New York

Texas Two Step

Jonathan Bowles — Thu, 07 Mar 2013 17:30:11 -0500

There has been a huge spike in the number of New Yorkers relocating to Texas in recent years, even at a time when fewer city residents were departing for Charlotte, Atlanta, Philadelphia and other traditional destinations.

Borough Breakdown: NYC Residents Moving to
Houston, Austin, Dallas, Fort Worth and San Antonio (2004/05 to 2009/10)

Migration from Bronx to...
	2004/2005	2009/2010	% Change
Dallas County	77	92	19.5%
Harris County	202	310	53.5%
Tarrant County	28	58	107.1%
Travis County	22	27	22.7%
Bexar County	29	66	127.6%
Fort Bend County	31	33	6.5%
Total	389	586	50.6%

Migration from Brooklyn to...
	2004/2005	2009/2010	% Change
Dallas County	132	152	15.2%
Harris County	271	351	29.5%
Tarrant County	64	71	10.9%
Travis County	83	224	169.9%
Bexar County	76	64	-15.8%
Fort Bend County	40	62	55.0%
Total	666	924	38.7%

Migration from Queens to...
	2004/2005	2009/2010	% Change
Dallas County	146	166	13.7%
Harris County	412	404	-1.9%
Tarrant County	117	125	6.8%
Travis County	56	89	58.9%
Bexar County	80	99	23.8%
Fort Bend County	67	90	34.3%
Total	878	973	10.8%

Migration from Manhattan to...
	2004/2005	2009/2010	% Change
Dallas County	311	356	14.5%
Harris County	346	508	46.8%
Tarrant County	51	107	109.8%
Travis County	167	303	81.4%
Bexar County	96	91	-5.2%
Fort Bend County	15	54	260.0%
Total	986	1419	43.9%

Migration from Staten Island to...
	2004/2005	2009/2010	% Change
Dallas County	N/A	N/A	N/A
Harris County	36	55	52.8%
Tarrant County	N/A	N/A	N/A
Travis County	N/A	N/A	N/A
Bexar County	N/A	N/A	N/A
Fort Bend County	N/A	N/A	N/A
Total	36	55	52.8%

Source: IRS Migration Data. For Staten Island, data was only available for migrations to Harris County.

This piece originally appeared a tthe Center for an Urban Future data blog.

Infographics: The Decongestion of Manhattan, New York Walking Commutes

Aaron M. Renn — Thu, 23 Aug 2012 11:53:21 -0400

Jim Russell pointed me at an interesting article about densification vs. de-densification over at the Urbanization Project at NYU Stern. It contains this very interesting map of the change in census tract densities in Manhattan over the century between 1910 and 2010:

Walking Related Commutes

Streetsblog, in an article covering the annual NYC DOT scorecard, included this graphic of the percentage of commutes that include walking as a core component (e.g, transit) in various parts of New York:

This post originally appeared at The Urbanophile.

The Last Stop in Brooklyn

Lou Siegel — Sun, 17 Jun 2012 23:13:31 -0400

Getting out was essential but I was stuck in Brooklyn until I could plot my escape…

There was no such thing as “diversity” in white, working-class Bensonhurst in the 1950s. Only the Jews and the Italians.

My tribe descending from Yiddish-speaking East European immigrants who settled in cramped tenements and worked in the schmatta trade of Manhattan’s lower east side.

Moving – after the war – across the East River to apartments with bedrooms and bathrooms; a 50 minute commute to “the city” on the west end line of the BMT. Sharing the neighborhood with Southern Italian Catholics, a few Irish and fewer blacks and Puerto Ricans who worked for – but rarely lived among – us white “ethnics.”

My father drove a cab six days a week and my mother typed for a living. We weren’t poor but sometimes for dinner my mother would serve macaroni with ketchup. Sally and Irv enjoyed themselves occasionally – they played penny poker with friends on Saturday night, she watched Liberace, he watched the Yankees, and now and then they would go out for “Chinese.”

But much of the time they were frustrated and miserable. Irv was known to friends and cousins as “easy going” and – though he didn’t drink – could “snap” and do a lot of damage. Sally was always worrying and felt ashamed of her divorce in the 1940s. Her daughter, my “half” sister, twelve years older, lived with us and hated my father (for good reason).

I was acting out at home – yelling, cursing and defiant – and in junior and senior high: cutting classes and on my way to becoming an official “truant” and dropout. In the grip of adolescent anguish, by 14 I would ruminate incessantly about girls, particularly the local Italians, whose appeal was intensified by a taboo that would prevail into the 1970s and beyond.

Even my pre-pubescent preferences leaned in that direction, stimulated by those lusty Italian ladies of Bensonhurst. Cleavaged, tight-skirted and toe-nail polished, they seemed more overtly libidinal than the Jewish women in the neighborhood. My fascination was a distraction from family problems and a way to imagine my escape. I enjoyed other diversions, as well: scooting around the corner to play punchball or pedaling my bike to the Cropsey Avenue Park or buying an egg cream – for twelve cents – on Bay Parkway and 86thStreet.

Rivalries erupted from time to time between the Jewish and Italian boys. I was involved in some of these courtyard fist fights. Though the violence was minimal (no weapons: just a few punches in the face, a headlock and then a submissive “I give.”), these neighborhood battles would not only contest virility but would reveal an ethnic-based class resentment.

While many of my Italian peers became very successful academically, professionally and financially, it was the Jewish kids who were most eager to leave the old neighborhood (this is decades before the borough became trendy for Gen X bohemians). This ethic of upward and outward mobility, built into Jewish cultural DNA, has fashioned a Jewish-American Diaspora – from Hester Street to the “outer boroughs” to the upper west side, Hempstead Long Island, Southern California and points in between.

For a time, I resisted the traditionally available route for a smart Jewish kid to get ahead. Depressed and anxious, I was flunking out of school. Developing instead the style of free spirit, a malcontent and a wanderer; a persona which required that I reject my parent’s values with a simplistic, snotty and condescending critique of them as vacuous and conventional.

This fit right in with “generation gap” rhetoric and prevailing notions of liberation pulsing through the counter culture in 1967. I could distance myself from my painful past and pathetic parents, disparage their “material values” – appalled, for example, by their choice to cover their sofa with clear, thick, sticky plastic – and fashion myself as superior.

It would take awhile before I would better understand how my parent’s lives shaped my political values. By my late teens I saw as merely incidental the fact that they had joined the ranks of New York’s unionized civil service. My father was forced out of taxi driving by his health, becoming a clerical for the state insurance fund; my mother putting her fast fingers to work for the city’s board of education.

But a lonely 17-year-old had no time for such reflections. On nights when I had trouble sleeping, I would slink out of my parent’s apartment to wander the streets. There was always the faint hope of an exotic sexual encounter, but most of these three-in-the-morning outings were a time for thoughtful solitude.

Walking past the Coney Island Terminal – the last stop for Brooklyn-bound trains from Manhattan – just a few blocks from the Atlantic Ocean and the famous Boardwalk, Aquarium, Cyclone and Nathan’s, I was ruminating over my academic circumstances.

In a few hours, I would be starting a new high school. (My parents and I had, in fact, deserted Bensonhurst – but only barely – relocating a few neighborhoods south to Brighton Beach which, ten years later, would take in thousands of Soviet émigrés and gain national fame as “Odessa by the Sea.”)

I stayed up all night, walked along Surf Avenue as far as “Seagate,” (one of America’s oldest gated communities on the western edge of Coney Island) and – somewhere along the way – decided to stop screwing around in school.

I could tell this was a big deal. Later in life when I started to chart these pivotal events, I would mark my Surf Avenue expedition as the first of many.

That semester in Lincoln High I stuck to my resolve, dropping bookkeeping and merchandising, flipping back to a college prep curriculum, re-taking failed classes – geometry, biology – and planning an extra year in high school.

Though I would finish Lincoln with a weak overall record, my academic performance improved substantially the final two years – enough to let me shop around for a college which would recognize my potential.

The last stop on my exit from Brooklyn would be the NYU psychology clinic for nine months of analytic psychotherapy with a grad student who would later become a successful New York analyst. Nowadays, concerned and proactive parents who detect problems in their kids are quick to refer them to psychologists for therapy and psychiatrists for medication. But this was my initiative and I jumped at the chance to see a “shrink.” Twice a week I rode the subway into lower Manhattan and – for 50 cents a session – began what would be decades of various forms of psychotherapy (including a brief period in which I aspired to be a therapist myself).

Coincidentally – and ironically (given my ultimate career choice) – in 1970, the NYU psychology clinic building was located at 23-29 Washington Place which, 60 years earlier (then known as the Asch Building) was the site of the Triangle Shirt Waste Factory fire which killed 146 immigrant garment workers – mostly young Jewish women.

I didn’t find out until years later that the building held such enormous historical significance; that this epic tragedy – which triggered fire code and workplace safety reforms across the country – took place at the spot where I was preparing for my life as an adult.

Though oblivious to quite a bit happening around me (preoccupied with, among other things, overcoming my awkwardness with girls), I was however starting to absorb some of what was going on in the world.

I could recount stories here about my cultural and political “awakenings” – tying my personal development to iconic historical events: the M.L. King and Bobby Kennedy killings, Woodstock (I was there), the Democratic National Convention police riot (I wasn’t there) – but I’ll save for another time my detailed reflections on this period in American culture and politics. Hasn’t enough already been said about how sex, drugs and rock ‘n roll changed our lives?

Though I was linked to prevailing counter-culture sentiments – appropriately appalled by the War in Vietnam and other U.S. “atrocities” – my political views were confined (or should I say restrained) by a mainstream liberal tendency that I’ve maintained to this day.

Sure I was impressed by Ivy League SDSers taking over the dean’s office – I respected their dedication to social causes (and the fun they seemed to be having). But my own working-class resentments may have been surfacing in reaction to what was then perceived – not always correctly – as the “privileged” student protesters of American middle class families.

My working-class “liberal populism” reflected my parent’s political values pretty closely (though I couldn’t know this at the time). One example would be my lack of resistance to Hubert Humphrey in the 1968 presidential. The “no difference” argument didn’t hold as I lined up happily with New Deal Labor Dems to try to beat Nixon.

I also took an intense interest in the reform movement in Eastern Europe against communist totalitarianism. While I assume most American liberals and radicals at the time aligned with Czechoslovakians in their protest against Soviet tyranny, I felt a particular affinity for the young reformers. My revulsion to Soviet Communism was sealed for life when Russian tanks and troops crushed Alexander Dubcek’s Prague Spring.

I don’t want to make too much of all this – I was just a kid – but I always felt a slight pull to the political center and couldn’t quite wrap my head around radical-chic notions about the Panthers, Mao or a range of utopian ideas espoused by elements of the new left. Though I might have looked like one, I was not a revolutionary.

Twenty years later, I would find a very nice fit within the American Labor Movement, navigating comfortably among the so-called old guard and the new generation of union militants. I would develop a revisionist view of Sally and Irv, less critical of their values and more appreciative of how a few extra dollars in their pockets – thanks partly to the New York public sector unions – could make a big difference in workers’ lives.

I would also take on a more balanced – you could say compromised – view on the potential for personal transformation and social change. Economic conditions do shape peoples lives, but individual choice enters the mix. America – at its best – gives you a shot (at least it used to) and you make of it what you will.

As a Brooklyn, working-class, Jewish American – introspective and inclined toward progressive (but practical) politics – I feel lucky to have come as far as I have.

I’ve spent my life trying to overcome an agitated mother and angry father. By 10, I was bratty and foul-mouthed; by 13, sexually-fixated and withdrawn; by 16, defiant and delinquent. To compensate, I would develop very subtle behaviors to conceal my feelings of isolation.

But I’m getting ahead of myself. By the end of the 1960s, these formations were incubating. In the 1970s I would work on my narrative: success on my own terms and an ongoing struggle for American justice and personal salvation.

I would also figure out that blaming parents or “society” for low self-esteem – even if it opens the door to self-acceptance – can only take you so far.

An Obituary for the Occupation in New York

Harry Siegel — Fri, 09 Dec 2011 16:49:06 -0500

I came to report on the occupation of Zuccotti Park expecting it would pass in a matter of days, like the stillborn movements before it.

In spite of its self-celebrated cosmopolitanism, New York after 9/11 has become an arid environment for protest under Mayor Michael Bloomberg and Police Commissioner Ray Kelly. The press and the public yawned through the massive anti–Iraq War march in 2003 and the excessive police response to the 2004 RNC protesters (the city is still dealing with those lawsuits). Even after the Wall Street meltdown, an eerie silence prevailed.

Zuccotti was something else: a physical presence, symbolically charged by its location a stone’s throw from both Ground Zero and Wall Street, with no end date to wait out and no demand to be placated.

While the act of occupation had little to do with the broader complaint—at the core, unhealthy economic distribution perpetuated by increasingly unresponsive elected “representatives”—it proved a dramatic setting for airing them, and for bringing participants together. For one season the park took on a life of its own, before reverting to a place for “passive recreation.”

In the course of that season, though, the scene aged badly. With a big push from the Bloomberg administration and tabloid coverage fixated on civic order, Zuccotti Park descended from a new public commons to a fever dream.

I surveyed the scene for the first time about a week after it started. In that first of what became many such visits, I stayed from early afternoon through the next morning, listening to professors, students, union members, veterans, homeless women, eccentrics, lunatics, librarians, old colleagues from other newspapers, members of various working groups and even a neighbor from Brooklyn there to take it in.

Occupy Wall Street had yet to draw the high-profile NYPD abuses and errors—the pepper spraying and Brooklyn Bridge arrests—that would give them a shape and purpose they couldn’t sustain themselves. But amid the drum circles and music festival “model society” absurdity of the park, people who’d been at a loss until now about how to express an array of concerns sensed an opening.

I was less interested in the protest itself than in the creation within Zuccotti of the sort of freewheeling commons New York City has lost under this mayor, even as the Internet and mobile devices eroded what was left of a shared café culture.

That shift is epitomized by the increasing commercialization of public spaces like the generator-powered gift market at Union Square. But it left a hole that the occupiers briefly filled.

The handmade cardboard signs, the conversations with engaging strangers, the library, even the General Assembly all seemed like flashes of the participant city that’s hunkered down to wait out an unpopular mayor. Bloomberg has built an ever-expanding safe space for the very well-off at the expense of the rest of us, using his private fortune to encourage New Yorkers to simply leave the city’s civic life in his hands.

Problems in Zucotti stemmed in no small part from the massively disproportionate police response, intended in part to limit the size and scope of the protests by warning the economically marginal, the physically frail, and the meek about the bad things that might happen to those who participated.

That tactic backfired. As the occupation grew, the would-be political participants found themselves starved for space, overwhelmed by their own tents and by an excess of hangers-on, panhandlers and carnival-goers unsober in all senses. They were ringed by barricades and police officers, blinded by spotlights aimed into the park at all hours, and eyed at all times by dozens of NYPD cameras carried by officers and atop a 20-foot pole on an unmarked police truck.

“Just because you’re paranoid,” one Occupier said, sweeping her arm across the park, “doesn’t mean they’re not out to get you.”

The NYPD response was a far more significant disruption to the life of the city than the protesters themselves—for the first time since 9/11 penning off streets to those without IDs to prove they “belonged” there, erecting barricades that starved businesses of customers, sending so many officers to “protect” the demonstrably nonviolent marches that crime rates went up elsewhere.

In turn, the occupiers became fixated on the police department. At each march, rumors would swirl about brutality, arrests and reports that “they’re taking the park.” Crowds would at times work themselves into mobs, facing off with the NYPD as though they were in Oakland or Egypt. Yet they failed to notice—let alone respond to—the tactics used to manage them, like complicated penning schemes that broke bigger groups into smaller ones or tricked protesters into separating themselves from the rest of the city instead of showing they were just like everyone else.

After I reported that the police were exacerbating a split between participants and nonparticipants in Zuccotti by encouraging drunks and rowdies to head down there, the NYPD’s main mouthpiece issued a tepid denial. “Not true,” he said, without specifying what exactly wasn’t true, adding that those types would of course find their way there.

Explaining his decision to finally clear the park, Bloomberg pointed to the EMT who broke his leg on the sidewalk just outside the park (but inside the barriers separating the police from the protesters) a week earlier, in the middle of the night.

I was the only reporter on the scene when that happened. My colleagues had dispersed around the park to track a spate of seemingly contagious violent incidents on an especially ugly night.

Two very large OWS “community watch” members were patiently working to calm down and eject from the park a crazed 20-year-old, Joshua Ehrenberg, who I was told had punched his girlfriend in the face earlier that night. Just outside the barriers separating the sidewalk from the street, officers watched the crowd swelling around the scene.

The police ignored requests to move on as Ehrenberg kept playing to them, spitting out slogans of the occupation: “The process is being disrespected” since “the community hasn’t consented to this,” trying to get friends to form a human chain with him. As ever, the gawkers accused each other of being infiltrators and police agents.

As that scene played out, two huge men in still another fight emerged behind us, inside the park, throwing ineffective haymakers at each other, nearly toppling tents. One of the OWS security members left to try to handle that, while his partner finally asked the police, watching from outside the barriers, to come in and remove Ehrenberg.

Despite the invitation, the crowd swarmed around the entering officers, yelling “Pig!” and the like as the police carried the struggling, still slogan-shouting would-be Occupier out by his arms and legs.

An EMT there to take him for a psychiatric evaluation, walking backward just ahead of the swollen group of police, protesters and park campers, put his foot through the rungs of a ladder that for some reason was leaning against the sidewalk.

As he wailed in agony, the crowd gave no space—even as the police calmly asked them to give him room, pushing those who wouldn’t listen back with measured force.

In press reports about the incident, a city spokesperson incorrectly claimed that the EMT was shoved or assaulted, while Occupation sources peddled the line that this was just one of those things, an unavoidable accident unrelated to the occupation.

Did he fall or was he pushed? Yes.

Would the Occupation movement—really, a moment—have collapsed under its own weight without the city’s heavy-handed help? Thanks to that help, we’ll never know.

This piece first appeared at City and State New York.

Housing Bottom? Not Yet.

Jeff Speakes — Thu, 06 Oct 2011 19:14:35 -0400

Weakness in housing activity and in housing prices continues to be a major drag on the overall economy. My colleagues at California Lutheran University's Center for Economic Research and Forecasting have long maintained that the home ownership rate (HOR) needs to fall back to its historical norm of 64% before housing can recover. Their view has been that the attempt to increase the HOR by loosening credit standards contributed to creating financial instability. In a classic case of unintended consequences, the attempt to improve the home ownership rate contributed to rising home prices which ended up lowering affordability for first-time buyers.

A rising home ownership rate has been a major goal of public policy for several decades under both Republican and Democratic administrations. The rationale was multi-part. First, it was believed that communities are stronger where home ownership is greater. Second, building equity in a home was viewed as the primary path to improving a family’s financial condition. Finally, lower home ownership among minorities was felt to be an indicator of bias.

Policies directed towards increasing the rate of home ownership included subsidizing first time home buyers, reducing required down payments, and streamlining the application process. Weaker underwriting standards increased the effective demand for housing and helped propel a boom in housing activity and home price appreciation between 1995 and 2006. The overall HOR rose from 65% in 1990 to 69% in 2006 which was applauded on both sides of the political aisle.

However, rising home prices eventually reduced affordability and, along with excess supplies of housing due to overbuilding, led to a peak and then a decline in housing prices. The price decline eventually set in motion forces that generated severe losses to mortgage investors and homeowners alike. The underwriting pendulum shifted from easy to tight, and effective demand for houses plummeted. Millions of people have lost their homes, and many more have zero or negative equity in their homes. The homeownership rate has now declined from 69% to 66%, and appears to be headed lower.

Another fundamental indicator of housing weakness is the large number of delinquent mortgages and the implied backlog of future foreclosures. Of course, as the foreclosure backlog is worked through, the result will be a decline in the home ownership rate, as newly foreclosed-upon home owners become renters. Thus, this issue is not separate from the HOR issue.

The large number of vacant homes is also a measure of housing market health. During the period of 2002 through 2005 the housing industry massively overbuilt. The degree of overbuilding can seen by comparing the rate of household formation (about 1.1 million new households per year during this period) with total housing starts, which is the number of new units (including rentals) completed each year.

This number exceeded two million units per year during the boom. Since the end of the housing boom, total starts have fallen dramatically to around 600,000 per year. If the rate of household formation had remained at 1.1 million per year, then the surplus developed during the boom would have been eliminated by now. However, an important yet obscure statistic maintained by the Census Department, the Vacant Homes For Sale (VHFS), remains at more than one million above its long-term average. What is going on?

I suspect that the rate of household formation dramatically declined following the crisis and subsequent recession because more young adults returned to their family homes, and because multiple families are occupying the same housing unit.

The problem of too much housing stock and too few households will not be resolved purely by a lower home ownership rate. It will be resolved by rising household formation , even if the new households are renters instead of owners. What we need is more people. One strategy to accelerate the process is to streamline legal immigration and to lift or eliminate quotas on the number of people who can legally come to this country.

Jeff Speakes is Executive in Residence at California Lutheran University, and Lecturer in economics at the University of Southern California.

New York City Population Growth Comes Up Short

Wendell Cox — Thu, 24 Mar 2011 17:52:28 -0400

Just released census counts for 2010 show the New York metropolitan area historical core municipality, the city of New York, to have gained in population from 8,009,000 in 2000 to 8,175,000 in 2010, an increase of 2.1 percent. This is the highest census count ever achieved by the city of New York.

Nonetheless, the figure was 245,000 below the expected level of 8,420,000 (based upon 2010 Census Bureau estimates). The higher population estimate had been the result of challenges by the city to Census Bureau intercensal estimates. The city of New York attracted 29 percent of the metropolitan area growth. Approximately 43 percent of the metropolitan area’s population lives in the city.

Overall, the New York metropolitan area grew from 18,323,000 to 18,890,000, an increase of 3.1 percent. The suburbs grew approximately twice as rapidly as the city of New York, at 4.0 percent, and attracted 71 percent of the metropolitan area growth.

High Cost of Living Drives New York’s Fiscal Deficit with Washington

Eamon Moynihan — Thu, 19 Aug 2010 17:38:15 -0400

Between now and the end of the year, a hot political topic here in New York will be whether to let the Bush tax cuts expire for people in the highest income bracket, as the Obama administration proposes, or whether to extend those cuts for everyone. Advocates taking the latter position will correctly argue that higher rates will be especially harmful to New York, because of the large number of wealthy people, who live here.

What is not likely to be discussed, however, is that because of the exorbitant cost of living in New York and the surrounding suburbs, federal taxes take a supersized bite out of the incomes of all New Yorkers, who in the vast majority are not wealthy at all. The result is that here in New York City, which is arguably the poorest city in America when it comes to what people can actually afford, we end up subsidizing other states and localities, where people pay less to Uncle Sam, even as they enjoy a higher standard of living than we do.

How could this be? The answer is that because New York and the surrounding suburbs are so expensive, businesses have to pay higher salaries to recruit people to work for them. According to the ERI Economic Research Institute, a leading data survey company that helps corporate clients set compensation packages and calculate the cost of doing business throughout the United States and elsewhere, these higher salary costs are substantial.

They calculate, for example, that a typical registered nurse in metropolitan New York earns $82,712 versus a national average of $65,464. In the case of an accountant, they calculate a figure of $74,388 versus a national average of $58,712. In the case of an administrative assistant, as they define those job responsibilities, they calculate a figure of $59,243 versus $47,961 nationally. And finally, they also provide data for someone working as a janitor. Here the figure they calculate is $38,142 versus $31,220.

Sounds great. Who doesn’t want a higher salary? But unfortunately, it’s not that simple. The problem is that the IRS doesn’t care how much you can actually buy with your hard earned dollars. They just want to see the number printed on your W-2. And as we all know, the more you make, the more you pay.

For the average registered nurse in New York, filing as an individual, and assuming no special deductions or one-time credits, the tax bite amounts to $14,381 versus $10,219 for the average registered nurse in the rest of the country. An accountant here pays $12,444 versus $8,531 nationally. For an administrative assistant, the figure is $8,656 versus $5,844. And in the case of a janitor, the figure is $3,899 versus $2,864.

But wait, it gets worse than that. Based on data from the federal Bureau of Economic Analysis, it turns out that the cost of living in the New York metropolitan area is significantly higher than the difference in salaries alone would indicate. According to their data, the cost of living here is 45 percent higher than in the rest of the country or approximately twice the difference in salaries.

Yes, employers have to pay more to recruit people to work here in New York, but they don’t have to make up the whole difference. Economists refer to this as money illusion, which is their way of saying that people find it difficult to distinguish between the nominal value of money and the true purchasing power of that money in the marketplace.

If we recalculate salaries to take into account the cost of living, it turns out that the federal tax premium that New Yorkers have to pay is even greater. Thus, if the tax bite were to reflect the actual standard of living for a registered nurse in New York, the real tax would be $8,106 instead of the actual tax of $14,381 or a difference of $6,275. For an accountant, the difference would be $5,775. For an administrative assistant, it would be $4,352, and for a janitor, $1,778.

The lessons here are clear. In the short term, New York’s Congressional delegation needs to restrain efforts to raise taxes in Washington, D.C., because the impact here will be greater than elsewhere. And in the longer term, we need to determine why the cost of living in New York is so high and then implement the reforms necessary to fix the problem and give New Yorkers a standard of living that is competitive with rest of America.

Supporting Small Business in NYC: The Harlem Metro Market Project

Kirsten Moore — Fri, 06 Aug 2010 15:23:52 -0400

The Harlem Community Development Corporation has come up with a rather unique plan to combat high real estate prices in the district. It proposes establishing an open-air market under the Metro North tracks spanning one mile, or 22 city blocks. This new market would accommodate about 900 vendors, helping to increase the now low number of local entrepreneurs and independent retail stores in Harlem.

The market would not only attract vendors, but tourist traffic as well, which would help rejuvenate a neighborhood hampered by soaring commercial real estate costs. It costs anywhere from $125 to $225 per square foot for commercial space in Harlem’s prime locations, resulting in only 42 stores for every 10,000 residents. The Metro market project would ease pressure on small, independent retailers and allow potential entrepreneurs the chance to create viable businesses in the city.

This need for such a project reflects the economic trends and challenges facing the larger New York urban area’s middle class. New York City has the nation’s highest cost of living, and like the rest of the nation, is still experiencing the effects of the recession. The middle class, including small business owners facing high rents, struggles to make the six-figure salaries needed to meet the city’s high cost of living.

Harlem’s Metro market project, which would encourage an independent entrepreneurial spirit, embodies the required plan of action for New York City. The city needs to find inventive ways to deal with its economic reality in order to reverse the recession and revitalize its appeal to the energetic and the ambitious.

Rating the Unaffordable: The Economist and Mercer

Wendell Cox — Mon, 03 May 2010 16:26:15 -0400

An article by Carl Bialik in The Wall Street Journal questions the value of city livability ratings, such as lists produced by The Economist and Mercer. This issue has been raised on this site by Owen McShane.

(1) The Wall Street Journal notes a lack of transparency in ratings. In the case of The Economist and Mercer, this starts with the very definition of "city." They don't say. In the case of New York, for example, is the city Manhattan?, the city of New York or the New York metropolitan area. The difference? Manhattan has fewer than 2,000,000 residents, the city about 8,000,000 and the metropolitan area about 20,000,000. That makes a difference. The same problem exists, to differing degrees in the other "cities," whatever they are.

(2) The first principle of livability is affordability. If you cannot afford to live in a city it cannot, by definition, be affordable.

The Economist ranks Vancouver, Melbourne, Sydney, Perth, Adelaide and Auckland among its top 10 livable cities. In fact, in our 6th Annual International Housing Affordability Survey, these metropolitan areas rank among the 25 least affordable out of 272 metropolitan areas in six nations (the United States, the United Kingdom, Canada, Australia, Ireland and New Zealand). The Economist's champion, Vancouver, is most unaffordable, with Sydney second most unaffordable. Mercer's top 10 list also includes Vancouver, Auckland and Sydney.

By contrast, the three fastest growing metropolitan areas with more than 5,000,000 population in the developed world, (Atlanta, Dallas-Fort Worth and Houston) have housing that is one-half to one-third as expensive relative to incomes (using the Median Multiple: the median house price divided by the median household income) as all of the "cities" noted above in the two lists.

Purpose of the Lists: The purpose of these lists, for all their difficulties, is often missed. The Economist and Mercer do not rate livability for average people, but rather for international executives. Thus, the lists are best understood as rating cities for people with a lot of money and a big expense account. The lists may be useful if one is contemplating a move from Manhattan's Upper East Side to London's Mayfair.

Unfortunately, The Economist and Mercer lists are often treated by the press as if they rate the quality of life for average citizens, which they most surely do not.

The average Vancouverite does not live on English Bay, nor does the average Sydneysider have a view of the Harbour Bridge. Because of escalating house prices, they are far more likely to live in rental units, with the hope of home ownership having made impossibly expensive by rationing, through restrictive land use policies, of an intensity that not even OPEC would dare adopt.

What Seneca Falls Can Learn from Toronto

Wendell Cox — Tue, 09 Mar 2010 16:43:32 -0500

One of the most enduring myths in public policy is that local government consolidations save money. The idea seems to make sense, and most of the academic studies support the proposition. However, rarely, if ever, does the promised reduction in public expenditures or taxes actually take place.

Residents will vote March 16 on a proposal that would merge the village government of Seneca Falls, New York into the more rural and adjacent town of Seneca Falls. Under state law, this can occur without the consent of the town into which the village would be merged.

Paltry Savings and the Risks: A consultant report suggests savings that can only be characterized as pitiful. Out of a combined budget of $13 million, less than $400,000 would be saved, and even that figure is by no means sure, according to the consultant.

Voters may want to consider the following specific risks that could make achievement of the expected savings and tax reductions impossible:

Proponents expect to receive $500,000 annually in funding from a state program that seeks to encourage municipal consolidations. The state program is slated for cuts. Further, with New York’s serious budget difficulties, such a superfluous program could be a prime candidate for discontinuance. Thus, one of the principal factors expected to lower taxes might not survive in the longer run.

Presently, the village has a police department, while the town does not. The new town government is not likely to be able to get away with providing a higher level of police protection in the former village than in the merged town. One of two outcomes seems likely: (1) The first is that the present police protection (and budget) would be spread throughout the merged town. This would dilute police protection in the former village area. (2) The second is that the higher level of police protection in the village would be spread throughout the merged town. This would mean larger expenditures that could easily erase the already minimal projected savings.

The consultant proposes that a new town hall be built. The costs of this building could substantially erode the projected operating cost savings.

A principal reason that municipal consolidations rarely save money is that the necessary “harmonization” of service levels and employee compensation costs inevitably migrate to the level of the more costly former jurisdiction. The police issue in Seneca Falls is a prime example of the service harmonization cost risk.

Learning from Toronto: Seneca Falls does not have to look far to see how local government consolidation can lead to more spending and higher taxes. Less than 150 miles away as the crow flies, Toronto residents were glowingly told of the lower taxes and expenditures that would result from consolidating six jurisdictions into a “megacity” in the late 1990s. As we and others predicted at the time, things have not worked out. Toronto’s spending has risen strongly under the consolidated government. Despite its much smaller population, the risks are similar in Seneca Falls.