A Fly-Over State Change of Mind

Google the phrase “fly-over state.” You will find some unkind and a few nasty characterizations of the states that occupy the middle of the country. Nobody goes to these boring, unremarkable places with their ignorant people, uncultured lifestyles and awful weather. "Fly-over states" are where people never actually go but just fly over to get from the East Coast to the West Coast where the interesting places are.

Now I don't want to disparage the coastal states or their “cool” cities because I have many friends living and working there that I would never dream of offending. But the truth is that the middle of the country is doing quite well and can look forward to a bright future with unaccustomed, uncharacteristic optimism.

The Great Plains turnabout is robust and pervasive, according to “The Rise of the Great Plains,” a report on the future of the American Great Plains recently released by Texas Tech University. Joel Kotkin, Praxis Strategy Group and Kevin Mulligan of TTU’s Center of Geospatial Technology authored the report, which is accompanied by an interactive online atlas of economic, demographic and geographic data.

Instead of being passed over, the region has surpassed the national norms in everything from population increase to income and job growth during the last decade. After generations of net out-migration, the entire region now enjoys a net in-migration from other states, as well as increased immigration from around the world. Contrary to perceptions of the area as a wind-swept, old-age home, the vast majority of the newcomers are between the ages of 20 and 35.

“The Rise of the Great Plains” concludes that three critical factors will propel the region’s future in the 21st century.

First, the region’s vast resources places it in an excellent position to take advantage of worldwide increases in demand for food, fiber and fuel. The region’s manufacturing prowess and increasing trade savvy can propel it into more global markets.

Second, the hyper-evolution and adoption of advanced technologies has enhanced the development of precision agriculture and energy resources, notably oil and gas previously considered impractical to tap. So, too, the Internet and advanced communications have reduced many of the barriers — socio-economic and cultural — which have isolated the Plains from the rest of the country and the world.

Third, and perhaps most significantly, are demographic changes. The reversal of out-migration means that the region is again becoming attractive to people with ambition and talent. This is particularly true of leading cities, many of which now enjoy positive net migration not only from their own rural hinterlands, but from metropolitan areas such as Los Angeles, Minneapolis, the San Francisco Bay Area, New York and Chicago.

Fly-over states forever? Certainly some of the economic realities and perceptions of the Great Plains will persist. Yet, we can accelerate their demise by choosing to make prudent, generative investments in our infrastructure, businesses, institutions, communities and people. By doing so, we ourselves will be empowered to fly over to opportunities wherever they might be found throughout the world.

Delore Zimmerman is the President of Praxis Strategy Group and Publisher of NewGeography.com. This piece originally appeared in Prairie Business Magazine, January 31, 2013.

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USA's "Uncool" cities the wave of the future of Western Civ

I have come to believe that "cool" cities or "Superstar" cities as described by Gyourko, Mayer and Sinai in a paper of that name, evolve towards an inevitable state of self-imposed stagnation and leakage of opportunity-seeking population and business to the "uncool" cities. There certainly does seem to be an element of geographic pre-determination involved as part of the path-dependent urban evolutionary process, so that the "cool" cities are all "coastal" (or at least on a large lake and/or part of a navigable waterway).

Many of the "cool" cities do have geographic advantages in terms of their natural amenity endowment - nice views, water-based recreation, etc. But often there is an economic downside to this geography. The urban area is frequently forced into inefficient, discontinuous patterns of growth. Choke points are frequently created by bad planning - almost every such city has a CBD that is a serious choke point because it occupies a focal point that is geographic as well as "economically functional", and road bypasses are seldom planned or built.

As if these disadvantages were not enough, these cities seem to inevitably succumb to anti-growth urban planning which actually worsens the problems by way of unintended consequences. Housing unaffordability, revealed by high median multiples, is only part of the story. The more expensive urban land becomes, the more people and businesses are "priced out" of locating efficiently. There are numerous effects of planning and high urban land prices, that erode productivity.

Traffic congestion becomes worse far more rapidly in any city with geographic constraints on urban form, that deliberately neglects road expenditure in favour of mass public transit. In "flat" and amorphous cities, there are far more "alternative routes" for drivers to utilise to get from A to B within the urban area. It is also obvious that households, businesses, and urban amenities can be far closer to each other on average when there are fewer geographic obstacles to building. It is completely unreasonable for cities with difficult geography and fragmented urban form, to expect to achieve international "best practice" in trip-to-work distances and times ; yet almost all such cities without exception end up in the grip of urban planners trying to achieve the impossible.

I believe that we are seeing a phenomenon at work now, where the "Superstar" cities have imposed very high costs on their own productive sectors, excluded new entrants to their agglomeration economies, hampered productivity growth, and imposed dire social injustices via housing market outcomes. Growth is being deflected via default, to the cities and regions with no urban growth constraints as well as the advantage of flat geography, continuous urban form, and lower costs of providing infrastructure for growth.

The USA is virtually unique in having a sizeable part of its economy with such cities to which growth is being deflected; most other nations have strict anti-growth policies applying to ALL their cities. Look at the absurdly land-rich nation of Australia, for example. Where is there anywhere else in the world that has cities like Houston or Atlanta or Dallas or Charlotte or Raleigh?

So these parts of the USA stand to pick up growth deflected from most of the rest of the first world, not just from the anti-growth parts of the USA. Joel Kotkin is one of a few people who is following this phenomenon in his writings. We are actually swamped with an embarrassment of riches if we look for examples of this phenomenon. Multinationals are setting up all over the place in the USA's low-urban-land-cost, pro-growth, resource-boom regions.

Even China and other Asian tiger economies are not helping themselves by keeping economic land rent so obscenely high in their cities, not to mention the political instability risks compared to heartland USA.