San Francisco and the Meltdown

iStock_000000100038XSmall.jpg

Initially San Francisco and the Bay Area market seemed to be immune to the financial meltdown resulting from the mortgage crisis. After all, the City and its accompanying affluent suburbs had not suffered drastic drops in home prices as seen in many other regions of the country. Yet as the mortgage crisis has snowballed into a complete meltdown of the worldwide financial system, the poster child of the ‘new economy’ now appears less and less immune from the turmoil dominating our news headlines.

The region that consists of the City by the Bay and the adjacent Silicon Valley is no stranger to drastic market corrections.  read more »

No More Urban Hype

iStock_000005845250XSmall.jpg

Just months ago, urban revivalists could see the rosy dawn of a new era for America's cities. With rising gas prices and soaring foreclosures hitting the long-despised hinterland, urban boosters and their media claque were proclaiming suburbia home to, as the Atlantic put it, "the next slums." Time magazine, the Financial Times, CNN and, of course, The New York Times all embraced the notion of a new urban epoch.

Yet in one of those ironies that markets play on hypesters, the mortgage crisis is now puncturing the urbanists' bubble. The mortgage meltdown that first singed the suburbs and exurbs, after all, was largely financed by Wall Street, the hedge funds, the investment banks, insurers and the rest of the highly city-centric top of the paper food chain.  read more »

New Urbanism’s Economic Achilles Heel

iStock_000001128115XSmall.jpg

By Richard Reep

Whether one believes that form follows function or that function can follow form, a town or a city needs three key elements to be healthy. Firstly, a sense of place that includes the sacred is important to people to provide a basis for spiritual involvement. The city must then be able to reliably deliver safety and security to its inhabitants in order to grow and mature. And lastly, a city must provide the means of employment for its inhabitants.  read more »

Root Causes of the Financial Crisis: A Primer

iStock_000007508697XSmall.jpg

It is not yet clear whether we stand at the start of a long fiscal crisis or one that will pass relatively quickly, like most other post-World War II recessions. The full extent will only become obvious in the years to come. But if we want to avoid future deep financial meltdowns of this or even greater magnitude, we must address the root causes.

In my estimation two critical and related factors created the current crisis. First, profligate lending which allowed many people to buy overpriced properties that they could not, in reality, afford. Second, the existence of excessive land use regulation which helped drive prices up in many of the most impacted markets.  read more »

Industry, inequality and the middle classes

iStock_000004472108XSmall.jpg

The financial collapse dominates the news, but its unregulated rise is not unrelated to the relative decline of manufacturing over the last quarter century, and the outsourcing of much of industrial production. One consequence of this de-industrialization and financialization of everything has been an astounding increase in inequality, a massive concentration of wealth at the very top and the squeezing of the middle classes.

Places that remained strong in manufacturing tend to have had and still have lower inequality than places more dependent on services, lowly to professional, and experienced a smaller change in inequality.  read more »

American Elections Inspire Interest in Ghana

IMG_0252_2.JPG

There’s another presidential election just around the corner here in Ghana. Current President John Kufuor is stepping down after eight years in office that has seen the gold- and cocoa-exporting West African country expand its economy and solidify its democratic credentials. Another economic stride forward is expected when Ghana begins to pump oil in 2010 or 2011.  read more »

Subjects:

Knowledge Worker Migration: Going Where the Brains Are

iStock_000005579594XSmall.jpg

At a time when national unemployment is rising, Nebraska is working overtime to attract labor. At the inaugural Sarpy County Economic Summit, Governor David Heinemann (R) talked about the need to “market the state to 16- to 20-year-olds.” Nebraska, apparently, has more jobs requiring college degrees than it has college graduates. (Interested college students can call the Director of the Nebraska Department of Economic Development, Richard Baier, at 402-471-3746.)  read more »

Appalachia and Energy

AppalachiaCoal.jpg

When I think of the energy crisis, I cannot help but think of the poignant story of Martin Toler. A victim of the Sago Mine disaster, he was found sitting alongside his 12 fellow miners in darkness. Deep in the heart of the earth he wrote a note to his family as air and time was running out: “Tell all that I’ll see them on the other side,” read the note found lying beside his body. “It wasn’t bad. I just went to sleep. I love you.”  read more »

The Opportunity City weathers all storms

iStock_000000838146XSmall.jpg

In the dark early-morning hours of September 13th, Hurricane Ike scored a direct hit on the Houston region with 110mph winds, a 13ft storm surge, and a gigantic eye 80 miles across. While Texas gets its fair share of Gulf hurricanes, this was the first direct hit on Houston since Alicia in 1983, 25 years ago.  read more »

Regulating People or Regulating Greenhouse Gases?

iStock_000005412602XSmall.jpg

It seems very likely that a national greenhouse gas (GHG) emission reduction standard will be established by legislation in the next year. Interest groups are lining up with various proposals, some fairly benign and others potentially devastating.

One of the most frequently mentioned strategies – mandatory vehicle miles reductions – is also among the most destructive. It is predictably supported by the same interests that have pushed the anti-automobile (and anti-suburban) agenda for years, often under the moniker of “smart growth.”  read more »