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Location: Cleveland bound with MPLS in the rear-view
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Originally Posted by jluke65780
Check this out:
Moderator cut: link removed, linking to competitor sites is not allowed
Did you read and interpret your own link? It's showing that the primary driver of the cost of living difference is housing, which is subsidized for those who are below the poverty line. The expenses come down to food, utilities and clothes, which are roughly the same across the country. A lot of that is subsidized as well. In other words, you can use a static poverty figure across the board because people living in poverty, as defined by the govt., have expenses that don't vary a ton from state to state.
There's some truth to what the article says -- but I think there's a lot of other factors going on. None of that really diminishes the fact that capital is mobile and becomes ever increasingly so. There's ever less inertia that keeps people and capital confined to certain geographic areas and the high-growth areas of the country will eventually continue their growth.
The fast growing regions of the country are the southeast, southwest, and mountain west / PNW. Each has its own story, and the regions are very different from each other.
The Southeast has long been mired in poverty for historical reasons, and recent migration (from the northeast and west coast) hasn't entirely changed that -- though I would say it has helped.
The southwest is heavily impacted by immigration, and immigrants tend to have higher rates of poverty; also, the southwest does have long-established pockets of poverty, some of which predate the immigration boom.
The mountain west and Pac NW (Colorado, Utah, Oregon, Washington) don't really fit the trend identified by the article -- they tend to be relatively high income and much of that income was brought in from outside -- technology in particular. Seattle was a gritty port city / industrial town which was transformed first by Boeing / Aerospace and then by Microsoft / technology. Denver was also a gritty industrial town until telcommunications and technology showed up and took over. Of course, neither the PNW or the Mountain west grew quite as fast in the last decade as the SE or SW did.
It is true that some economies -- I'm thinking of (Florida, Arizona, Southern Nevada, and parts of California) did create a bubble-style housing boom -- where much wealth was generated simply by a massive building binge. However, that in hindsight was a bit of a Ponzi-like bubble. On the other hand I don't think any of the above are permanently down in any sense, because capital is very mobile and the same qualities that attracted people to these places in the first place will continue to do so in the future.
I've repeated this over and over. Slower growing places are already well established, plain and simple. There is no "This place is growing, it must be better than your slow growing city/state"
Fast growing places attract poor people because they think "Hey maybe I can get ahead here." However, if that doesn't pan out they lack the money to move away or back home and drag down the average. Meanwhile they don't appear out of thin air. They often come from the places that are experiencing negative growth or slow growth thereby boosting their averages as the bottom of the sample is going elsewhere.
That's not an accurate statement. The reason a lot of fast-growing areas are growing is because they contain the elements of what makes for a successful local or regional economy: A growing industrial base, moderate to low costs in living, and growing supportive infrastructure. The US has had a history of hot spots developing mostly because they are more ideal for the middle class- aka- a decent house, modest to decent pay, etc etc. That sort of opportunity for the most part dried up in the older more established cities awhile ago. hence why there is a reversal in their population growth.
Not everyone that moves to fast growing places are poor. Quite the opposite. One of my friends is helping to setup offices in Austin because the business he currently runs in California is too costly. In Austin not only can he find talent, but he can live a better life there than he could in CA. Businesses move to lower cost areas due to lower costs as well. For example, Texas now has more fortune 500 companies than any other state. That's a dramatic reversal from just a few decades ago. Obviously not everyone that works for a fortune 500 company is poor. In fact many who do work there are transferred from other more costly states.
Not everyone that moves to fast growing places are poor. Quite the opposite.
I agree -- in fact; those who move across the country are almost invariably middle class or higher -- in fact the truly wealthy are often the most mobile of all.
It is true that the poor, not being tied down with houses to own or many possessions -- are more easily able to move around within a metro area or region -- in fact the poor are often moving from place to place every few months. But moving, say, to Arizona from Michigan; is not something that the truly poor often do -- because it takes at least several thousand dollars in cash to make a cross-country move (sometimes much more) -- and the truly poor simply lack the ability to access that amount of cash.
I've repeated this over and over. Slower growing places are already well established, plain and simple. There is no "This place is growing, it must be better than your slow growing city/state"
if a place wants to keep growing fast, it can. do you really think new jersey can't develop any more than it is? like it can't hit a boom anymore? that place could easily become a booming state again and see fast growth "if it wants to." i don't think you're someone who would want it to but that's you. as long as a state is financially appealing to industry and business, then there's no reason it would slow down. money runs all.
if a place wants to keep growing fast, it can. do you really think new jersey can't develop any more than it is? like it can't hit a boom anymore? that place could easily become a booming state again and see fast growth "if it wants to." i don't think you're someone who would want it to but that's you. as long as a state is financially appealing to industry and business, then there's no reason it would slow down. money runs all.
Actually I think this is a really poor assesment; there always is a money trail, yes but also look at the industries attracted etc. It isnt a pure and simple equation and the opportunity cost to locate between places based on tax, workforce etc. Call centers that spring up all over growing areas bring jobs and people but realistically locating them to NJ (for example) is not financially sound; they typically dont pay enough to attract the right employee in that setting etc. Service industry momentum has had an impact with real estate prices and attracting workforce; all these work together actually. Because one area is growing at a faster rate does not make the market better or even stronger in many aspects. Wealth generation etc are all important aspects. You are actually from the complete anamoly of a Metro - basically subsidised on the backs of the taxpayer - DC at its price point would have no where near the growth seen in recent years without the out of control growth of the Gov't subsidizing this; the shame there is we are all going in debt to subsidize this benefit for the DC area
it's not financially sound to relocate to nj because people demanded too much. unions control these "once fast growth before people demanded too much, now slow growth financial black holes of ny/nj," and the area's manufacturing base is crumbling. buffalo, detroit, cleveland, pittsburgh are all examples of what demanding too much from your boss will get you. luckily for nyc, they had the luxury of that huge financial sector etc to fall back on because if they didn't, nyc would be a giant detroit. though it is, in a way, turning into a giant detroit for non service industry workers.
Last edited by CelticGermanicPride; 04-22-2011 at 11:18 PM..
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