Source – oftwominds.com
– ‘…The sacrifices required to live in high-cost urban areas are no longer worth it: traffic congestion, long commutes, high-stress jobs, homelessness and decaying infrastructure are outweighing the benefits of hipster urbanism. Although it’s verboten to mention this in the we’re so fabulous local media, many of these high-cost urban regions are hopelessly dysfunctional. Taxpayers have ponied up billions of dollars in new taxes, fees and bond measures, and yet none of the problems that make daily life miserable ever get better”
America’s Forced Financial Flight: Fleeing Unaffordable and Dysfunctional Cities – By Charles Hugh Smith
The forced flight from unaffordable and dysfunctional urban regions is as yet a trickle, but watch what happens when a recession causes widespread layoffs in high-wage sectors.
For hundreds of years, rural poverty has driven people to urban areas: cities offer paying work and abundant opportunities to get ahead, and these financial incentives have transformed the human populace from largely rural to largely urban in the developed world.
Now a new set of financial pressures are forcing a migration of urban residents out of cities which are increasingly unaffordable and dysfunctional. As highly paid skilled workers and global capital have flooded into high-job-growth regions, living costs and the costs of doing business have skyrocketed: where not too long ago $1,000 a month would secure a modest one-bedroom apartment in major urban job centers, now it takes $2,000 or $3,000 a month to rent a modest flat.
Wages for the average worker have not doubled or tripled, and this asymmetry between soaring living costs and stagnant incomes is driving the exodus out of cities that are only affordable to the top 10% of wage earners, or those who bought a house decades ago and have locked in low property taxes.
Gordon Long and I discuss this forced migration in a new video program. It’s important to note that we’re not talking about economy-wide inflation or the general rise in the cost of living; we’re talking about the hyper-drive cost increases that characterize high-cost urban areas.
I’ve addressed economy-wide real-world inflation many times,for example:
The Burrito Index: Consumer Prices Have Soared 160% Since 2001 (August 1, 2016)
Burrito Index Update: Burrito Cost Triples, Official Inflation Up 43% from 2001 (May 31, 2018)
In high-cost urban regions, burritos aren’t $7.50; they’re $10 or $12. Parking tickets aren’t $15, they’re $60, and so on.
Consider this chart of rents in the San Francisco Bay Area: unless the household’s income has shot up in parallel with rents, this cost of living is simply unaffordable.
Here are the dynamics driving this financially forced flight, which hits the young especially hard: who can afford to buy a house when cramped, decaying 100-year old bungalows are $900,000 and property taxes are $15,000 or more? Who can afford to have kids when childcare costs a small fortune?
The elderly retired who don’t own a house free and clear are also being priced out of these regions.
1. Household income is stagnating as real-world inflation erodes the purchasing power of income: rent, housing, childcare, healthcare, dining out are all rising far faster than “official” inflation of 2% annually.
2. Prices in high-cost urban zones are increasing faster than in less pricey regions. Areas with job growth are experiencing supply-demand imbalances in rent and housing. Only top earners can afford to buy a home.
3. Young households are burdened with student loan debt, making it financially difficult to buy a home in a pricey urban zone and start a family. The only way to afford a home and children is to move to a region with affordable housing and living costs.
4. Income in high-cost urban areas is more heavily skewed by “winner take most” dynamics of finance and technology; the Pareto Distribution of 20% earn 80% of the income is extended so the top 4% take 64% the income. Even above-average incomes are not enough to support a traditional middle-class lifestyle.
5. Local government services cost more in high-cost urban areas, and so cities and municipalities are relentlessly increasing taxes, fees and licensing, pressuring all but the top tier of households.
6. The sacrifices required to live in high-cost urban areas are no longer worth it: traffic congestion, long commutes, high-stress jobs, homelessness and decaying infrastructure are outweighing the benefits of hipster urbanism.
Although it’s verboten to mention this in the we’re so fabulous local media, many of these high-cost urban regions are hopelessly dysfunctional. Taxpayers have ponied up billions of dollars in new taxes, fees and bond measures, and yet none of the problems that make daily life miserable ever get better.
At some point, the urban hipsterism that seemed so cool and appealing becomes just another example of the Haves and Have-Nots: how many households can afford $200+ for a meal and drinks at the latest foodie-fusion bistro? What level of sainthood is required to tolerate the traffic or crowded public transport to get to the hipster paradise, including avoiding the bodies, needles and other detritus of the entrenched homeless on the sidewalks?
The forced flight from unaffordable and dysfunctional urban regions is as yet a trickle, but watch what happens when a recession causes widespread layoffs in high-wage sectors and suddenly the hipster bistro that was always jammed is empty, and then shuttered. To replaced the taxes lost to layoffs and closed businesses, the political class will have no choice but to launch a frenzy of higher taxes, fees and surcharges on those left behind.
Seattle is dying; so are Portland and Spokane – By JEFF SAYRE
A few weeks back, my wife and I headed to Portland, Ore., for a mini-vacation and a concert.
Driving into Portland on a route we have used for 25 years, we noticed tents and tent camps everywhere — under bridges, in abandoned properties and tarp cities.
We also saw many abandoned camps. The people were gone. The trash was left behind. Garbage, tarps, things collected and used were now left behind for someone else to pick up — or as it looked, not pick up. What a great view for tourists coming to visit. Welcome to Portland — a literal sewer and garbage dump.
We stayed downtown where, as you walk, you can see people in sleeping bags everywhere. These are people without shoes or socks.
In old Chinatown, people were in every door stoop with their stuff. Outside nice restaurants, homeless folks were camping with all their stuff against the windows and stoops, drinking wine and smoking weed while others dined on the other side of the glass inside.
We saw people so wasted they couldn’t stand up in front of operating businesses.
I saw people sharing needles on the sidewalk. I saw used needles on the sidewalks.
We rode the MAX from Modi Center and decided not to get off at the first stop because there were 50 people sleeping and many others partying it up. It looked unsafe.
The root causes of homelessness are and have been mostly societal problems, such as mental illness, addiction and domestic violence and they have always existed in the United States.
Widespread homelessness has not.
The current crisis stems from decisions made during a generation: The flood of returning Vietnam-era vets in the 1970s coincided with a national push to de-institutionalize mental hospitals. In the 1980s and ’90s, under both Republican and Democratic presidents, the federal government got out of the business of building public housing and pushed direct responsibility for caring for poor and vulnerable people to state, county and city governments.
More then 50 percent of all homeless people counted in the U.S. suffer from some physical or psychological problem. California has 109,000 homeless. Oregon has 11,000 and Washington state about 16,000. All three are the hot spots for the most homeless in America, except New York City.
Eugene, Ore., Seattle and Spokane made the list, too.
The West Coast has become a magnet for the homeless to move to and live.
Seattle is way out of control with its handling of homeless people and now Spokane is joining in with its liberal city council’s ideology. Spokane actually had its city council vote to open all city-owned properties during day time hours for homeless people and now is working on a homeless bill of rights.
Want to watch a great documentary on the issue in Seattle?
It’s called “Seattle Is Dying.” KOMO-TV made it and Eric Johnson, now an anchorman who I worked with at KREM-TV in Spokane, did most of the interviews, writing and voice over work. It’s a great story.
It’s easy to see what’s going on in most of these West Coast cities. Liberal lawmakers were trying great new societal experiments in the old proven-to-fail Marxist ways.
In King County, it’s legal to possess up to 3 grams of heroin and meth with no consequences. None. Perfect.
Seattle is trying the same failed policy Vancouver, B.C., tried with legal shooting galleries with a nurse on site so you can safely inject meth, cocaine or heroin.
Great idea. But it’s safe, a nurse is there.
Mobile sites are proposed, too. Last weekend Vancouver’s emergency medical technicians responded to 45 overdose cases from midnight Friday to midnight Sunday.
Crime rates associated with homeless people have skyrocketed in many West Coast cities.
Businesses and residents pay the brunt of the damages caused by theft, shoplifting and assaults.
Seattle police officers will not even talk with the media about how they feel when people they arrest are put back on the streets — some many times. Morale is low.
Portland has 120 commissioned officers’ positions open. I wonder why.
Police are told to stand down on most of these situations in Seattle and Portland and not to enforce the law. They are beyond frustrated. In the old days, a billy club on the head and one to the gut and being told to move along worked well. It should be today, too. Ah, how many lumps ya want, bub? Done.
In three days in downtown Portland, we saw not one Portland police officer. None. Zero. Not on a bike, on foot or even a car. On the other hand, I did not see Antifa directing traffic for them, either.
Elected officials, businesses, citizens and visitors must fight back against these liberal policies.
I’m sure neither the Seattle nor Portland mayor gives a rip. But, hey, call them anyway.
Tell them to shape up or you won’t return with your money to spend there.
Sayre of Lewiston served as regional director to former U.S. Sen. Larry Craig. His email address is firstname.lastname@example.org.