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  • On Jane Jacobs: “Generating and Preserving Diversity”

    “To understand cities, we have to deal outright with combinations or mixtures of uses, not separate uses, as the essential phenomena.”

    “Cities need old buildings so badly it is probably impossible for vigorous streets and districts to grow without them.” -Jane Jacobs, The Death and Life of Great American Cities

    One of Jane Jacobs’s great insights was the importance of diversity and a mixture of uses to urban success.  Cities seem to be natural generators of diversity, but not universally so. Some places are lively and bustling while others remain inert. Jacobs attempted to diagnose this by identifying four key items she believed needed to be in place to actively generate diversity in an urban district:

    1. The district must serve more than one primary use, and preferably more than two.
    2. Most blocks must be short.
    3. Buildings must be mingled in their age, condition, and required economic yield.
    4. A dense concentration of people.

    Some of these, such as block size, would appear to be relatively stable over time. Others respond dynamically, either bringing about or destroying diversity.  In the current “global city” era, we see two countervailing trends here, one tending to support diversity, the other to destroy it.

    On the plus side, we’ve seen many formerly monolithic central business districts such as Chicago’s Loop or Downtown Manhattan see additional primary uses come into being. For example, Downtown Manhattan has seen a residential population boom. Chicago’s Loop also has vastly more residents than in years past, as well as the emergence of the so-called “Loop U”, a collection of colleges that collectively have over 60,000 students. Tourism has also taken on a more important role.

    Similar trends have appeared in other cities. We see what were once 9-5 office districts or down at the heels industrial zones near the center take on several new primary uses, notably residential, educational, tourism, entertainment, and cultural hub activities.  These new primary uses bring different people, on different schedules, into the districts in question to help fuel a significant increase in liveliness and diversity.  This is exciting news for those of us who love cities.

    On the other hand, we’ve also witnessed what may be a longer term threat. Jacobs also noted that diversity tended to destroy itself, particularly as one use becomes dominant and bids up rents to the point where other uses flee.  This results in a single-use office district, restaurant strip, etc.

    The rise of the global city has seen outsized returns to those who participate in selected functions such as specialized finance or producer services. This has led to large cost increases in these cities which has displaced non-high end functions. Central cities are increasingly playgrounds for the rich, lacking in the diversity of people and uses that were once there.

    From a Jacobsian perspective, one troubling consequence has been the reduction in the supply of older, obsolete buildings with lower economic yield requirements. Large numbers of older buildings, such as Class C office space or warehouses, have been demolished and replaced, or else converted into high end uses such as luxury condos. This is reducing the supply of lower rent buildings, undermining one of the pillars of Jacobs foundations of diversity. She noted how the hot areas tended to move around in cities as uses were displaced. So perhaps it is unsurprising that various districts in Brooklyn, for example, have become hipster and artistic havens while Manhattan has become more uniformly upscale and placid.

    Whether or not these global city effects will ultimately lead to a self-undermining success is unknown. But the loss or upscale conversion of older and lower rent buildings in our central cities, while something to celebrate in many respects, should be a long term concern to those who care about truly sustainable urban diversity, especially if taken too far.

    This piece originally appeared as a part of the City Builder Book Club’s discussion of Jane Jacobs’s "The Death and Life of Great American Cities."

  • Foreign Industrial Investment Is Reshaping America

    Declinism may be all the rage in intellectual salons from Beijing to Barcelona and Boston, but decisions being made in corporate boardrooms suggest that the United States is emerging the world’s biggest winner. Long the world leader as a destination for overseas investment, the U.S. is extending its lead as the favored land of overseas capital.

    Since 2008, foreign direct investment to Germany, France, Japan and South Korea has stagnated; in 2009, overall investment in the E.U. dropped 36%. In contrast, in 2010 foreign investment in the U.S. rose 49%, mostly coming from Canada, Europe and Japan. The total was $194 billion, the fourth highest amount on record.

    Foreign investment is already reshaping the American economic landscape, shifting wealth and income from differing regions. The transformative role is nothing new. After all, the country started as a colony of England, and for much of the 19th century remained dependent on European investors for everything from building canals to railroads. Without European capital, the settlement of the West and the rise of cities such as New York would have been far slower.

    Today this pattern is re-asserting itself as foreign countries rediscover America’s intrinsic advantages: a huge landmass, vast natural resources, a large, expanding consumer market and a relatively predictable legal system. Our relatively vibrant demographics — at least before the Great Recession depressed birthrates and immigration — marks a strong contrast with such key countries as Japan, South Korea and Germany, all of which are aging far more rapidly than the United States. China’s authoritarian political system leaves many investors reluctant to expose themselves too much to the regime’s often less than tender mercies.

    The investment boom is concentrated not so much in the most celebrated sectors, such as tech or trophy real estate, but in the more basic industries that are best suited to our large, resource-rich country. Investment in the burgeoning energy sector more than tripled to $20 billion between 2009 and 2010. Some of this investment has come into the renewable industry, where Europe and China also have heavily subsidized companies, but the vast bulk has been devoted to the country’s expanding production of oil and gas.

    The shale revolution in particular has attracted foreign interest. Energy firms from China, France and Spain have all placed major investments in the shale fields of Ohio, Colorado and Michigan. French giant Total recently paid $2.3 billion for minority stakes in the vast oil and gas holdings of Chesapeake Energy.

    Perhaps even more important has been a surge in industrial investment, which rose $30 billion just between 2009 and 2010. Much of this growth is concentrated in the chemical industry as well as automobile, steel and other transportation sectors. It is also heavily focused on the southeastern states and Texas — the very places that most surveys reveal have the most hospitable business climates. According to a recent study by Site Selection magazine, the five states with the best business climates and 10 of the top 12 are from the old Confederacy.

    Foreigners, particularly from large global corporations, are not stupid. They also are not burdened as much as domestic firms with legacy costs or romantic attachments to traditional industrial bailiwicks. “At the end of the day, a company looks at a whole nation and looks at the factors that matter most, like ease of doing business,” notes Bill Taylor, who for 17 years headed up Mercedes’ U.S. operations. “The Southeast has that and has a workforce willing to be engaged. They have found the area to be very fertile ground.”

    This has certainly been true for companies such as Mercedes, whose largest U.S. plant is in Tuscaloosa, Ala. Last year the company invested $350 million in the facility.

    Nor is Mercedes alone. Arch competitor Volkswagen last year announced it will build a new assembly plant in Chattanooga, Tenn. Nissan, Toyota and Kia have all announced major new plant openings or expansions over the past three years throughout the region.

    These are not inconsequential investments. With the average cost of building these facilities at over $1 billion, and the higher-paying manufacturing jobs they represent, such plants represent major employment generators. They also bring with them parts suppliers and other industries related to auto manufacturing. Alabama, for example, has seen major steel mill investments, including $4.6 billion from Germany’s Thyssen Krupp.

    Over the next decade, these investments could transform the nation’s industrial structure. Alabama and Kentucky already produce almost as many cars as Michigan. According to the U.S. Dept. of Labor, Michigan still leads the country in auto employment with 181,000 jobs, followed by Indiana. But the next three states are Kentucky, Tennessee and Alabama.

    Why is this happening? Managers in foreign firms, suggests Taylor, who previously worked for Ford and Toyota, believe Southern workers have not picked up the bad habits and work rules common among their unionized Midwestern brethren. Unions certainly are much less of an issue in the Southeast. Though Alabama has seen a huge jump in the number of its auto workers in recent years, according to its state department of labor, only 7,100 are unionized. Nationwide, according to the Bureau of Labor Statistics, around 12 percent of workers belong to unions, compared to just over 10 percent in Alabama. Less than 5 percent of workers in Georgia, Texas, South Carolina, Virginia and North Carolina belong to them.

    Unions are not the only issue. The South also enjoys a strong network of rail and highway lines that make transport to key markets easy and affordable. Energy costs tend to be lower. Furthermore, many Southeastern port cities — notably Houston, Charleston, Mobile, Hampton Roads — have made big infrastructure investments in recent years.

    The Southeast also plans to become a research hub for the auto industry. The Clemson University International Automotive Research Center is the nation’s only school to offer a Ph.D. in automotive engineering and has secured $200 million in commitments. Additionally, the South Carolina center has created partnerships beyond auto manufacturers with other universities in the area: Auburn, Mississippi State, Alabama, Alabama-Birmingham, Kentucky and Tennessee.

    The overall impact of the Southeast’s auto industry may not be fully felt for a few years. But long-term prospects are excellent. U.S. manufacturers, notably GM and Chrysler, make most of their money on fuel-guzzling trucks and SUVs. GM’s Volt, its much-hyped fuel-efficient car, has so far proved an expensive dud. In contrast, the major foreign manufacturers — particularly Volkswagen, Honda, Toyota, and Kia — have long experience in building reliable, fuel-efficient cars. Demographically the high-end makers, notably BMW and Mercedes, increasingly dominate the luxury market, particularly among younger customers.

    Battle tested in world markets, these firms — and their counterparts in steel and other metals-related industries — are successful competitors and reliable employers. Overall, according to the U.S. Department of Commerce, foreign manufacturing firms, in autos and elsewhere, have proven far less susceptible to layoffs than their domestic competitors. They also tend to offer higher salaries on average than U.S.-based firms.

    Some observers, such as the American Prospect’s Harold Meyerson, decry these investments. He believes foreign firms, particularly from Europe, come to “slum.” America, as he puts it, is where Europeans now go “to get the job done cheap.”

    Meyerson points out, correctly, that these companies generally invest in mostly Southern “right to work” states in order to avoid entanglements with unions. They also avoid stricter environment controls in green-dominated juristictions such as California. Not surpsingly these plants are often seen as regressive at Berkeley salons or at AFL-CIO headquarters. But they may seem far more congenial in the historically poor backwaters of the Southeast , long lacking in steady, relatively well-paid and skilled work.

    When Toyota recently announced plans to establish a plant for the Prius near Tupelo, Miss., (birthplace of Elvis), one imagines few locals were singing the blues. Instead the new plant received 35,000 applications for 1,300 available spots.

    To be sure, these new jobs may not pay as well as top-grade UAW contracts, and a lack of unions could expose workers to undue management pressure. But in an economy where $8 hour jobs are king, an entry level job that involves learning technical skills and starts at $14 may appear akin to manna from heaven .

    Of course, some will denounce this “foreign” influence as pernicious or even neo-colonialist. But the overseas investment surge might also be seen as confirming, once again, that at least some places in the country remain fields of opportunity for people other than geeks, corporate rent-seekers or investment bankers.

    This piece originally appeared in Forbes.com.

    Joel Kotkin is executive editor of NewGeography.com and is a distinguished presidential fellow in urban futures at Chapman University, and contributing editor to the City Journal in New York. He is author of The City: A Global History. His newest book is The Next Hundred Million: America in 2050, released in February, 2010.

    Manufacturing Industry photo by Bigstockphoto.com.

  • California’s Bullet Train — A Fresh Start and a Change in Direction

    A new strategy is beginning to emerge toward California’s embattled high-speed rail venture. The strategy is designed to rescue the project from a possible defeat at the hands of the state legislature, gain friends and supporters among local transportation agencies, win converts among independent analysts and turn around a largely skeptical public.

    The plan combines the existing commitment to proceed with construction of the first rail segment in the Central Valley with near-term actions aimed at upgrading rail facilities at both ends of the proposed LA-to-SF high-speed line. Specifically, the so-called "bookend" strategy will involve "blending" high-speed rail service with commuter rail service in existing Bay Area and Southern California rail corridors.

    At the northern end of the line, between San Francisco and San Jose, bullet trains would share track with Caltrain commuter trains. Both would benefit from new investments in electrification, signaling systems, bridge replacements, passing tracks and grade crossings elimination. Similar type of improvements would be introduced at the Los Angeles/Orange County/San Diego ends of the line, benefitting LA’s Metrolink and other Southern California commuter rail and transit systems.

    Improving the urban "bookends" of the system will make it possible to increase the speed of local commuter trains and thus bring immediate benefits to large segments of California’s urban population. It will be a good investment whether or not the overall $98 billion high-speed rail project ever goes forward, said Will Kempton, chief executive of the Orange County Transportation Authority (OCTA) and Chairman of the independent Peer Review Group advising the High Speed Rail Authority.

    The investments will be funded with a portion of Proposition 1A funds, supplemented by matching funds from local government agencies. Up to $2.3 billion in bond money and its $950 million "interconnectivity" fund would be committed to these near term improvements according to well-informed sources. This would provide approximately $1.4 billion for Southern California and $900 million for the Bay Area, assuming a 60/40 split. Another $2.7 billion has been already set aside for the 130-mile Central Valley segment, leaving roughly $4 billion of Proposition 1A money for future HSR construction.

    The new strategy has evolved from discussions held by the High Speed Rail Authority’s new chairman, Dan Richard with the Governor and his fellow board members. In a conversation we had with Chairman Richard several weeks ago, he was frank to admit that significant changes must be made in the Authority’s way of doing business if the bullet train project is to retain the support of the state legislature, overcome the skepticism of independent critics and turn around public opinion. The Authority must find ways, in the Governor’s words, to do things "better, faster and cheaper."

    While supportive of the Governor’s vision, Richard saw a need to show signs of near-term progress and not have to wait until 2033 to demonstrate the benefits of the investment. The dollars spent on the "bookends" could have "an immediate and dramatic effect," he told us.

    Turning to the Central Valley project, Richard freely admitted the ham-handed way in which the Authority dealt with the affected property owners and local governments. He made plain his resolve to restore trust and rebuild the agency’s credibility with the Valley constituencies. We also were struck by his refreshing willingness to reach out to the program’s critics, in contrast to the Authority’s often arrogant and dismissive posture of the past.

    Richard’s new strategy is beginning to bear fruit. Six Southern California planning and transportation agencies, including the Southern California Regional Rail Authority (Metrolink) voted as a group on March 1 to support the development of high-speed rail "while providing funding for local early investment projects in

    Southern California that will improve rail service immediately." The Authority hopes to stimulate similar expressions of support in Northern California by working closely with the Bay Area’s Caltrain and San Francisco’s Municipal Transportation Agency. The Peer Review Group, which has long supported the "bookends" approach, can be expected to provide an additional boost to Richard’s strategy.

    As for the initial Central Valley segment, its construction, initially planned to begin in September, has been pushed back. The slowdown is due to the need to revisit the environmental report whose initial version has run into a storm of objections concerning the proposed route. The revised draft report will be subject to another round of public hearings before the route through the valley is finalized. Assuming the state legislature authorizes the bond funding, construction in the Central Valley is now expected to begin in early 2013, although court challenges may cause further delays. Critics are expected to continue questioning the value of that investment, fueling continued controversy and increasing the project’s vulnerability.

    A New Perception

    Regardless of what ultimately becomes of the Central Valley project, the new urban "bookends" strategy is bound to profoundly modify the public perception of the bullet train venture. While the Governor and Chairman Richard maintain that the ultimate year 2033 goal of a 2 hour 40 minute train trip from LA to San Francisco has not changed, the practical effect of the new strategy will be to shift the focus from achieving that distant vision to effecting concrete near-term improvements— investments designed to benefit millions of present-day commuters in California’s two largest metropolitan rail corridors.

    Given California’s budget deficit, given the uncertainty of further federal support for high-speed rail in general and for California’s HSR project in particular (see below), and given a lack of any evidence of private investor interest, the"bookend" program of investments may indeed end up as the key accomplishment of the Proposition 1A initiative. While bullet train visionaries will regret this shift in the focus, pragmatists will welcome it as a prudent and realistic response to the growing skepticism. From an economist standpoint, the bookend strategy will be viewed as the best use of scarce financial resources. The public will see it as a victory for common sense: a decision that wisely  places greater value on satisfying present-day needs than on the promise of distant-in-time benefits.

    Could Washington come to the rescue?

    Meanwhile, in Washington, the Administration continues pursuing its fantasy-land rhetoric. "We envision an America in which 80 percent of people have access to high-speed rail," Transportation Secretary Ray LaHood reiterated in a recent blog. "We’re committed to this program… there’s no going back… we will keep the momentum going" he stated at a February 29 high-speed rail conference sponsored by the U.S. High Speed Rail Association.

    Except that this momentum, if there ever was one, has long since vanished. No funds for high-speed rail have been provided two years in a row, including the current (FY 2012) year. Nor are any HSR funds likely to be appropriated  in the next year’s budget. Congressional reaction to the Administration’s $2.5 billion HSR request in its FY 2013 budget submission has ranged from cool to dismissive. The President’s high-speed rail program is "a vision disconnected from reality" members of the Senate Budget Committee told Sec. LaHood at a recent hearing on the Administration’s transportation budget.

    Rep. John Mica (R-FL), chairman of the House Transportation and Infrastructure Committee was even more blunt. "If the president thinks his proposal for high-speed rail is going to fly, he’s pipe-dreaming," he told participants at the February 29 rail conference. In short, all signs point to continued congressional unwillingness to support a federal high-speed rail program. This sentiment seems to cross party lines: neither the Republican-controlled House nor the Democratic-led Senate have included HSR funds in their reauthorization bills. Rep. Jeff Denham’s (R-CA) bill would specifically prohibit new federal funds from going to California’s bullet train project during the entire life of the bill.

    For California, the implications are grave. Without further federal funds, the State of California will be obliged to seek a fresh infusion of public and private funds by 2015 if it is to continue pursuing its $98 billion bullet train vision. Will a new bond initiative or a public-private partnership succeed? Time alone will tell.

  • Is The United States Population Heading to Long-term Deceleration?

    It’s been clear since the census 2011 estimates were released on December 21, 2011, that we are experiencing something of a demographic change, at least in the short run. Clearly growth is slowing down in part, many believe, due to economic reasons, as was the case during the 1930s as well as the 1970s.

    But there may be a series of other of causes of recent population change which suggest it is quite possible the United States population is simply heading towards zero population growth far quicker than the Census had previously estimated. One key reason may be the slowdown in immigration. Whatever the cause, if these patterns are not reversed, we could start observing European like slow rates of population growth spreading in the next couple of decades.

    The 2011 numbers estimated 4,008,000 total births in the United States, while a just released report by the Centers for Disease Control and Prevention (CDC) shows a provisional estimate of 3,978,000 births from June, 2010 to June, 2011—the first time this number has been under four million since 1999. This   certainly may be attributed to the effects of the economic recession, but may be part of much larger demographic trends — such as falling fertility rates of Hispanic women — that eclipse economic fluctuations.

    Here is a series of maps that highlight recent population changes for the 50 states. The District of Columbia is too small to be seen at this scale, but DC did have the fastest population growth rate from 2010 to 2011, at 2.16%.  There are a variety of ways to present the same data, classifying and color coding, but it is always good to look at total numbers, and both absolute and relative change.

    Map Figure One: Estimated Population by State as of July 1, 2011

    The United States now has a population of about 311 million persons, and four states (California, Texas, New York and Florida) exceed fifteen million persons.  Combined, these top four states combined have 101.9 million people.

    Map Figure Two: Estimated Absolute Change in Population from July 1, 2010 to July 1, 2011

    The second map shows the absolute change in population from July 1, 2010 to July 1, 2011 in six categories. Only one state, Michigan, lost population, but fourteen states added less than ten thousand persons. A total of twenty seven states added fewer than 25,000 persons. Four states added over 100,000 persons; Florida added 218,929 persons, while Georgia added 103,053 persons.  California, although its population growth is slowing down, added 353,714 persons. Texas grew by the most people—421,215 persons—a rate that, if maintained, might result in the state surpassing 30 million people in the 2020 census.  It still has a long way to go to catch up with California, which in 2011 has an estimated population of 37,691,912.

    Map Figure Three: Estimated Relative Change in Population from July 1, 2010 to July 1, 2011

    The third map shows relative percentage change. Although Michigan remains the only state to shrink, thirteen states are now growing less than a third of a percent a year, similar to many European Countries with very slow population growth. Overall, the United States population increased by 0.73 percent—a noticeable difference from 1970 through the 2000s, when population was consistently growing at about one percent per year. The highest rate of growth was Texas at 1.67 percent. Texas in 2011 is similar to Arizona and Nevada a few years back—states with both high absolute and relative population growth, and both positive domestic migration from other states and international migration from around the world. Texas is, for now, the most dynamic place for demographic change.

    Map Figure Four: Estimated Relative Births minus Deaths (Natural Rate of Absolute Population Change) from July 1, 2010 to July 1, 2011

    The natural rate of population growth (births minus deaths), was estimated at 1,557,874 persons from July 1, 2010 to July 1, 2011. A third of this growth occurred in two states, California and Texas, and Texas had the highest natural rate of absolute growth at 274,024 persons compared with 230,798 for California.

    West Virginia is the first state to record more deaths than births, but a number of states are only a few years away from attaining this status that occurs at the end of the demographic transition process. In Ohio   the natural rate of population growth is higher than the total rate, due to negative net migration, suggesting it is one of a number of states that could have modest population increase if it could cease losing people to other places.

    Map Figure Five: Estimated Relative Births minus Deaths (Natural Rate of Relative Population Growth) from July 1, 2010 to July 1, 2011

    The fifth map shows what appears to be an East-West split.  In the eastern thirty-one states, with the exception of Georgia, states have a natural rate of growth that is similar to other parts of the world with slowing or negative populations, including most of Europe, Russia, and East Asia. On the other hand, twelve out of nineteen western states have a natural rate of population growth exceeding 0.6 percent.

    The highest rate of natural growth is in Utah, with an annual change of 1.36 percent, similar to the current population growth rate of India. Alaska also has a natural rate of increase above one percent, at 1.1 percent, and Texas, at 0.91 percent, has a similar rate of natural increase as the United States had for total population growth rate only a few years ago.  The overall natural rate of increase for the United State is 0.5 percent per year, similar to China and France.

    Map Figure Six: Estimated International Migration from July 1, 2010 to July 1, 2011

    The sixth map shows that every state had international migration during 2010-2011.  Most states number in the thousands, but five states, California, Texas, Florida, New York and New Jersey, have over thirty thousand migrants arriving.

    Map Figure Seven: Estimated Domestic Migration from July 1, 2010 to July 1, 2011

    In contrast to the map of international migration, the seventh map shows domestic migration; the net effect of millions of Americans moving to different states during the course of a year.  Twenty-four states show negative domestic migration, including all of the Midwest states except North and South Dakota.  Texas and Florida experience both strong international and domestic migration, while California, New York and New Jersey have negative domestic migration and positive international migration.

    Map Figure Eight: Estimated Net Migration (Combined International and Domestic) from July 1, 2010 to July 1, 2011

    The eighth and final map shows the effects of net migration. States along the West Coast, the State of Texas, and the South Atlantic Region have all experienced net positive migration.  A band of states mostly in the Midwest and Northeast have negative net migration, as their residents leave for other places.  Migration patterns have been occurring for a long time, but what will be new is how migration occurs in the face of slowing overall natural rates of population change.

    These numbers are, of course, just one year and it is entirely possible that growth will rise as the economy improves and as the current large millennial generation enters their prime child bearing years. But if the current one-year trend becomes a longer term phenomena, we could see a possible leveling off of population much sooner and at a lower rate than forecasted, say around 360 million by mid-century instead of 478 million by the year 2100 as forecast by the United Nations Population Division. These, will have implications for government fiscal policy, and will generate debate about government policy in encouraging births as we observe in Europe, Russia and Japan.  Population growth has been a relative advantage for the United States and remains so, but we may have to consider whether this trend is inexorable.

    Ron McChesney is a Geographer with Three Scale Strategy and Research in Columbus, Ohio. Ron received a PhD in Geography at The Ohio State University in 2008.

    Greg Overberg is a City and Regional Planner with Three Scale Strategy and Research in Columbus Ohio.  Greg received a MA in City and Regional Planning at The Ohio State University in 2011.

  • The Return of the Monkish Virtues

    “[The author of Leviticus] posits the existence of one supreme God who contends neither with a higher realm nor with competing peers. The world of demons is abolished; there is no struggle with autonomous foes, because there are none. With the demise of the demons, only one creature remains with ‘demonic’ power – the human being. Endowed with free will, human power is greater than any attributed to humans by pagan society. Not only can one defy God but, in Priestly language, one can drive God out of his sanctuary. In this respect, humans have replaced demons…..[The author of Leviticus] also posits that the pollution of the sanctuary leads to YHWH’s abandonment of Israel and its ejection from the land….Israel pollutes the land; the land becomes infertile; Israel is forced to leave.” – Jacob Milgrom, Leviticus


    “Pollution ideas are the product of an ongoing political debate about the ideal society. All mysterious pollutions are dangerous, but to focus on the physical danger and to deride the reasoning that attaches it to particular transgressions is to miss the lesson for ourselves…. Pollution beliefs trace causal chains from from actions to disasters…Pollution beliefs uphold conceptual categories dividing the moral from the immoral and so sustain the vision of the good society.” – Mary Douglas and Aaron Wildavsky, Risk and Culture


    “Celibacy, fasting, penance, mortification, self-denial, humility, silence, solitude, and the whole train of monkish virtues; for what reason are they everywhere rejected by men of sense, but because they serve to no manner of purpose; neither advance a man’s fortune in the world, nor render him a more valuable member of society; neither qualify him for the entertainment of company, nor increase his power of self-enjoyment? We observe, on the contrary, that they cross all these desirable ends; stupify the understanding and harden the heart, obscure the fancy and sour the temper. We justly, therefore, transfer them to the opposite column, and place them in the catalogue of vices.” – David Hume, An Enquiry Concerning the Principles of Morals

    The era of the 100 watt incandescent light bulb came to an end in America on January 1st. Lower wattages will soon join them in a phaseout over time. As I noted previously, this will mean factory shutdowns in the United States and the migration of the light bulb manufacturing industry to China. The most common replacement type bulbs, compact fluorescents, are not “instant on,” generally fail to provide a proper light spectrum, contain poisonous mercury, and burn out sooner than advertised. CFL boosters claim none of these are real problems and that CFLs are a slam dunk for benefit/cost reasons, but the cold reality is that despite significant promotion, they never received widespread consumer adoption voluntarily. Given how eagerly consumers slurp up even bona fide more expensive products like Apple computers when they are perceived to be superior, I’m inclined to think the consumers are on to something. I’ve tried out CFLs myself and thought they basically sucked.

    The supposed rationale for imposing an inferior product that did not receive the desired traction in the the marketplace is to prevent climate change. I went searching to try to find exactly what the impact of light bulbs on greenhouse gas emissions was and have found it quite difficult to obtain. The various sites touting CFLs all note the high output of CO2 from electricity generation generally, how much CO2 changing this or that bulb will save, etc, but as for what a wholesale elimination of light bulbs would achieve, that’s harder to find.

    According to the EPA, residential electricity accounted for 784.6 million metric tons of CO2 in 2009, or 11.8% of total US human greenhouse gas emissions. How much of that is from light bulbs? It’s not broken out in the EPA’s report (even the detailed version), but I’ll attempt an estimate of aggregate CO2 savings. (If someone has a direct link to this information, please let me know).

    The Guardian reported that an Australian incandescent ban would save that country 800K tons of CO2 emitted per year and a UK ban would save 2-3 million tons. It also reported that China could save 48 million tons per year by banning incandescents.

    The US is bigger than Australia and the UK, but similarly advanced developmentally. China is a bigger emitter than the US, has far more people, is less advanced developmentally, and is a bigger user of coal for electricity generation. However, all three countries project similar per capita emissions reductions from incandescent elimination. If the US savings were at the upper end of their range, it would have CO2 savings of around 15 million tons a year. That’s only 0.2% of total US greenhouse gas emissions. Even if the US saved the same 48 million tons as China, it’s only 0.7%. I’d be skeptical of anyone claiming the US would save a lot more CO2 per capita than these. Some maybe, a lot, no.

    In short, swapping out incandescent light bulbs is not going to be a major contributor to solving the problem of climate change. I’m not aware of anyone claiming it is. So why pass a law that is unpopular in many quarters and cram CFLs and other type of bulbs consumers haven’t chosen to buy on their own down their throats? It seems to be a purely provocative move of a mostly symbolic nature with little real substance that is sure to only harden opposition to the real changes we need to make to actually make material reductions in GHG emissions. (One might say the same of other items like mandatory recycling or banning plastic grocery bags).

    The answer is that the symbolism is the substance.

    The sad reality is that rather than make policy cases based on benefit/cost or other technical considerations, for political or personal reasons sustainability advocates have decided to model their cause on the template of religion. In it we have an Edenic state of nature in a fallen state because of man’s sin (pollution) for which we will experience a coming apocalyptic judgement (damage from climate change). Thus avoiding the consequences becomes fundamentally a problem of sin management. The proposed sin management solution is again taken from traditional Christianity: confession and repentance, followed by penance, restoration to right standing with God (nature), and committing to a holier life.

    There are two basic problems with this. The first is that while the religion template taps in to a deep psychological vein in the human spirit – some have suggested humanity may even carry a so-called “God gene” – most people already have a religion and aren’t likely to convert to a new one without a major outreach effort.

    But more importantly, the notion of penance, and perhaps of asceticism more generally, has never sold with the public, even in more religious eras. David Hume (a vigorous religious skeptic it should be noted) referred to the values resulting from this lifestyle as the “monkish virtues” and noted that they have “everywhere rejected by men of sense.” Or as Carol Coletta put it more recently, people don’t want to be told to “eat their spinach.”

    It strikes me that while perhaps environmentalists don’t really want to force a particular lifestyle on people, there is a fundamental desire to see people engage in some sort of public penance for our environmental sins. I believe this to be the root logic underlying a lot of feel-good (or perhaps more accurately, “feel-bad”) initiatives like getting rid of incandescent light bulbs. It is a form of penance and embrace of the monkish virtues.

    I can’t help but notice that even Christianity itself has moved away from promoting the monkish virtues. While things humility are of course still preached and expected to be modeled, modern Christianity mostly rejects the notion of an ascetic life. Most Evangelical churches actually preach that God wants humans to be happy. The idea is of a God who wants us to be unselfish, but not unhappy. A not insignificant number of churches actually preach the so-called “prosperity gospel” in which God will provide earthly blessings to His followers. In the Catholic tradition, monasticism itself has been in decline for some time. (I liken the reports of upticks in interest in joining monasteries as similar to the perennial “return of the suit” articles in fashion magazines).

    Whether these theological points are accurate or not is beside the point of this article. They appear to be attractional. For example, well-known prosperity gospel preacher Joel Osteen runs the largest church in the United States, with over 40,000 attending weekly.

    What might the environmental movement have looked like based on a different template? I’ll refer again to the work of Bruce Mau. If you’ve ever seen him present on this topic, he likes to start by noting that if we brought the entire world up to US standards of living, it would take four Earth’s worth of resources given our current technologies and approaches to make it happen. He thinks that’s a good thing, because the patent impossibility of that “takes that option off the table.” He then goes on to talk about all the super-cool new stuff we are going to have to invent and scale up to address the challenges of the future. If you haven’t, I might suggest getting his book Massive Change, which I reviewed a while back. It’s difficult to come away from one of Mau’s books or lectures without being excited about the possibilities of the future.

    I don’t think Mau has any different view of the fundamentals of climate change than your typical orthodox environmentalist. But his approaches to solutions (which are admittedly not always short term practical action plans) and the sales job on them is very different. As a designer, he knows he needs to create something that’s aspirational and attractional in order to get people to want it. It’s a shame too few people have followed that lead.

    The monkish virtues are just never going to sell. Perhaps you can get a room full of the sustainability in-crowd to buy into it, or even focus on top level political success as with the bulb ban. But ultimately I think this is self-defeating.

    In the short term I’d suggest ending any efforts to impose direct consumer mandates. I don’t think that’s where the money is, so to speak, in GHG reductions. Instead, let’s focus on the producer side of the equation in ways that are largely transparent to consumers and don’t involve significant costs. More fuel efficient vehicles might be one. Replacing coal with natural gas is another possibility. (The EPA report I linked earlier cited this as a big contributor the decline in GHG emissions in recent years). New technologies are clearly needed and should perhaps be invested in even though as we know this will lead to many failures along the way.

    As the financial crisis in Greece and elsewhere shows, people rarely confront structural problems, no matter how serious, until the crisis actually comes. At least if “austerity” (a monkish virtue if ever there was one) is the major part of the proposed solution.

    If an environmental equivalent of austerity is required to save the planet, then I’m afraid we should prepare for the deluge. I personally don’t think we’re at that point, given that we’ve had huge gains in energy efficiency for many decades now while our lifestyles have actually improved. More of that, not the promotion of monkish solutions like CFL lightbulbs, is what it will really take to drive further environmental improvements.

    PS: If you don’t think people are really promoting or embracing monkish lifestyles in support of environmentalism, read this article from the Guardian about people giving up on daily showers. Or think about the people trying to completely go “off the grid.” Even if CFLs don’t fit for you, clearly there are plenty of examples. I pick CFLs because they are an institutionalization of monkish virtues, not just the passion of the small minority, which has always been the case.

    Aaron M. Renn is an independent writer on urban affairs based in the Midwest. His writings appear at The Urbanophile, where this essay originally appeared.

    Photo by BigStockPhoto.com.

  • Shale Revolution Challenges the Left and the Right

    In his State of the Union address, President Obama invoked the 30-year history of federal support for new shale gas drilling technologies to defend his present day investments in green energy. Obama stressed the value of shale gas—which will create thousands of jobs and billions in profits—as part of his "all of the above" approach to energy, and defended the critical role government investment has always played in developing new energy technologies, from nuclear to solar panels to wind turbines.

    The president’s remarks unsurprisingly sparked a strong response from some conservatives (here, here, here, and here), who have downplayed and even attempted to deny the important role that federal investments in hydrofracking, geologic mapping, and horizontal drilling played in the shale gas revolution.

    This is an over-reaction. In acknowledging the critical role government funding played in shale gas, conservatives need not write a blank check for all government energy subsidies. Indeed, a closer look at the shale gas story challenges liberal policy preferences as much as it challenges those of conservatives, and points to much-needed reforms for today’s mash of state and federal clean energy subsidies and mandates.

    The Government’s Role

    Some have pointed to the fact that fracking dates back to the 19th century and hydraulic fracking to the 1940s as evidence that federal funding for today’s fracking technologies was unimportant. But dismissing the importance of federal support for new shale gas technologies in the ’70s and ‘80s because private firms had succeeded in fracking for oil in the ’40s and ’50s is like suggesting that postwar military investments in jet engines were unnecessary because the Wright Brothers invented the propeller plane in 1903.

    Enhancing oil recovery from existing wells in limestone formations by injecting various combinations of water, sand, and lubricants, as was done by private firms starting in the 1940s, is a vastly different and less complicated technical challenge than recovering widely dispersed gas methane in rock formations like shale that are simultaneously porous but not highly permeable.

    Recovering gas from shale formations at a commercial scale requires injecting vastly more water, sand, and lubricants at vastly higher pressures throughout vastly larger geological formations than anything that had been attempted in earlier oil recovery efforts. It requires having some idea of where the highly diffused pockets of gas are, and it requires both drilling long distances horizontally and being able to fracture rock under high pressure multiple times along the way.

    The oil and gas industries had no idea how to do any of this at the time that federal research and demonstration efforts were first initiated in the late 1960s—indeed, throughout the 1970s the gas industry made regular practice of drilling past shale to get to limestone gas deposits.

    This is not just our opinion, it was the opinion of the natural gas industry itself, which explicitly requested assistance from the federal government in figuring out how to economically recover gas from shale starting in the late 1970s. Indeed, shale gas pioneer George Mitchell was an avid and vocal supporter of federal investments in developing new oil and gas technologies, and regularly advocated on behalf of Department of Energy fossil research throughout the 1980s to prevent Congress from zeroing out research budgets in an era of low energy prices.

    Early Efforts

    The first federal efforts to demonstrate shale gas recovery at commercial scales did not immediately result in commercially viable technologies, and this too has been offered as evidence that federal research efforts were ineffective. In two gas stimulation experiments in 1967 and 1969, the Atomic Energy Commission detonated atomic devices in New Mexico and Colorado in order to crack the shale and release large volumes of gas trapped in the rock. The project succeeded in recovering gas, but due to concerns about radioactive tritium elements in the gas, the project was abandoned.

    These projects are easy to ridicule. They sound preposterous to both anti-nuclear and anti-government ears. But in fact, the experiment demonstrated that it was possible to recover diffused gas from shale formations—proof of a concept that had theretofore not been established.

    A few years later, the just-established Department of Energy demonstrated that the same result could be achieved by pumping massive amounts of highly pressurized water into shale formations. This process, known as massive hydraulic fracturing (MHF), proved too expensive for broad commercialization. But oil and gas firms, with continuing federal support, tinkered with the amount of sand, water, and binding agents over the following two decades to achieve today’s much cheaper formula, known as slickwater fracking.

    Early federal fracking demonstrations can be fairly characterized as big, slow, dumb, and expensive. But when it comes to technological innovation, the big, slow, dumb, and expensive phase is almost always unavoidable. Innovation typically proceeds from big, slow, dumb, and expensive to small, fast, smart, and cheap. Think of building-sized computers from the 1950s that lacked the processing power to run a primitive, 1970s digital watch.

    Private firms are really good at small, fast, smart, and cheap, but they mostly don’t do big, slow, dumb, and expensive, because the benefits are too remote, the risks too great, and the costs too high. But here’s the catch. You usually can’t do small, fast, smart, and cheap until you’ve done big, slow, dumb, and expensive first. Hence the reason that, again and again, the federal government has played that role for critical technologies that turned out to be important to our economic well-being.

    Drilling Down into Innovative Methods

    In fact, virtually all subsequent commercial fracturing technologies have been built upon the basic understanding of hydraulic fracturing first demonstrated by the Department of Energy in the 1970s. That included not just demonstrating that gas could be released from shale formations, but also the critical understanding of how shale cracks under pressure. Scientists learned from the large federal demonstration projects in the 1970s that most shale in the United States fractures in the same direction. This led government and industry researchers to focus their efforts on technologies that would allow them to drill long distances horizontally, in a direction that situated the well hole perpendicular to the directions that fractures would run, which allowed firms to capture much more gas from each well.

    Government and industry researchers also focused on developing the ability to create multiple fracks from each horizontal well, and in 1986 a joint government-industry venture demonstrated the first multifrack horizontal well in Devonian Shale. During the same period, government researchers at Sandia Laboratory developed tools for micro-seismic mapping, a technique that would prove critical to the development of commercially viable fracking. Micro-seismic mapping allowed firms to see precisely where the cracks in the rock were, and to modulate pressure, fluid, and proppant in order to control the size and geometry of each frack.

    George Mitchell, who is widely credited with having pioneered the shale gas revolution, leaned heavily upon these innovations throughout the 1990s, when he finally put all the pieces together and figured out how to extract gas from shale economically. Mitchell had spent over a decade consolidating his position in the Barnett Shale before he asked for technical assistance from the government. “By the early 1990s, we had a good position, acceptable but lacking knowledge base,” Mitchell Energy Vice President Dan Steward told us recently.

    Mitchell turned to the Gas Research Institute and federal laboratories for help in 1991. GRI paid for Mitchell to attempt his first horizontal well. The Sandia National Laboratory provided Mitchell with the tools and a scientific team to micro-seismically map his wells. It was only after Mitchell turned to GRI and federal laboratories for help that he finally cracked the shale gas code.

    A Counterfactual?

    But so what? Federal investments in new gas technologies may have proved critical to the shale gas revolution, but could they have happened without those investments? Where is the counterfactual?

    Constructing a counterfactual can be a useful analytical method, but it can be abused. In this case, the counterfactual has been asserted as a kind of faith-based defense against the inconvenient history of the shale gas revolution. Nobody has offered a real world example—for instance, a country where private firms developed economical shale gas technology without any public support.

    Nor has anyone offered a detailed historical analysis to justify the claim that private entrepreneurs would have done the critical applied research, developed the fracking technologies, funded the explorations in new drill bits and horizontal wells, and created the micro-seismic mapping technologies that were all required to make the shale revolution possible. A close look at the development of those technologies reveals private sector entrepreneurs, like Mitchell, who were loudly and clearly asking for help because they knew they had neither the technical knowledge nor the ability to finance such risky innovations on their own.

    The Implications for Renewable Energy Subsidies

    In the end though, we are mostly having this debate now because historical federal investments in shale gas are being compared to current investments in renewables. There is much that is in fact comparable—the federal role in the shale gas revolution went well beyond basic research, as some have claimed, and matches up with current renewables programs virtually demonstration for demonstration, tax credit for tax credit, and dollar for dollar when comparing the scale and nature of present federal support for renewables with past support for unconventional gas. But that doesn’t mean that President Obama’s subsidies for green energy are immune to criticism.

    Indeed, once we acknowledge the shale gas case as a government success, not a failure, it offers a powerful basis for reforming present clean energy investments and subsidies. Federal subsidies for shale gas came to an end, and so should federal wind and solar subsidies, at least as blanket subsidies for all solar and wind technologies. In many prime locations, where there is good wind, proximity to transmission, state renewable energy purchase mandates, and multiple state and federal subsidies, wind development is now highly profitable.

    If federal investments in wind and solar are really like those in unconventional gas, then we ought to set a date certain when blanket subsidies for wind and solar energy come to an end. Imposing a phase-out of production subsidies would encourage sustained innovations and absolute cost declines. We might want to extend continuing support for some newer classes of wind and solar technologies, those that are innovating new technological methods to generate energy, or those that are specifically designed to perform better in lower wind or marginal solar locations. But in the ’80s and ’90s we did not provide a tax credit to all gas wells, only those using new technologies to recover gas from new geologic formations—and we should not continue to provide subsidies to wind and solar technologies that are already proven and increasingly widely deployed with no end in sight.

    Another key lesson is that many of the most important research and demonstration projects in new shale gas technologies were funded and overseen by the Gas Research Institute, a partnership between Department of Energy laboratories and the natural gas industry that was funded through a small Federal Energy Regulatory Commission-administered fee on gas prices. GRI had both independence from Congress and the federal bureaucracy, and strong representation from the natural gas industry, which allowed it to focus research and dollars on solving key technical problems that pioneers like George Mitchell were struggling with. Federal investments in applied research and demonstration of new green energy projects ought to be similarly insulated from political meddling and rent seeking.

    These and other lessons from the shale gas revolution point to far-reaching reforms of federal energy innovation and subsidy programs. If the history of the shale gas revolution challenges the tale of a single lone entrepreneur persevering without help from the government, it also challenges the present federal approach to investing in renewables in important respects. The history of federal support for shale gas offers as much a case for reform of current federal clean energy investments as it does for their preservation.

    This piece originally appeared at The American.

    Shellenberger and Nordhaus are co-founders of the Breakthrough Institute, a leading environmental think tank in the United States. They are authors of Break Through: From the Death of Environmentalism to the Politics of Possibility.

  • Is Energy the Last Good Issue for Republicans?

    With gas prices beginning their summer spike to what could be record highs, President Obama in recent days has gone out of his way to sound reassuring on energy, seeming to approve an oil pipeline to Oklahoma this week after earlier approving leases for drilling in Alaska. Yet few in the energy industry trust the administration’s commitment to expanding the nation’s conventional energy supplies given his strong ties to the powerful green movement, which opposes the fossil-fuel industry in a split that’s increasingly dividing the country by region, class, and culture.

    But Republicans, other than the increasingly irrelevant Newt Gingrich, have failed to capitalize on the potent issue, instead lending the president an unwitting assist by focusing the primary fight on vague economic plans and sex-related side issues like abortion, gay marriage, and contraception. The GOP may be winning over the College of Cardinals, but it is squandering its chance of gaining a majority in the Electoral College, holding the House, and taking the Senate.

    No single sector affects more people and industries than energy, and none is more deeply affected by the disposition of government. Energy divides the nation into two camps. On one side there are the regions and industries dependent on the development and use of energy. They include the increasingly expansive energy-producing region stretching from the Gulf Coast and the Great Plains to parts of Ohio, Pennsylvania, and the Appalachian range.

    The centers of energy growth, including areas stretching from the Gulf Coast through the Great Plains to the Canadian border, have generated the highest levels of job and income growth over the past decade (along with parasitic Washington, D.C.).

    Nine of the 11 fastest-growing job categories are related to energy production, according to an analysis by Economic Modeling Systems Inc. Energy jobs pay an average of $100,000 annually, about the same as software engineers earn in Silicon Valley.

    Perhaps more important politically, this bonanza is now spreading to historical battleground states Ohio, Pennsylvania, and Michigan. Long-depressed areas like western Pennsylvania are reversing decades of decline as new finds and advances in natural-gas drilling have opened up vast new stores of domestic energy. The new energy wealth has created new jobs, enriched property owners, and provided states with potential huge new sources of revenue.

    On the other side of the energy divide stand a handful of dense, mostly coastal metropolitan areas with either little in the way of energy resources or, in the case of California’s most affluent urban pockets, little interest in exploiting them. With a shrinking industrial base and less dependence on automobiles, these areas now constitute the political base for the both the Democratic Party and the growing green-industrial complex, which boasts strong ties to Silicon Valley’s well-heeled venture-capital “community” and their less celebrated, but even wealthier, Wall Street allies.

    In these places, the current fossil-energy boom is regarded less as a boon than as an environmental disaster in the making, a view captured in the unrelenting attack on shale development in the news pages of The New York Times and other outlets in broad sympathy with the Obama administration. New production of low-cost, low-emission natural gas also threatens the viability of politically preferred renewables such as solar and wind. But unlike fossil fuels, such “green” initiatives have created very few jobs; overall, the promise of “green jobs,” as even The New York Times has noted, has failed to live up to its hype.

    Given the success in the other energy states, California—with double-digit unemployment—might reconsider its policies, but this is unlikely. “I asked [Gov.] Jerry Brown about why California cannot come to grips with its huge hydrocarbon reserves,” John Hofmeister, a former president of Shell Oil’s American operations and a member of the U.S. Department of Energy’s Hydrogen and Fuel Cell Technical Advisory Committee, told me recently. “After all, this could turn around the state."

    Brown’s answer, according to Hofmeister: “This is not logic, it’s California. This is simply not going to happen here.’”

    But elsewhere in the U.S., new technologies such as hydraulic fracking and vertical drilling have vastly increased estimates of North America’s energy resources, particularly natural gas. By 2020, the United States, according to the consultancy PFC Energy, will surpass Russia and Saudi Arabia as the world’s leading oil and gas producer.

    As President Obama has acknowledged, this surge of production boasts some great economic benefits. American imports of raw petroleum have fallen from a high of 60 percent of the total to less than 46 percent. Overall, according to Rice University’s Amy Myers Jaffe, U.S. oil reserves now stand at more than 2 trillion barrels; Canada has slightly more. She pegs North America’s combined reserves at more than three times the total estimated reserves of the Middle East and North Africa.

    At the same time, energy exploration is sparking something of an industrial revival. The demand for new rigs, pipelines, and a series of new petrochemical facilities has created a burst of industrial production across much of the country. Steel mills, makers of earth-moving equipment, and construction suppliers all have benefited. A recent study by PricewaterhouseCoopers suggests shale gas could lead to the development of 1 million industrial jobs. Not surprisingly, some of the biggest backers of shale-gas exploration are prominent CEOs from industrial firms.

    Energy policy may also be critical for the future of the Great Lakes–based American auto industry. Despite expensive PR ventures like the electric Chevy Volt, the Big Three depend for profits largely on SUVs and trucks. High oil prices will only help their competitors from Japan, South Korea, and Germany, all of which are ramping up in the emerging Southeastern auto corridor. Rising oil prices could also raise the costs of food production, which relies heavily on energy-intensive fertilizers and machinery.

    Aware of the negative consequences for a still-weak recovery, President Obama has started to mount a defense for his energy policies. Last month he launched several preemptive strikes, claiming credit for rising U.S. production while ridiculing Republicans for their “drill, baby, drill” response to rising energy prices.

    Obama is correct in asserting that increases in domestic production will not solve the energy price issue overnight, or even in the near future. But it was disingenuous for him to then take credit for the current energy boom, which resulted largely from policies adopted during the Bush years, while Obama’s policies have, if anything, slowed exploration and development.

    It’s fairly clear that the president and his team—notably Energy Secretary Steven Chu and Interior Secretary Ken Salazar—are at best ambivalent about greater fossil-fuel development. Obama, for example, recently proposed cutting tax breaks and subsidies for the oil industry, which he estimated at $4 billion annually—a new expense for the companies that would in large part be passed on to consumers at the pump.

    This is not necessarily a bad thing in its own right, but along with the effective tax hike, Obama proposed doubling down on the much larger and, to date, far less productive giveaways to the green-industrial complex, which received $80 billion in loans and subsidies in the 2009 stimulus. According to various studies, including the Energy Information Agency, solar firms enjoy rates of subsidization per kilowatt hour at least five times those gained by fossil-fuel firms.

    If all energy subsidies were removed, the fossil-fuel industry likely could shrug off the hit, while the heavily subsidized green-industrial complex would markedly diminish. Yet even if Congress refuses to continue the green subsidies, it’s probable that administration regulators would find ways to slow fossil-fuel expansion in a second Obama term. Responding largely to the Democratic environmental lobby, they have already overruled the State Department to delay the Keystone XL pipeline from Canada. Plans for new multibillion-dollar petrochemical plants on the Gulf will make easy pickings for federal regulators from agencies now controlled by environmental zealots.

    “The energy states feel they are being persecuted for their good deeds,” says Eric Smith, director of the Tulane Energy Institute in New Orleans. “There is a sense there are people in the administration who would like this whole industry to go away.”

    In the short run, Obama’s political exposure in the energy wars is somewhat limited. Most of the big-producing states—Oklahoma, Wyoming, Utah, Texas, Louisiana, Alaska, and North Dakota—are unlikely to vote for him anyway. Nor does he have to worry about too much pressure from inside his party; Democratic ranks in Congress from energy-producing states have thinned considerably in recent years, removing contrary voices inside the party.

    A more dicey issue relates to contestable states like Ohio, Pennsylvania, and Michigan, where many see the energy boom as a source of economic recovery. To make their case in these and other swing states, Republicans first have to make energy the overall revival of the American economy—the key issue for this November’s election. If they insist on campaigning primarily as stolid defenders of rigid social values and election-year promises of painless tax cuts, they will have themselves to blame for their drubbing in November.

    This piece originally appeared in TheDailyBeast.

    Joel Kotkin is executive editor of NewGeography.com and is a distinguished presidential fellow in urban futures at Chapman University, and contributing editor to the City Journal in New York. He is author of The City: A Global History. His newest book is The Next Hundred Million: America in 2050, released in February, 2010.

    Photo courtesy of BigStockPhoto.com.

  • Will Millennials Still be Liberal When They’re Old and Gray?

    The Millennial Generation (born 1982-2003) is the cohort most in favor of using the federal government to promote economic stability and equality since the GI Generation of the 1930s and 1940s. The attitudes of Millennials were heavily shaped by the protected and group-oriented way in which they were reared and their experience of feeling the full brunt of the Great Recession as they emerged into adulthood.  

    As a result, the biggest political story of the first half of the 21st century may well be the extent to which the largest American generation ever retains its economic liberalism and thereby shapes the direction of public policy in coming decades. If history is any guide, much of that story’s plot will be written during the next four or five years.

    Millennials deserve America’s sympathies for the disproportionate impact the Great Recession has had on their generation. According to a recent Pew Research Center survey, a clear plurality (41%) of Americans think that young, rather than middle-aged (29%) or older  (24%) adults are having the toughest time in today’s economy. And they are right.  Last year, the unemployment rate for 18-24 year olds (16.3%) and 25-29 year olds (10.3%) was well above that of those 35-64 (7%). Even among those 18-24 year olds fortunate enough to find full-time employment, real median weekly earnings were down by six percent over the previous four years. Not surprisingly, the weak economy has had a profound impact on the personal lives of Millennials. Nearly half (49%) say they have taken a job (often part time) just to pay the bills. A third (35%) have returned to school, something that may pay benefits in the long term, but is at the expense of current earnings. About a quarter have taken an unpaid job and/or moved back in with their parents (24% each). About one in five have postponed having a baby (22%) and/or getting married (20%). Less than a third (31%) say that they earn or have enough money to lead the kind of life they want.

    Their experiences with the Great Recession have only reinforced Millennials’ support for economically activist government. Last November, when Pew asked whether Americans preferred a larger government that provided more services or a smaller government that provided fewer services, Millennials opted for a bigger government over a smaller one by a large 54% to 35% margin. By contrast, 54% of Boomers (born 1946-1964) and 59% of Silents (born 1925-1945) favor a smaller government. .

    In addition, a majority of (55% to 41%) Millennials favored a greater level of federal spending to help the economy recover from the recession rather than reducing the federal budget deficit. Millennials also continue to support governmental efforts to lessen economic inequality; 63% agreed that government should guarantee every citizen enough to eat and a place to sleep. Consistent with their overall attitudes toward the size of government, the two oldest generations—Boomers and Silents—favored reduced spending and a more limited government role in promoting economic equality.

    The tendency of people to retain their political viewpoints and preferences throughout their lives suggests that once they are set, Millennial Generation attitudes toward government’s proper role in the economy will persist for decades. This conclusion was recently confirmed by   economists Paola Giuliano and Antonio Spilimbergo. In a longitudinal analysis of survey data collected annually since 1972, they found that experiencing an economic recession during one’s “formative” years (18-25 years old) led Americans to favor “leftist” governmental policies that would “help poor people” and lessen “income inequality.” These attitudes were not influenced by experiencing a recession either before or after the formative years and remained in place even when controlled for demographic variables such as sex, race, and social class. However, the same data suggested that the deeper and more sustained the recession, the lower the level of confidence survey respondents had in governmental institutions such as Congress and the presidency.  

    The success of governmental action in dealing with the Great Depression in the 1930s and World War II in the 1940s put the GI or Greatest Generation on the path of lifelong support for governmental activism. After the nation’s victory over the Axis and the economic boom that followed, positive perceptions of government and political efficacy were virtually universal among Americans. Today, although America has begun to shake off the worst aspects of the Great Recession, unemployment remains stubbornly high and growth rates remain below the level needed to make dramatic dents in unemployment rates, especially among Millennials.

    So far Millennial beliefs in activist, egalitarian government policies have not been shaken by the slow pace of the recovery or what  some may perceive as an inadequate federal response. The extent to which those attitudes persist in future decades, when Millennials will represent over one out of every three adult Americans, could depend on how well the government deals with the economic challenges the nation faces in the years just ahead.

    Morley Winograd and Michael D. Hais are co-authors of the newly published Millennial Momentum: How a New Generation is Remaking America and Millennial Makeover: MySpace, YouTube, and the Future of American Politics, named by the New York Times as one of their ten favorite books of 2008.

  • Information Technology and the Irrelevance of Architecture

    Throughout history, architecture served as the primary communication device of common cultural values. Whether inspiring religious awe or displaying the power of an empire, great works of architecture went beyond mere utility to reflect the shared expression of time and place.  Modern architecture, with its right angles and smooth surfaces devoid of ornamentation expressed the early 20th Century zeitgeist of efficiency and mass production. In many ways, the Modern architectural language also conveyed common cultural values of the time as it became the model for socialist utopia.

    The information technology revolution of the late twentieth century changed the role of architecture forever. With digital information readily available at our fingertips, buildings are no longer needed as a communication device. This new paradigm has largely gone unnoticed by the architectural establishment, which itself has been through a series of futile stylistic phases in recent decades ranging from the campy Postmodernism to the cynical Deconstructivism. The soul-searching continues today, as leading architects promote the use of technology to justify the creation of wild, superfluous forms that are for the most part nothing more than self-referential, sculptural contortions.

    Function still matters, but building design often no longer serves the higher aim of communicating a shared culture to a civic audience. Rather, it is the mobile IT products created by companies like Apple that do a superior job of communicating and transferring information while at the same time filling a human desire for great design.

    The implications for urbanism are enormous. Cities, as they are thought of in the traditional sense of high-density concentrations of people and buildings, are no longer required for a productive economy. No other place represents this new reality better than Silicon Valley. Rather than being an exalted futuristic urban landscape as one might expect given the amount of innovation that goes on there, Silicon Valley is a non-descript amalgam of low-density suburban villages. The headquarters of internet giants like Google, Yahoo! and Facebook are just as anonymous—bland office parks that turn inwards and are indifferent to the street.

    Los Angeles Times architecture critic Christopher Hawthorne blasts this reality in a critique of the proposal for the new Apple headquarters, which he calls a ‘retrograde cocoon.’ The proposal is a huge four-story concentric ring set among a park-like setting in the Silicon Valley town of Cupertino which Hawthorne laments as what he sees as the continuation of an unfortunate land-use pattern of low-density sprawl.


    Urbanists cannot afford to ignore the fact that technology is unsympathetic to architecture. Computer programmers and IT innovators, people who require countless hours of focused concentration, might actually prefer the pastoral landscape and low-key nature of Silicon Valley to the noisy and bustling urbanism that define what we traditionally think of as a ‘city’. Taking this into consideration, the new Apple HQ is an appropriate design for its purpose and also serves as reminder of the irrelevance of architecture in the twenty-first Century.

    This essay originally appeared in the architecture journal CLOG: APPLE

    Adam Nathaniel Mayer is an American architectural design professional currently living in China. In addition to his job designing buildings he writes the China Urban Development Blog.

  • Don’t Bet Against The (Single-Family) House

    Nothing more characterizes the current conventional wisdom than the demise of the single-family house. From pundits like Richard Florida to Wall Street investors, the thinking is that the future of America will be characterized increasingly by renters huddling together in small apartments, living the lifestyle of the hip and cool — just like they do in New York, San Francisco and other enlightened places.

    Many advising the housing industry now envisage a “radically different and high-rise” future, even though the volume of new multi-unit construction permits remains less than half the level of 2006. Yet with new permits at historically low levels as well for single-family houses, real estate investors, like the lemmings they so often resemble, are traipsing into the multi-family market with sometimes reckless abandon.

    Today the argument about the future of housing reminds me of the immortal line from Groucho Marx:Who are you going to believe, me or your lyin’ eyes? Start with the strong preference of the vast majority of Americans to live in detached houses rather than crowd into apartments. “Many things — government policies, tax structures, financing methods, home-ownership patterns, and availability of land — account for how people choose to live, but the most important factor is culture,” notes urban historian Witold Rybczynski.

    Homeownership and the single-family house, Rybczynski notes, rests on many fairly mundane things — desire for privacy, need to accommodate children and increasingly the needs of aging parents and underemployed adult children. Such considerations rarely enter the consciousness of urban planning professors, “smart growth” advocates and architectural aesthetes swooning over a high-density rental future.

    Just look at the numbers. Over the last decade— even as urban density has been embraced breathlessly by a largely uncritical media — close to 80% of all new households, according to the American Community Survey, chose to settle in single-family houses.

    Now, of course, we are told, it’s different. Yet over the past decade, vacancy rates rose the most in multi-unit housing, with an increase of 61%, rising from 10.7% in 2000 to 17.1% in 2010. The vacancy rate in detached housing also rose but at a slower rate, from 7.3% in 2000 to 10.7% in 2010, an increase of 48%. Attached housing  – such as townhouses –  posted the slightest increase in vacancies, from 8.4% in 2000 to 11.0% in 2010, an increase of 32%.

    The attractiveness of rental apartments may soon be peaking just in time for late investors to take a nice haircut. Rising rents, a byproduct of speculative buying of apartments, already are making mortgage payments a more affordable option in such key markets as Atlanta, Chicago, Miami, Phoenix and Las Vegas.

    Urbanist pundits often insist the rush to rental apartments will be sustained by demographic trends. One tired cliché suggest that empty nesters are chafing to leave their suburban homes to move into urban apartments. Yet, notes longtime senior housing consultant Joe Verdoon, both market analysis and the Census tells us the opposite: most older folks are either staying put, or, if they relocate, are moving further out from the urban core.

    The two other major drivers of demographic change — the millennial generation and immigrants — also seem to prefer suburban, single-family houses. Immigrants have been heading to the suburbs for a generation, so much so that the most diverse neighborhoods in the country now tend to be not in the urban core but the periphery. This is particularly true in Sunbelt cities, where immigrant enclaves tend to be in suburban areas away from the core.

    Millennials, the generation born between 1983 and 2003, are often described by urban boosters as unwilling to live in their parent’s suburban “McMansions.” Yet according to a survey by Frank Magid and Associates, a large plurality define their “ideal place to live” when they get older to be in the suburbs, even more than their boomer parents.

    Ninety-five million millennials will be entering the housing market in the next decade, and they will do much to shape the contours of the future housing market. Right now many millennials lack the wherewithal to either buy a house or pay the rent. But that doesn’t mean they will be anxious to stay tenants in small places as they gain some income, marry, start a family and simply begin to yearn for a somewhat more private, less harried life.

    In the meantime, many across the demographic spectrum are moving not away from but back to the house. One driver here is the shifting nature of households, which, for the first time in a century are actually getting larger. This is reflected in part by the growth of multi-generational households.

    This is widely believed to be a temporary blip caused by the recession, which clearly is contributing to the trend. But the move toward multigenerational housing has been going on for almost three decades. After having fallen from 24 percent in 1940 to barely 12 percent in 1980, the percentage topped over 16 percent before the 2008 recession took hold. In 2009, according to Pew Research Center, a record 51.4 million Americans live in this kind of household.

    Instead of fading into irrelevance, the single-family house seems to be accommodating more people than before. It is becoming, if you will, the modern equivalent of the farm homestead for the extended family, particularly in expensive markets such as California. This may be one of the reasons why suburbs — where more than half of owner-occupied homes are located — actually increased their share of growth in almost all American metropolitan areas through the last decade.

    Some companies, such as Pulte Homes and Lennar, are betting that the multi-generational home — not the rental apartment — may well be the next big thing in housing. These firms report that demand for this kind of product is particularly strong among immigrants and their children.

    Lennar  has already developed models — complete with separate entrances and kitchens for kids or grandparents — in Phoenix, Bakersfield, the Inland Empire area east of Los Angeles and San Diego, and is planning to extend the concept to other markets. “This kind of housing solves a lot of problems,” suggests Jeff Roos, Lennar’s regional president for the western U.S. “People are looking at ways to pool their resources, provide independent living for seniors and keeping the family together.”

    But much of the growth for multigenerational homes will come from an already aging base of over 130 million existing homes. An increasing number of these appear to being expanded to accommodate additional family members as well as home offices. Home improvement companies like Lowe’s and Home Depot already report a surge of sales servicing this market.

    A top Home Depot manager in California traced the rising sales in part to the decision of people to invest their money in an asset that at least they and their family members can live in. “We are having a great year ,” said the executive, who didn’t have permission to speak for attribution. “ I think people have decided that they cannot move so let’s fix up what we have.”

    These trends suggest that the widely predicted demise of the American single family home may be widely overstated. Instead, particularly as the economy improves, we may be witnessing its resurgence, albeit in a somewhat different form. Rather than listen to the pundits, perhaps it would be better to follow what’s before your eyes. Don’t give up the house.

    This piece originally appeared in Forbes.com.

    Joel Kotkin is executive editor of NewGeography.com and is a distinguished presidential fellow in urban futures at Chapman University, and contributing editor to the City Journal in New York. He is author of The City: A Global History. His newest book is The Next Hundred Million: America in 2050, released in February, 2010.

    Photo by Bigstockphoto.com.