Tag Archive for: middle class

California’s Vanished Dreams, By the Numbers

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Even today amid a mounting exodus among those who can afford it, and with its appeal diminished to businesses and newcomers, California, legendary state of American dreams, continues to inspire optimism among progressive boosters.

Laura Tyson, the longtime Democratic economist now at the University of California at Berkeley, praises the state for creating “the way forward” to a more enlightened “market capitalism.” Like-minded analysts tout Silicon Valley’s massive wealth generation as evidence of progressivism’s promise. The Los Angeles Times suggested approvingly that the Biden administration’s goal is to “make America California again.” And, despite dark prospects in November’s midterm elections, the President and his party still seem intent on proving it.

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Texas Is The Future

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In 1946, the American author John Gunther described Houston as “mostly ugly and barren, without a single good restaurant and hotels with cockroaches”. The only reasons to live in the city, he claimed, were financial; it was a place “where few people think about anything but money”.

This view was widespread at the time, and has lingered well into the 21st century. Forget Houston. New York, Chicago, San Francisco, and Los Angeles are the cities most frequently associated with the urban American dream.

Fast forward to today, however, and a new urban renaissance is taking shape — and this time, it’s in the heart of Texas. Never before in American history have two metros in one state — Houston and Dallas-Ft. Worth — been in the nation’s five largest. So much for its cockroaches; at its current rate of growth, Houston could replace Chicago as the nation’s third largest municipality by 2030.

What’s driving this Texan resurgence? Traditionally, American cities such as Detroit, Cleveland, and St. Louis all tried to copy the model set by New York and, to a lesser extent, Chicago, with high-rise offices crowded into central business districts. But Texas urbanism is different. They may wear cowboy boots, drive pickup trucks, and attend rodeos, but Texans have created a new model of American urbanity rooted in the demands of the consumer market — an idea deeply offensive to many planners and retro-urbanists.

Some observers lament the fact that the vast majority of Texas’s metropolitan growth — nearly 100% — has taken place in the suburbs and exurbs. But this has its benefits, not least the fact that its cities haven’t been turned into rabbit warrens that only provide high living standards to the rich. Over the past decade, Texas has built three times as much housing as California. This has allowed its cities, despite massive demographic and economic growth, to keep housing prices significantly lower than in coastal Californian cities such as San Francisco, San Jose, San Diego and Los Angeles.

But while affordability has been the secret sauce for Texan cities, its urbanism also thrives by embracing the realities of the marketplace. Over the past decade, Austin and Dallas have created jobs two to three times faster than New York, Los Angeles, or Chicago. And this growth is not all at the low end of the job market, as some like the New York Times’s Paul Krugman suggest. Over the past five years, for instance, Austin has displaced San Francisco as the fastest growing tech market. Indeed, Austin is now arguably the strongest rival to Silicon Valley, home to the headquarters of Tesla, and Oracle, as well as Apple’s engineering division and Meta’s latest expansion, 33 floors downtown.

But the most significant expansion has been in professional and business services, the core of the new urban economy. Over the past five years, Austin and Dallas-Ft. Worth have created more than twice as many new business service jobs as San Jose; all four big Texas cities have grown this sector many times the rate of New York, Los Angeles, or Chicago. The Dallas metroplex is now home to 24 Fortune 500 company headquarters, trailing only New York and Chicago by a small number; 40 years ago, the region had fewer than five.

Read the rest of this piece at UnHerd.

Joel Kotkin is the author of The Coming of Neo-Feudalism: A Warning to the Global Middle Class. He is the Roger Hobbs Presidential Fellow in Urban Futures at Chapman University and Executive Director for Urban Reform Institute. Learn more at joelkotkin.com and follow him on Twitter @joelkotkin.

Homepage photo: from PxHere under CC 0.0 Public Domain.

When the Arc of History Bends Back Toward the Dark Ages

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The notion that “the arc of history” favors humanity extends across the political spectrum from George W. Bush to Barack Obama. Yet rather than facing the dawn of a progressive future, we may be entering “the great regression,” a period where the world becomes more hierarchical and feudal, less prosperous, and much less free.

A decade or two ago, optimism was buttressed by the economic boom that followed the end of the Second World War and was further extended by the collapse of Communism. This “end of history” moment seemed to be the dawn of a future that was more like Star Trek, with advanced technologies used to deliver universal prosperity under a regime of enlightened rulers. Instead, today’s new world order is a springtime for dictators, revanchist ideologies, and the pitiless global struggle for supremacy.

In place of the broad-based prosperity enjoyed by Europe, Australia, and North America that gave birth to capitalism and modern democracy, those regions have become more feudalistic, hierarchical, and profoundly unequal. The middle class, which was critical in destroying feudalism and ushering in the prosperity of the modern world, has lost ground to a small aristocracy of financiers, as corporate and tech hegemons have increased their power over the global economy.

Once-dynamic Western societies are now stagnating as they did in feudal times. Median incomes have stayed flat while the populations of post-industrial societies are growing slowly or not at all—a problem exacerbated by the COVID-19 pandemic. The mid-20th-century liberal “golden age” has receded under the rising tide of autocracy. Indeed, according to a recent study by Sweden’s University of Gothenburg, nearly 70% of the world’s population lives under some kind of autocracy, including illiberal electoral regimes, up from 50% in 2011. Belief in democracy is also declining, most disturbingly among young people who are intimately acquainted with the shortcomings of Western liberal democracies but have no historical memory of what life was like under previous autocracies.

Although the united Western response to Vladimir Putin’s invasion of Ukraine offers some hope of a revived liberal alliance, the most likely solutions to the crisis will come from deals struck between monarchs fighting over turf and prestige. While no one is expecting the UN bureaucracy to broker a solution, dictators like Turkey’s Recep Tayyip Erdogan have a vital role to play. At the moment, global oil shortages have already empowered autocrats in Saudi Arabia, the United Arab Emirates, Qatar, and Venezuela. Soon Iran’s mullahs, saved by Europe and the United States, will see their own windfall as Western nations purposely surrender their capacity to generate energy on their own.

The United States’ failure to prevent Russia’s strategic dominance of Europe’s energy sector or China’s relentless drive for global preeminence is not a predetermined fact of history—rather, it reflects choices made by our ruling establishment. Rather than seek, as in the past, to boost the United States’ productive power with investment in manufacturing and energy, corporate and political elites in the United States have comprehensively demonized and dismantled precisely those industries in the name of a green ideology that Joel Garreau calls “the religion of choice for urban atheists.” It is no coincidence that the very industries that tend to spread wealth to ordinary workers, enrich owners, and support an independent middle class are portrayed as being full of deplorables and contributing to the climate apocalypse. Like the early Christians, today’s climate activists employ religion to strangle dissent and control opinion.

Read the rest of this piece at The Scroll.

Joel Kotkin is the author of The Coming of Neo-Feudalism: A Warning to the Global Middle Class. He is the Roger Hobbs Presidential Fellow in Urban Futures at Chapman University and Executive Director for Urban Reform Institute. Learn more at joelkotkin.com and follow him on Twitter @joelkotkin.

Welcome to the New Middle Ages

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By: Ed West
On: UnHerd

Today the richest 40 Americans have more wealth than the poorest 185 million Americans. The leading 100 landowners now own 40 million acres of American land, an area the size of New England. There has been a vast increase in American inequality since the mid-20th century, and Europe — though some way behind — is on a similar course.

These are among the alarming stats cited by Joel Kotkin’s The Coming of Neo-Feudalism, published just as lockdown sped up some of the trends he chronicled: increased tech dominance, rising inequality between rich and poor, not just in wealth but in health, and record levels of loneliness (4,000 Japanese people die alone each week, he cheerfully informs us). Read more

Joel Kotkin on Big Cities are Past Their Prime at Intelligence Squared Debate

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By: John Donovan
On: Intelligence Squared Debates

New York. Los Angeles. Boston. San Francisco. Call them America’s “superstars.” With mega populations, these urban hubs have long reigned as the nation’s economic, social, and cultural capitals. But big cities have also been the hardest hit by the pandemic. “Zoom towns” are springing up across the country as professionals leave the city in droves. Even more, the pandemic has brought economic and social inequality into sharp focus for the nation’s lawmakers. And some, particularly in large cities that boast the most obvious cases of such inequality, are enacting new progressive policies and laws that seek to combat inequality. For some, this means a new financial structure that makes city life less compelling for those in higher income brackets. Will megacities keep their magnetism in the wake of Covid-19? Or are their best days behind them?

Listen to this episode at Intelligence Squared Debates

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Next California Migration: Video

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By: USC Sol Price School of Public Policy

California poses many challenges for the middle- and working-class. As a result, there is a significant migration of people, jobs, and opportunities— both within and outside the state. Who is leaving California, and who is no longer seeking to move to the golden state? Are there incentives for job creation and how can the state remain competitive?

Dr. Jorge De la Roca, Joel Kotkin and Marshall Toplansky tackle these questions and more. This expert panel offers an overview of current demographic trends in California, followed by a discussion around future implications for the state and possible solutions to reinvigorate the California dream. The event concluded with audience Q&A.

Watch the full event:

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Joel Kotkin Talks with Amanda Vanstone about the Limits of Libertarianism

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By: Amanda Vanstone
On: Counterpoint

What are the limits of libertarianism? Joel Kotkin explains that ‘in recent years, libertarians increasingly seem less concerned with how their policies might actually impact people. Convinced that markets are virtually always the best way to approach any issue, they have allied with many of the same forces – monopoly capital, anti-suburban zealots and the tech-oligarchy – which are systematically undermining the popular rationale for market capitalism’. He goes through some core libertarian beliefs and how they’ve changed and says that ‘in many ways, libertarians, like all of us, are victims of history’ and that to become relevant again, libertarians need to go beyond their dogmatic attachments, focus on bolstering the vitality competitive free markets’. That ‘libertarian ideas still have great relevance, but only so much as they reflect markets that are open to competition and capable of improving everyday lives’.

Listen to this episode:

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The Power Hungry Podcast: Joel Kotkin Talks with Robert Bryce

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By: Robert Bryce
On: The Power Hungry Podcast

Joel Kotkin is a demographer, journalist, author, and executive editor of NewGeography.com. In his second appearance on the Power Hungry Podcast, Kotkin discusses his recent article for Quillette, “The New Great Game,” how China and Russia are allying against the West, why America needs “a new nationalism” to counter this alliance, how California’s administrative state is crushing the poor and the middle class, Michael Shellenberger’s gubernatorial bid, energy, housing, and why despite his many concerns, he remains bullish on the future of the United States.

 

Listen to this episode on The Power Hungry Podcast

Related:

The Great New Game
Welcome to the End of Democracy and It’s Not Trump’s Fault
Buy The Coming of Neo-Feudalism

What’s Left? is a weekly podcast hosted by Aimee Terese (@aimeeterese) and Oliver Bateman (@moustacheclubUS). Among other topics, we usually discuss politics, current affairs, culture, and the sleazy world of bourgeois media.

Tarnishing the Golden State

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No state advertises its egalitarian bona fides more than California. Governor Gavin Newsom brags that his state is “the envy of the world,” a place that is “not going to abandon our poor people.” In his inauguration speech, he claimed that “unlike the Washington plutocracy, California isn’t satisfied serving a powerful few on one side of the velvet rope. The California Dream is for all.” Yet even as Newsom and his progressive allies have backed Black Lives Matter and enacted a racialized “ethnic studies” curriculum in public schools, reality tells a less positive story. The Golden State’s racial minorities are far from thriving. Increasingly, they’re seeking fortunes elsewhere—often to redder, less “enlightened” states.

The minorities leaving California are not running away from beautiful weather or scenery but toward an opportunity horizon that no longer seems achievable in the Golden State. In a new report for Chapman University, my coauthors and I found that African-American and Latino Californians’ real earnings ranked between 48th and 50th among the states. Blacks in California earn roughly the same, or slightly less, than do their counterparts in Mississippi. The state has the nation’s worst cost-adjusted poverty rate and the third-highest Gini Inequality index (behind New York and Louisiana). According to the United Way of California, over 30 percent of California residents lack sufficient income to cover basic living costs even after accounting for public-assistance programs; this includes half of Latino and 40 percent of black residents.

It was different once. Ever since the nineteenth-century Gold Rush, people from around the world rushed to California to seek their fortunes, giving the state a diverse population of whites, Asians, Latinos, and blacks. Deeply afraid of an “Asian invasion” into what newcomers called Gold Mountain, incumbent Californians limited the rights of Chinese, Japanese, and other migrants from the East and backed racially oriented bans originating from Washington, D.C. that lifted only in the early 1950s. The Asian population has risen since. Until 1990, Asians were not systematically enumerated in the decennial census but were instead combined with Pacific Islanders; this larger grouping increased from 2.0 percent to 9.6 percent of the state’s population, according to Census Bureau research. The state’s Asian population increased from 10.9 percent in 2000 to 15.1 percent in 2020.

Immigrants also entered from Mexico, at first to escape the chaos of that country’s brutal 1910–1920 revolution. Controls on Mexican migration tended to follow economic conditions, but a liberalization of immigration laws in 1965, and a mass amnesty in 1986, assured that Latinos would be the Golden State’s largest group. Census Bureau research indicates that California’s Hispanic population rose from 6.0 percent in 1940 to 13.7 percent in 1970 and 32.4 percent in 2000. A figure of 37.6 percent was reached in 2010, rising to 39.4 percent in 2020.

Finally, African-Americans started coming to the state in the 1920s and 1930s, with their numbers increasing during World War II. Lured by good jobs in the state’s burgeoning aircraft, automobile, and construction economies, blacks may have faced some discrimination, but far less than they did elsewhere. In L.A., wrote Ralph Bunche, blacks were “eating high up” off the hog. As late as 1940, less than 2 percent of the population was black—a number that more than doubled by 1950 and reached a peak of 7.7 percent in 1980. Since 2000, however, California’s black population has dropped from 6.7 percent to 5.4 percent.

Today, the California opportunity structure is no longer so promising. Once seen as a mecca of sorts for blacks, L.A. now ranks toward the bottom of the Urban Reform Institute’s Upward Mobility Index, which measures such factors as income, housing affordability, unemployment, educational attainment, and homeownership. San Francisco does poorly by the same metrics. The best American cities for upward mobility today are not Los Angeles or San Francisco but Atlanta; Phoenix; Virginia Beach and Richmond, Virginia; and Lancaster, Pennsylvania.

Read the rest of this piece at City Journal.

Joel Kotkin is the author of The Coming of Neo-Feudalism: A Warning to the Global Middle Class. He is the Roger Hobbs Presidential Fellow in Urban Futures at Chapman University and Executive Director for Urban Reform Institute. Learn more at joelkotkin.com and follow him on Twitter @joelkotkin.

Photo: City Journal.

You Can’t Fix Housing with New Houses. We Need New Cities

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Housing is rapidly becoming the key economic issue facing America’s beleaguered middle class. Even as interest rates rise, rents are on a wild binge, up near 20 percent in the past year or more in some cities. Meanwhile, home prices have hit a high and appear to be climbing further still. Higher prices are emerging even in what have long been relative bargain communities in the southeast, as refugees from the high-priced Northeast pour in with their greater resources.

The property gold rush has been made more problematic by the growing role of professional, well-funded investors and speculators, to whom the housing market is more attractive than a sometimes unsteady stock market. Read more