46 Comments
founding
May 12, 2023Liked by Arnold Kling

Arnold don’t get me started on the people’s republic of MoCo. I’m holding on until my last kid graduates high school and then going to Colorado.

Expand full comment
May 12, 2023Liked by Arnold Kling

Seems to me that “voicing” one way and “exiting” another way is the definition of “luxury beliefs.”

Expand full comment

“The chart above made me think of that. Florida is like Clayton. It is going to enjoy a virtuous cycle in which more wealth comes to the state, tax revenue rises, and the government just has to be halfway competent to keep the state attractive. Meanwhile, the deep Blue jurisdictions controlled by teachers’ unions will be like U. City. They will suffer from a vicious cycle of losing wealthy taxpayers, leading them to have to raise tax rates and cut public services.”

This why it is so important to the Blues that they control the Federal government. Then they can use the taxing and regulatory power of the feds to disadvantage Texas and Florida, for example, and prop up New York and California. Does an open border with Mexico cause chaos in Texas? Then the Blues favor open borders.

Expand full comment

This sounds like trollism. None that I know of favors open borders, although neither party has seen fit to invest in fair and humane border control.

Expand full comment

It's kind of inevitable that immigration will change TX and FL. It had the same effect on CA and NY (they weren't always blue).

Expand full comment

"Tiebout competition also should promote efficiency. ... New York and California are losing customers, but I don’t see them reforming any time soon."

So Tiebout is wrong about efficiency gains. Isn't that the takeaway?

Expand full comment

Schooling is done at the state level and equalized across jurisdictions. Most states use a formula based on district income to determine the "fair share" that should be contributed by local taxpayers and then provide state funding to even things out. This is part of civil rights law as well.

Furthermore, in a lot of the country school districts are at the county level, which is way to big to be considered "local".

The main draw of moving out to the burbs is the schools, so having bad schools would probably lead to lower property values and cause a negative feedback loop.

Single people do vote for school budgets less often, but most either will have or have had kids in the past or have grandchildren. They also understand the housing price dynamic.

The places single people might want to live, urban centers with bad schools, tend to have higher taxes than the burbs. Bad schools cost the same (or more) then good schools, and teachers unions vote all the same.

Perhaps we should phrase it a different way.

1) All governments provide the three items Bryan mentions: schooling, law enforcement, housing regulation. There are many reasons for this that are not easily waved away.

2) All governments tax the maximum amount they can without causing either a voter revolt or mass emigration. Spending then matches this amount whether that amount of money is needed or not.

3) The difference between jurisdictions is mainly in quality rather than tax rates or the existence/non-existence of certain core services. Suburbs have good schools, reasonable law enforcement, and more appropriate housing regulation (not what Bryan would like, but suburbs grow while keeping the poors out and do a better job than the cities).

4) The sweet spot seems to be a mix of threat and investment from residents (exit and voice). The threat of moving to the next town over keeps people honest, but the investment of long term residents (usually families with children) means people care about long term decision making.

I'm not sure Exit alone does anything. People have been exiting Baltimore for seven decades and they are as screwed up as ever. There can be an effect where people leave and the only ones left are supporters of the failing system, in which case the feedback loop is negative (I failed and I gained political power). And for the most part state and federal governments tend to subsidize failing polities.

Expand full comment

" Suburbs have good schools, reasonable law enforcement"

But the major reason for that is because most suburbs have a higher proportion of smart motivated students and a lower proportion of residents committing crimes. Some suburbs don't. Ferguson, Missouri is a suburb. (And, interestingly, only few miles from University City, in the opposite direction from Clayton. I wish I knew St. Louis geography better.)

Expand full comment

Well, that's where the housing regulation comes in, doesn't it.

Which is why putting YIMBY at the front of the cart is often (not always) an error. Until you deal with crime and schools in a way other then physical distance and pricing people out there is always going to be a constituency to keep the poors out because they have huge negative externalities, and the only legal way to keep the poors out is to prevent the building of cheap housing.

Expand full comment

Alas, you are right.

Expand full comment

On Baltimore, there is probably a time dimension here too, especially with larger polities with a lot of previously built civic infrastructure (city owned and things like businesses). Baltimore being a major port helps slow the decline as some businesses have to be there, and many have been there a long time and are slow to leave. It may well be a matter of decades before enough people leave, and what’s more refuse to commute back in, before the businesses in a big city leave for the suburbs and things really start to collapse.

Expand full comment

What keeps Baltimore going is the hospitals. It has world class hospitals. Ghetto blacks may not have much income, but they do have Medicaid and Medicare (those with both are a privileged class called "duals" that get so much money from the government that insurance companies will pay your rent and grocery bill for the right to give you all the free healthcare you want).

A had to go to a Baltimore hospital once. Tons of blacks and gunshot victims. Cops interviewing people about recent shootings.

The other thing keeping it going is the public schools. Despite property tax rates over double the suburbs, Baltimore City only provides $3,700 per student in its own local school funding in 2019. It received $12,200 from the State (suburban taxpayers) and $1,500 from federal. So it only provides ~20% of its own school funding, the rest is outside subsidy.

Baltimore Cities #1 public expense is police at $510 million in 2021. Second highest is schools at $287M. The next four highest categories total about $150M combined.

In short the Democratic state legislature funnels money to a dysfunctional city government and in exchange that urban machine turns out a democratic vote advantage of 80-20 or so for state elections. Even when a popular RINO governor wins that's enough to control the state legislature.

Expand full comment

Wow, those numbers are pretty shocking. I hadn’t thought about the hospital angle too... with state funded healthcare a dysfunctional populace could be a real boon to hospital administrators who commute.

Expand full comment

The questions about this are why "Progressive" jurisdictions have inefficient land use regulations and building codes. And why teachers' unisons don't have a revealed preference for better schools.

Expand full comment

Teachers unions do want better schools. The problem is that, pretty much, good students make good schools. And nobody really knows how to turn bad students into good students.

Ed schools are constantly coming up with new ideas, and teachers unions will support some of them, but as Arnold has pointed out, no one has come up with an improvement that makes a lasting, noticeable difference and is replicable and scalable. "Hire Jaime Escalente" is neither :) So since most everyone believes spending more makes things better, that becomes the default: teachers unions push for smaller class sizes, more para-professionals, higher pay for teachers, more education courses, workshops, and professional development.

Expand full comment

I agree. But that is not the same as posing them as existential opponents of educational reform or better municipal governance.

Expand full comment

Certainly not. Most people want to do good and think they are doing good. Most people also have a remarkable capacity for self-delusion. People in education are stuck in a terrible situation. Schools are doing about as well as they can. But everyone who matters thinks they can do better, not just a little better but a lot better. So you have to lie to yourself. Saying, "we can't do better" is defeatist, "the soft bigotry of low expectations." If you talk like that at an employment interview, you will not be hired.

Expand full comment

1) SALT was the glue that kept the local blue governments going. It's easier to ignore bloated spending then 1/3 of it is getting lobbed off your federal tax bill.

2) The best piece of advice I could give a young person is to move to where they want to live long term since that is harder to change then getting another job in your city where you live.

3) At the same time it's hard to forecast what a place is going to be like over a lifetime. I liked the place I grew up then but wouldn't like it now (it also wasn't always a one party dem state). California used to be the Reagan Dream and nots is Newsome's California. The same things could happen to Florida or TX long term.

4) It seems like my own small town went though a change in the last decade. Newcomers from DC voted in a new mayor that is leftist and anti-development. Many of them don't have families here and don't even live here every day (its like a vacation home on the weekends from Alexandria), but they vote.

5) One of the main problems in the south is they have very large school districts. In the Northeast most school districts are town based (each town has its own elementary, middle, and high school). This leads to better governance, but the less populated south did school districts at the county level.

Expand full comment
Comment deleted
Expand full comment

The in-state tuition at University of Florida is $6,381 a year. Average cost after financial aid is estimated to be $5,100 or so. You can pay for college with a tax advantaged 529.

They have a 30% acceptance rate and an 89% graduation rate. US News ranked in 28 in the country.

The college I attended is up to $60k a year in tuition. Even though they probably give out a lot of scholarships (that's how I attended) that is x10 the sticker price. USN claims the average cost after financial aid is $35k (my include room and board).

Right now my wife is taking some time off to be with our young kids, and we are enjoying our 1.875% mortgage. I'm waiting a few years to see if Florida has staying power (if the universal school vouchers are really universal or if there end up being waiting lists and gotcha loopholes). When its time for my wife to go back to work we may consider applying for jobs in Florida.

Expand full comment

Check as well the sustainability of disaster insurance rates.

Expand full comment
Comment deleted
Expand full comment

Yeah, it remains to be seen it Florida is Red or if DeSantis just got COVID right and will fade.

I'm pro-life but I didn't really consider his move to a six week ban smart. Reports that he didn't even do it out of conviction but political pressure make him seem weak.

I like the guy a lot. And I visited Florida on my birthday and really liked it. I've considered where we might move if it works out. But I've got a few years before we would make a move anyway so I'm observing if this stuff sticks or not.

I'm a New York metro area person. New York transformed because of immigration. For most of the countries history is was a "northern swing state". Catholics and its Dutch merchant ancestry made it a pragmatic place, but demographics dominate and it's one party now. The Sharks pushed out the Jets.

I note that the "new right" is mostly CA and NY Republicans that watched the effects of immigration on their homes.

Expand full comment

It is a shame that "immigration" got deflected from recruiting talent and energy from all over the world to keeping out low marginal value immigrants and turned from and economic growth issue to a social/political issue.

Expand full comment

In my experience the decisive factor is demographics - the neighbours. I don’t refer to race, but to standards of hygiene, behaviour, respect for the local and others, criminal activity.

Expand full comment

Which, alas, correlates with race. Good progressives can honestly say, "I want to live in a diverse neighborhood, but I have to live where the schools are good." But if you rank schools by student test scores or colleges the graduates go to, almost all the "good" districts will be mostly white and Asian. So that's where they'll go.

Expand full comment

Which leads to something interesting. The progressive can then say, " I hate white privilege because it keeps me from living in the diverse neighborhood I want to. If there were no white privilege, there would be lots of black/white diverse neighborhoods with good schools." That last sentence, after all, is part of the modern American catechism.

Expand full comment

I wonder - did they control for the wealth of the "progressives" vs "conservatives"?

Seems there is an obvious conflation as conservatives are on average less wealthy. ¿no?

Expand full comment

Is your assertion about wealth true, though? The Republican Party is much whiter than the Democratic Party, and whites are much wealthier than every other demographic except for some of the subclasses of east Asians. Where the Democrats dominate is at the very, very top of the wealth scale, but I suspect that dominance is largely an illusion as that class of people faces enormous social pressure to espouse progressive shibboleths, or to at least remain silent.

Expand full comment

I don't have the data off hand. But my recollection is that on average democrats are weather. I don't know about the median.

Your logic seems flawed based on whites dominating one party. In absolute numbers white poverty dominates all other races. So white domination of the Republican party can still lead to the conclusion that the republic party is poorer.

Expand full comment

https://www.nytimes.com/interactive/2023/05/15/upshot/migrations-college-super-cities.html

COVID destroyed coastal blue cities. At first the lower middle class moved away but not college grads don't want to live there either.

Expand full comment

What makes the NY/CA situation different from what you would predict is the role of the federal government. The worse the citizenry in NY/CA, the more federal money comes in. They are optimizing for federal subsidies (hence pro-indigent policies etc.) and not for anything like economic growth.

Expand full comment

I exited MoCo for a low-tax state. I miss the amenities of my old neighborhood, but to paraphrase something Bret Weinstein said about leaving Portland, I wouldn't patronize a restaurant that billed me for a meal that it never provided. Crime was on the rise. When car thefts escalate to armed carjackings, it is time to leave. Being mugged in another region of the country back in my youth taught me that affluent areas can be a magnet for criminals from less affluent surrounding areas, so living in 'very white neighborhoods' in the DC area doesn't necessarily insulate you from crime. With Governor RINO gone, I figure the last remaining restraint on wasteful spending at the state level is also gone. Another concern was the seemingly endless pipeline of 'luxury' high-rise apartment buildings that were mushrooming all over the neighborhood. The development model seemed to embody a 'field of dreams' mentality that doesn't make any sense to me.

Expand full comment

Good essay, but it seems to mix different issues:

Rich progressives move away from diverse cities and neighborhoods?

Rich progressives move away from poor value for money cities?

Non-rich, non-progressives move away from poor value for money cities?

Expand full comment

The foot-voting is something urbanists don't/won't talk about. A quick hand-wave and on to the next topic.

Expand full comment

I have a lot of confirmation bias with all of this, especially as an adopted Floridian, someone with too much mood affiliation, and my vast preference for exit over voice. But I question the importance of the wealth movement chart because of the tax base of Florida being so reliant on regressive consumption (sales) taxes and property taxes. Also, some 15 to 20 years ago the biggest predictors/correlates for population growth within the US were higher mean temperatures in January and home prices. People looked at the sunbelt growth and talked about taxes probably more than was warranted.

Expand full comment

In the end, exit to a different town or state won't matter- the federal government will grow and grow and grow. Increasingly, Texas will turn purplish as Georgia and Arizona has undergone the last decade, then blue (Florida is already purplish and has been for almost 3 decades). That is the thing about progressives- they don't tolerate the existence of non-progressive jurisdictions, and they control the education of the children pretty much everywhere today.

Expand full comment

The surprising thing is that Florida has actually gotten redder recently. Those around in 2000 know that Florida was a very closely divided swing state at that time, but seems pretty solidly Republican now. Which is not to say that might not change in the future...

Expand full comment

Looking at a St. Louis map, University City is almost right next to Clayton. I find it hard to believe house prices could be so different. Arnold, I'd love to see you run the experiment again with present data. (I don't know how to get the data and am not willing to put in the time and effort to learn how.)

Expand full comment
author

I Googled "median house price Clayton Missouri" and got $600K

I Googled "median house price University City Missouri" and got $250K

My old neighborhood is quite a bit below the median for U. City, and yet Google Maps says that my old neighborhood is 3.2 miles from downtown Clayton.

Expand full comment

My church has a nice seminary there, hopefully Clayton remains livable

Expand full comment

It is not uncommon in many cities to wild swings in price within a few blocks of each other.

BTW, I recommend Steve Sailers work on Oak Park, IL as an example.

Expand full comment

Yeah. Especially if those few blocks include a school district boundary

Expand full comment