Tuesday, July 18, 2023

I sometimes get the feeling I'm talking to a brick wall...


... when I keep warning about the dangers of living in "big blue" cities, because few people appear to take my warnings seriously.  Nevertheless, I'll keep providing evidence, in the hope that at least some of my readers may see the light in time, and get the hell out of them before it's too late.

Try this somber reflection for size.

Imploding Cities Will Drag All of Us Down — Even if You Don't Live Anywhere Near One

There is so much wrong with America’s cities, it’s hard to see why any contributing member of society would live and/or work in one of them. Some of the issues arise from far-Left local governance while others are generated by more widespread Leftist policy. These are coupled with an organic workforce evolution, as the United States transitions from an industry-based to an information-based economy. The result is urban areas caught in a downward spiral — and, as with any sinking vessel, threatening to suck everyone nearby down with them.

First, a quick refresher on the compounding problems of urban areas. Chief among them is that big cities are dark blue, and thus they’ve become crucibles of Left-wing policy failure. Uncontrolled crime, roving drug and mental-illness zombies, and swarms of sanctuary-recipient asylum scammers are crowding out reasonable people and businesses. The normals who remain to take advantage of access to cultural events (such as they are) and restaurant variety are also subject to totalitarian social controls and two-tiered justice systems that punish them when they fight back against criminals. But no matter how desperate the situation becomes, city councils can be counted on to double down on woke policies, then double down again.

Businesses are fleeing. In the ones that remain, shopping for basic goods has become a frustrating exercise in waiting for an associate to unlock the case so you can grab a razor and some toothpaste. Add in today’s high interest rates, which make owning and running a business prohibitively expensive, and the writing is on the wall ... The effects of the imminent collapse of the commercial urban real estate market will ripple out across the financial sector and affect just about everyone in one way or another.

. . .

Cities must then make choices between cutting services and raising taxes — either of which will further drive out the remaining wealthy and productive residents and businesses. The cycle can be deadly. As in the 1970s, municipalities will start declaring bankruptcy — and that will add a drain on federal resources, which will have to be used to bail them out. This will be on top of the unemployment benefits to the urban retail and hospitality workers who lost their jobs ... When you realize that everyone’s pensions are involved, you understand that not bailing out these banks and cities was never going to be an option. They have us over a barrel. So we can expect a cool trillion or two to flow from Big G’s coffers. This, while we are still reeling from the inflation and high interest rates from the last crisis, the Great COVID Overreaction Rescue Plan.

There's more at the link.

Charles Hugh Smith puts it in monetary terms.

The Coming Crisis of Cities: Reinvention or Bankruptcy

In summary, here's what's happening: given the increasing speed of digital communications, the majority of the knowledge/FIRE economy work can be done from anywhere. This has long been the reality, but the pandemic lockdown accelerated the recognition of this reality.

Given the higher wages paid to knowledge workers and the absurdly high costs and life-limitations (kids and homeownership are unaffordable) of living in big cities, the incentives for those who were too young to buy a house for $150,000 that's now worth $1 million are to move to an affordable locale and abandon the marginal benefits of the city (novelty, entertainment).

The incentives for the poor living on social-welfare benefits and the working-poor who do "real-world" jobs is to stay put, as their opportunities are considerably diminished in less wealthy regions.

The problem is the poor and working-poor pay a relatively modest percentage of taxes. The high-wage earners who are incentivized to leave pay the majority of taxes.

Cities are terribly costly to operate, and most of these costs are fixed, meaning they stay the same regardless of how many customers use the services. About 75% to 80% of all municipal budgets (the general funds, not projects paid by borrowing money via selling municipal bonds) go to labor--government employees and their pension/healthcare costs.

Buses, subways and trains all have the same fixed costs and staffing whether they're full or empty.

. . .

Somebody has to pay more, or these services will go away. Municipal workers are unionized and will resist reductions in pay and benefits, even in municipal bankruptcy.

Remote work and the systemic inequality created by financialization and globalization are generating a doom-loop of incentives to leave before the inevitable collision with reality occurs: either services are slashed or taxes are raised, or more likely, both.

. . .

There is a self-reinforcing feedback loop in raising taxes: at some threshold, high-earner households will conclude the benefits no longer outweigh the costs and they'll sell out and leave.

. . .

As for the consequences of remote work, they are already visible in statistics. The Bureau of Labor Statistics (BLS) recently released employment and wage data nationally and in the most populous 350 counties in the US ... in the high-wage, high-cost Silicon Valley counties, the decline in wages is staggering:

San Francisco: -22.6%
San Mateo: -20.7%
Santa Clara: -15.0%

High-cost states suffered significant wage declines:

California: -6.9%
New York: -5.1%

Some of these declines may be the result of tech-sector layoffs, but the number of jobs in all these regions increased by over 2% from Dec. 2021 to Dec. 2022. The more likely primary cause may be companies paying lower wages when employees switch to remote work.

15% to 20% declines in wages paid are absolutely monumental. They add up to billions of dollars that are no longer available to pay taxes or fund city-centric "pleasures."

These statistics raise big questions about the viability of housing prices staying so high that only the top 10% can afford to buy homes. How many in-migrants will earn top-10% salaries? How many out-migrants are taking their earnings somewhere where they can hope to afford a family and a house?

Who's going to be left who is willing and able to pay much higher taxes and fees to pay the sky-high legacy costs built up during the glorious 30 years of urban expansion fueled by speculative bubbles?

Again, more at the link.

Folks, if you can't read the writing on the wall by this point, I don't know how to reach you.  Too many people are judging the cities they live in by the conditions around their suburban homes, where everything looks just peachy and hunky-dory.  However, that ignores the festering plague spots of low-income, low-education, overcrowded, urban-decay, crime-infested areas where the people live largely on government benefits and have little to no hope of ever breaking free from that cycle of dependency.  They're part of the same cities as those suburbs.  When the stresses in those areas stretch too tight, or the benefits they depend on are no longer available (or are reduced in value thanks to inflation and rising prices), they display their displeasure by becoming more violent and anti-social.  They blame "the system", or "the man" . . . never their own shortcomings, faults and failures.  (To be fair, there's enough blame to go around:  Lyndon Johnson's failed and discredited "Great Society" policies have a whole lot to answer for, as do our moribund education system and dependency-inducing entitlement programs - it's not just human failings.)

The result?  To name just a few out of many possible examples:

Watts riots of 1965

New York City blackout of 1977

Never forget that the infamous Cloward-Piven strategy was inspired by and arose out of the Watts riots.  Its pernicious effects are now key to Democratic Party policies in the cities they control, and also underpin the tactics of groups such as Black Lives Matter and Antifa.

Friends, our cities have fallen so far that I seriously doubt they can be rescued.  They'll have to hit rock bottom, and realize it, and take steps to cut away the deadwood that's crippling them, before they can rise again.  If you stay, hoping for the best, I fear greatly that you may end up as part of the deadwood that's cut away.

I hope I'm wrong . . . but I doubt it.  The evidence of what's coming is overwhelming.  It won't happen overnight, or even in a year or two, but the overall trend is unmistakeable, and probably irreversible.

Leave our "big blue" cities while you still can, even if it means taking a financial loss in the process.  Some things - your family, your and their lives, your security - are worth more than money.



Anonymous said...

Perhaps the Americans have adopted the fatalistic mentality of Africans who go to the same waterhole their relative was killed by a crocodile the past weekend.

Michael said...

Africans, water IS LIFE, 3 days without safe water your DEAD or nearly so.

Those Africans live with the hazards by "Being Careful and It won't happen to me". Not always true but it's a coping mechanism.

WE in the USA are Not that much different than the bush Africans.

Sometimes I think we talk AT folks and fail to listen.

I listened to a couple of folks living "near" Boston.

I've hears the normalcy bias "it's not THAT BAD, Thank Goodness I Don't live in Chicago, You just don't go where its bad and so on.

I've heard the I own a house here and cannot sell it to start over somewhere else. Or my Jobs here sort of answers.

Face it friends, when an Empire falls a LOT of folks will lose everything. Homes ablaze, dispossessed and suffering all the evils of a fallen mankind.

ALL of US will lose a LOT as our COUNTRY has been supporting OUR Lifestyle of Coffee and Bananas from far away CHEAPLY to those items becoming very expensive and hard to get.

From the worlds cheapest calories to much closer to the rest of the worlds price per calorie. Our obesity problems will go away as "starving" people go crazy destroying and looting over their FAILURE of EBT cards to buy their beer and burgers.

As the VAST Majority of our Transportation, Power Grid and so on GOES THROUGH those soon to be Insane BLUE HIVE disasters ALL of us will discover just how much of our lives will be disrupted by lack of the "LOTS OF FOOD we Grow IN America and Grid Power failures as they CANNOT GET To our Stores and Homes.

Noah could only save his family and the pairs of animals, the Angels sent to save Lot from the Cities of Sodom didn't save the rest from God's wrath.

So beyond protecting our families and trusted friends are we getting worked up about the destruction of Gomorra 2.0?

Anonymous said...

I used to live in a suburb outside Rochester, NY. Rochester is a deep, deep, very black, I mean blue city in Western NY.
9 or 10 years ago I think a woman campaigned for mayor, she was a resident of the inner city her whole life. Constituents loved her. The election signs that went up said what was happening very plainly:

Our mayor
Our city
Our turn

We moved the next summer. She has since been arrested for cocaine, bribery, and AK47s!!! I hear now that the crime is rampant, literal kids (11-15 years old) commit an average of 3 carjackings a day, with firearms (as a 40 year old taxpaying property owner with ZERO criminal record, I could not get a permit for one).
We're on 15 acres in the country in EastTN now, no worries. In a newly built house, for what I used to pay for... oh, nevermind. Wasting my time too.
Have hope dear host, it took time, but 'vote with your feet' eventually got through to me. If for nothing else, documenting the decline will prove useful when people ask the inevitable questions.

Bob in NC said...

For some it's not that simple to just move - I have a long time friend who has lived in the Village in NYC since the late 70's. He is around the poverty line, has no family except an emotionally distant brother in Texas, and cannot afford to move. He is aware of the danger but is trapped..

Anonymous said...

The thing is that the riots almost never make it anywhere near the suburbs, though. They'll wreck the urban core, sure, but even blue city officials know that if they let the rioters get to where the gentry liberals live rather than just where they work or shop, their chances of getting re-elected will plummet.

Amahl_Shukup said...

Your warnings have NOT fallen on deaf ears as far as I'm concerned, it's just that I already live in a benign place, far to the west of a mid-sized Southern city in east Tennessee. The city is blue, for sure, but is mostly occupied by college students and a typical but small-ish minority population... and it's a blue city in a much larger red county.

Having studied these thoughts for a long time now, I've sort of come to realize that the city dwellers will only pose a threat to themselves and any unlucky college student or faculty living there. Any attempt to "go to Mayberry" to sack and pillage will be met with merciless firepower. We don't put up with a lot of foolishness in these parts.

As to the truly large metropolises of Atlanta, Philadelphia, Detroit, Chicago, etc., I've already written them off. Never again will I go to one of those cesspools.

Jen said...

Weird thing happened last night. 0130ish, our doorbell started buzzing (original to the house, no ring camera). Not ring- ring, just loud bzzzzzzzzzz, like somebody was leaning on it. I checked the front and Himself checked the back. Nothing. Doorbell still going off, earsplittingly loud at 1am. Couldn't get it stopped. I thought it was electrical, and started unscrewing the plate from the wall, when he discovered the backdoor button totally mashed in. He got it stopped, and I spent the rest of the night sitting in the dark, waiting.
When I lived on the farm, middle of the night knocks weren't rare; it was usually a motorist telling me there were cows out. Or they'd run over a cat. But now I'm in a small town on a cul de sac in the woods.
Anybody got any ideas?

Anonymous said...

One problem out in the country is aging. Old bodies can’t do as much work, and there’s no help - no kids, and adults are taking care of their own families. We do what we can. Thank God we got out of the city years ago.
Housing prices around here are astronomical. Million dollar properties are not unusual. 3 bedroom on an acre or two are going for $700K. Anyone trying to leave the cities would have to consider moving to another part of the country, I think.
Southern NH

Anonymous said...

For what it's worth ... We read your blog, and we recently moved out of the San Francisco Bay area. We were quite fortunate in that we had a good landing spot ... but it was definitely time to go regardless.

Sherm said...

Everyone reads and understands the warnings. However, normalcy bias is a mighty strong drug and it's easy to say, "There goes Peter, again." In part this is because we typically don't compare where we are to five years ago or ten years ago but to yesterday or last week. Based upon that time frame, not much, if anything, has changed.
What many people need is a triggering event, something that makes them stop and reassess. It may be them or a neighbor being mugged or something much more benign. In my case it was simply driving over the freeway in north San Diego County one late summer weekday morning about 10. Traffic on I-5 was stopped dead. I knew that 15 years earlier I could drive from that point to downtown San Diego in 35 minutes. I thought, "this is nuts," and we moved before the year was out.

Marc Adkins said...

A lot of us are paying attention both to current events and historical ones. A very fair amount of us are the ones following the various libertarian and prepper type blogs. We understand both the concepts and what actions brought about the Native American Reservations, the Plantations of the antebellum South, Company towns in coal country, Asian Internment camps in the American Southwest, Along with the occupied territory ghettos and resulting judenrat in Europe among others. We see and we heavily suspect where all of this is going. Our problem is the other 95% of the population can't be bothered with looking at any of the above. I have actually heard a practicing Jew say " The Holocaust could only exist in Grandmas time, there is no way it can happen again"....... I had a Russian classmate who blocked me after I responded to an Trump is anti Immigration social media post by asking her this question. " What do you think would happen to me if I was caught trying to sneak across any of Russia's borders ?" People that think like us are definitely in the minority. This is why it is so important that we keep trying to talk to us fellow travelers on a regular basis just so that we know we are not alone. This is just one reasons of many that the PTB do their hardest to keep us from talking to each other.

Stealth Spaniel said...

Could not agree more. I left the splender of Los Angeles; I grew up there and it always had crazy pockets, but most folks were hard working and just trying to get ahead. You cannot beat the weather and the beauty-but it is now so contaminated with drugs, homeless, INSANE politicians, and 3rd world wonders that it is not a place I wanted to stay in. I moved to the burbs of Sacramento; it is still nice, although the same problems are moving in. I work at a BigBox and the crazy there is not to be believed. So many people-white, black, hispanic, oriental, Ukranians and Russians-all have the EBT card. It is treated as an inheritance. Some nimwit came in and purchased $450+ of liquor and liquor products. Yep, first thing out of her wallet was the EBT-then she was upset that it didn't qualify. So she begrudgingly pulled her American Express. What is going on in this country is idiotic. Folks spending $900-$2000 a run for food. I realize that some people live up in the hills, but a lot of that "food" is potatoe chips, candy, one-meal-frozens and I wonder where is the everyday cognitive planning? They are no more prepared than an apartment dweller eating out every meal. So, the burbs will have problems. I have a wealthy cousin who lives in Indiana and you can see Chicago from her property. "Well! It's across the Lake!" she tells me. Like people haven't been on boats before........I am saving my sheckels to get to a small town, up in some mountainous territory, with a lake and 2 roads. Haven't found it yet.

Aesop said...

Anybody who can "remote work" is liable to find their job has been outsourced to a "remote country".

If you have a job that cannot be outsourced, Catch-22: you're stuck right where you are.

Jobs available that cannot be outsourced are already filled "outside the blue hives".
So you can show up in Hooterville, dilute the talent pool, and drive everyone's wages down, along with your own.

Or risk cities going pear-shaped.

Best wishes with whatever plan you concoct.
Nobody gets out of this alive.

Anonymous said...

I’m currently living in a city that is doing much better than a few years ago. The murder rate has dropped sharply and it is now very livable.

San Salvador, El Salvador.