NewGeography.com blogs

There's yet another study, this one from Hewitt Associates, that confirms our notion that telecommuting will be an ever bigger part of our future. A Washington Post piece picked up by blogger Steve Bartin also quotes consultant James Ware about the environmental and economic forces pushing firms and individuals towards full or part-time telecommuting, "The combination of gas prices and climate-change issues is going to push a lot of people in that direction."

You don't have to be an Al Gore apostle or a new urbanist to see that telecommuting could be part of the solution for reducing commutes and energy use while also creating the basis for viable communities. What continues to mystify: only a few environmentalists and neo-traditionalist developers embrace this trend. Perhaps it has something to do with individual choice, and the fact that it does allow people to live in the kind of dispersed and low-density environments that so many of these kind of people tend to despise.

Yet there is nothing anti-urban in embracing telecommuting. Many cities, such as San Francisco and Santa Monica, are hotbeds for entrepreneurs working from home. In fact, as the economy continues to decluster, this may be one way traditional cities can reinvent themselves: through the work of a new generation of high-tech artisans. It also offers opportunities for suburbs to reinvent themselves as something other than bedroom communities filled with miserable commuters. For rural towns, it provides a chance to plug into the broader global economy. All geographies benefit when people can choose the kind of community they both desire and can afford.

Recent soundings from Washington suggest that neither party has a solid idea of what to do about the deepening economic crisis. It makes me cringe to hear Barney Frank, Chairman of House Financial Services Committee, talking about a big stimulus to “prop up consumption”.

Under the Democratic-controlled Congress, this would likely include the usual tax relief to middle and working class Americans, as well as big new payments to hard-pressed cities and states. To be sure, the interests of wage-earning Americans should be paramount, but this is reminiscent of the “stimulus” plan earlier this year that did little more than “prop up” spending on consumer goods for a couple months.

Since many of these products are made in China or somewhere overseas, who are we helping most here? In addition, of course, the bail out of local governments benefits a prime Democratic constituency --- public employee union. If we are going to cough up more to pay their salaries, why not ask them first to accept less largesse? Maybe they can agree not to retire until they are in their sixties, like the rest of us chumps, I mean, taxpayers. Then we can talk bailout.

However, let’s not pick on Democrats alone. The Republicans seem to like consumer “stimulus” but only when spiked with more tax cuts for their dwindling, but still significant cadre of wealthy Americans. Maybe this will help consumption a bit more at Bloomingdales than Wal-mart, but in the end, who cares?

My thought is that we should focus instead on the core issues of stimulating the “real economy” through incentives for high value manufacturing, domestic energy producers of all kinds (including nuclear power) and investment in basic infrastructure, including new transmission lines, research in clean and alternative fuels. All of these things would reduce our increasingly debilitating dependence on other countries to fund our deficits and consumption habits.

To lift spirits of Americans the most we need a program that aims to make the country less dependent on both Middle East energy producers and Chinese manufacturers. As we did starting in the 1930s, let us create a climate for real upward mobility based on expanding the productive economy. It’s time to stop relying on quick sugar highs to spur more consumption of items we do not produce or can’t afford and time to start getting back to basics.

A recent article in the Las Vegas Review-Journal lamented the economic decline in the state according to a report by the Rockefeller Institute of Government in NY. The Rockefeller report cited a growth index released by the Philadelphia Fed, but reset the index to a baseline of January 2007, singling out Nevada as the worst performing state in the nation over that period.

Interested in the bigger picture, I looked up the original index from the Philadelphia Fed and charted it back to its original baseline of July 1992. The results show a much more interesting picture for the state of Nevada.

We see a meteoric rise in economic activity in Nevada, far surpassing any state since 1992. Then as late as November 2007, the bottom began to fall out. The recent decline in Nevada is certainly serious, but we can always benefit by putting as much data into the picture as possible. What if the Rockefeller report had chosen January 2005 as a baseline? It would have shown Nevada as about flat, but obscured the detail of its true growth trajectory.

After several days in New York, I encountered serious climate change — in terms of atmosphere — at a USA-Canada Summit in Grand Forks, ND. Sure people were concerned about the market meltdown, but the talk was all of new plans for expanding the economy across both sides of the border. The distressed martinis of Manhattan nights were gone in a place where drinks also came with good cheer.

Perhaps most inspiring was an appearance by Senator Byron Dorgan (D-ND) who spoke of the economic crisis but in terms far less hyperbolic than those used by many members of Congress and most of the media. He compared to the current crisis to a low tide that has exposed some weak points in the economy but has not fundamentally altered the underlying strength of what he called “the real economy”.

This includes the manufacturing, farm, energy and business services firms that are flourishing across large parts of the country, particularly in the Heartland. Firms representing these industries at the conference were not whining about competition or the credit crunch, but talking about cooperation across the border and the prospect of a better future.

How refreshing it would be if either of the two major candidates, particularly Senator Obama, the likely winner, spoke with such confidence about the intrinsic strengths of the country and this continent in general. I would not deny the real significance of the stock market crash and the real estate mess, but, as Senator Dorgan suggested, “optimism” about the future has been a primary driver of American progress since the founding.

Let’s hope Senator Obama, or Senator McCain, lose some of their negative rhetoric when they take office. It may be good politics now to be a nay-sayer, but as President, these fellows will need to comprehend the country’s fundamental strengths and how to utilize them to make a strong recovery.

Local and Regional banks in the Great Plains are doing just fine, thanks, according to Bill Wycoff, a bank president in southeast Kansas. Bill wrote in the WSJ Saturday that

"Here in the heart of Kansas, the sky isn't falling and Chicken Little isn't running around without a head. Community banks like mine are still making loans and serving the needs of customers. ... My father always told me that character repaid many more debts than collateral ever would. Community banks form long-term relationships with customers."

He's had to go out of his way to combat recent media coverage and hysteria about the financial industry:

"All of the media pressure about this terrible crisis has really worried people. We community bankers must spend time reassuring folks that everything will be fine. The best way I have found to do that is to make more loans this September than we made a year ago, offer new products, and serve a fantastic group of customers with home loans at our bank where all is well and none are facing foreclosure."

Here in the prairie, we see many small town banks opening branches in adjacent metropolitan areas to tap some of the solid economic growth. Growth here may not be explosive, but it is built upon the productive economy and professional and business services. The Great Plains has consistently bested the national rate of job growth since 1990, and many local banks have launched advertising campaigns in the past weeks to say "everything is all right."

Anyone in New York recently can see that the swagger is now gone. With the economy losing its primary engine - a relative handful of financial hotshots- the whole plutonomic system seems to be under major stress. The state and city budgets also seem to be heading south in a big way.

You can see this strolling through Soho and peering into empty restaurants and nearly empty shops. Clerks and waiters now actually seem to want you to enter. The $350 children’s sweaters are now on the sales rack, for about a third the price.

Wall Street area is in even worse shape, says friend of the New Geography, Jonathan Bowles of the Center for an Urban Future. Yet there are signs of dynamism. Jonathan and I went to lunch on 32nd Street, also known as Little Korea. Here the restaurants and stores, many of them tied to the global garment trade, seem as busy as ever. Good value, hard work and plain old sticktoitivness will still pay off, even in a recession.

New York will bounce back but the impetus likely won’t come from the investment bankers or the fashionistas. Instead, look for the Koreans, Indians, Africans and other newcomers --- and the skilled media and other artisans now mostly living in Brooklyn and Queens --- to pick up the slack. A more affordable, less luxury-obsessed city is good news for them. It makes running a business or buying a house or condo a possible dream. These are the folks most capable of reinventing the city in the post-bubble age.

S&P released the July Case-Shiller Index today. Check out our line chart to follow the trend in each market.

Click the graph for a larger version. Many of the most inflated markets are still in free-fall mode, but the 20 metropolitan area composite seems to be starting to level off. Markets such as Charlotte, Denver, Atlanta, and Dallas - areas with the most moderate increases during the height of the bubble - seem to be in the best shape.

Minneapolis seems to be rebounding slightly after a sharp decline in the last year, but Detroit has fallen below its mark in 2000. How far can prices fall? Check out Wendell's take on realistic housing prices. Here's a big version of the chart.

The late Jesse Unruh, longtime speaker of the California Assembly, was a giant of a man, both in accomplishment and girth. But he will be forever remembered for having said that “Money is the mother’s milk of politics”.

Never truer words were said. We got a good glimpse of that in the recent vote on the Paulson-Pelosi Wall Street bailout. A quick survey conducted by the Berkeley, California based Maplight.Org showed that members of Congress in both parties who supported the bailout received 54% more money from the financial service industry than those who voted against it.

The differential among Democrats was even wider --- those who backed the bailout received almost twice as much from Wall Street than those who opposed the measure. A regional analysis conducted by the New York Times showed another interesting pattern, with opposition to the measure strongest in the heartland states, Texas and other places where the housing bubble was less inflated.

Clearly constituents in these areas reached some of their representatives with complaints. As for those who went the other way, well, somewhere in heaven, California’s “Big Daddy” is wearing a sly, knowing smile.

You don’t have to believe Sarah Palin is qualified to be vice-President, much less President - I certainly don’t - to understand that her nomination has unsettled many people in our big metropolitan centers. The very idea that a former Alaskan small town Mayor being selected for such high office has elicited an outpouring of scorn towards micropolitan and small town America.

One prominent recent example is the article by Jennifer Bradly and Bruce Katz entitled “Village Idiocy” published in the Oct. 8 issue of the New Republic. Bruce, who is a very influential figure in urban policy circles, finds praise for small town values an “understandable fantasy.”

In reality most Americans, as he points out, live in big metro areas. That’s the level where Brookings, and most of our leading policy commentators, believe political power and decision-making should be concentrated - when Washington is not the preferred option.

Yet Bruce and other compulsive centralizers forget that over one-third of Americans still would like to live in small towns or the countryside – roughly twice as many who want to live in his beloved, high-density cities. Migration patterns show that Americans are moving, on net, more to mid-sized and smaller cities, and within the metropolitan areas, away from the central cities. If the benefits of small town living is a “fantasy,” it’s a widely shared one.

Even residents of metropolitan areas often regard themselves as residents of their local town or neighborhood. Most local governments remain small-scale, particularly in the vast suburban hinterlands.

Few residents of greater Los Angeles, for example, feel an emotional allegiance to the “region,” much less than shadowy Southern California Association of Governments. Instead we identify with Irvine or Burbank, Riverside or Ontario. Even those of us who live within the borders of the city of Los Angeles, tend to consider ourselves residents of Valley Village, Leimart Park, Koreatown or Highland Park. If anything has gotten strong in LA over the past three decades, it’s identification with neighborhoods.

Katz and many of his regionalist colleagues would prefer that all of us look to some centralized regional authority for leadership and inspiration. Although regional organizations have their place, the notion of local control will continue to possess great appeal. Even the nomination of Sarah Palin won’t change that.

Many of you might know I am a bit of a Houston fan. It's not that they don't have zoning --- I am neutral on that issue --- but because they have heart. I was privileged to see Houstonians open themselves to 250,000 or more mostly poor and minority evacuees from Louisiana after Katrina. It was an inspiring effort and very ecumenical, led largely by evangelical Christians but including Jews, Muslims, Catholics and anyone else who gave down.

Now, after Ike, they are taking care of their own, as we can see from a message from Elliot Gershenson to Jeff Mosley (listed at the bottom) at the Greater Houston partnership.

A lot of cities may be prettier or have better weather than Houston, but in terms of helping neighbors, no big city is better. As Davis Henderson, CEO of the Greater Houston Chapter of the American Red Cross, told me after Katrina, “Who else would have adopted another city like we adopted New Orleans?” Henderson previously oversaw Red Cross operations in Tampa and Chicago. ”In Houston,” he adds, “a neighbor is a neighbor --- not a competitor.”

Urban greatness has many facets, but if I was to pick one, the kind of generosity of spirit Houston has showed would be at the top of my list.

Here's the full letter:

Like so many non-profits, IM has been out of power but still kept going, serving the community. It's hard to believe that it is possible to serve so many seniors and refugees without computer power and phone service, but somehow we have done so. Just as so many other first-responder organizations like the Red Cross, Salvation Army and government agencies like the City of Houston, Harris County and FEMA have stepped up. We'll likely hear stories about failed efforts, but the true heart and guts of our city needs to be recognized. There are so many stories of bravery, dedication and pure visionary action that are worthy of telling.

There's the story of dozens of churches and other faith groups who have been housing evacuees from Galveston and other places in their gyms and sanctuaries - providing food, shelter and clothing. Much of these expenses will be borne by them. Certainly the time and talent of their core volunteers and staff is being diverted from other programs - all because the people of Houston are heroes.

There's the story about crime - not the one we would expect - but how low the crime statistics have been.

People in Houston have learned how to drive! Somehow, with all those lights out, people have slowed down and let the other guy take a turn.

I keep hearing that people connected with their neighbors, many for the first time. And now as the electricity is coming back on and the garage openers begin working again, it feels like we're losing something very special.

I learned about one church's senior pastor who received a phone call from someone he didn't know living back east. The caller said they could not find their elderly parents and were desperate to find out if they were ok. So this pastor got in his car late that night, with a load of food, water and ice and drove across town to find the parents. He drove up to the house and knocked on the door. They were fine, but without electricity or phone, so he called their kids on his cell phone and said "here, someone wants to talk to you." After the call the parents said they didn't need anything but across the street there was someone who really looked like he did. So the pastor gave all of his food, water and ice to the neighbor. The next day he came back with more food and water only to find that the neighbor had distributed what he received the night before to his neighbors. The church volunteers returned each day until the electricity came back.

The president of my synagogue bought Sabbath dinner for 1,250 families who he thought might need a kosher meal. In the end a number of synagogues and the Jewish Federation of Greater Houston backed him up so that he did not need to take this financial burden on his own. Only about 500 families came forward to receive these meals, so in the end he and my synagogue donated enough food to the Houston Food Bank and the Jewish Community Center to feed 700 families and seniors.

I could go on - but I think you already know what I am talking about. You've likely witnessed this yourself and have been amazed by the grace that has been shown by Houston and all of our leadership.

On that note (about leadership), please let me make a special appeal. Normally this would have been the Tuesday Memo when I showcase the annual United Way campaign which just began. IM is proud to be a significant recipient of United Way funding and we use these funds to serve well over 1,000,000 meals to seniors each year, to make the resettlement of hundreds of refugees the best we know how, and to support our Ready Houston! disaster preparedness and response activities (which has been in full swing these past two weeks).

My focus always is on the community building elements of the campaign. I have been quoted as saying that if someone gave Houston $1 billion dollars NOT to run an annual campaign, if I were the United Way Board Chair I would turn it down. Not because I am foolish, but because I believe, as important as the money raised is, it is equal䁥