A Bailout For Yuppies

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The recent call by the porn industry – a big employer where I live, in the San Fernando Valley – for a $5 billion bailout elicited outrage in other places. Around here, it sparked something more akin to nervous laughter. Yet lending a helping hand to Pornopolis is far from the most absurd approach being discussed to stimulate the economy.

Some influentials close to the administration may even find the porn industry a bit too tangible for their tastes. After all, the pornsters make a product that sells internationally, appeals to the masses and employs a lot of people whose skills are, well, more practical than ideational.

As such, they may not even qualify for what is best described as a yuppie bailout, poised to extend the welfare state to the highly educated professional set. After all, George Bush's bailout of Wall Street has already set a precedent, using public money to secure the bonuses and nest eggs of some of the nation's most elite professionals. Call it the Paulson principle: In bad times, steer help to those least in need.

A yuppie stimulus differs from the more traditional approach, which aims to get the front-line, blue-collar types back to work. Instead, it would channel public funds away from those grouchy construction workers – some 30% of whom may soon be out of work – to better heeled, and, in their minds, more deserving "creative" professionals. After all, what stake do the netroots have in making things better for Joe the Plumber?

In contrast, the yuppie bailout focuses on a sure-fire Democratic constituency, the well-educated urban professional. One advocate of such an approach, pundit Richard Florida, has urged President-elect Barack Obama to eschew crude investments in traditional production and a renewed housing market in favor of goodies directed to what he calls "the creative industry."

Florida sees any focus on restoring manufacturing and housing as a misguided rescue of the "old industrial economy," in which Americans actually made things and other Americans consumed them. Instead, he suggests, "the first step must be to reduce demand for the core products and lifestyle of the old order."

So let's stop worrying about what happens to Detroit, or the crisis in the housing market. In Florida's view, cars, of course, are demonized as woefully bad for environmental reasons and not particularly friendly to the preferred dense urbanity so attractive to advocates of "hip cool" cities.

Florida even recommends shifting away from the single-family home, which is also, all too often, in the 'burbs. Instead, we should develop what he calls "flexible rental housing," so people can move every time they get new jobs. I think that is what they used to do in Chairman Mao's China, too, albeit without the granite countertops and a Starbucks around the corner.

In a yuppie bailout, what spending takes priority? More jobs for academics and educators. Florida suggests we invest in "individually tailored learning." We assume this means neither home-schooling nor basic skills training but something more like painting and acting classes for tots and advanced "creative" navel-gazing for tweens and adolescents. And, of course, lots and lots of new jobs for well-paid, unionized teachers.

These ideas should not be dismissed out of hand as the impractical meanderings of a lone scholar. In fact, Florida's views are taken very seriously among influential Obama supporters at companies like Google as well as by politicos such as Michigan Gov. Jennifer Granholm, who is widely identified as a key Obama counselor on economic issues.

Nor is Florida alone in his views. Bigger feet among the purveyors of conventional wisdom, like The New York Times' Thomas Friedman, also think the stimulus should steer more resources into the public pedagogy. Friedman even recently suggested teachers be exempted from paying federal taxes.

And it's not just teachers who would benefit from a yuppie bailout. The economic stimulus, Friedman says, should also focus more on high-tech companies like Google, Apple, Intel and Microsoft, all of which enjoy extraordinary valuations. This reaffirms the Paulson principle with a politically correct spin.

Politically, a yuppie bailout would certainly appeal to powerful Democratic constituencies, not just the teachers' unions. Select high-tech companies and venture capitalists can count on new subsidies and tax breaks. Greens and "smart growth" advocates will celebrate if money is diverted from hard infrastructure – such as improved roads, bridges, ports and transmission lines – which they insist would create enough carbon to heat the planet like a toaster.

This "yuppie first" approach certainly would appeal to many mayors, some of whom are already adherents to the Floridian ideology. They may be further encouraged by a new report by the Philadelphia Federal Reserve called "City Beautiful," which suggests cities should not promote growth through traditional infrastructure but instead invest in frilly amenities. As a Boston Globe article on the report summarized cheerfully: "Make it fun."

Here's another hint of what might be coming in a yuppie bailout. Providence, R.I., located in the state with the nation's second-highest unemployment rate, wants to sink money into a polar bear exhibit at its zoo – perhaps so we can see them before they become extinct or go on Al Gore's payroll – as well as make improvements to a soccer field. Miami envisions spending on a giant water slide, new BMX and dirt bike trails at a local park and, of great national import, a new Miami Rowing Club building.

Even the once-booming but now-hurting ultimate "fun city," Las Vegas, wants in on the act. Mayor Oscar Goodman is asking the feds to kick in big time for its new Museum of Organized Crime and Law Enforcement. That's right, taxpayers can participate in building a monument to Bugsy Segal. And with Nevada's own Harry Reid running the Senate, the project seems well-positioned to get the "respect" it deserves.

If Goodman, who used to defend mobsters as a criminal defense lawyer, has his way, it could spark a feeding frenzy for every under-funded tourist trap from Cleveland to Cucamonga. Pork used to mean roads, bridges and ports that, at least in theory, made the economy more productive while providing well-paid work for blue-collar workers. Soon these dollars may instead go toward yacht clubs, art galleries, museums and "creativity" training for toddlers.

A yuppie bailout is likely to hold more money for Boston, San Francisco and other havens of the perennially hip – all of them Democratic bastions. There's also likely to be less funding for the grotty suburban towns, industrial backwaters and Appalachian hamlets, all of which don't usually appeal to the artistic set.

To an old-fashioned Democrat, this all seems to miss the point. Shouldn't we be stimulating the places already suffering the most from high unemployment, foreclosures and spreading impoverishment? Where do Toledo, Cleveland or Modesto fit in to the yuppie bailout? As Pittsburgh-based blogger Jim Russell says: "Most of the population will continue to live in 'Forgottenville.' Should we just forget about them?"

In spite of all this, the mounting pressure for a yuppie bailout sadly reveals how the supposed party of the people is being transformed into just a second party of privilege. We should desperately try to create new productive capacity and better-paying jobs, especially for the denizens of Forgottenville. It certainly makes more sense than pouring taxpayer funds into new clubhouses, water slides or even better-financed pornographic movies – however much the latter may help property values in my neighborhood.

This article originally appeared at Forbes.

Joel Kotkin is executive editor of NewGeography.com and is a presidential fellow in urban futures at Chapman University. He is author of The City: A Global History and is finishing a book on the American future.



















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For me, that is a good

For me, that is a good idea.It is all because of the so called crisis, the critical event or point of decision which, if not handled in an appropriate and timely manner (or if not handled at all), may turn into a disaster or catastrophe. So do you ever wonder if you need a payday loan? You might be able to use one. A payday loan is a short-term loan that you get to fill a short-term need and that you pay back quickly, usually your next payday. You have to have a job, and at least $1,000 a month in income – if you're on unemployment, then you can't get one. You also have to have an open and active checking account, and have been employed for at least the last three months. If you have a sudden financial need because of a crisis, then a cash advance payday loan might be what you're looking for. or payday loan might be what you're looking for.

Detroit

Where's the mercy?
True, they may lack a spiritual center and rational political leadership, but they're still part of America. Maybe the unions dwindling ability to financially dictate elections there will allow new leaders to arise that will stimulate some visionary business models.

***news flash***

nobody cares about detroit, or the failed state of michigan for that matter.

"Well Heeled" Yuppie Needs Finishing School

Anyone else notice that while she sips her Silver Oak and contemplates feasting on her Halibut (not a great match in my opinion), she's forgotten to place her napkin in her lap? I love it.

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Not only finishing School, but a good salon...lol

Yes, fingerpicker22, not only is a red with seafood a faux pas, she also lacks highlights, has no manicure to speak of, and generally, possesses that "low-income look" along with her oversized in-your-face creative kindergartner necklace by Chico's.

Best thing, imo, to counterweight this yuppie bailout is to withdraw whatever you have from the Fund companies and sit in a US Treasury MMF. Quit financing these people and their outrageous lifestyles (more like deathstyles, imo) along with their contributions and voter support to such persons as Chris Dodd (D-CT) and Barney Frank (D-MA).

Stop contributing to your 401k, which in my opinion, was just a scam with strong support from the brokerages (who, in fact, will make YOU broke). Save your money *yourself* in an Individual Account with a no-load mutual fund company. No tax-deferred accounts, who knows where the gov't is going to look for taxes to pay for the bailouts...probably will raise taxes on the tax-deferred IRAs and 401k accounts at withdrawal.

I'm not sure what purpose the yuppies serve when you think about it...I mean really, someone working in a call center can do the same thing for a lot less - such as financial analysts....how about anal-cysts?

Misstrial
4th Generation Californian

manufacturing, infrastructure, pollution, questions

Thank you Joel Kotkin.

Companies that make products in the United States of America may produce less air pollution, water pollution, and land pollution on our planet than companies that make products in China. The farther that items have to travel the more water pollution and other types of pollution that may take place between place of manufacture and final destination.

Do you want our country to have a manufacturing base capable of helping the poor move into the middle class and help the middle class stay in the middle class? Do you want our country to have a manufacturing base capable of funding government operations and reducing the national debt over time? Who do you think are going to buy the products and services that high tech companies provide? Who do you think is going to be able to pay the salaries of college professors? Who do you think is going to be able to pay the salaries of government employees? Do you want to reduce the probability of high inflation? Do you care if the money you have now is a lot less valuable in the future than it is now? High inflation is especially harmful to poor people, people who have saved money, and people who are on fixed incomes.

Do you care if you and your children have safe drinking water?

Do you care if you and your children have safe food to eat?

Do you care if your children have safe toys to play with?

Do you care if our country has the manufacturing capacity to make the weapons we need to defend our country?

Do you care if a bridge collapes while you are on it?

Do you care if poorly maintained roads cause accidents and possibly wreck vehicles? Do you want to pay a lot of money for automobile repairs?

Do you care if you are without electricity for many days and possibly weeks because of a lack of investments in energy transmission and energy development? How are you going to enjoy your high tech devices without power?

Do you want to reduce our country's dependence on automobiles? Think about how much money our country could save on foreign oil, military expenses that are not necessary, monthly automobile payments, automobile insurance, and other things if our country spends more money on buses within cities, buses between cities, and passenger rail. Think about how cleaner air might reduce the health care costs connected with children who have asthma who are harmed by air pollution. Think about how many parents may lose fewer days from work taking care of children who have missed school because of asthma attacks.

I graduated from the University of New Hampshire in 1992 with a BA Degree in Political Science and a minor in Economics. I took geography courses in college.

I ran for United States Senate in 2002.

My website is http://www.myspace.com/kennethstremsky

Sincerely,

Ken Stremsky

Come on

This comes across as bitter and full of class resentment, like something that might have come out of the McCain-Palin campaign sweatshop. Too bad, because your basic point is valid. Why should yuppie industries get any stimulus? For the most part, they don't need it. It would be a disaster for the stimulus package to turn into a pork-fest. There is more than enough in the way of basic infrastructure needs to suck up whatever money gets allocated. That's all you need to say, really. The rest is the type of hyperbole (e.g. rental housing = Maoism) that demagogues today use to stoke culture wars, and surely we don't need to waste energy on that in these trying times.

your response

well i like they you agree with my basic points. as to the mccain comment, frankly, it's stupid. i did not see mccain oppose the bailouts either. as for palin, who knows or cares?

as i stated i am an old-style democrat with a strong social democratic orientation. how does that make me sound like a republican?

in terms of class, there is plenty of room for resentment. the middle class has been hammered by both parties.

joel

I was talking about the rhetoric

I realize that you're not a Republican; what I meant was that the rhetorical bashing of cultural elites was similar to what came out of that campaign. It only serves to alienate and polarize, and it isn't necessary to make your point.

palin

As for Palin, I know or care.
She won't be at the bailout trough this go around.
She'll be cutting budgets and tightening her belt, a pretty good yuppie role model.
As a new style Repub, I think McCain might have gotten elected if he had opposed the bailout.
Thanks for your cogent and reasoned article.
UW

As for Palin....she won't be

  • As for Palin....she won't be at the bailout trough this go around.
  • We'll see about that.

    Palin asking for infrastructure money

    Looks like Sarah Palin is open to infrastructure money but none of the porky stimulus largesse.