jump start" the state’s economy, particularly in central California. In the past decade, Texas has created almost 200,000 energy-related jobs, while California has generated barely 20,000. These jobs provide good wages to many blue-collar workers, the very people losing out the most in our progressive-minded state.

    There are other signs of pragmatism from the governor. Brown has announced support for a peripheral canal that would provide more-reliable water supplies to the state’s huge agribusiness industry. Although some state regulators threaten farmers with ever-tougher regulations, some observers, such as three-term Salinas Mayor Dennis Donahue, now a full-time farmer, say the governor is trying to "walk the line between labor, greens and agriculture."

    Many Republicans and conservatives find the notion of Brown getting on the road to reality itself fundamentally unrealistic. But the past could be prologue. Brown also started off his first term, in 1975, as something of a dreamer, proclaiming a "small is beautiful" agenda. This was, in many ways, ahead of its time, and skeptical of government spending, but Brown’s environmental views, particularly, also offended some business interests. Far worse, he signed off on legislation freeing up public-sector unions, which has turned into something of a disaster.

    But by the time he started running for a second term, Brown readjusted to a new reality. He could claim that, as someone opposed to the growth of institutionalized government, he could live with Proposition 13. Brown had opposed the measure, but, once it passed, in 1978, he chose, unlike many progressives, to embrace it.

    Brown then ran as a centrist, pro-growth governor. He particularly embraced the then-ascendant technology industry, gaining new donors and allies, although the shift toward realpolitick horrified some of his green backers. But the politics worked brilliantly.

    Today’s circumstances, of course, are different. For one thing, Brown faces little pressure from the right, as the Republican Party, at least for now, has deteriorated into near irrelevancy. The once-potent California business community also has lost much influence, with every lobby, basically, trying to make its own deal with the overweening state apparat.

    So, if Brown is to move to the center, he will have to do it largely on his own, and put up with the incessant hectoring of his allies. Yet, Brown’s occasional genius has demonstrated a Machiavellian quality, knowing when to embrace opponents in order to divide or weaken them, or to allow allies to stew. He also, at this stage of life – today, April 7, is his 75th birthday – must wonder if he wants to leave a legacy of fiscal weakness, a fading competitive edge and an ever-expanding class chasm. In the long run, whether on fracking or a host of other issues, Brown’s success will not derive from pleasing progressive writers, but by promoting a better future for the vast majority who live in, and love, this state.

    Joel Kotkin is executive editor of NewGeography.com and a distinguished presidential fellow in urban futures at Chapman University, and a member of the editorial board of the Orange County Register. 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.

    This piece originally appeared in the Orange County Register.

    Photo: Troy Holden

  • Megacities And The Density Delusion: Why More People Doesn’t Equal More Wealth

    Perhaps no idea is more widely accepted among urban core theorists than the notion that higher population densities lead to more productivity and sustainable economic growth. Yet upon examination, there are less than compelling moorings for the beliefs of what Pittsburgh blogger Jim Russell calls “the density cult,” whose adherents include many planners and urban land speculators.

    Let’s start at the top of the urban food chain, the world’s 28 megacities of over 10 million people (which we are defining as areas of continuous urban development, incorporating suburbs and satellite communities). Is greater density the key to great prosperity? For the most part, the world’s densest megacities are the poorest. Take the densest, the Bangladeshi capital of Dhaka. Its 14 million residents are squeezed into an area of 125 square miles, making for a population density of 115,000 per square mile, as reported in the latest edition of Demographia World Urban Areas (which includes estimates for all known urban areas in the world with at least 500,000 residents). Dhaka’s per capita gross domestic product, $3,100, is the lowest of all the world’s megacities.

    Three other megacities — Mumbai, Karachi, Delhi — have population densities that are between three to seven times as high as the biggest megacity, Tokyo-Yokohama, which has a density of 11,000 per square mile. Tokyo is also much richer; the region’s per capita GDP tops $41,100, while the three ultra-crowded metropolises on the subcontinent have GDPs under $10,000 per capita. In contrast the two most spread out megacities, Los Angeles and New York, have population densities about half or less of Tokyo’s, but their per capita GDPs rank number rank first and third ($63,100 in New York and $54,400 in Los Angeles).

    Do any dense metropolitan areas boast higher GDPs? Seoul-Incheon, South Korea, packs more than 20 million people into an area roughly a quarter of Tokyo’s and at a density four times that of Los Angeles. Its per capita GDP, at $32,200, is the highest among the 10 most dense megacities. Paris, which is twice as dense as New York and 50% more dense than Los Angeles, stands at $53,900. (Yes, Los Angeles is denser than New York — despite its small central core, L.A. lacks the wide stretches of bucolic suburbia common in eastern cities).

    This imperfect, if not inverse, relationship between density and wealth is widely ignored by most urban core boosters, many of whom argue that packing people together is the true key to economic growth. But more often than not, notes Russell, the objective is aggrandizing the “creative class” — those who tend to settle in dense urban cores and also work in industries that do best there, but with little positive for everyone else.

    Many retro-urban theorists maintain that high density is the key to urban prosperity. These theorists often point for justification to Santa Fe Institute research that, they claim, links productivity with density. Yet in reality it does nothing of the kind. Instead the study emphasizes that population size, not compactness, is the decisive factor.

    Size does matter. A region is helped by the infrastructure that generally comes only with a large population, for example airports. But being big does not mean being dense. In fact the U.S. cities that made the largest gains in GDP  in 2011 — Houston, Dallas-Fort Worth and greater Detroit — are not dense cities at all.

    Some of the metropolitan regions that have the highest per capita GDPs in the world based on purchasing power are not particularly dense. The two regions at the top — Hartford, Conn. and San Jose, Calif., — are if anything largely suburban in character. Neither has a strong central core, and most of the jobs in the areas are on the periphery.

    These areas are marked by everything that density advocates detest: They have very low levels of transit ridership and are largely dominated by single-family homes. The most affluent, Hartford, has among the lowest urban population densities in the world. It turns out that our low-density, “sprawling” metropolitan areas do very well in terms of wealth creation. Of the top 10 urban regions in the world in terms of GDP per capita all but one — Abu Dhabi in the United Arab Emirates — are located inside the United States.

    There are many thriving American urban areas with densities below the U.S. average for large urban areas.This includes not only Hartford, but also Boston, Durham, Seattle and Houston. Indeed, smaller, low-density Des Moines nearly broke into the top 10 (13th), reflective of the economic gains being made in the Great Plains.

    We may think, for example, of Boston, which ranks fifth in the world in per capita GDP, as a tightly packed urban area. But once one gets behind the relatively small urban core, the overall density is barely 2,200 per square mile, less than half San Jose or Los Angeles, hardly a fifth that of Tokyo and not much more than Atlanta, the least dense major city in the world with more than 2.5 million residents.

    Why is this the case? One key reason is that cities, as they evolve, naturally spread out. As New York University’s Shlomo Angel has pointed out, virtually all major cities in the world are growing more outward than inward, and becoming less dense in the process. This is not only true in the United States, but also in Europe and, even more surprisingly developing countries as well. For example, over the past four decades, everyone’s favorite dense core city, Paris, has seen its urban land area expand 55%, while its population has risen only 21%. Today, the geographical extent of urban Paris is more than 25 times that of the ville de Paris, home to most of the familiar tourist attractions.

    In some ascendant countries, notably China, American-style suburbs are being duplicated; and when Chinese and other Asians immigrate, they tend to move to lower-density suburban areas. The only exceptions have been cities where development has been distorted by ideology, such as Moscow before the fall of the Soviet Union, notes Alain Bertaud, a former principal planner World Bank.

    The reason for moving outward may be lost on theorists and their real estate backers, but they remain compelling for many people, particularly families. A national association of realtors survey in 2011 found that roughly 8o% of adults prefer to live in detached single-family houses while only 8% preferred an apartment. It is thus not surprising that the suburbs, which abound in detached housing, contain nearly three-quarters of America’s major metropolitan population or that areas outside the urban core accounted for 99% of growth between 2000 and 2010.

    For the most part, this suggest the population, for the most part, will continue to seek out the periphery. This is not only true, as NYU’s Angel points out, in the United States or in similar countries such as Australia or Canada. As people seek out more affordable and larger housing, they tend to spread out from their historic cores. It happens most decisively in wealthy areas that are also land-rich.

    This is not to say that the higher-density enclaves of urban areas do not have an important place. In terms of culture, finance, media and certain other transaction-based industries, a number of dense urban cores remain unassailable in their efficiency and appeal. But in the United States, and much of the rest of the high-income world, this is accomplished by bringing residents from the periphery to the core — by car, train, bus and increasingly through telecommunications, even as most jobs are located elsewhere in the urban area.

    The future shape of the city is likely to continue expanding, even as some urban cores grow. Visit any burgeoning city in the developing world from Shanghai to Mexico City and the same reality emerges: as cities get larger, they spread out, as people begin to aspire, as best they can, for the quality of life that most North Americans and Europeans already take for granted.

    Joel Kotkin is executive editor of NewGeography.com and a distinguished presidential fellow in urban futures at Chapman University, and a member of the editorial board of the Orange County Register. 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.

    This piece originally appeared at Forbes.com.

    Dhaka photo by wiki commons user BL2593.

  • Houston Rising—Why the Next Great American Cities Aren’t What You Think

    America’s urban landscape is changing, but in ways not always predicted or much admired by our media, planners, and pundits. The real trend-setters of the future—judged by both population and job growth—are not in the oft-praised great “legacy” cities like New York, Chicago, or San Francisco, but a crop of newer, more sprawling urban regions primarily located in the Sun Belt and, surprisingly, the resurgent Great Plains.

    While Gotham and the Windy City have experienced modest growth and significant net domestic out-migration, burgeoning if often disdained urban regions such as Houston, Dallas-Ft. Worth, Charlotte, and Oklahoma City have expanded rapidly. These low-density, car-dominated, heavily suburbanized areas with small central cores likely represent the next wave of great American cities.

    There’s a whole industry led by the likes of Harvard’s Ed Glaeser, my occasional sparring partner Richard Florida and developer-funded groups like CEOs for Cities, who advocate for old-style, high-density cities, and insist that they represent the inevitable future.

    But the numbers tell a different story: the most rapid urban growth is occurring outside of the great, dense, highly developed and vastly expensive old American metropolises.

    An aspirational city, by definition, is one that people and industries migrate to improve their economic prospects and achieve a better relative quality of life. In the 19th and early 20th centuries, this aspirational spirit was epitomized by cities such as New York and Chicago and then in the decades after World War Two by Los Angeles, which for many years was the fastest-growing big city in the high-income world.

    Until the 1970s, the country’s established big cities were synonymous with aspiration—where the jobs and opportunities for broad portions of the population abounded. But as the financial markets took on an oversized role in the American economy and manufacturing receded, the cost of living in the nation’s oldest metropolises shot up far faster than the median income there—and Americans have turned elsewhere now that, as Virginia Postrel wrote in an important essay on the nation’s growing economic wall, “the promise of a better life that once drew people of all backgrounds to rich places like New York and [coastal] California now applies only to an educated elite—because rich places have made housing prohibitively expensive.”

    Like the great legacy cities during their now long-past adolescent and at times ungainly growth spurts, today’s aspirational cities often meet with little approval from travelers from other, older cities. A 19th-century Swedish visitor to Chicago described it as “one of the most miserable and ugly cities” in North America. New York, complained the French Consul in 1810, was a city where the inhabitants had “in general no mind for anything but business”; later Bostonian Ralph Waldo Emerson, granted Gotham’s entrepreneurial supremacy only to explain that his more cultured “little city” was “appointed” by destiny to “lead the civilization of North America.”

    Los Angeles, most of whose early-20th-century migrants came from the Midwest, became a favorite object of scorn from sophisticates. William Faulkner in the 1930s described the city of angels as “the plastic asshole of the world.” As the first great city built largely around the automobile, mainstream urbanists detested it; their icon Jane Jacobs called it “a vast blind-eyed reservation.”

    A half century later, today’s aspirational urban centers suffer similarly poor reputations among urbanists, planners and journalists. One New York Post reporter recently described Houston as “brutally ugly” while new urbanists like Andres Duany relegate the region to a netherworld inhabited by car-centric cities such as Phoenix and Atlanta.

    Yet over the past decade the 25 fastest-growing cities have been mostly such urbanist “assholes”—Raleigh, Austin, Houston, San Antonio, Las Vegas, Orlando, Dallas-Fort Worth, Charlotte, and Phoenix. Despite hopeful claims from density advocates that the Great Recession and the housing bust ended this trend, the latest census data shows that Americans have continued choosing places that are affordable enough to offer opportunity, and space.

    One common article of faith among mainstream urbanists, at least when they stop to note this growth at all, is that these cities grow mainly because they are cheap and can house the unskilled. But in reality many of these metropolitan areas are also leading the nation in growing their number of well-educated arrivals. Houston, Charlotte, Raleigh, Las Vegas, Nashville, and San Antonio, for example, experienced increases in the number of college-educated residents of nearly 40 percent or more over the decade, roughly twice the level of growth as in “brain centers” such as Boston, San Francisco, San Jose (Silicon Valley), or Chicago. Atlanta, Houston, and Dallas each have added about 300,000 college grads in the past decade, more than greater Boston’s pickup of 240,000 or San Francisco’s 211,000.

    Once considered backwaters, these Sunbelt cities are quietly achieving a critical mass of well-educated residents. They are also becoming major magnets for immigrants. Over the past decade, the largest percentage growth in foreign-born population has occurred in sunbelt cities, led by Nashville, which has doubled its number of immigrants, as have Charlotte and Raleigh. During the first decade of the 21st century, Houston attracted the second-most new, foreign-born residents, some 400,000, of any American city—behind only much larger New York and slightly ahead of Dallas-Ft. Worth, but more than three times as many as Los Angeles. According to one recent Rice University study, Census data now shows that Houston has now surpassed New York as the country’s most racially and ethnically diverse metropolis.

    Why are these people flocking to the aspirational cities, that lack the hip amenities, tourist draws, and cultural landmarks of the biggest American cities? People are still far more likely to buy a million dollar pied à terre in Manhattan than to do so in Oklahoma City. Like early-20th-century Polish peasants who came to work in Chicago’s factories or Russian immigrants, like my grandparents, who came to New York to labor in the rag trade, the appeal of today’s smaller cities is largely economic. The foreign born, along with generally younger educated workers, are canaries in the coal mine—singing loudest and most frequently in places that offer both employment and opportunities for upward mobility and a better life.

    Over the decade, for example, Austin’s job base grew 28 percent, Raleigh’s by 21 percent, Houston by 20 percent, while Nashville, Atlanta, San Antonio, and Dallas-Ft. Worth saw job growth in the 14 percent range or better. In contrast, among all the legacy cities, only Seattle and Washington D.C.—the great economic parasite—have created jobs faster than the national average of roughly 5 percent. Most did far worse, with New York and Boston 20 percent below the norm; big urban regions including Philadelphia, Los Angeles, and, despite the current tech bubble, San Francisco have created essentially zero new jobs over the decade.

    Another common urban legend maintains these areas lag in terms of higher-wage employment, lacking the density essential for what boosters like Glaeser and Florida describe as “knowledge-intensive cities.” Defenders of traditional cities often cite Santa Fe Institute research that they say links innovation with density—but actually does nothing of the kind. Rather, that research suggests that size, not compactness, constitutes the decisive factor. After all, it’s hard to define Silicon Valley, still the nation’s premier innovation region, as anything other than large, sprawling, and overwhelmingly suburban in form.

    Size does matter and many of the fastest growth areas are themselves large enough to sport a major airport, large corporate presences and other critical pieces of economic infrastructure. The largest gains in GDP (PDF) in 2011 were in Houston, Dallas and, surprisingly, resurgent greater Detroit (and that despite its shrinking urban core). None of these areas are characterized by high density yet their income growth was well ahead of Seattle, San Francisco, or Boston, and more than twice that of New York, Washington, or Chicago.

    But in fact neither density nor size necessarily determine which regions generate new high-end jobs. The growth in STEM—or science-technology-engineering and mathematics-related—employment in Houston, Raleigh, Nashville, Austin, and Las Vegas surpassed that in San Francisco, Los Angeles, Boston, or New York. One reason: most STEM jobs are not found in fashionable fields like designing social media or videogames but in more prosaic activities tied to medicine, manufacturing, agriculture and (horror of horrors) natural resource extraction, including fossil fuel energy. In this sense, technology reflects the definition of the French sociologists Marcel Mauss as “a traditional action made effective.”

    This pattern also extends to growth in business and professional services, the nation’s biggest high-wage job category. Since 2000, Houston, Dallas-Fort Worth, Charlotte, Austin and Raleigh expanded their number of such jobs by twenty percent or more—twice the rate as greater New York, the longtime business-service capital, while Chicago and San Jose actually lost jobs in this critical category.

    Finally there is the too often neglected topic of real purchasing power—that a dollar in New York doesn’t go nearly as far as one in Atlanta, for example. My colleague Mark Schill at the Praxis Strategy group has calculated the average regional paycheck, adjusted for cost of living. Houston led the pack in real median pay in, and seven of the 10 cities with the highest adjusted salary were aspirational ones (the exceptions were San Jose-Silicon Valley, Seattle, and the greater Detroit region). Portland, Los Angeles, New York, and San Diego all landed near the bottom of the list.

    Conventional urbanists—call them density nostalgists—continue to see the future in legacy cities that, as the University of Washington demographer Richard Morrill notes, were built out before the dominance of the car, air-conditioning and with them the prevalence of suburban lifestyles.

    Looking forward, it is simply presumptuous and ahistorical to dismiss the fast-growing regions as anti-cities, as 60s-era urbanists did with places like Los Angeles. When tradition-bound urbanists hope these sprawling young cities choke on their traffic and exhaust fumes, or from rising energy costs, they are reflecting the classic prejudice of city-dwellers of established urban centers toward upstarts.

    The reality is that most urban growth in our most dynamic, fastest-growing regions has included strong expansion of the suburban and even exurban fringe, along with a limited resurgence in their historically small inner cores. Economic growth, it turns out, allows for young hipsters to find amenable places before they enter their 30s, and affordable, more suburban environments nearby to start families.

    This urbanizing process is shaped, in many ways, by the late development of these regions. In most aspirational cities, close-in neighborhoods often are dominated by single-family houses; it’s a mere 10 or 15 minute drive from nice, leafy streets in Ft. Worth, Charlotte, or Austin to the urban core. In these cities, families or individuals who want to live near the center can do without being forced to live in a tiny apartment.

    And in many of these places, the historic underdevelopment in the central district, coupled with job growth, presents developers with economically viable options for higher-density housing as well. Houston presents the strongest example of this trend. Although nearly 60 percent of Houston’s growth over the decade has been more than 20 miles outside the core, the inner ring area encompassed within the loop around Interstate 610 has also been growing steadily, albeit at a markedly slower rate. This contrasts with many urban regions, where close-in areas just beyond downtowns have been actually losing population.

    Even as Houston has continued to advance outwards, the region has added more multiunit housing over the past decade than more populous New York, Los Angeles or Chicago. With its economy growing faster and producing wealth faster than any other region in the country, urban developers there usually do not need subsidies or planning dictates to be economically viable.

    Modern urban culture also is spreading in the Bayou City. In what has to be a first, my colleagues at Forbes recently ranked Houston as America’s “coolest city,” citing not only its economy, but its thriving arts scene and excellent restaurants. Such praise may make some of us, who relish Houston’s unpretentious nature, a little nervous—but it shows that hip urbanism can co-exist with rapidly expanding suburban development.

    And Houston’s not the only proverbial urban ugly duckling having an amenity makeover. Oklahoma City has developed its central “Bricktown” into a centerpiece for arts and entertainment. Ft. Worth boasts its own, cowboy-themed downtown, along with fine museums, while its rival Dallas, in typical Texan fashion, boasts of having the nation’s largest arts district.

    More important still, both for families and outdoor-oriented singles, both cities are developing large urban park systems. At an expense of $30 million, Raleigh is nearing the completion of its Neuse River Greenway Trail, a 28-mile trail through the forested areas of Raleigh. Houston has plans for a series of bayou-oriented green ways. For its part, Dallas is envisioning a vast new 6,000 acre park system, along the Trinity River that will dwarf New York’s 840-acre Central Park.

    To be sure, there’s no foreseeable circumstance in which these cities will challenge Paris or Buenos Aires, New York, or San Francisco as favored destinations for those primarily motivated by aesthetics that are largely the result of history. Nor are they likely to become models of progressive governance, as poverty and gaps in medical coverage become even more difficult problems for elected officials without a well-entrenched ultra-wealthy class to cull resources from.

    Finally, they will not become highly dense, apartment cities — as developers and planners insist they “should.” Instead the aspirational regions are likely to remain dominated by a suburbanized form characterized by car dependency, dispersion of job centers, and single-family homes. In 2011, for example, twice as many single-family homes sold in Raleigh as condos and townhouses combined. The ratio of new suburban to new urban housing, according to the American Community Survey, is 10 to 1 in Las Vegas and Orlando, 5 to 1 in Dallas, 4 to 1 in Houston and 3 to 1 in Phoenix.

    Pressed by local developers and planners, some aspirational cities spend heavily on urban transit, including light rail. To my mind, these efforts are largely quixotic, with transit accounting for five percent or less of all commuters in most systems. The Charlotte Area Transit System represents less a viable means of commuting for most residents than what could be called Manhattan infrastructure envy. Even urban-planning model Portland, now with five radial light rail lines and a population now growing largely at its fringes, carries a smaller portion of commuters on transit than before opening its first line in 1986.

    But such pretentions, however ill-suited, have always been commonplace for ambitious and ascending cities, and are hardly a reason to discount their prospects. Urbanistas need to wake up, start recognizing what the future is really looking like and search for ways to make it work better. Under almost any imaginable scenario, we are unlikely to see the creation of regions with anything like the dynamic inner cores of successful legacy cities such as New York, Boston, Chicago or San Francisco. For better or worse, demographic and economic trends suggest our urban destiny lies increasingly with the likes of Houston, Charlotte, Dallas-Ft. Worth, Raleigh and even Phoenix.

    The critical reason for this is likely to be missed by those who worship at the altar of density and contemporary planning dogma. These cities grow primarily because they do what cities were designed to do in the first place: help their residents achieve their aspirations—and that’s why they keep getting bigger and more consequential, in spite of the planners who keep ignoring or deploring their ascendance.

    Joel Kotkin is executive editor of NewGeography.com and a distinguished presidential fellow in urban futures at Chapman University, and a member of the editorial board of the Orange County Register. 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.

    This piece originally appeared in the The Daily Beast.

    Photo by telwink.

  • Progessives, Preservation & Prosperity

    Conservatives often fret that Barack Obama is leading the nation toward socialism. In my mind, that’s an insult to socialism, which, in theory, at least, seeks to uplift the lower classes through greater prosperity. In contrast, the current administration and its core of wealthy supporters are more reminiscent of British Tories, the longtime defenders of hereditary privilege, a hierarchical social order and slow-paced economic change.

    The notion that the "progressives" are, in fact, closeted Royalists has been trotted out by a handful of Obama admirers, such as Andrew Sullivan, who calls the president "the conservative reformist of my dreams." Essentially, Sullivan argues, Obama has been a "Tory president," with more in common with, say, an aristocratic toff like British Prime Minister David Cameron than a traditional left-liberal reformer.

    The fundamental conservativism underlying the modern "progressive" marks the central thesis of an upcoming book by historian Fred Siegel, appropriately titled "Revolt Against the Masses." Siegel traces the roots of the new-fashioned Toryism to the cultural wars of the 1960s, when the fury of the "Left," once centered on the corporate elites, shifted increasingly to the middle class, which was widely blamed for everything from a culture of conformity to racism and support for the Vietnam War.

    Tory progressivism’s most-unifying theme, Siegel notes, includes the preservation and conservation of the landed order enjoyed by the British ultrawealthy and upper-middle classes. In the 19th century, Siegel notes, Tory Radicals, like William Wordsworth, William Morris and John Ruskin, objected to the ecological devastation of modern capitalism and sought to preserve the glories of the British countryside.

    They also opposed the "leveling" effects of a market economy that sometimes allowed the less-educated, less well-bred to supplant the old aristocracies, with their supposedly more enlightened tastes. "Strong supporters of centralized monarchical power, this aristocratic sensibility also saw itself as the defender of the poor – in their place," writes Siegel. "Its enemies were the middle classes and the aesthetic ugliness they associated with the industrial economy borne of bourgeois energies."

    Today, this Tory tradition lives on in contemporary Britain, where industry remains widely disparaged and land use tightly controlled. There is no more strident defender of preserving the space of the landed gentry than the leading Tory mouthpiece, The Daily Telegraph. All efforts are made to restrict the expansion of suburbs and new towns, all the better to preserve the British countryside for the better enjoyment of the gentry.

    As a result, Britain now suffers some of the world’s highest housing prices – even in the economically devastated north of the country. Unable to afford decent accommodations, notes author James Heartfield, some British families have been forced to live in old restrooms, garden sheds, even abandoned double-decker buses.

    Until recent decades, such an "enlightened" conservatism has been rare in America, with its strong tradition of upward mobility and vast landscape for development. As early as the 1950s, however, intellectuals, architects, planners and aesthetes have railed against the banality of suburbanizing, and democratizing, America, but the real turn towards gentry progressivism took place with the rise of the environmental movement in the 1970s.

    Rightfully alarmed by the deterioration of the environment at that time, early green activists made contributions to a remarkable cleanup of the nation’s air and water, something that widely benefited millions of Americans. But the movement also fell ever more prone to all manner of hysterias; at the first Earth Day, in 1970, some scientists predicted that, by the 1980s, people would not be able to walk outside without a helmet. Then followed a series of jeremiads about "limits of growth" associated with the depletion of critical minerals, "peak oil" and, finally, the call for radical steps to address climate change.

    All these causes, sometimes based on fact or somewhat overheated extrapolation, gradually diverted American progressives from their historic interest in economic growth and social mobility to a primary focus on environmental purity, whatever the social or economic cost. Their Tory-like policies have helped stunt economic growth, particularly in the blue-collar industrial and construction sectors, promoting, albeit unintentionally, ever-narrowing opportunity for all but a few Americans.

    Despite its opportunistic use of populist rhetoric, the Obama administration has presided over widespread economic distress – with the average household now earning considerably less than it did four years ago. This trend has worsened during the current "recovery," even as the Federal Reserve’s policies have generated record profits for corporate and Wall Street grandees.

    It has been a particular boon time for a new rising class of oligarchs from Silicon Valley, which has embraced Obama with money and technical expertise. Not surprisingly, the ultra-affluent coastal areas have become primary supporters of the administration, which in November won eight of the nation’s 10 wealthiest counties, many of them handily.

    The growing gaps between the "1 percent" and everyone else have been particularly marked in those regions under the most complete progressive control. The Holy Places of urbanism, such as New York, San Francisco and Washington, D.C., also suffer some of the worst income inequality.

    In these regions, the so-called "creative class" is courted by politicians, developers and corporate big-wigs. Meanwhile their putative political allies, in places like Oakland and parts of New York’s the outer boroughs, experience seemingly irrepressible permanent unemployment and, increasingly, rising crime. Perhaps the most outrageous example of the dual nature of the new progressive economy, notes Walter Russell Mead, can be seen in Detroit, where a shrinking, debt-ridden and dysfunctional city that fails its largely poor residents has generated $474 million since 2005 for well-connected Wall Street bond issuers.

    Under the progressive Tory regime, the best that can be offered the middle class is an outbound ticket to less-Tory-dominated, albeit often less culturally "enlightened" places, such as Texas, the Southeast or Utah. There, manufacturing, energy and agricultural industries still anchor much of the economy. Despite their expressions of concern for the lower orders, gentry progressives don’t see much hope for the recovery of blue-collar manufacturing or construction jobs, at least not in their bailiwicks. Instead they suggest that the hoi polloi seek their future in what the British used to call "service," that is, as caregivers, haircutters, dog walkers, waiters and toenail painters for their more-highly educated betters.

    Such kindness, however, is no replacement for the kind of broad-based economic growth that historically has promoted self-sufficiency and upward mobility, both in California and elsewhere. Due in large part to the new progressive policies, this is now increasingly out of reach for many in the middle class, as well as the increasingly Latino working classes. Indeed, a recent report from the Public Policy Institute of California reveals that class stratification in the state has expanded far faster than the national average.

    "We have created a regulatory framework that is reducing employment prospects in the very sectors that huge shares of our population need if they are to reach the middle class," notes economist John Husing. A onetime Democratic activist, Husing laments how, in progressive California, green energy policies have driven up electricity costs to twice as high as those in competitor states, such as Utah, Texas and Washington, and considerably above those of neighboring Arizona and Nevada. These and other regulatory policies, he suggests, are largely responsible for the Golden State missing out on the country’s manufacturing rebound, losing jobs, while others, not only Texas but also in the Great Lakes, have expanded jobs in this sector.

    Similarly, Draconian land-use regulations have not only kept housing prices, particularly on the coasts, unnecessarily high, but slowed a potential rebound in the construction sector, traditionally a source of higher-wage employment for less-than-highly educated workers. So, while Google workers are pampered and celebrated by the progressive regime, California suffers high unemployment and a continued exodus of working-class and middle-class families.

    Sadly, there currently is no strong counterweight to the new Tory ascendency. Until traditional social democrats awake to realities, or the GOP acknowledges the painful reality of class, America will continue to lurch towards the very Tory model that our forefathers had the wisdom to reject throughout most of our history.

    Joel Kotkin is executive editor of NewGeography.com and a distinguished presidential fellow in urban futures at Chapman University, and a member of the editorial board of the Orange County Register. 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.

    This piece originally appeared in the Orange County Register.

    Photo by: conservativeparty

  • Will Obama Play his Aces?

    With the stock market hitting new highs, and unemployment easing, albeit slightly, President Obama can now seize his moment. After spending four years blaming George W. Bush for his lousy hand, the president now sits at the table with three strong aces among his cards.

    The key question is: Will he play them?

    One reason he might not is that most of his good hand stems primarily not from his stewardship but America’s economic and demographic kismet. In fact, this resurgence is primarily not taking the "green," urban and high-tech form, as preferred by most coastal Democrats, but stems largely from the productive forces being unleashed in the nation’s largely red heartland.

    But Barack Obama is president, and if the country resurges on his watch, he will get much of the credit. This country, for all its problems, is naturally blessed, with both human and physical resources. It is beginning to both pull away from laggard Europe and Japan and seems far more well-positioned to compete with China than most observers believe. The choice for the president is whether to ride this resurgence, or throw it away as incompatible with his political agenda.

    This dichotomy starts with energy, the thing most propelling the real, as opposed to the paper, economy. The current energy boom is taking place in a manner precisely what Obama and, certainly, many of his strongest backers, least likely would have preferred. In his first term, Obama charted a path on energy typical of the university faculty lounge. His departing energy secretary, Steven Chu, embraced the idea that Americans used fossil fuels irresponsibly, comparing them to teenagers. He liked forcing higher costs for energy while using our tax dollars to subsidize often-dodgy renewable schemes.

    Yet, history, as is often the case, played out quite differently than the expected script. Rather than being required to accept enforced scarcity, Americans, largely due to new drilling techniques and advanced technology for identifying previously undiscovered fields, now are on the cusp of a massive energy boom. This has changed the country’s trade and economic prospects immeasurably. Since 2009, the industry, according to the consultancy EMSI, has added some 430,000 jobs, in contrast to the much subsidized "green" energy industry, which has suffered a spate of embarrassing failures.

    Energy employment

    One problem for the president: The big winners to date have come from outside the coastal strips whose residents constitute his base. Over the past decade, Texas alone has added 180,000 mostly highly paid energy-related jobs. Oklahoma added 40,000, and the Intermountain West well over 30,000. In what could be a persuasive case, Pennsylvania, a blue state with a hunger for jobs, has joined the party; the original center of the U.S. energy industry is now enjoying a resurgence.

    In contrast, energy-rich California, despite the nation’s third-highest unemployment rate, has chosen to stand largely on the sidelines, creating a mere 20,000 such energy-related jobs. The same can be said about New York, which so far has chosen to follow the lead of celebrity "fracktivists" and is refusing to exploit its rich natural gas resources. Yet even in California, some normally progressive voices, such as former longtime Los Angeles Times columnist Tim Rutten, suggest that, in order "to jump-start" its economy, the state ought to climb on the energy bandwagon.

    To be a successful president, Obama can embrace this growth while maintaining his green bona fides. As the environmentalists at the Breakthrough Institute have noted, America’s recent remarkable progress in reducing greenhouse gases primarily is not the result of the sort of green technologies financed by the president’s venture-capitalist friends and embraced by his media allies. Instead, it has been overwhelmingly the result of the gradual replacement of coal usage with natural gas.

    Embracing gas – not only to generate electricity but also for transportation – serves both Obama’s interest and the country’s long-term interest. But his task is made more perilous by his efforts to appease his urban, green constituency, once strongly supportive of natural gas, but now decisively against it. Two contrarian environmentalists, an increasingly endangered species, have labeled the celebrity-driven protesters of hydraulic fracturing drilling techniques as "fracktivists for global warming."

    Some observers, such as former Al Gore aide Morley Winograd, suggest that Obama’s appointment of Ernie Moniz as energy secretary will bolster the notion that the president has shifted towards "pragmatic idealism" on energy. Obama may still be reluctant to allow much drilling in publicly held land but he could countenance a negotiated reasonable solution to the contentious issue of fracking.

    High-flying farming

    Energy is only one, albeit the most dramatically apparent, ace in the presidential hand. Another is agriculture, which is on a historic tear. This has been led, particularly in the Great Plains and the Midwest, by a boom in agriculture exports: The U.S. exported a record $135 billion in 2011, with a net favorable trade balance of $47 billion, the highest in nominal dollars since the 1980s.

    What accounts for this boom? One driver is growing markets in the developing world – notably, China, which consumes almost 60 percent of the world’s soybean exports and 40 percent of its cotton. The Great Plains Corridor, in particular, produces both these crops in abundance, which is one reason for its increased share of U.S. exports.

    Most farmers and farm communities – outside of some who might ship to lovocore (eat local) restaurants – tilt conservative, but the exports of this sector drive growth in services and even technology. Farming today is increasingly tied to science, and that includes efforts to reduce the use of fertilizers and water. Cities from Omaha, Neb., to Kansas City to New Orleans all benefit from agricultural trade.

    Cars come back

    The last of Obama’s aces comes from manufacturing, whose resurgence has been among the most surprising developments of the past five years. Some of this is tied to the energy boom, which is boosting industry along the Gulf Coast, with its burgeoning petrochemical complex. By itself, the expansion of energy – particularly cheap and plentiful natural gas – will create, according to a recent PricewaterhouseCoopers study, more than 1 million industrial jobs nationwide.

    But more politically important for the president is the resurgence of the U.S. auto industry. Whatever one thinks of how the GM and Chrysler bailouts were conducted, the return to profitability in Detroit represents a big win for Obama and may be one of the reasons for his surprisingly strong electoral showing in the industrial Great Lakes. In comparison with Europe and, increasingly, even China, American manufacturers are showing great resiliency and growing competitive strength.

    Yet, even here Obama needs to be careful. What a recent Boston Consulting Group report described as the incipient "reallocation of global manufacturing" will primarily benefit lower-cost, nonunion red states such as South Carolina, Alabama and Tennessee. This is where most new investment from German, Japanese and Korean firms is going. Yet, if this growth continues, Obama is helping his core constituencies, notably African-Americans, who now can see the prospect of higher-wage employment with benefits.

    Ultimately, as the former Gore aide Winograd suggests, how Obama plays these cards may well determine the success of his tenure.

    He could choose to throw out his trump cards in a gesture to placate his gentry funding base, urban progressives and his most devoted media claque. Or he could, like most great politicians, choose, instead, to play the great hand providence has provided him, irrespective of his core supporters, thereby all but assuring his stature as one of the more successful presidents in recent history.

    Joel Kotkin is executive editor of NewGeography.com and a distinguished presidential fellow in urban futures at Chapman University, and a member of the editorial board of the Orange County Register. 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.

    This piece originally appeared in the Orange County Register.

    Barack Obama photo by Bigstock.

  • Marissa Mayer’s Misstep And The Unstoppable Rise Of Telecommuting

    Marissa Mayer’s pronunciamento banning home-based work at Yahoo reflects a great dilemma facing companies and our country over the coming decade. Forget for a minute the amazing hubris of a rich, glamorous CEO, with a nursery specially built next to her office, ordering less well-compensated parents to trudge back to the office, leaving their less important offspring in daycare or in the hands of nannies.

    The real issue is how we deal with three concerns: the promotion of families; humane methods to reduce greenhouse gases; and, finally, how to expand the geography of work and opportunity.

    For parents, particularly women, telecommuting provides a golden opportunity to balance the challenges of child-raising with those of work. Working at home, full or part-time, shrinks the number of hours wasted commuting and allows greater flexibility that is often critical to maintaining a family. In a country with a deteriorating fertility rate, and ever greater strains on those trying to raise children, telecommuting offers, at least for some, a way to remain in the labor force without cheating the next generation.

    Equally important, as the online universe expands, telecommuting allows us to reduce carbon emissions and energy use without forcing people to live in dense communities that most Americans, particularly in their adult years, clearly do not prefer. Greens, planners and many pundits seem anxious to force people to live in crowded housing close to buses and trains, yet rarely mention that it’s infinitely more eco-friendly to not commute at all.

    Finally there’s the often ignored issue of geography. If you force people to work in daily commuting distance from Yahoo’s Palo Alto headquarters, you are essentially telling them to live in a region where housing is among the most expensive in the nation. For anyone under 40 who does not have wealthy parents, a large amount of dot-com stock or recently robbed a bank, it’s almost impossible to buy a single-family home or spacious townhouse in the Valley, even in the only modestly attractive parts.

    So what’s the beef with the expansion of telecommuting? The conventional explanation usually revolves around the notion that putting employees together every day together generates greater innovation. See the New Yorker’s James Surowiecki for a good summary of this argument.

    That’s really not too surprising, since one of the last rationales for many without large financial resources to put up with big city home prices and taxes lies in the idea that, as the great economic royalist Michael Bloomberg maintains, you have to be located in “the intellectual capital of the world” to be successful. Natural allies of the anti-telecommuting crowd include urban land speculators and developers, who prefer that the “talent” remain chained to their particular locations and not wander off to the awful periphery.

    There are clearly advantages in face-to-face contact, particularly for younger people and top-echelon executives, who may be more effective minding the store if they hang around the office. But for most employees productivity actually rises with telecommuting.

    This is confirmed by broad studies such as one by the consultancy Workshifting that found, on average, a 27 percent rise in productivity among telecommuting employees. Over two thirds of the employers surveyed reported higher productivity among home-based employees, including British Telecom, Dow Chemical, American Express and Compaq.

    One of the best examples of telecommuting advantages can be seen at the high-tech company Cisco, which in contrast to Mayer’s assertion, has found telecommuters are effective at communicating and collaborating. It has also improved employee retention and also saved $277 million by allowing its employees to telecommute.

    Other companies reporting positive results, particularly in terms of retaining employees, from telecommuting, include IBM and Best Buy.

    Equally critical, notes a study by Global Workplace Analytics, are the tremendous environmental savings. Half-time telecommuting could reduce carbon emissions by over 51 million metric tons a year — the equivalent of taking all of greater New York’s commuters off the road. Additional carbon footprint savings will come from reduced office energy consumption, roadway repairs, urban heating, office construction, business travel and paper usage (as electronic documents replace paper). Traffic jams idle away almost 3 billion gallons of gas a year and accounts for 26 million extra tons of greenhouse gases.

    But perhaps most relevant, whatever its merits, telecommuting and home-based work seems to be the inevitable wave of the future, whether corporate managers like it or not. Working at home grew faster percentage-wise than any other mode of work access in the United States between 2000 and 2010. In that decade, the country added some 1.7 million telecommuters, almost twice the much ballyhooed increase of 900,000 transit riders.

    This tends to be more true in places like Silicon Valley, where workers are computer savvy and housing costs are onerous. Between 2005 and 2009, the Valley workforce grew by less than 10 percent but the telecommuting population increased by almost 130 percent. Tech-oriented places like Austin, Portland, Denver, San Diego, San Francisco and Seattle all rank among the cities with the highest percentage of people working at home.

    As workers become more familiar with technology, these trends should accelerate. A survey by the Information Technology Association of America found that 36 percent of respondents would choose telecommuting over a pay raise. These preferences appear to be even greater among millennial generation workers, who, according to a Pew study, tend to seek a “balance” between work and life. Global Workplace Analytics suggests this means they will be more attracted to flexible work throughout their careers , particularly as they start families.

    Other trends, including the huge expansion in self employment in the U.S., promise to accelerate telecommuting in years ahead. The ranks of independent contractors have grown by 1 million since 2005, according to George Mason University economist Jeffrey Eisenach. One in five work in such fields as management, business services or finance, where the percentage of people working for themselves rose from 28 percent to 40 percent between 2005 and 2010. Many others work in fields like energy, mining, real estate or construction. Altogether there are now as many as 10 million such independent workers, constituting upwards of 7.6 percent of the national labor force and over $626 billion in income.

    This trend will be further accelerated not only by millennials but increasingly by the other big growth demographic, aging boomers. The self-employment rate for adults 55 and older is 16.4 percent, according to the Bureau of Labor Statistics, well above the 10.4 percent rate of self-employment for the total labor force. From 2007 to 2008, the latest data available, new businesses launched by 55- to 64-year-olds grew 16 percent, an increase that was faster than that of any other group, according to the Kauffman Foundation. All told, Boomers in that age group started approximately 10,000 new businesses a month.

    Many of these older entrepreneurs are likely to work out of their homes, which many now own outright. In fact, over time, according to Workplace Analytics, upward of half the American workforce could eventually telecommute. Ultimately the issue of whether managers of office developers like this trend is beside the point. Smart managers who learn how to adjust to this path will flourish. Those who do not, like Marissa Mayer, are standing against a historical wave that is likely to prove too powerful for any company or CEO to overcome.

    Joel Kotkin is executive editor of NewGeography.com and a distinguished presidential fellow in urban futures at Chapman University, and a member of the editorial board of the Orange County Register. 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.

    This piece originally appeared at Forbes.com.

    Photo by By Rae Allen, "My portable home office on the back deck"

  • U.S. Could be Courting Trouble in Europe

    One of the most fascinating aspects of Barack Obama’s presidency stems not so much from his racial background, but his status as America’s first clearly post-European, anti-colonialist leader. Yet, after announcing his historic "pivot" to vibrant Asia, the president, the son of an anti-British Kenyan activist, recently announced as his latest foreign policy initiative an economic alliance with, of all places, a declining, and increasingly decadent, Europe.

    Some analysts, such as Walter Russell Mead, suggest the possible "ratting out" of the new Asia focus could constitute "a mistake of historic proportions." In East Asia, leaders, from Vietnam and Singapore to Japan, have been counting on a strong U.S. presence to ward off Chinese hegemony in the region. The idea of a reduced naval presence and a weakening commitment to allies would undermine our influence in this increasingly critical economic region.

    At the same time, the president’s desire to integrate our economies more closely to that of Europe reflects a longtime prejudice within the Democratic Party favorable to the old Continent. The notion of a new trade tie to the European Union set longtime Eastern policy types, such as former Bill Clinton aide and onetime Woodrow Wilson School head Anne-Marie Slaughter into rhapsodies about an emerging new "Atlantic Century." Vice President Joe Biden, for his part, told a recent Munich security conference that Europe represents "the cornerstone of our engagement with the rest of the world."

    This is delusional, to say the least. Republicans have their faults, but at least they know how to tell historic time. In contrast, largely Democratic Europhiles simply want to relive the glorious past, and consume a legacy of affluence. And to be sure, generally it’s more pleasant to attend – as long as someone is paying the bill – a conference in London, Paris or Zurich than Beijing, Mumbai or Mexico City. Europe, as we know from the debates over compensation of EU bureaucrats, knows how to treat functionaries with the comfort to which they easily can become accustomed.

    Pumping for greater Euro-ties seems almost insane under current conditions. The Continent’s unemployment rate, nearly 12 percent among the 17 EU member countries, is already at record levels, and its younger generation suffers unemployment approaching 30 percent or higher in at least five EU countries, including Greece, Spain and France. In Portugal, 2 percent of the population has migrated just in the past two years, not only to Northern Europe but, amazingly, also to Portugal’s booming former African colonies.

    This does not seem to be setting up the prime conditions for Ms. Slaughter’s imagined new "Atlantic Century." Although North America retains the resources, demographics and innovative culture to compete with Asia and other rising powers, Europe is in a notably downward trajectory. Its share of the world economy has plummeted from nearly 40 percent in 1900 to 27 percent today and continues to shrink rapidly. By 2050, not only the United States, but China and the rest of the developing world, according to the European Commission, will have surpassed the total of the 27 countries in the EU.

    One has to be a cockeyed optimist not to see that the long-term prognosis, even without the current euro crisis, is not good. Manufacturing, long a Continental bastion, is weak and falling behind that of the U.S. as well as Asia. German engineering may still be first-class, but much of the production and design will be moving to Mexico, the U.S., Latin America and Asia.

    Energy may prove a particular vulnerability. Although the region has shale and other energy resources, greens are far more powerful in Europe than in America and hostile to the hydraulic fracking that has created the current U.S. boom in oil and gas. The combination of radical green policies favoring expensive, often unreliable renewables, as well the shuttering of the Continent’s once-strong nuclear industries, are creating both high prices and wobbly reliability of electricity supplies. (Ironically, the reluctance to maintain nuclear power and oppose fracking for natural gas has led to a rise in greenhouse gas emissions and even some increased use of coal.) Tulane’s Eric Smith suggests many of Germany’s manufacturing powers are intensifying efforts to shift operations, notably to the southern United States, for cheap electricity and lower overall costs.

    Demographics, however, may be Europe’s weakest suit. Although East Asia is now experiencing low fertility, Europe has been demographically stagnant for at least a generation longer. By 2050, Europe’s workforce is expected to decline by 25 percent from 2000 levels; the U.S. is expected to see expansion of upward of 40 percent.

    This phenomenon threatens Europe’s lone serious economic power, Germany. The country now produces fewer children than in 1900. Given the expansive welfare state, the fiscal burdens being faced in Germany and other EU countries will dwarf those of the United States; by 2050 Germany will have nearly twice as many retirees per active worker as America.

    Yet remarkably, for all its manifest failings, Europe remains a Mecca and role model for many American progressives, like Ms. Slaughter. The past decade has seen the publication of a spate of books, such as Jeremy Rifkin’s "The European Dream" and Steven Hill’s "Europe’s Promise," that see Europe’s regulation state and "soft power" an alluring alternative to America. Some hail the EU as the prototype of a benign "new kind of empire" based on culture and pacifism.

    If so, it’s an empire rapidly hurtling into its dotage. The great European historian Walter Lacquer has pointed out that such optimism about the Continent becoming "united and prosperous" is likely "misplaced." In policy terms, for the U.S. to follow Europe’s model is an almost sure recipe for our own decline. Even the usually pro-free-trade Wall Street Journal is concerned that any attempt to "harmonize" American policies with those of the "European model" will simply expand government power and bureaucratic hegemony.

    To be sure, there remain parts of Europe, particularly in the Northern rim, that are doing better. These countries – the Netherlands, Scandinavia and Germany – have enacted significant labor market reforms, retain some strong industries and have tried to be responsible fiscally. If they broke off from the EU and set up a modern-day Hanseatic League, it may make sense for us to embrace stronger ties with them. But that can’t be said of an alliance with the weak sisters of the EU’s southern and eastern fringes, or even dirigiste state-dominated France.

    In reality, the EU will never become a giant Sweden. Scandinavia possesses a unique history, shaped by massive outmigration in the past century and a largely homogeneous population; many of these countries possess great natural resources, such as oil, iron ore or hydroelectricity. In contrast, the eastern edge of the zone contains some of the most depopulating parts of the planet, as people seek opportunities in the more economically viable North. The comic political economy of Italy, the political violence of Greece and the mass disenchantment of Spain presage a European future that contrasts greatly with the relative prosperity and order of the North.

    None of this suggests that, if the political strings are not wound too tight, that a free-trading arrangement with Europe may prove useful. But if an agreement becomes a wedge for accelerating the adoption of Euro-style policies, it could allow us to squander an opportunity to maintain our pre-eminence in the post-colonial, and post-European-centered, world.

    Joel Kotkin is executive editor of NewGeography.com and a distinguished presidential fellow in urban futures at Chapman University, and a member of the editorial board of the Orange County Register. 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.

    This piece originally appeared in the Orange County Register.

  • Richard Florida Concedes the Limits of the Creative Class

    Among the most pervasive, and arguably pernicious, notions of the past decade has been that the “creative class” of the skilled, educated and hip would remake and revive American cities. The idea, packaged and peddled by consultant Richard Florida, had been that unlike spending public money to court Wall Street fat cats, corporate executives or other traditional elites, paying to appeal to the creative would truly trickle down, generating a widespread urban revival.

    Urbanists, journalists, and academics—not to mention big-city developers— were easily persuaded that shelling out to court “the hip and cool” would benefit everyone else, too. And Florida himself has prospered through books, articles, lectures, and university positions that have helped promote his ideas and brand and grow his Creative Class Group’s impressive client list, which in addition to big corporations and developers has included cities as diverse as Detroit and El Paso, Cleveland and Seattle.

    Well, oops.

    Florida himself, in his role as an editor at The Atlantic, admitted last month what his critics, including myself, have said for a decade: that the benefits of appealing to the creative class accrue largely to its members—and do little to make anyone else any better off. The rewards of the “creative class” strategy, he notes, “flow disproportionately to more highly-skilled knowledge, professional and creative workers,” since the wage increases that blue-collar and lower-skilled workers see “disappear when their higher housing costs are taken into account.” His reasonable and fairly brave, if belated, takeaway: “On close inspection, talent clustering provides little in the way of trickle-down benefits.”

    One group certain to be flustered by this new perspective will be many of the cities who have signed up and spent hard cash over the years to follow Florida’s prescription of focusing on those things—encouraging the arts and entertainment, building bike paths, welcoming minorities and gays—that would attract young college-educated workers. In his thesis, the model cities of the future are precisely those, such as San Francisco and Seattle, that have become hubs of highly educated migrants, technology, and high-end business services.

    That plan, though, has been less than successful in many of the old rust belt cities that once made up much of his client base. Perhaps even more galling to these cities, Florida has turned decidedly negative in his outlook on many of those cities—now looking remarkably gullible—that once made up much of his client base.

    The most risible example of this may have been former Michigan Jennifer Granholm’s “cool cities” campaign of the mid-oughts, that sought to cultivate the “creative class” by subsidizing the arts in Detroit and across the state. It didn’t exactly work. “You can put mag wheels on a Gremlin,” comments one long-time Michigan observer. “but that doesn’t make it a Mustang.”

    Alec MacGillis, writing at The American Prospect in 2009, noted that after collecting large fees from down-at-the-heels burgs like Cleveland, Toledo, Hartford, Rochester, and Elmira, New York over the years, Florida himself asserted that we can’t “stop the decline of some places” and urged the country to focus instead on his high-ranked “creative” enclaves. “So, got that, Rust Belt denizens?” MacGillis noted wryly in a follow-up story last year at the New Republic. Pack your bags for Boulder and Raleigh-Durham and Fairfax County. Oh, and thanks again for the check.”

    One key constituency advocating “creative class” oriented development has been the grandees of urban real estate. Albert Ratner of Cleveland-based Forest City Enterprises, a major urban developer with a taste for subsidies, in New York and elsewhere, suggests Florida’s ideas provides the “playbook for developers.”

    For Rust Belt cities, notes Cleveland’s Richey Piiparinen, following the “creative class” meme has not only meant wasted money, but wasted effort and misdirection. Burning money trying to become “cooler” ends up looking something like the metropolitan equivalent to a midlife crisis.

    It would have been far more sensible, Piiparinen suggests, for such areas to emphasize their intrinsic advantages, such as affordable housing, a deep historic legacy tied to a concentration of specific skills as well as a strategic location. He urges them to cultivate their essentially Rust-Belt authenticity rather than chase standard issue coolness promoted by big developers like Forest City. Focusing on attracting the “hip cool” single set, Piiparinen maintains, simply sets places like Cleveland up for failure.

    Geography of Hip Coolness

    Perhaps the best that can be said about the creative-class idea is that it follows a real, if overhyped, phenomenon: the movement of young, largely single, childless and sometimes gay people into urban neighborhoods. This Soho-ization—the transformation of older, often industrial urban areas into hip enclaves—is evident in scores of cities. It can legitimately can be credited for boosting real estate values from Williamsburg, Brooklyn, Wicker Park in Chicago and Belltown in Seattle to Portland’s Pearl District as well as much of San Francisco.

    Yet this footprint of such “cool” districts that appeal to largely childless, young urbanistas in the core is far smaller in most cities than commonly reported. Between 2000 and 2010, notes demographer Wendell Cox, the urban core areas of the 51 largest metropolitan areas—within two miles of the city’s center—added a total of 206,000 residents. But the surrounding rings, between two and five miles from the core, actually lost 272,000. In contrast to those small gains and losses, the suburban areas—between 10 and 20 miles from the center —experienced a growth of roughly 15 million people.

    The smallness of the potentially “hip” core is particularly pronounced in Rust Belt cities such as Cleveland and St. Louis, where these core districts are rarely home to more than 1 or 2 percent of the city’s shrinking population. Yet the subsidy money for developers is often justified in the name of “reviving” the entire city, most of which has continued to deteriorate.

    Nor has this dynamic changed since the onset of the Great Recession, as urban boosters such as Aaron Ehrenhalt have suggested. Ehrenhalt, citing the perceived preferences of millennials, envisions an urban future where more reject the suburban life, in part as a reaction to the wreckage of the last housing bust. To Ehrenhalt, places like downtown Chicago are emerging as the modern-day version of early-20th-century Vienna, central cores that attracted the elites while the working class and middle class dullards regress to the suburbs. Yet in reality, an examination of data between 2011 and 2012 by Jed Kolko at Trulia found despite a spike in downtown residents, population losses continue in surrounding close-in urban neighborhoods, while the fastest growth has continued to be located further out in the periphery.

    Class Politics in the “Creative Age”

    Investments in “cool” districts may well appeal to some young professionals, particularly before they get married and have children. But overall, as Florida himself now admits, it has done little overall for the urban middle class, much less the working class or the poor.

    Indeed in many ways the Floridian focus on industries like entertainment, software, and social media creates a distorted set of economic priorities. The creatives, after all, generally don’t work in factories or warehouses. So why assist these industries? Instead the trend is to declare good-paying blue collar professions a product of the past. If you can’t find work in deindustrialized Michigan, suggests Salon’s Ray Fisman, one can collect “ more than a few crumbs” by joining the service class and serving food, cutting hair or grass in creative capitals like San Francisco or Austin.

    These limitations of the “hip cool” strategy to drive broad-based economic growth have been evident for years. Conservative critics, such as the Manhattan Institute’s Steve Malanga have pointed out that many creative-class havens often underperform economically compared to their less hip counterparts. More liberal academic analysts have denounced the idea as “ exacerbating inequality and exclusion.” One particularly sharp critic, the University of British Columbia’s Jamie Peck see it as little more than a neo-liberal recipe of “biscotti and circuses.”

    Urban thinker Aaron Renn puts it in political terms: “the creative class doesn’t have much in the way of coattails.”

    Why Hipness Can’t Save New York

    The sad truth is that even in the more plausible “creative class” cities such as New York and San Francisco, the emphasis on “hip cool” and high-end service industries has corresponded with a decline in their middle class and a growing gap between rich and poor. Washington D.C. and San Francisco, perennial poster children for “cool cities,” also have among the highest percentages of poverty of any major urban center—roughly 20 percent—once cost of living is figured in.

    Nowhere are the limitations of coolness more evident than in New York, our country’s cultural capital and now one of Florida’s three residences, along with Toronto and Miami Beach. Manhattan suffers by far the highest level of inequality among the country’s 25 most populous counties, a gap between rich and poor that’s the widest it’s been in a decade. New York’s wealthiest one percent earns a third of the entire city’s personal income—almost twice the proportion for the rest of the country.

    This geography of inequality is now extending to the outer boroughs. In nouveau hipster and increasingly expensive Brooklyn, nearly a quarter of people live below the poverty line. While artisanal cheese shops and bars that double as flower shops serve the hipsters, one in four Brooklynites receives food stamps. New York has seen the nation’s biggest rise in homelessness; the number of children sleeping in the shelters of Mike Bloomberg’s “luxury city” has risen 22 percent in the past year.

    The Issue of Race

    On paper, the “creative class” theory worships at the altar of diversity. “The great thing about cities,” Florida told NPR last year, “is they’re diverse. There’s diverse people in them.” Yet even leaving aside their lack of economic diversity, the exemplars of “hip cool” world, notes urban analyst Renn, tend to be vanilla cities with relatively small minority populations. San Francisco, Portland and Seattle are becoming whiter and less ethnically diverse as the rest of the country, and particularly the suburbs, rapidly diversify.

    Creatives may espouse politically correct views, but the effect of Florida’s policy approach, notes Tulane sociologist Richard Campanella, often undermine ethnic communities. As they enter the city, creatives push up rents, displacing local stores and residents. In his own neighborhood of Bywater, in New Orleans, the black population declined by 64 percent between 2000 and 2010, while the white population increased by 22 percent.

    In the process, Campanella notes, much of what made the neighborhood unique has been lost as the creatives replace the local culture with the increasingly predictable, and portable, “hip cool” trendy restaurants, offering beet-filled ravioli instead of fried okra, and organic markets. The “unique” amenities you find now, even in New Orleans, he reports, are much what you’d expect in any other hipster paradise, be it Portland, Seattle, Burlington, Vermont or Williamsburg.

    Families and the Future

    Campanella also suggests another byproduct of hipster gentrification: a dearth of families. Ten years ago his increasingly “creative class” neighborhood of Bywater was family oriented. Now, it’s “a kiddie wilderness.” In 2000, 968 youngsters lived in the district. Just 10 years later, the number had dropped by 70 percent, to 285. When his son was born in 2012, it was the first post-Katrina birth on his street, the sole child on a block that had 11 when he first arrived from Mississippi in 2000.

    Unsurprisingly, there’s not much emphasis about families in Florida’s work, in part because his basic theory puts focuses largely on groups like singles, childless young professionals and gays. He largely discounts suburbs, generally the nation’s nurseries, as outdated for the “creative age” and considers homeownership and single family houses, also vastly preferred by families, as fundamentally passé.

    Indeed, the places that most attract “the creative class” are also the ones with the fewest families and children, led by San Francisco, Seattle, Manhattan, and rapidly gentrifying Washington, D.C. The very high prices per square foot, understandably celebrated by urban real estate boosters, have made it hard not only on the poor but on middle- and even upper-middle-class families. When you have children, you often have to let go of your bohemian fantasies; it’s hard to imagine being a parent in a place like San Francisco where there are a raging debates about the right of people to walk around naked.

    The Real Geography of Opportunity

    To be sure, the leading “creative class” cities have much to recommend them, and some of them, such as Portland and Boston, have registered impressive rises in their per capita income in recent years. But over the past decade, most “cool cities” have not been enjoying particularly strong employment or population growth; in the last decade, the populations of cities like Charlotte, Houston, Atlanta, and Nashville grew by 20 percent or more, at least four times as rapidly as New York, Los Angeles, San Francisco, or Chicago. This trend toward less dense, more affordable cities is as evident in the most recent census numbers than a decade.

    One reason for this: the fastest job growth has taken place in regions—Houston, Dallas, Oklahoma City, Omaha—whose economies are based not on “creative” industries but on less fashionable pursuits such as oil and gas, agriculture and manufacturing. Energy mecca Houston, for example, last year enjoyed the largest GDP growth of any major American city, easily outpacing “creative” urbanist favorites like Chicago, New York, San Francisco, or Boston. The other two top GDP gainers were Dallas-Fort Worth and, surprisingly, Detroit, largely as a result of the auto industry’s comeback.

    Of course, some these ascendant cities now are sprouting their own “hip” neighborhoods. But these regions also accommodate far faster growth in rapidly expanding, family-friendly suburbs and exurbs. Equally important, none, including “creative class” hotspots Raleigh and Austin, are dense, transit-centered places of the kind urbanists suggest create economic vibrancy and attract the largest number of migrations.

    In fact both Raleigh and Austin are both very low-density regions with only compact urban pockets surrounded by vast suburban communities. Take a walk in downtown Raleigh sometime; about five minutes from the densest central areas and you find yourself on tree-lined streets with nice single-family houses, essentially, older suburbs. Austin, too, is a relatively low-density place surrounded by the kind of suburban sprawl detested by Floridians; this is also the case with Charlotte, Atlanta, and other fast-growing cities.

    These facts, of course, are unlikely to interfere with the self-interested lobbying by large developers for subsidies for downtown development much less the defined prejudices of the urban-centric media. But contrary to the narrative espoused by Florida and other proponents of high-density cities, the predominant future urban form in America is emerging  (largely unrecognized to the media) elsewhere, in places less dense, economically diverse and, perhaps, just a bit less hip and cool.

    Joel Kotkin is executive editor of NewGeography.com and a distinguished presidential fellow in urban futures at Chapman University, and a member of the editorial board of the Orange County Register. 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.

    This piece originally appeared in the The Daily Beast.

    Seattle photo by Bigstock.