New Geography

Tag: middle class

  • The War Against Suburbia

    A year into the Obama administration, America’s dominant geography, suburbia, is now in open revolt against an urban-centric regime that many perceive threatens their way of life, values, and economic future. Scott Brown’s huge upset victory by 5 percent in Massachusetts, which supported Obama by 26 percentage points in 2008, largely was propelled by a wave of support from middle-income suburbs all around Boston. The contrast with 2008 could not be plainer.

    Browns’s triumph followed similar wins by Republican gubernatorial contenders last November in Virginia and New Jersey. In those races suburban voters in places like Middlesex County, New Jersey and Loudoun County, Virginia—which had supported President Obama just a year earlier—deserted the Democats in droves. Also in November, voters in Nassau County, New York upset Nassau County Executive Thomas Suozzi, an attractive Democrat who had carefully cultivated suburban voters.

    The lesson here is that political movements ignore suburbanites at their peril. For the better part of a century, Americans have been voting with their feet, moving inexorably away from the central cities and towards the suburban periphery. Today a solid majority of Americans live in suburbs and exurbs, more than countryside residents and urbanites combined.

    As a result, suburban voters have become the critical determinants of our national politics, culture, and economy. The rise of the Republican majority after 1966 was largely a suburban phenomenon. When Democrats have resurged—as they did under Bill Clinton and again in 2006 and 2008—it was when they came close to splitting the suburban vote.

    But now, once again, things have changed. For the first time in memory, the suburbs are under a conscious and sustained attack from Washington. Little that the administration has pushed—from the Wall Street bailouts to the proposed “cap and trade” policies—offers much to predominately middle-income oriented suburbanites and instead appears to have worked to alienate them.

    And then there are the policies that seem targeted against suburbs. In everything from land use and transportation to “green” energy policy, the Obama administration has been pushing an agenda that seeks to move Americans out of their preferred suburban locales and into the dense, transit-dependent locales they have eschewed for generations.

    As in so many areas, this stance reflects the surprising power of the party’s urban core and the “green” lobby associated with it. Yet, from a political point of view, the anti-suburban stance seems odd given that Democrats’ recent electoral ascendency stemmed in great part from gains among suburbanites. Certainly this is an overt stance that neither Bill nor Hillary Clinton would likely have countenanced.

    Whenever possible, the Clintons expressed empathy with suburban and small-town voters. In contrast, the Obama administration seems almost willfully city-centric. Few top appointees have come from either red states or suburbs; the top echelons of the administration draw almost completely on big city urbanites—most notably from Chicago, New York, Los Angeles, and San Francisco. They sometimes don’t even seem to understand why people move to suburbs.

    Many Obama appointees—such as at the Departments of Transportation and of Housing and Urban Development (HUD) and at the Environmental Protection Agency (EPA)—favor a policy agenda that would drive more Americans to live in central cities. And the president himself seems to embrace this approach, declaring in February that “the days of building sprawl” were, in his words, “over.”

    Not surprisingly, belief in “smart growth,” a policy that seeks to force densification of communities and returning people to core cities, animates many top administration officials. This includes both HUD Secretary Shaun Donovan and Undersecretary Ron Sims, Transportation undersecretary for policy Roy Kienitz, and the EPA’s John Frece.

    Transportation Secretary Ray LaHood revealed the new ideology when he famously declared the administration’s intention to “coerce” Americans out of their cars and into transit. In Congress, the president’s allies, including Minnesota Congressman James Oberstar, have advocated shifting a larger chunk of gas tax funds collected from drivers to rail and other transit.

    In addition, the president’s stimulus—with its $8 billion allocation for high-speed rail and proposed giant increases in mass transit—offers little to anyone who lives outside a handful of large metropolitan cores. Economics writer Robert Samuelson, among others, has denounced the high-speed rail idea as “a boondoggle” not well-suited to a huge, multi-centered country like the United States. Green job schemes also seem more suited to boost employment for university researchers and inner-city residents than middle-income suburbanites.

    Suburbanites may not yet be conscious of the anti-suburban stance of the Obama team, but perhaps they can read the body language. Administration officials have also started handing out $300 million stimulus-funded grants to cities that follow “smart growth principles.” Grants for cities to adopt “sustainability” oriented development will reward those communities with the proper planning orientation. There is precious little that will benefit suburbanites, such as improved roads or investment in other basic infrastructure.

    But ultimately it will be sticks and not carrots that planners hope to use to drive de-suburbanization. Perhaps the most significant will be new draconian controls over land use. Administration officials, particularly from the EPA, participated in the drafting of the recent “Moving Cooler” report, which suggested such policies as charging tolls on the Interstate Highway System, charging people to park in front of their homes, and steering some 90 percent of all future development into the most dense portions of already existing urban development.

    Of course, such policies have little or no chance of being passed by Congress. Too many representatives come from suburban or rural districts to back policies that would penalize a population that uses automobiles for upwards of 98 percent of their transportation and account for 95 percent of all work trips.

    But the president’s cadres may find other ways to impose their agenda. New controls, for example, may be enacted through the courts and regulatory action. There is already precedence for this: As EPA director under Clinton, current climate czar Carole Browner threatened to block federal funds for the Atlanta region due to their lack of compliance with clear air rules.

    Such threats will become more commonplace as regulating greenhouse gases fall under administrative scrutiny. As can already be seen in California, regulators can use the threat of climate change as a rationale to stop funding—and permitting—for even well-conceived residential, commercial, or industrial projects construed as likely to generate excess greenhouse gases.

    These efforts will be supported by an elaborate coalition of new urbanist and environmental groups. At the same time, a powerful urban land interest, including many close to the Democratic Party, would also support steps that thwart suburban growth and give them a near monopoly on future development over the coming decades.

    Glimpse the Future

    One can glimpse this future by observing what takes place in most European countries, including the United Kingdom, where land use is controlled from the center. For decades options for new development have been sharply circumscribed, with mandates for ever-smaller lots and smaller homes more the norm for single-family residences.

    In Britain the dominant planning model is widely known as “cramming,” meaning forced densification into smaller geographic areas. Over the past generation, this has spurred a rapid shrinking of house sizes. Today the average new British “hobbit” house, although quite expensive, covers barely 800 square feet, roughly one-third that of the average American residence. Even in quite distant suburbia many of the features widely enjoyed here—sizable backyards, spare bedrooms, home office space—are disappearing.

    But these suburban hobbits will be living large compared to the sardines who would be forced to move into inner cities. In London, already a densely packed city, planners are calling for denser apartment blocks and congested neighborhoods.

    This top-driven scenario may be playing soon in America. Following the proposed edicts of “Moving Cooler,” the urban option increasingly would become almost the only choice other than the countryside. Unlike their baby boomer parents, the next generation would have few affordable choices in comfortable, low- and medium-density suburbs and single-family homes.

    Ownership of a single-family home would become increasingly the province only of the highly affluent or those living on the fringes of second-tier American cities. Due to the very high costs of construction for multi-family apartments in inner cities, most prospective homeowners would also be forced to remain renters. Although widely hailed as “progressive,” these policies would herald a return to the kind of crowded renter-dominated metropolis that existed prior to the Second World War.

    Are Suburbs Doomed?

    The anti-suburban impulse is nothing new. Suburbs have rarely been popular among academics, planners, and the punditry. The suburbanite displeased “the professional planner and the intellectual defender of cosmopolitan culture,” noted sociologist Herbert Gans. The 1960s counterculture expanded this critique, viewing suburbia as one of many “tasteless travesties of mass society,” along with fast and processed food, plastics, and large cars. Suburban life represented the opposite of the cosmopolitan urban scene; one critic termed it “vulgaria.”

    Liberals also castigated suburbs as the racist spawn of “white flight.” But more recently, environmental causes—particularly greenhouse gas emissions as well as dire warning about the prospects for “peak oil”—now drive much of the argument against suburbanization.

    The housing crash that began in 2007 added grist to the contention that the age of suburban growth has come to an end. To be sure, the early phases of the subprime mortgage bust were heavily concentrated in newer developments in the outer fringes. In part due to rising home prices, a disproportionate number of new buyers were forced to resort to sub-prime and other unconventional mortgages.

    The outer suburban distress attracted much media attention and delighted many who had long detested suburbs. One leading new urbanist, Chris Leinberger, actually described suburban sprawl as “the root cause of the financial crisis.” Leinberger and other critics have described suburbia as the home of the nation’s future “slums.” The favorite images have included McMansions being taken over by impoverished gang-bangers and other undesirables once associated with the now pristine inner city.

    Others portray future suburbs as serving at best as backwaters in a society dominated by urbanites. In contrast to a brave new era for “the gospel of urbanism,” the suburbs are expected to contract and even wither away. According to planner Arthur C. Nelson’s estimate, by 2025 the United States will have a “likely surplus of 22 million large lot homes”—that is, residences on more than one sixth of an acre.

    City boosters, however, largely ignore the real-estate crisis impact on urban condo markets throughout the country. Like the new developments on the fringe, the much hyped apartment complexes in central cities such as New York, Miami, Los Angeles, Chicago, and Denver came on line precisely as the housing market crashed, with similar devastating effects. Many remain unoccupied and others have been converted from high-end condos to more modest rentals.

    Yet fundamentally the attack on suburbia has less to do with market trends or the environment than with a deep-seated desire to change the way Americans live. For years urban boosters have proposed that more Americans should reside in what they deemed “more livable,” denser, transit-oriented communities for their own good. One recent example, David Owens’ Green Metropolis, supports the notion that Americans should be encouraged to embrace “extreme compactness”—using Manhattan as the model.

    Convinced Manhattanization is our future, some “progressives” are already postulating what to do with the remnants of our future abandoned. Grist, for example, recently held a competition about what to do with dying suburbs that included ideas such as turning them into farms, bio-fuel generators, and water treatment plants.

    What Do the Suburbanites Want?

    In their assessments, few density advocates bother to consider whether most suburbanites would like to give up their leafy backyards for dense apartment blocks. Many urban boosters simply could not believe that, once given an urban option, anyone would choose to live in suburbia.

    Jane Jacobs, for example, believed that “suburbs must be a difficult place to raise children.” Yet had Jacobs paid as much attention to suburbs as she did to her beloved Greenwich Village, she would have discovered that they possess their own considerable appeal, most particularly for people with children. “If suburban life is undesirable,” noted Gans in 1969, “the suburbanites themselves seem blissfully unaware of it.”

    Contrary to much of the current media hype, most Americans continue to prefer suburban living. Indeed for four decades, according to numerous surveys, the portion of the population that prefers to live in a big city has consistently been in the 10 to 20 percent range, while roughly 50 percent or more opt for suburbs or exurbs. The reasons? The simple desire for privacy, quiet, safety, good schools, and closer-knit communities. The single-family house, detested by many urbanists, also exercises a considerable pull. Surveys by the National Association of Realtors and the National Association of Home Builders find that some 83 percent of potential buyers prefer this kind of dwelling over a townhouse or apartment.

    In other words, suburbs have expanded because people like them. A 2008 Pew study revealed that suburbanites displayed the highest degree of satisfaction with where they lived compared to those who lived in cities, small towns, and the countryside. This contradicts another of the great urban legends of the 20th century—espoused by urbanists, planning professors, and pundits and portrayed in Hollywood movies—that suburbanites are alienated, autonomous individuals, while city dwellers have a deep sense of belonging and connection to their neighborhoods.

    Indeed on virtually every measurement—from jobs and environment to families—suburban residents express a stronger sense of identity and civic involvement with their communities than those living in cities. One recent University of California at Irvine study found that density does not, as is often assumed, increase social contact between neighbors or raise overall social involvement. For every 10 percent reduction in density, the chances of people talking to their neighbors increases by 10 percent, and their likelihood of belonging to a local club by 15 percent.

    These preferences have helped make suburbanization the predominant trend in virtually every region of the country. Even in Portland, Oregon, a city renowned for its urban-oriented policy, barely 10 percent of all population growth this decade has occurred within the city limits, while more than 90 percent has taken place in the suburbs over the past decade. Ironically, one contributing factor has been the demands of urbanites themselves, who want to preserve historic structures and maintain relatively modest densities in their neighborhoods.

    Multicultural Flight

    Perhaps nothing reflects the universal appeal of suburban lifestyles more than its growing ethnic diversity. In 1970 nearly 95 percent of suburbanites were white. Today many of these same communities have emerged as the new melting pots of American society. Along with immigrants, African-Americans have moved to the suburbs in huge numbers: between 1970 and 2009, the proportion of African-Americans living in the periphery grew from less than one-sixth to 40 percent.

    Today minorities constitute over 27 percent of the nation’s suburbanites. In fast-growing Gwinett County outside Atlanta, minorities made up less than 10 percent of the population in 1980; by 2006 the county was on the verge of becoming “majority minority.” In greater Washington, D.C., the Northeast’s most dynamic region in economic and demographic terms, 87 percent of foreign migrants live in the suburbs, while less than 13 percent live in the district, according to a 2001 Brookings Institution study.

    Perhaps most intriguingly, this diversity is itself diverse, including not only African-Americans but also Latinos and Asians. Suburban areas such as Fort Bend county, Texas, and the city of Walnut, in the San Gabriel Valley east of Los Angeles, already have among the most diverse populations in the nation. And this is not merely a California phenomenon: Aurora (outside Denver), Bellevue (the Seattle suburb), and Blaine (outside Minneapolis) are becoming ever-more diverse even as the nearby city centers become less so. By 2000 well over half of mixed-race households were in the suburbs, a percentage that continues to grow.

    Today the most likely locale for America’s new ethnic shopping centers, Hindu temples, and new mosques are not in the teeming cities but in the outer suburbs of Los Angeles, New York, and Houston. “If a multiethnic society is working out in America,” suggests California demographer James Allen, “it will be worked out in [these] places  . . . The future of America is in the suburbs.”

    A War Not Worth Fighting

    If most Americans clearly prefer suburbs then why would our elected representatives choose to pick a fight with them? Perhaps the most widely used explanation lies with densification as a means of reducing greenhouse gases. But this rationale itself seems flawed, and could reflect more long-standing prejudice than proven science.

    For example, a recent study by the National Academy of Sciences found that a nationally imposed densification policy would at best cut greenhouse gas emissions between less than 1 and 11 percent by 2050. Other research suggests that, by some measurements, low-density development can use less energy than denser urban forms.

    Although automobile commuting now consumes more energy resources than well-traveled traditional urban rail systems, the future generation of low-mileage cars may prove more efficient than often underutilized rail systems that are now seen as critical elements of fighting climate change. A public system running at low capacity—commonplace in many regions—may actually produce more emissions than the coming generation of personal vehicles.

    Moreover, tall buildings may not be as green as some advocates suggest. Recent studies out of Australia show that townhouses, small condos, and even single-family homes generate far less heat per capita than the supposedly environmentally superior residential towers, particularly when one takes into account the cost of heating common areas and the highly consumptive lifestyle of affluent urbanites (with their country homes, vacations, and frequent flying). In terms of energy conservation, the easiest and least expensive option may be to retrofit single-family houses and wood-shaded townhouses.

    Two- or three-story homes or townhouses often require only double-paned windows and natural shading to reduce their energy consumption; one Los Angeles study found that white roofs and shade trees can reduce suburban air conditioning by 18 percent. Such structures are particularly ideal for using the heat- and water-saving elements of landscaping: after all, a nice maple can cool a two-story house more efficiently than it can a ten-story apartment.

    Of course, density advocates can and do produce their own studies to justify their agenda. But there seems enough reasonable doubt to focus on more efficient, and less intrusive, ways to create greener communities by improving energy efficiency of automobiles and changing the way suburbs fit into metropolitan systems.

    Turning Deadwood into Greenurbia

    The “green” assault on suburbia also largely ignores changes already taking place across the suburban landscape. In a historical context, the latest suburban “sprawl” may be compared to Deadwood. That rough-and-ready mining town on the Dakota frontier was developed quickly for the narrow purpose of being close to a vein of gold. But over time these towns developed respectable shopping streets, theaters, and other community institutions.

    One change already evident can be seen in commuting patterns. Density advocates and the media often characterize suburbanites as people who generally take long commutes to work compared to the shorter rides enjoyed by city-dwellers. But with the continuing dispersion of work to the suburbs over the past two decades, suburban work locations actually enjoyed shorter commutes than their inner city counterparts in virtually all the largest metropolitan areas.

    This is true even in New York. Although Manhattanites enjoy short commutes and can even walk to work, most people who live in New York City and work in Manhattan suffer among the longest commutes in the nation. In fact, residents of Queens and Staten Island spend the most time getting to work of all metropolitan counties. Residents in suburbs and particularly exurbs actually endure generally shorter commutes, in large part because of less congestion and closer proximity to employment.

    Such pairing of jobs and housing will shape the suburban future and represents among the easiest ways to cut transportation-related emissions. Even more promising has been the continuing rise in home-based employment. According to Forrester Research, roughly 34 million Americans now commute at least part time from home; by 2016 these numbers are predicted to swell upwards to 63 million.

    Oddly, despite these tremendous potential environmental benefits, the shift toward cyberspace has elicited little support from smart-growth advocates. Indeed most reports on density and greenhouse gases virtually ignore the consideration of telecommuting and dispersed work.

    One reason may be that telecommuting breaks with the prevailing planning and green narratives by making dispersion more feasible. The ability to work full time or part time from home, notes one planning expert, expands metropolitan “commuter sheds” to areas well outside their traditional limits. In exchange for a rural or exurban lifestyle, this new commuter—who may go in to “work” only one or two days a week—will endure the periodic extra long trip to the office.

    Yet although it may offend planning sensibilities, the potential energy savings—particularly in vehicle miles traveled—could be enormous. Telecommuters drive less, naturally; on telecommuting days, average vehicle miles are between 53 percent and 77 percent lower. Overall a 10 percent increase in telecommuting over the next decade will reduce 45 million tons of greenhouse gases, while also dramatically cutting office construction and energy use. Only an almost impossibly large shift to mass transit could produce comparable savings.

    Ultimately, technology will undermine much of the green case against suburbia. If we really want to bring about a greener era, focusing attention on low-density enclaves would bring change that conforms to the preferences of the vast majority of people.

    Think Twice Before You Act

    Ultimately, the war against suburbia reflects a radical new vision of American life which, in the name of community and green values, would reverse the democratizing of the landscape that has characterized much of the past 50 years. It would replace a political economy based on individual aspiration and association in small communities, with a more highly organized, bureaucratic, and hierarchical form of social organization.

    In some ways we could say forced densification could augur in a kind of new feudalism, where questions of land ownership and decision making would be shifted away from citizens, neighbors, or markets, and left in the hands of self-appointed “betters.” This seems strange for an administration—and a party—whose raison d’être ostensibly has been to widen opportunities rather than constrict them.

    Indeed it is one of the oddest aspects of contemporary “progressive” thought that it seeks to undermine even modest middle class aspirations such as living in a quiet neighborhood or a single-family house. This does not seem a winning way to build political support across a broad spectrum of the populace.

    Of course suburbia is not and will not be the option for everyone. There will continue to be a significant, perhaps even growing, segment of the population which opts for a dense urban lifestyle or, for that matter, to live further in the countryside. But unless we see a radical change in human behavior and social organization, the majority will likely settle for a suburban or exurban existence.

    Given these realities, it seems more practical not to work against such aspirations but instead to evolve intelligent policies that would reconcile them with our long-term environmental needs. Suburbanites like their suburbs but would also like to find a way to make them greener as well as more economically and socially viable. Right now neither party has developed such an agenda, and so the suburbs, now clearly leaning right, remain up for grabs. To win suburbanites over, politicians first have to respect the basic preferences while offering a realistic program for improvement. This remains a key to building a sustainable electoral majority, not just for the next election, but for the decades to come.

    This article first appeared at The American.

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

  • MILLENNIAL PERSPECTIVE: Vintage Fashion & The Twice-Around Economy

    One impact of the recession has been a fundamental change in consumer clothing purchase patterns. Luxury retailers’ losses have been second-hand retailers’ gains. Internet marketers have also been uniquely positioned to benefit.

    Instead of buying new goods, more shoppers are turning to second-hand bargains. Thrift stores, with their low prices, are rising in popularity. As an added bonus, shoppers can walk away with vintage goods that might be worth more than their price tags indicate, because most thrift stores do not check the labels on goods and price them accordingly. (I cannot resist mentioning that I personally recently found a Free People skirt for $5.95 at Goodwill. Still attached was the original store tag: $144.00. )

    Even small vintage boutiques that cater to a higher-end shopper — in Los Angeles, for example, Decades, Resurrection, and The Way We Wore — are actually faring quite well during these difficult economic times. More clothing is available for purchase by vintage store owners as people scramble to come up with extra cash. This allows the stores to choose from a larger selection, and consequently, have greater control over the quality and quantity of their stock. More clothing also equals a faster turnover of goods, keeping the racks refreshed. This means the stock of the store is more appealing to frequent customers who are most likely to make purchases.

    According to an employee at a San Francisco location of Buffalo Exchange, a nationwide, youth-oriented second-hand chain, “More people have definitely been trying to sell [to us], but the number of customers has surprisingly increased as well.” This is partially due to the quicker rotation of stock, but also because customers are searching for high quality clothing at lower prices. Vintage fashion items are usually made out of sturdier fabrics and have superior construction to today’s clothing. For consumers who want affordable clothing that will last, vintage presents a great alternative.

    Consumers are not the only ones with their eyes turned toward vintage fashion. Designers have recently been evoking the 1930s and 1940s in their newest lines, drawing parallels between the current economic recession and the Great Depression. Although reminding consumers of the Great Depression might seem like a poor marketing strategy, it also carries the message that the times will improve and the economic crisis will resolve just as the Great Depression did. The association of vintage items and longevity is also a boon, in that it makes their designs appear more like investments.

    As this designer interest suggests, the trend is fueled by more than pure economics. Vintage items contain elements of nostalgia. To those people who actually lived during the period in which the goods were manufactured, they often call back positive memories. More significant from a marketing viewpoint, for those who are not old enough to have experienced the actual decade in which their vintage product was created, vintage still recalls what they perceive as more prosperous times in our nation’s history.

    The notion that items can last despite the events of the time is part of a movement against the current cynicism towards the “disposable” culture. Vintage clothing is recognized as sturdy in an age of “planned obsolescence” with products made cheaply to intentionally break down and need replacement. Anything that has survived this long is viewed as a good investment over the inferior merchandise of today.

    Along with a rejection of the throw-away culture is a rejection of the mass-produced, seen-everywhere culture. The older a piece of clothing is, the less likely it is that other similar pieces have survived. It’s one of the few inexpensive ways to find unique, possibly even designer, clothing. There’ s also a counter-cultural element in not following the corporate legacies of stores like Macy’s, but instead creating new looks that differ from what current designers decide is in fashion.

    The search for vintage clothing is about finding something completely original and rare that no longer exists, or does so only in small amounts. And what better tool speaks to finding unusual niches than the internet?

    The internet has become an option where pricing has leveled out between the extremes of bargain hunting and pricey boutiques. This equilibrium of price has been achieved in part by the abundance of information available on the internet, not just about vintage fashion, but about how to price it correctly. The search features on sites such as eBay allow users to easily compare similar pieces of vintage fashion and determine if it is overpriced or not as unique as it might be perceived in a vintage store window.

    Perhaps the most important innovation in the online realm of vintage fashion is the website etsy.com, which allows individuals to set up their own shops and sell handmade and vintage goods. What differentiates Etsy from competitors such as Amazon and eBay is the interface: consumers feel as if they are breezing through individual shops as they enjoy aesthetically appealing layouts and large high quality photographs. This ability to create personalized shops aimed at an audience searching for handmade and vintage items is the perfect resource for those searching for a venue in which to resell their thrift store finds and make them appeal as affordable and unique clothing.

    The downside is the difficulty to determine authenticity in a virtual world. Unlike porcelain and glass, there is no simple black-light test to figure out the age of a fabric. On the other hand, online information abounds in relation to authenticating vintage fashion in general.

    As the economy spins, fashion does as well: past to present, cast-off to coveted, retail to thrift shop. With the addition of the internet, yesterday’s twice-arounds may become tomorrow’s thrice-arounds.

    Photos of Elsewhere Vintage in Orange, California by Elizabeth Iverson.

    Elizabeth Iverson is a freshman at Chapman University in Orange, California. She is currently studying Film Production and wishes to pursue a career in the entertainment industry.

  • Denmark, and the US, in 2010

    Denmark is a good microcosm. It holds lessons for us here in the States, good and bad. I felt that way when I first lived there in 1971, when I researched my doctoral dissertation there in 1977, and I feel that way now.

    Denmark is a mixed-economy (free market competition with a large public sector), social welfare, multi-party democratic country that, because of its small size and international exposure, is affected more quickly and deeply by social, economic and political forces at work in the Western (and wider) world. It was a founding NATO member (1949) and the first Nordic member of the European Union (which it joined, simultaneously with Britain and Ireland, on New Year’s Day 1973). For such a small, homogenous country, it has amazing social, economic and political diversity (for example, over the past 36 years some 15 different political parties have at one time or another garnered representation in Folketinget, the Danish Parliament).

    Denmark has had, and continues to have, an outsized global influence relative to its size, whether in diplomacy, design, architecture, or quality manufacturing. Denmark gets a lot of things right. The standard of living is high, and so is the quality of life. As for the Danes themselves, both the famous and anonymous, they display an unmistakable national character combined with healthy individualism. (The unwritten law of Danish culture commands that one is not to draw attention to oneself, but it’s liberally violated!)

    The US is also a mixed-economy, social welfare, multi-party, democratic, diverse nation. There is an undeniable leftist political orientation among elites, media, academia, government and public policy professionals in both countries. What lessons can we learn from recent developments in Denmark? Like the US, Denmark has gone through, and is going through, economic, financial, real estate, employment, debt and deficit problems of unanticipated severity. And like the US, responsible parties have taken their eye off the ball.

    My colleague and partner Jorn Thulstrup, owner, CEO and publisher of News ex-press, a daily compilation of Danish news media presented in English for the diplomatic community in Copenhagen (among other clients), recently wrote a sharply critical report on the hangover left in Denmark by the Climate Conference. He states:

    The COP15 Climate Conference held in Copenhagen in December, fuelled by political and economic special interests and enthusiastically embraced by naive Danish journalists, preoccupied people in this country far more than the rest of the world. For a lengthy period of time, leading Danish politicians and commentators seemed to be suffering from the illusion that, in terms of climate and energy, Denmark could rule the world. A widespread perception flourished that Denmark, as host of COP15, could create some kind of platform to market Danish technology, especially wind energy and enzymes used in the production of bio-ethanol.

    But eventually, as expected, the concluding “Copenhagen Accord” failed to live up to the exaggerated expectations and only confirmed that the skeptics were right at least about the politics: the climate conference was a ritual event without meaning or influence.

    Preoccupation with meaningless things is not costless. Hosting the Climate Conference cost Denmark billions of kroner, but the indirect costs were even more serious: it tied up official government business, cabinet ministers and security forces for such a long time, and to such an extent, that many serious political and economic issues – like how to get the economy growing again – were neglected.

    Denmark deservedly prides itself on its quality of life, which includes a low crime rate. But while Copenhagen was free of the widespread destruction and vandalism that many had feared during the climate conference, the devotion of overwhelming police resources to COP15 over the past two years has actually been accompanied by an increased crime rate generally.

    The failure of COP15 is disappointing, if not unexpected. But the global economic crisis has left its mark throughout this country too. Years of budget surpluses have been transformed into deficits, in the necessary effort to prevent a collapse of the financial sector and limit growing unemployment. The government is now focused on the domestic agenda, with the top priority to restore economic growth, aiming to secure a political platform that will lead to victory at the next general election. Sound familiar?

    Small country, big ideas
    Another more serious problem is Denmark’s inability to compete, writes Thulstrup. Major wage hikes at home and devaluations abroad have made Danish goods and services too expensive. Unfortunately, Danish workers haven’t been able to compensate with increased productivity – in fact, quite the opposite. Possibly, as a society, the crisis was not taken seriously enough. Things went well for years and it appeared, after years of balance of payments and budget surpluses, that the country was capable of managing any setback. Also sound familiar?

    Every year or so some international poll shows that Danes are the “world’s happiest people.” (It would be more accurate to say “most contented,” or, if I’m feeling mischievous, “resigned to their situation”!) But the problem, writes Thulstrup, is that they are no longer very industrious. Studies, reports and commissions have been warning for years of the lack of qualified manpower.

    Denmark has a high workforce participation rate, due to the share of women that work outside the home, but is a laggard in actual hours worked. It’s a case of short working days, long holidays, and a high amount of sick leave. Students take too long to become qualified and too many people retire early – at the state’s expense. More and more fail to contribute anything to production and are being supported by fewer and fewer. A third of working-age adults – the potential labor force – is out of work, compared to just one in four eight years ago. And it’s going to get worse in the coming years. Thulstrup expects very little change in Denmark in 2010, in terms of economic growth. .

    That also sounds depressingly familiar.

    What about “flexicurity,” the Danish labor market scheme that seeks to combine employer flexibility (the ability to hire and fire easily) with employee security (publicly-funded job retraining)? Robert Kuttner praises flexicurity in Foreign Affairs (March/April 2008), while conceding that Danish conditions are unique and not applicable elsewhere. Thulstrup says flexicurity keeps the official Danish unemployment rate artificially low by forcing into job training, and then counting as employed, many people whose employment prospects are meager. In this way and others, he says, the system is susceptible to waste, fraud and abuse. Additionally, its costs are exorbitant: an “astonishing” 4.5% of GDP (as per Kuttner).

    Big country, perverse ideas
    We have taken our eye off the ball here in the States too. Over the past year our liberal elites have been consumed with climate control, health-care reform and public-sector pump-priming, when they should have been focusing on creating the conditions for private sector economic growth. We are now faced with the specter of laws, regulations and taxes that are unwanted and harmful, more expensive energy, and slower economic growth than would otherwise occur. That’s a shame, because economic growth is an all-purpose salve that cures a multitude of ills, and an all-purpose social lubricant that hides a multitude of sins.

    The essence of all of this is the matter of incentives.

    The lesson we should be learning from Denmark is that preoccupation with ritual, meaningless and nonsensical things is not costless. The cost of not working is greater than imagined over time. Misallocation of resources is not just wasteful and expensive, it does violence to the general welfare, not to mention common sense.

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

    Photo:

  • Stop Coddling Wall Street!

    By all historical logic and tradition, Wall Street’s outrageous bonuses—almost $20 billion to Goldman Sachs alone—should be setting a populist wildfire across the precincts of the Democratic Party. Yet right now, the Democrats in both the White House and Congress seem content to confront such outrageous fortune with little more than hearings and mild legislative remedies—like a proposed new bank tax, which, over the next decade, seeks to collect $90 to $100 billion. This amounts, on an annual basis, to about half of this year’s bonus for Goldman’s gold diggers alone. It’s speaking loudly and carrying a stick made of paper mache.

    But this should come as no surprise, really. Postmodern Democrats are generally more concerned about the fate of the polar bears than real people on Main Street.

    One reason may be that Democrats increasingly collect the bulk of contributions from the very financial sector that they have bailed out and coddled since taking office. However, more substantially, the Democrats—including many “progressives”—seem more comfortable with big business and high finance than their erstwhile working- and middle-class constituencies. For this, we need the Democratic Party?

    Somewhere outside Nashville, the shade of Andrew Jackson, the founder of the modern Democratic Party, is stirring uncomfortably. So, too, are the remains of Harry Truman and Franklin Roosevelt, Jackson’s heirs to the leadership of the Party of the People.

    Faced with highway robbers like those at Goldman Sachs, Jackson would have threatened to seize their assets and, if they protested, hang them from the highest tree. Franklin Roosevelt would have made political mince meat out of these outrageous “economic royalists.” Harry Truman would have uttered an earthy expletive and sought to cut them down to size. Truman hated phonies and elitists; today’s Democrats Party is lousy with them.

    Now we see the very abandonment of the idea of the Democratic Party opposing concentrations of power. Historically, Democrats took on the largest and most powerful institutions of society. Jackson made his critical battle against the government-run Bank of the United States, which he considered a means “ to grant titles, gratuities, and exclusive privileges, to make the rich richer and the potent more powerful.”

    In his time, Franklin Roosevelt battled big business, which largely hated him, by seeking to create a more equal distribution of wealth. He tried to save homeowners and farmers from the banks; speculators wiped out in 1929 did not enjoy banner years for a long time to come. Truman fought not for big banks and major companies, but for programs that spread capital to the middle class, whether for college loans or mortgages.

    Now we have the postmodern Democratic Party of Barack Obama. The new party has little use for populism of any kind—it prefers to legislate from on high, whether on financial reform, climate change or land-use policy, from what it considers its superior knowledge. If your factory or business is shut down as a result, it’s you who better learn to evolve.

    We will see this same mind-set in action with the administration’s proposal for a cap-and-trade program. It may end up doing little for the environment, but a lot of traders, well-connected corporate CEOs, and academic consultants will be made even richer. Draconian “green” policies that boost subsidies and energy prices may not be what Americans want—climate change ranks near the bottom of popular concerns—but such an approach fits neatly the agendas of Harvard faculty, Wall Street, and the mainstream media. That is, those who matter.

    The rotten economy remains detestable but the stimulus program is working fine for their key constituencies. Stocks are up, many hedge funds are doing well, university research coffers are bulging. Meanwhile, taxpayers are employing ever-more unionized public employees, whose often-insane pensions are consuming many local government budgets.

    Many Americans who work for themselves are enraged, but they lack a credible channel for expressing it. The Republicans are largely discredited by their disgraceful performance over the last decade, up to and including the initial Bush-Paulson bailout. The Republicans presided as easily as the Democrats over the disastrous financialization of the economy; by the mid-2000s, finance accounted for some 41 percent of all American profits—three times the percentage in the 1970s.

    But for now, populists are in retreat in Washington. Last week, Byron Dorgan of North Dakota announced his retirement from the Senate. Dorgan, friends tell me, was disgusted with Obama’s focus on health care and climate change at a time when the economy was unraveling and Americans were losing their jobs. He also knew that the president’s mounting unpopularity in Middle America posed a profound threat to his own reelection prospects.

    Dorgan will be missed. His voice would have been set against the coddling of Wall Street. He supported reinstating the 1933 Glass-Steagall Act, which put a barrier between banks and investment houses. He also opposed “too big to fail” policies and was ready to attack the administration’s “cap-and-trade” scheme, which he considered a large giveaway to Wall Street traders.

    Dorgan’s departure leaves only a handful of genuine populists in Congress, including Jon Tester from Montana, James Webb of Virginia, as well as our resident socialist, Vermont’s Bernie Sanders. They may well be at last willing to take on the battles that Jackson, Roosevelt, and Truman would have fought against “interests.”

    Right now for every populist, there are several gentry Democrats—epitomized by the likes of New York Senator Charles Schumer and his sidekick, Kirsten Gillibrand—who will do Wall Street’s bidding on the Hill. Erstwhile populists may find some allies among independent-minded Republicans but, for the most part, the GOP is too blinded by ideology or too well bought to curb the big investment houses.

    So in the end, another crop of 35-year-old Wharton and Harvard MBAs gets to spend their multimillion-dollar windfalls. Maybe if you live in New York, perhaps a few shekels might fall your way. After all, these people have kids to nanny, dogs to walk, apartments to decorate, and toenails to be painted.

    These bonuses simply remind us of our outrage. Jackson, Roosevelt, and Truman would have understood the opportunity for the Democratic Party presented by this egregious, undeserved windfall. Truman in particular would have detested the academically oriented “progressives” who explain away excess and look for new ways to harry independent smaller businesses. As he once quipped, “There should be a real liberal party in this country, and I don’t mean a crackpot professional one.”

    Yet that’s exactly the kind of Democratic Party we have now: one that shames the legacy of Truman, Roosevelt, and Jackson and looks the other way while the Treasury is raided and the economy works mainly for the benefit of the least deserving.

    This article first appeared at TheDailyBeast.com

    Joel Kotkin is executive editor of NewGeography.com and is a distinguished presidential fellow in urban futures at Chapman University. He is author of The City: A Global History. His next book, The Next Hundred Million: America in 2050, will be published by Penguin Press February 4th.

  • Beyond Neo-Victorianism: A Call for Design Diversity

    By Richard Reep

    Investment in commercial development may be in long hibernation, but eventually the pause will create a pent-up demand. When investment returns, intelligent growth must be informed by practical, organic, time-tested models that work. Here’s one candidate for examination proposed as an alternative to the current model being toyed with by planners and developers nationwide.

    Cities, in the first decade of this millennium, seem to be infected with a sort of self-hatred over their city form, looking backward to an imagined “golden era”. The most common notion is to recapture some of the glory of the last great consumerist period, the Victorians. During this time, from the 1870s to the early 1900s, many American towns and cities were formed around the horse-drawn wagon and the pedestrian. This created cities with enclaves of single-family homes and suburbs that seem quaint and tiny in retrospect to today’s mega-scale subdivisions and eight-lane commercial strips.

    One bible for the neo-Victorians was “Suburban Nation,” a 2000 publication seething with loathing and anger over urban ugliness. In a noble and earnest effort to repair some of the aesthetic damage, the writers proposed a grand solution. Their goal was essentially to swing the development model back to the era of the streetcar and the alleyway, the era when cars were not dominant form-givers and families lived in higher density and closer proximity.

    In the last decade, this movement gained traction with hapless city officials often tired of hearing nothing from their citizens but complaints over traffic and congestion. They embraced the New Urbanist movement which promised to turn the clock back to an era of walkable live/work/play environment of mixed neighborhoods. In the new model, the car would at last be tamed.

    Yet, looking at most of these communities, the past has not created a better future. More often they have created something more like the simulated towns lampooned by “The Truman Show”. These neo-Victorian communities ended up with some of the form of that era, but devoid of employment and sacred space. They also created social schisms of low-wage, in-town employers and high-salary, bedroom community lifestyles marking not the dawn of a new era but the twilight of late capitalism as the service workers commute into New Urbanist villages while the residents commute out.

    Meanwhile, planners who believe that practical design solutions and the vast quantity of remnants from the tailfin era are “almost all right” have remained quietly on the sidelines. This silent retreat, a natural reaction, now puts many good places in jeopardy as the activist planners try to “fix” neighborhoods and districts that were not broken to begin with. We risk losing some of the important postwar building form that well serves the needs of its users and, rather than being blacklisted, should be held up as a valid, comparative model for use by developers seeking to build good city form when the pent-up development demand returns.

    It is time to hit back. Midcentury modern – the era from about 1945 to 1955 – has become a darling style of the interior design world, has yet to be recognized as a valid model for urban development. For too long, neighborhoods built in this era have been treated poorly by the planning community. Yet this period created a critical transition between the archaic beloved streetcar suburbs and the 1980s commercial car-must-win planning. They provide a valuable, forgotten lesson when the middle class’s newfound prosperity was expressed by low-density, car-oriented mixed-use districts that were still walkable and expressed through their form a certain heroic optimism about the future.

    With building fronts set back just enough for parking, yet still close together to give a pleasant pedestrian scale, these little districts remain abundant in the landscape of our towns and cities – nearly forgotten in the fight over form, perhaps because they are doing just fine. They were built when everyone was encouraged to get a car, but before the car became a caveman club pounding our suburban form into big box “power centers” and endless, eight-lane superhighways of ever-receding building facades. These districts were developed before the local hardware store was replaced by Home Depot and many remain intact, thriving, and chock-full of independent business owners. Many of these are true mixed-use districts – with light industrial, second floor apartments, retail and other uses peacefully coexisting.

    In small commercial districts developed in the late 1940s and early 1950s, a balance was struck between the traditional town form and the car, a balance that has been forgotten in the planning war being waged today. This era produced many neighborhoods and districts that are “almost all right”, in the words of noted Philadelphia architect and thinker Robert Venturi, when defending Las Vegas to the prissy academic community.

    To go right to a case study, take the Audubon Park Garden District in Orlando, Florida. Adjacent to Baldwin Park, a Pritzker-funded New-Urbanist darling of 2002, this district is a vintage collection of mixed-use commercial, residential, and industrial buildings constructed in the 1950s. Set back from the curb approximately 42 feet, the mostly one-story storefronts allow parking in front yet are visible and accessible to pedestrians. The car is accommodated in the front of the store, making access easy and convenient, yet the pedestrian can walk also from place to place without long, hot trudges. Drivers see the storefronts. Scale is preserved. (See attached file for street elevations).


    View Larger Map

    The architecture, instead of recalling nostalgic, Victorian styles, is influenced by the art deco and populuxe styles of the Truman era, when America was united, self confident, and victorious. And the businesses reflect an organic mix serving neighborhood needs, their storefronts and facades created by themselves, not by some Master Planner, theming consultant, or fussy formgiving designer. Here, one finds customers in dialogue with shopkeepers, blue collar and creative class mixed together, a few apartments over their stores, and a localism that has endured for fifty-odd years, largely forgotten because it works.

    Places like this three-block district, and others like it, need to be championed. Decoding just what works here, and how it elegantly accommodates the car and the pedestrian, is critical to counterbalance the coercive impact of the New Urbanist movement and present a working model to future developers.

    When New Urbanism was a fledgling movement, it represented a necessary alternative to car-dominated planning principles, and offered a choice where there previously was none. Today, the rhetoric of this movement has sadly forced out all other choices and emphasized one form – that of the streetcar era – over all others. This increasingly authoritarian movement shuts out all other choices today, and now threatens places like Audubon Park with its singular vision by sending in planners to “workshop” an ideal, Victorian makeover. Such actions, if implemented, will destroy the healthy, functioning connective tissue that makes up vast portions of our urban environment for the sake of a romantic notion of form over substance.

    Instead of enforced, and often overpriced, nostalgia, we would do better to seek out districts planned after the car and have worked through time, and hold them up as valid choices to implement when planners are considering a development. These districts, whether a single building, a collection, or a whole community, will become important models as the pendulum swings back from the extremes that it reached by 2007 and 2008.

    For too long, planners and developers have chosen to be silent in the face of the often strident rhetoric espoused by “smart growth” and New Urbanist ideologues. Meanwhile, a tough analysis of New Urbanism’s successes has yet to be seriously undertaken, and alternative models presented. Cities across the nation are considering a move to form-based codes which would lock out districts like Audubon Park and doom existing ones to Victorian makeovers. Useful, diverse and workable places will be destroyed to fit a “one size fits all” ideology.

    So before midcentury modern becomes just another furniture style, a window of opportunity exists to fight back. These kinds of districts dot the cities and towns of America and deserve to be held up as alternative models for new development. Instead of a dogmatic slavishness to nostalgia, planners and developers need to stand up to the preachers of preapproved form, and look for multiple solutions for future urban form. Smart growth should not supersede the arrival of a more flexible, diverse approach of intelligent growth.

    Richard Reep is an Architect and artist living in Winter Park, Florida. His practice has centered around hospitality-driven mixed use, and has contributed in various capacities to urban mixed-use projects, both nationally and internationally, for the last 25 years.

  • Will Anyone Stand Up for American Industry?

    “Esau for one morsel of meat sold his birthright. For ye know how that afterward, when he would have inherited the blessing, he was rejected: for he found no place of repentance, though he sought it carefully with tears.” – Hebrews 12:16-17

    Built from 1933-1936, the Bay Bridge linking San Francisco to Oakland was an engineering marvel of its day. A complex series of multiple spans, when it opened – six months ahead of the more famous Golden Gate Bridge – it was both the longest suspended bridge deck in the world and the longest cantilever bridge in the world. The western suspension bridge section, technically two bridges in one, had to settle for being only the second and third longest suspension bridges in the world.

    The 1989 Loma Prieta earthquake badly damaged the Bay Bridge. The iconic western suspension span was seismically reinforced, but the eastern steel truss section required replacement. San Francisco wanted another iconic span, not just a functional one. A striking self-anchored suspension structure was selected and is under construction.

    The dubious part of this new span isn’t the usual matter of being way late and massively over budget – though it is – but where it’s being made. The steel for the bridge is not being built in America but in China.

    Why is this bridge being fabricated in China? The troubling answer, according to a lengthy article in the SF Public Press, is that no American company can do the job. America, a country that once pulled off the most audacious of engineering projects with panache, one that put a man on the moon in the 1960s, now can’t even build a bridge to replace one it constructed with ease in the 1930s.

    What’s more disturbing, is that China can’t really build it either – but we are teaching them, and paying for them to learn how.

    When you drive across that new Bay Bridge, your tolls will literally be helping to finance the advancement of China’s industrial base and the evisceration of America’s.

    I believe in free trade, strongly. I believe America can compete in a free market. But the United States is a country curiously uncommitted to industry. Other countries build, promote and protect industrial champions. They blockade their markets against American competitors. India freely sells us software and BPO, but passes laws to hamper Wal-Mart and other American firms. China demands many foreign companies do business there only through joint ventures, and transfer technology to local partners. It also intervenes to keep its currency artificially low. Many countries outright ban foreign involvement in many sectors such as energy. They view even their privately owned firms, many of which have close and corrupt ties to the state, as instruments of national and foreign policy.

    These places see Japan as a model to follow, a country that used its closed market to build industrial champions, even in high technology markets. Perhaps in time the same problems that hobbled Japan – asset bubbles, debt, demographic collapse, or an inflexible economy – will similarly afflict these emerging markets. But by that time it might be too late for American industry. And those problems are just as likely to affect us as them.

    This raises difficult questions about the future of America. Can we thrive as a purely post-industrial economy? Can we have a long term prosperous society built on little more than selling each other ever more exotic pieces of financial paper, creative consultancies, typing away at computers, serving up caffe lattes, and the like? Can we have a just social order as a two-tier society of only highly-paid elite knowledge workers and a low end service class, but not the robust middle class a manufacturing economy – along with agriculture and energy – supported?

    Can America even retain its military industrial strength under such conditions? In the past, military technologies launched spin-offs to the commercial world. Today, the reverse is as likely to happen. Already the only major ship builders left in America are captive suppliers to the US Navy. Only the anomalous Jones Act has kept a tradition of small and medium sized commercial shipbuilding alive.

    There’s a positive reinforcement cycle at work. The less we manufacture, the less we can manufacture. We slowly lose the skills, the facilities, the institutions, and the culture that enable a robust manufacturing economy to thrive. Eventually, we won’t be able to recover.

    Maybe we won’t even want to. The less we make, the less we want to make. As we become unmoored from our agro-industrial roots, we fail to see them as central to our national identity and frequently treat them with hostility. As Douglas and Wildavsky put it in Risk and Culture (1982):

    A larger proportion of the population of working age was disengaged from the production process than had been before. The economic boom and educational boom together produced a cohort of articulate, critical people with no commitment to commerce and industry.

    Increasingly, Americans have no personal experience with industry, and even no family experience with it. What was once common is just another niche, much like military service has become. This means most people have little familiarity or affection for industry, agriculture, or energy production. Many, especially urban dwellers, view most productive industry as a negative, as a source of blight where once others saw jobs and a strong tax base.

    Portland provides the perfect example. It views its waterfront as prime territory for residences and recreation, but not for industry. As the Oregonian reports:

    The question makes Jay Zidell uncomfortable. When will he stop building barges on the waterfront and start building high-rises? The room goes silent….Oregon power brokers have nudged the Zidell family for decades to do more with their prime Portland real estate…In the 1970s, Gov. Tom McCall called Jay Zidell’s late father, Emery, to suggest he stop adding industrial buildings. As Jay Zidell has told the story, McCall said: “We have big plans for the waterfront.”

    Those big plans don’t include manufacturing. Portland is the perfect example of where America is heading. It’s a place where thousands of highly educated but often underemployed young people sip lattes by the light rail while on the waiting list for a job at Starbucks. Meanwhile people in third world countries, hungry for more, hustle to build an ambitious future for themselves and their nation. Americans increasingly view manufacturing as an undesirable activity, particularly in an urban context, when in fact we should be looking to build new industrial cities – updated, re-imagined, and re-designed for a 21st century economy.

    Also, too often industry is viewed only as a source of pollution. Many industrial expansions are opposed on environmental grounds. But from a global, not local perspective, an ever stricter regime of regulation is sending firms offshore where pollution standards are usually far laxer. Corporations put a green gloss on their branding campaigns while building their products in China, where they get electricity from one of the new coal fired power plants that open at a rate of more than one per week. They also escape independent unions, anything like the Environment Impact Statement process in the US, and operate in a regime of weak property rights, questionable worker health and safety conditions, and a limited ability for the public to dissent. It’s not just cheap labor, it’s regulatory arbitrage. It’s like inverse colonialism, only this time the joke’s on the West. And the end result is a global environment that ends up worse, not better.

    To really protect the environment, we should be doing more manufacturing at home, where we can keep an eye on it and prevent the worst abuses. It’s like the Steak ‘n Shake boast about their open kitchens: “In sight, it must be right”.

    The sometimes exception to this negative take on manufacturing is, of course, “green” industry, notwithstanding that the concept does not exist except as a transitory state. In a decade there will just be “manufacturing”, and virtually all will adhere to green standards. But if America can’t succeed at traditional manufacturing, why would anyone think it will be different with green manufacturing? Even if so, by then there might not be many major American producers left to succeed.

    American firms and labor have made many mistakes over the years, but more often today they are adopting the new approaches needed to compete in tomorrow’s world. American labor can compete, even against cheap foreign workers, since it is the best and most productive workforce in the world. But not when public policy implicitly favors shipping manufacturing overseas.

    The answer is not protectionism, it’s freeing American labor to compete and developing policies designed to advance American manufacturing interests. Alexis de Tocqueville talked about Americans knowing the difference between raw, naked self interest, and “self-interest well-understood”. Likewise, we need to find a new approach to create “free trade, well understood”, a modern day trade equivalent of speaking softly, but carrying a big stick. Billions for American infrastructure, but not one $4 Bay Bridge toll to finance China’s technology ambitions.

    Alas, this seems unlikely. American industry is trapped between a political right that can’t see beyond instinctive anti-federalism and an overly ideological vision of free trade, and a political left that, while paying lip service to labor interests, no longer embraces industry. Almost alone among nations, America today lacks political champions for its industry. That, more than anything, is why it is being left to wither. Will anyone stand up and be counted before it’s too late?

    Aaron M. Renn is an independent writer on urban affairs based in the Midwest. His writings appear at The Urbanophile.

  • The Limits Of Politics

    Reversing the general course of history, economics or demography is never easy, despite even the most dogged efforts of the best-connected political operatives working today.

    Since the 2006 elections – and even more so after 2008 – blue-state politicians have enjoyed a monopoly of power unprecedented in recent history. Hardcore blue staters control virtually every major Congressional committee, as well as the House Speakership and the White House. Yet they still have proved incapable of reversing the demographic and economic decline in the nation’s most “progressive” cities and states.

    Obama and his congressional allies have worked overtime in favor of urban blue-state constituencies in everything from transportation funding and energy policies to the Wall Street bailouts and massive transfers of private wealth to powerful public-employee unions. Yet these areas continue suffering from net outmigration and stubbornly high job losses – as well as from some of the most severe fiscal imbalances in the nation.

    Nowhere is this more evident than in the president’s hometown of Chicago. The Windy City has suffered a very bad recession and may have fallen to its worst relative position since the Daley reconquista in 1989. As Chicago blogger Steve Bartin points out, even the presence of a Daley operative in the White House has failed to prevent the city from falling “in a funk.” He writes that even a reliable booster, columnist Mary Schmich of the Chicago Tribune, has lately described the city “as edgy, a little sullen and scared, verging on depressed.”

    There’s plenty reason for feeling low, well beyond the humiliating loss of the Obama-backed Olympics bid last year. For example, Oprah Winfrey, the city’s one bona fide A-list celebrity, is retiring her talk show in 2011. She is also reportedly shifting much of her media empire to Southern California, which, for all its admitted problems, has gads of celebrities and much better weather.

    Chicago’s most serious concern, however, revolves around the economy. In June, its unemployment rate peaked at 11.3%, far outpacing the national unemployment rate of 10%. Since 2007, the region has lost more jobs than Detroit, and more than twice as many as New York. Chicago’s total loss over the entire decade is greater than any region outside Detroit: about 250,000 positions, which is about the amount its emerging mid-American rival Houston has gained. In hard times businesses tend to look for places with a friendly environment for their enterprise. They avoid high taxes, political payoffs and inflated public employee salaries – all well-known Chicago specialties. These costs are undermining the city’s competitive position in, for example, the convention business, among others.

    Other key sectors are also flailing. Political influence in Washington will not stem the flow of high-wage trading jobs away from the Mercantile Exchange to decentralized electronic exchanges. Nor can it reverse the deteriorating state fiscal crisis caused by weak economies and exacerbated by insanely high pensions and out of control spending policies. Late last month Moody’s and S&P downgraded the debt ranking for the State of Illinois. Of course, such fiscal malaise is not limited to Chicago or Illinois. True blue California has an even worse debt rating. New York, another blue bastion, is also just about out of cash.

    To be sure, the recession has not hurt New York as much as Chicago, but the Big Apple has lost heavily , including 50,000 financial sector jobs since 2007. The outrageous bonuses to a few well-placed financial types will cushion but not deflect the influence of declining high-wage jobs. This can be seen in the striking weakness in the once seemingly unstoppable high-end condominium market. Particularly hard hit have been recent gentrified neighborhoods like Williamsburg in Brooklyn, N.Y., much like the hard-hit, newly developed areas along the Chicago lakefront.

    Other blue bastions have been shedding jobs as well, both during the recession and over the whole decade. Beyond Chicago and Detroit, the biggest losses among the mega-regions have taken place in the San Francisco Bay Area, Los Angeles-Long Beach and Boston. Big money can still be made in Silicon Valley, Hollywood or around the academic economy of Boston, but in terms of overall jobs, the past decade has been dismal for these regions. Meanwhile, the consistent big gainers have been – besides Houston – Dallas and Washington, D.C., the one place money really does seem to grow on trees. Even Miami, Phoenix and San Bernardino-Riverside, in California, boast more jobs today than in 2000, despite significant setbacks in the recent recession.

    These trends coincide with continuing shifts in demographics. The recession may have slowed the pace of net migration, but the essential pattern has remained in place. People continue to leave places like New York, Chicago, San Francisco and Los Angeles for more affordable, economically viable regions like Houston, Dallas, Austin and San Antonio. Overall, the big winners in net migration have been predominately conservative states like Texas – with over 800,000 net new migrants – notes demographer Wendell Cox. In what Cox calls “the decade of the South,” 90% of all net migration went to southern states.

    Utah, Colorado and the Pacific Northwest have also experienced positive flows – but perhaps most striking have been the migration gains, albeit modest, in Great Plains states such as Oklahoma and South Dakota as well as Appalachian Kentucky and West Virginia. Historically these places shipped many of their people to cities of the industrial Midwest, the eastern seaboard and California; that is no longer the case.

    Ultimately these shifts could undermine the true blue political strategy, perhaps as early as the 2010 congressional and state elections, and certainly after reapportionment. By 2012, the census will likely take seats from New York, Michigan, Pennsylvania and Ohio, handing them over to Texas, North Carolina, Georgia and Utah. Perhaps nothing will epitomize the new reality more than the fact that California, now among the most extreme blue states in terms of governance, will not gain a Congressional seat for the first time since the 1860s.

    These trends suggest that the current administration and the majority party in Congress must adjust their strategy. Further attempts to push a radical “progressive” agenda – expansive public employee bailouts, higher taxes and radical measures to combat “climate change” and suburban development – might please their current core constituencies, but they have the perverse effect of driving even more people and jobs out of these regions.

    All these underlying trends appear a boon to Republicans. But Democrats could counter the emerging GOP edge by appealing to the needs of these ascendant regions. By their very nature, growth states have the most urgent need for government investments in basic infrastructure, something traditional Democrats long have espoused. Moreover, such areas tend to become more tolerant as they welcome outsiders, and could be turned off to excessive Republican social conservatism.

    For any of this to work, however, Democrats must first abandon their current narrow, urban-centric blue-state strategy. They must learn to adjust their appeal to regions on the upswing, or things could turn out very badly for them very soon.

    This article originally appeared at Forbes.com.

    Joel Kotkin is executive editor of NewGeography.com and is a distinguished presidential fellow in urban futures at Chapman University. He is author of The City: A Global History. His next book, The Next Hundred Million: America in 2050, will be published by Penguin Press early next year.

  • Why New York City Needs a New Economic Strategy

    When Michael Bloomberg stood on the steps of City Hall last week to be sworn in for a third term as New York City’s mayor, he spoke in upbeat terms about the challenges ahead. The situation, however, is far more difficult than he portrays it. American financial power has shifted from New York to Washington, while global clout moves toward Singapore, Hong Kong, and Shanghai. Even if the local economy rebounds, the traditional media industries that employ many of Bloomberg’s influential constituents likely will continue to decline. New Yorkers have long had an outsize view of their city; historically, its mayors have touted mottos that encouraged that view, from Rudy Giuliani’s “capital of the world” to Mike Bloomberg’s “luxury city.” But as Bloomberg begins his new term, New York needs to reexamine its core economic strategy.

    A good first step would be to recognize that the world owes New York nothing. The city cannot simply rely on inertia and the disbursements of Wall Street megabonuses to save its economy. Instead, it needs to rebuild its middle-class neighborhoods and diversify toward a wide range of industries that can capitalize on the city’s unique advantages—including its appeal to immigrants; the port; and its leadership in design, culture, and high-end professional services.

    It’s also time to get rid of the Sex and the City image and start making New York a city where people can have both sex and children. This will become more important as the millennial generation enters its late 20s and early 30s later this decade. This is when many young migrants to the city, including upwardly mobile immigrants, typically become ex–New Yorkers.

    Despite all the “back to the city” hype, New York over the past decade suffered one of the highest rates of out-migration of any region in the country. Young singles may come to New York, but many leave as they get older and have families. An analysis by the city controller’s office in 2005 found that people leaving the city were three times more likely to have children than those arriving.

    If New York is to thrive, it will need to keep more of these largely middle-class families. To do that, it needs to diversify its economy beyond Wall Street, which in 2007 provided roughly 35 percent of all income earned in the city. Since the recession, the city has lost 40,000 financial-service jobs, but the industry has been quietly downsizing for years: over the past two decades, more than 100,000 financial-services jobs have disappeared from New York. In good years, financial services provided an enormous cash engine, but it can no longer provide enough jobs. According to an analysis by the Praxis Strategy Group, finance now accounts for barely one in eight jobs in New York City. Most job growth has come instead in lower-paying professions like health care and tourism.

    To become economically sustainable, New York needs to create policies that help encourage development in areas where its less wealthy citizens live. Most outsiders identify New York almost exclusively with Manhattan, yet roughly three out of four New Yorkers actually live in the outer boroughs: Queens, Brooklyn, Staten Island, and the Bronx. Neighborhoods like Bay Ridge, Whitestone, Flatbush, Howard Beach, and Middle Village are really New York’s middle-class bastions.

    Over the past decade, these communities have provided a critical middle ground between the bifurcated Bloombergian “luxury city” with its high-end enclaves and the many distressed neighborhoods throughout the city. Although the mayor, some urbanists, and many developers would like to make these middle-class enclaves ever denser, their very appeal often lies in their moderate scale, proximity to work areas, decent schools, and parks. Those attributes hold sway, even in a recession. “Brand- new and expensive places have not held up as well as the established family neighborhoods,” says Jonathan Bowles, director of the New York–based Center for an Urban Future.

    Nurturing these neighborhoods will require a distinct shift in public policy. During the Bloomberg years the big subsidies have gone to luxury condo megadevelopments, sports stadiums, or huge office complexes. Consider the 22-acre Atlantic Yards project in downtown Brooklyn, which will include luxury housing and a new arena for the NBA’s Nets; one recent report by the city’s Independent Budget Office put the total subsidies provided by the city, New York state, and the transit authority at $726 million and estimated the project will hurt, not help, the city’s economy over time.

    More than anything, the plain-vanilla neighborhoods that represent New York’s real future will require policies that create a broad array of economic opportunities. Right now New York is so overregulated and highly taxed that only the most high-end business, such as big media and financial firms, can possibly thrive. The city has neglected its smaller firms, typically engaged in such activities as food processing, furniture making, and garment production. Traditionally these industries were run by Russian, German, Polish, and Italian immigrants; West Indians, Latinos, Koreans, Chinese, and South Asians do much of this work today. Over the past decade, the number of self-employed immigrants in New York has grown even as the number of self-employed among the native-born has dropped.

    Earlier generations of urban residents as well as many immigrants today stay in the city to be close to their communities and industries dominated by them. These days many others stay in the city largely because of its cultural attributes and quality of life. This doesn’t mean these workers remain unreconstructed bohemians forever. Their priorities often change as they age, start businesses, and raise families. Different, more mundane issues—stable employment, taxes, safety, schools, and housing affordability—often determine whether they stay in the city. “It’s easy to name the things that attracted us—the neighbors, the moderate density,” says Nelson Ryland, a film editor with two children who works in his sprawling home in Brooklyn’s Flatbush neighborhood. “More than anything it’s the sense of the community. That’s the great thing that keeps people like us here.”

    Technology will boost this sense of community. Online groups like the Flatbush Family Network can facilitate contact in different parts of a city among artists, families, and neighborhood groups, supplementing the traditional community adhesives of schools, churches, synagogues, and clubs. These new online institutions can perform some of the functions that urbanist Jane Jacobs’s “eyes on the street” did in the old, cohesive city neighborhood. Information about the arrival of a promising new store or restaurant, or the unwelcome appearance of a possible child molester, travels through these community networks much as it did when mothers spoke over the washing, men went to the pool hall, or kids hung out at the candy store.

    Bloomberg has built on many of the achievements of his predecessor during his eight years in City Hall. This, combined with huge campaign spending from his personal fortune, is why voters sent him back for a third term. To position the city for prosperity in an economy that’s no longer overly dominated by Wall Street, he’d be wise to spend his final term focused on making new opportunities for people who live far from his own Upper East Side neighborhood—the people who represent the real future of New York.

    This article originally appeared at Newsweek.

    Joel Kotkin is executive editor of NewGeography.com and is a distinguished presidential fellow in urban futures at Chapman University. He is author of The City: A Global History. His next book, The Next Hundred Million: America in 2050, will be published by Penguin Press early next year.

  • Obama’s Elite Power Base

    Looking back at President Obama’s first year in office, this much is clear: Obama first enraged the right wing by seeming to veer far left, then turned off the left by seeming to abandon them. Even as Fox News fundamentalists rail against “socialism,” self-styled progressives like Naomi Klein scream about a “blown” opportunity to lead the nation from the swamp of darkest capitalism.

    Both right- and left-wing critics fail to consider the fundamental nature of the Obama regime. This presidency represents not a traditional ideology but a new politics that mirrors the rise of a new, and potentially hegemonic class, one for which Obama is a near-perfect representative.

    Every president and political movement, of course, brings to power an often-hoary group of grasping interest groups. Under the conservatives and George W. Bush, the favored classes included standbys like the fossil-fuel energy companies, Big Agriculture, suburban homebuilders, and the defense industry.

    Rather than the “good old boys,” Obama’s core group hails from what may be best described as the “creative class” – the cognitive elite, or, to borrow from Daniel Bell’s The Coming of Postindustrial Society, the “hierophants of the new society.” They come not from traditional productive industry, but the self-conscious “knowledge” sectors – such as financial services, the software industry, and academia.

    From early on, Barack Obama attracted big-money people like George Soros, Warren Buffett, and JP Morgan’s Jamie Dimon far more effectively than his opponents in either party. As The New York Times’ Andrew Sorkin put it back in April, “Mr. Obama might be struggling with the blue-collar vote in Pennsylvania, but he has nailed the hedge-fund vote.”

    Other bastions of support could be found in Silicon Valley, where Google Chairman Eric Schmidt and venture capitalist John Doerr were all early backers. Obama, the former law school professor, also did exceedingly well with academics, and many of his pivotal wins in the Midwest rested heavily on both votes and volunteers from college constituencies.

    Finally Obama gained the early support of public-sector unions, now arguably the dominant power within the Democratic Party. Together, these groups now enjoy the lion’s share of influence inside the administration.

    In contrast, the representatives of traditional Democratic sectors such as industrial labor unions, Latinos, or even many African Americans were slow to join the Obama bandwagon. Even after they joined his electoral coalition, they have received little in the way of succor from the president and the administration.

    Indeed, for most of these voters, the past year has been an awful one. Unemployment for Latinos, blacks, and blue-collar workers has skyrocketed, particularly among males. For them, Obama’s economic plan has done very little – unsurprising given its primary focus on sustaining public-sector employment and large financial institutions.

    In contrast, the core Obama constituencies appear to have ridden out the recession in fine shape. Mega-patron George Soros, for example, has boasted openly about how he was having “a very good crisis.” Much the same can be said of the largely pro-Obama hedge funds and investment bankers, for whom Paulson to Bernanke to Geithner has provided a double-play combination for the ages.

    Academia has also emerged as a big winner. This administration is crammed with professors from Science Adviser John Holdren and Energy Secretary Steven Chu to former Harvard President Larry Summers, the director of the National Economic Council. More broadly, academics have reaped massive windfalls from the stimulus, both in terms of direct support for universities and funding for research projects.

    One place where the priorities and class interests of the cognitive elite coalesce most has been on “climate change.” In contrast to manufacturers, farmers, or fossil-fuel firms, investment bankers, software companies, and university professors have little to fear from the rash of “green” policy initiatives.

    In fact, for these groups, “climate change” often means a once-in-a-lifetime bonanza. Wall Street sees the administration’s “cap and trade” proposals as opening a whole new frontier to enjoy yet more profit. University researchers – particularly those with the right spin on the climate issue – have been big winners in the tens of billions of dollars being handed out by the Chu-led Energy Department and other federal agencies.

    Overall, subsidized “alternative energy” – largely excluding both nuclear power and natural gas – also provides Silicon Valley with federal backing for ventures in everything from luxury electric cars and dodgy geothermal developments to “smart” energy grids. And, of course, all this increased federal spending also plays into the public-sector unions, for whom an ever-expanding government represents the ultimate growth industry.

    In the short term, Obama’s loyalties have gained him political credit even in hard times. Support from Wall Street and Silicon Valley assures access to big-money sources and influences the upper echelons of the establishment press, particularly in New York. Meanwhile, the academy and the public bureaucracy provide a cadre of political shock troops who may be needed to rouse an increasingly disaffected Democratic base in the 2010 elections.

    But Obama’s class strategy also poses considerable longer-term risks. The cognitive elites – clustered in places like Washington, New York, Boston, or Silicon Valley – tend to only talk to and listen to each other. This often makes them slow to recognize shifts in grassroots opinion on such issues as the health plan or global warming.

    That risks continued erosion of support from many hard-pressed middle-class voters around the country more concerned with economic growth and holding onto their home than saving the planet. These are precisely the voters, not the tea party activists or their leftist analogues, who likely will determine the political winners in 2010 and beyond.

    Official White House Photo by Pete Souza.

    This article originally appeared at The Daily Beast.

    Joel Kotkin is executive editor of NewGeography.com and is a distinguished presidential fellow in urban futures at Chapman University. He is author of The City: A Global History. His next book, The Next Hundred Million: America in 2050, will be published by Penguin Press early next year.

  • New Geography Top Stories of 2009

    As we bring to a close our first full calendar year at NewGeography.com, we thought readers may be interested in which articles out of more than 350 published enjoyed the widest readership. It’s been a solid year of growth for the site; visits to the site over the past six months have more than tripled over last year and subscribers have increased by a factor of six. The list of popular articles is based both on.readership online and via RSS.

    15. Joel Kotkin’s piece, Numbers Don’t Support Migration Exodus to “Cool Cities”, makes the case that places considered “cool” by many in media and economic development circles are actually losing net migrants to other U.S. regions. In almost every case, he argues, your local resources are better spent focused on skills upgrades for your local residents or hard and soft infrastructure upgrades for industries already successful in your region. This article originally appeared on Forbes.com

    14. The British Labour Party is no example for American Progressives. Legatum Institute Senior Fellow Ryan Streeter’s piece just in time for the 4th of July, View from the UK: The Progressive’s Dilemma, dissects Britain’s high social spending, increasing debt load. Streeter contends that the UK is danger of mortgaging its future.

    13. Breaking down Obama’s first year and looking forward. In two equally popular pieces from this fall, Joel Kotkin outlines a five point plan to improve Obama’s presidency (Obama Still Can Save His Presidency which originally appeared in Forbes.com. In the second piece he takes encouragement from signs that the President may be retuning his policy back towards America – “a big, amazingly diverse country with an expanding population” – and away from the “Scandinavian Consensus” model (Is Obama Separating from His Scandinavian Muse?) . This article originally appeared on Politico.com.

    12. State of the economy June 2009. Susanne Trimbath says it may be a while before the average citizen will actually see tangible improvements in the economy. As is often the case, Susanne’s predictions have turned out so far to be all too accurate.

    11. Questioning the stimulus plan. In February’sStimulus Plan Caters to the Privileged Public Sector, Joel Kotkin calls the stimulus plan “a massive bailout and expansion of the public-sector workforce as well as quasi-government workers in fields like health and education” yet “as little as 5% of the money is going toward making the country more productive in the longer run – toward such things as new roads, bridges, improved rail and significant new electrical generation.” This article originally appeared in Forbes.com

    10. Is California’s economic malaise leaking into Oregon? After years of strong migration flows of former Californians heading to Oregon, Joel Kotkin and California Lutheran University economist Bill Watkins point out that the state’s oppressive tax policies and red tape may be leaking into Oregon as well in California Disease: Oregon at Risk of Economic Malady. The article originally appeared in The Portland Oregonian.

    9. Tracking housing decline. Wendell Cox broke down the comparative national housing market in two widely read pieces. In the first he points out that the downturn can be broken into two phases, one mirroring the explosive growth in many overvalued markets, and another second phase were markets are declining across the board: Housing Downturn Moves Into Phase II. In the second, Wendell uses his median multiple calculation for the 49 largest metropolitan regions to show that prices in many place still have much farther to fall to reach historic norms: Housing Downturn Update: We May Have Reached Bottom, But Not Everywhere.

    8. Public debt is looming. Susanne Trimbath lists public debt levels of the most highly leveraged sovereign nations and explains why this debt and the credit default swaps purchased against it could create a looming public catastrophe: The Next Global Financial Crisis: Public Debt.

    7. Washington, DC is flourishing in the recession. NYU Professor and urban commentator Mitchell Moss explains how Washington is the one city benefiting from the government stimulus. He argues this is stimulating the DC economy, from increased lobbyist activity to web designers benefiting from the government’s new interest in digital communications: Washington, DC: The Real Winner in this Recession.

    6. Californa’s Decline. Three equally widely read pieces track the drastic shift in California from economic vibrancy to stagnancy: Kotkin’s “Death of the California Dream which ran first in Newsweek and The Decline of Los Angeles from February on Forbes.com. The third piece by economist Bill Watkins examines California’s domestic migration net losses using an old coal mining metaphor: In California, the Canary is Dead.

    5. Housing Affordability Rankings. The most read housing piece this year was Wendell Cox’s release of his annual housing affordability rankings based on median multiple calculations (ratio of median housing price to median household income in a given market). “Housing Prices Will Continue to Fall, Especially in California” lists median multiple calculations for each metropolitan region in the U.S. of more than 1,000,000 population.

    4. Detroit as a model for urban renewal. In a widely linked piece across the blogosphere, Aaron Renn points out that the decline in Detroit could be a platform for residents to get creative with urban re-development. This piece is full of stunning imagery of formerly dense neighborhoods now full of greenspace that sent me on a two hour Google Earth binge exploring the area. Detroit: Urban Laboratory and the New American Frontier.

    3. ”Alternative” Geography. New Geography publisher Delore Zimmerman’s run down of odd and quirky maps that redefine borders of the U.S. proved very popular on social bookmarking sites. “Borderline Reality”: “Sometimes maps can inspire and motivate us by helping to more fully understand the geography of our economic and demographic challenges and opportunities. Perhaps most importantly thematic maps tell a story about places.”

    2. Portland isn’t a model for every community. Easily our most widely discussed, shared, and linked piece this year was Aaron Renn’s “The White City.” The piece sparked a fair amount of criticism with some looking to poke holes in the racial breakdowns and others taking the piece as an affront to liberal politics instead of an examination of urban planning policy. Many of the most vehement critics failed to address the central point of the piece: Portland is a unique place with a unique disposition and composition, yet it is held up by many community leaders in other regions as the ultimate in public policy. Instead of holding up Portland as a model, cities and regions need to do a better job of looking at themselves and defining policy based upon local community identity. Be who you are.

    1. Best Cities Rankings. Overall, our most read content at New Geography this year was the Best Cities Rankings, released in April with Forbes. Our rankings are purposefully focused just on a combination of measures of one metric, employment change. We leave out all of the more qualitative measures thinking that all contribute to the output of a shifting employment landscape.

    Where are the Best Cities for Job Growth? (Summary Piece)
    2009 How We Pick the Best Cities for Job Growth
    All Cities Rankings – 2009 New Geography Best Cities for Job Growth

    It’s been a good year at New Geography, one of steady growth and, we believe, increased influence. We welcome your comments, participation, and submissions. Thanks for reading.