: Turn back, nothing good ahead and it's long and boring _
Indeed it is. IMO, Charlotte has some serious issues facing it. Remember the what has happened in the past is no indication of what will happen in the future. As an example, St. Lewis was the 4th largest city in the USA in the middle of the 20th century and it looked to heading towards rivalling Chicago. However instead, by the end of the century it was thrown up as an example of complete urban failure. It's population fell by 500,000 during this period. The point is that you can't look at the past and assume the future will be the same.
Charlotte's economic past has always been reliant on these 3 items:
- Direct manufacturing. Yes, there was a lot of manufacturing in the city.
- It was the administrative and distribution center for the manufacturing and farming in the Southern Piedmont.
- Some sort of banking and finance. This ranges from the good rush at the beginning of the 19th century, to the US Mint producing gold coins in downtown, to the handling of money for the cotton mills, to the growth of the large banks.
So why has it gone wrong and what is going to happen to Charlotte? Well unfortunately Charlotte's fortunes are tied to the nation's fortunes which really stink despite what you hear on the news. In order to understand what is happening here you have to first accept what is really wrong in this country, and I have found that few really know. (and if told dismiss it) Against my better judgement I go over it here so people can throw rocks at it.
First understand that real wealth in an economy is generated by just 3 things. 3 things, nothing else. They are:
- You dig it up
- You grow it
- You manufacture it
People hear this and they roll their eyes and say you are crazy. The tell you that banking, that big thing in Charlotte, has made plenty of people here wealthy. Yes it's true but look at how it works. Banking and the associated make people wealthy by
transferring the wealth created by the above activities. It doesn't create it. When all the wealth creating is gone, guess what goes next?
This is all well and good and one asks then why shouldn't Charlotte be doing a lot better. Well that is because nationally our economy has participated in a mass transfer of our manufacturing industry, including all logistical technology, to China, Mexico, Vietnam, India, etc etc. The excuse as been that it is cheaper to produce stuff there and good for all. All good economists and MBAs from fine American universities know this. Where this has failed is in the lack of understand of what this means to the economy.
There are two ways to explain it. First remember the 3 items that I said create wealth? Well if you eliminate manufacturing you are left with:
- You dig it up
- You grow it
That's fine, but this is a description of a 3rd world economy with no middle class. The middle class is disappearing in this country no ifs ands and buts about that. Another way to explain it, where the myopic MBAs don't see and don't care to see, is that when you pay, say $2 to someone in Charlotte to make some steel in one of the mills left here, they will turn around and spend that $2 on something else here. Pay a Chinaman $1 to make that steel and the money is gone from this economy forever. What does China buy from us? We don't have anything they want except for our food and our resources. They certainly don't want our bankers, insurance and real estate people.
So this is a long winded talk that would seem to have nothing to do with Charlotte's future. But there is one final element to this. When we got rid of manufacturing over the last 30 years, we replaced it with something referred to as FIRE. = Finance, Insurance, Real Estate. Which was proped up by cheap energy and the huge printing of money.
FIRE is why Charlotte has boomed in the last 25 years because we were a perfect place for it. First there were state laws that protected BofA (NCNB) and Wachovia (First Union) from any competition. Then when they got big enough, the laws were removed and replaced by different laws that allowed them to swallow up bank after bank. This created a bunch of symbiotic industry here related to real estate, home construction and everything needed to supply all the happy people with their McMansions and Condos in skyscrapers downtown. Second we were a place that had little regulation on development and business. This is why the city of Charlotte sprawls over 300 sq/miles. Meanwhile all of the manufacturing around Charlotte was being dismantled and shutdown. The failure of Cannon mills years ago should have been a big warning shot when 5000 were laid off, but nobody paid notice. Charlotte was invincible people said. "Those are ignorant "put tops on bottoms" people, doesn't mean anything to us educated here in CLT."
This illusion of nice wealth might have gone on for a while except for one thing. The price of oil. It was ignited by Katrina, made very sensitve due to wars, and when the hurricane hit Houston last year, that was the beginning of the end. $100 oil, caused the finance house of cards to start falling and it hasn't stopped yet. Now the finance industry is collapsing and manufacturing is gone. This is 2 of Charlotte's 3 long term mainstays. #3 also has a lot of issues because there isn't much to distribute these days. We hear platitudes about becoming a "hotspot" for energy, but all cities are saying that. We would be much worse off, but the government in it's inability to deal with the issue, handed a $Trillion in borrowed money to the finance industry.
Aside from the one bank left, Charlotte is also a city that doesn't have much political pull either at the state level nor at the national level. The mayor, who took a lot of direct credit for the city's growth but is no where to be found now that fortunes are falling, has pissed off a lot of the state legislators and has no political pull in Washington since he hooked his star to GW Bush and that has since train wrecked. So this means that when Charlotte gets in line for federal cash, it is usually at the tail end.
I realize this sounds pretty negative, but that is because the people running this city and the brain dead media that goes along with it, have yet to admit these are the issues facing this place and are working to put some plan in place to address it. Instead we keep hearing that we will be in recovery 6 months from now when it's talked about. More important news is Michael Jackson, Obama not being American, so forth and so on. They still think a knight riding on a white horse is going to come riding into town with bags of money to save the skyscrapers being built downtown. The fact of the matter is what is left there, is being built with some sort of government assistance. This should be concern enough.
Eventually though the people will figure it out, but it won't be soon. Meanwhile, I am reminded of a quote from the Kubrick movie, Full Metal Jacket, about a certain kind of sandwich that we are all going to have to take a bite out of. It's not going to be tasty or pleasant at all.
If you made it this far, you deserve something clever, but I can't think of it at the moment.
Welcome to City-Data.com forum! Make sure to register - it's free and very quick! You have to register before you can post and participate in our discussions with 700,000 other registered members. User profiles and some forums can only be seen by registered members. After you create your free account you will be able to customize many options, you will have the full access to over 15,000 posts/day about local topics and you will see fewer ads. 
Linear Mode
