The Future of California

This new Michael Lewis piece is worth reading.   It must be fun to go for a bicycle ride with Arnold.   To my fellow worried home owners in California, let’s go back to basics.  1. We are an urban nation.  2.  The key determinant of urban growth is attracting and retaining the skilled.  3.  California has the best quality of life in the nation and perhaps the whole world.  4.  The skilled greatly value quality of life.  Combine these facts together and we arrive at the conclusion that California has a bright future.  Yes, public sector employees have swell pensions. Yes, Prop 13 is silly.   Yes, I have trouble naming which industries will boom in California in the next 30 years.  But, California offers a unique experience and life is short. People who want to live well will sing those Beach Boy songs and join us on the West Coast.

Author: Matthew E. Kahn

Professor of Economics at UCLA.

37 thoughts on “The Future of California”

  1. Agreed on the quality of life in CA, not least because of its leading the nation in environmentally conscious legislation. Also – as the American south and southwest become desertified and essentially uninhabitable, the northern latitudes will be seeing very large influxes of population. I’ve already heard folks here in Austin, TX talking about fleeing the heat. Over the next twenty years climate change will be a major factor in demographic shifts, skilled and otherwise. Factor in the tissue paper collapse of the “Texas Miracle” and go-go *d’oh! gone!* South and you have a prescription for massive, rapid reversal of American population trends of the last sixty years. The question then becomes less whether CA and the Northern states can attract skilled workers, than are they ready to absorb the endemic and deep rooted ignorance and hostility of unskilled and uneducated red state southerners fleeing the heat.

  2. About #3. Really? Highest quality of life when the public services have so deteriorated? When it costs three times as much tuition to send your kid to a state school as it does in (Virginia, Maryland, Wyoming, Texas)?

    I grew up in Calif. Love it there. But would I go back? It seems like a Hell of a risk, with all the trend lines of public finance leading to the edge of a cliff.

    If for some job reason it clearly made sense to go there, I would probably rent.

    1. A very quick search indicates that tuition and fees at the U of Virginia for a resident is around $12K a year. http://www.virginia.edu/Facts/Glance_Tuition.html The same at Berkeley is a little less than $8K.

      Not that I think the Berkeley fees are where there should be. When I was in school, Cal was essentially free and that was a very good thing for a very poor student.

        1. That’s an incredible deal, considering we’re talking about a world-class university and a state-class university.

          1. Once a world-class university. Heaven only knows how many of the minds are actually still there or have slipped away while the UC execs have been abusing the shit out of the system.

  3. Everyone should have a pension. Private sector workers should have figured this out by now. The 401k thing is a hoax (except for that tiny minority of people who actually enjoy investing).

    1. Right. This sour grapes business of attacking public workers really shows how low we’ve sunk.
      Pensioners get great health care… What is the world coming to?!!!
      In a decade will we be complaining that public employees only have a 40 hour workweek too?

  4. People who want to live well will … join us on the West Coast

    De gustibus and all that, I suppose.

    Each of my visits to Los Angeles has reinforced my original impression that it is the Anti-City. I wouldn’t live there if you paid me. If I had to live in an American city it would be New York. Possibly I’d be OK with Boston, but it’s a bit small, a bit provincial. But no, thanks, I’ll stay here in Old Europe. The quality of life is so much better, you see, than anything I have found on the other side.

    [ob-Objectivity: there are some things that are much better in America than here. What you’d call plastic wrap; what you’d call Scotch tape; there are doubtless a few other things that would occur to me as well if I gave it a bit of thought. Now, you’re probably asking yourself why I do not mention bagels. That is because one can’t speak of American bagels being better than European bagels; there are no European bagels. Indeed, there are no bagels outside New York. The unsweetened round breadlike things with a hole that one can buy elsewhere do not merit the name, and I say that having tried what Kupel’s of Harvard Street sell under that designation — a noble failure, the best of a bad lot. In the end, it is the bagel question that would keep me from living in any other American city than New York (on further reflection, Boston is out, and for that reason, rather than for its provincialism and smallness). True, I don’t get bagels over here, but then Europe’s QoL superiority is enough to outweigh even bagelessness. Anyway, I’m in Istanbul a lot, and a freshly baked simit feeds the bagel monkey better than does some horror sold in a plastic bag labelled “sesame bagels” in a suburban grocery chain’s bakery aisle.]

      1. I’ll do so, should I ever visit Montreal (a city I have long wanted to visit). But should they not, under Quebec law, be called béguelles or some such?

        I’ve also been told I need to try the smoked meat sandwiches. I’ve always wondered how they stack up against a hot pastrami on rye. A couple of years ago, while visiting New York, I took my son to the Carnegie Deli for the latter. The wait-staff were a melting pot of all ethnic origins and both genders; they could not have been friendlier or more solicitous. “Great Cthulhu’s Tentacles,” I asked myself, “what on earth has happened to this place?”

        1. Speaking of tentacles, I noticed something odd last week. “Cthulhu” is on the Apple iPhone dictionary. “Ftaghn” is not. I guess this is a good example of subcultural mainstreaming.
          (I have a three-year-old child. In my household, “Cthulhu ftaghn” is a commonly-used phrase conveying great happiness.)

          1. I am temporarily relenting on the Reply button —

            can I have a phonetic spelling of “Cthulhu ftaghn,” please? I looked up Cthulhu on Wiki but the directions about how to pronounce it were vague. Is it sort of like the name Sven? So it’s “S-thool-hoo?” And “f-tawn,” to sound like a “baton?”

    1. Conflation of Los Angeles with “California city” vitiates your observations.

      Nice to see the ob- prefix for “obligatory”, though.
      Were you once a reader of rec.arts.books (where I believe that usage originated) ?

  5. So far, nobody here has disagreed with the structure of Matthew’s argument, just his chauvinistic assertion on the quality of CA life. I’ll go with the consensus. CA has a pretty good quality of life, but de gustibus and bizarro-world taxation and all that.

    1. And until the GOP blockage is defeated, California will suffer from having a group of complete unaccountable loons destroying things. Hmmmm – sounds like Chicago economists………

  6. Not sure the adjective I would use to describe Prop 13 is “silly.” Doesn’t convey the pernaciousness of it.

  7. California has the best quality of life in the nation and perhaps the whole world.

    Yeah, yeah, we all get that you were just kidding with that. But the fake triumphalism is still annoying.

    I’ll take Vermont’s quality of life over California’s any day. Fortunately, people have different opinions about what makes for a good quality of life. If everyone shared my opinion, this lovely state would soon be a colder and wetter version of LA, and then we’d all have to move somewhere else in search of peace, quiet, a beautiful natural environment, and good self-government.

    1. Well, what about them, or about Russian бублики? The relationship is obvious, but those are no more bagels than a (Neapolitan) pizza is a (New York) pizza. Allopatric speciation, to use a biological metaphor.

  8. Matt, California has an outstanding quality of life provided one doesn’t care about the size of one’s house or the quality of the public schools. Lots of people care a lot. Here your sometime co-author Ed Glaeser is more clear-headed, I think: see his discussion of Houston (which he doesn’t like but can understand why others would).

    Also, I think you may be conflating “the skilled” with “very highly paid dual-income professionals who can afford to send kids to private schools.” A household income of $80,000 a year is pretty highly skilled in my book, well above the median. In several states with not-so-nice weather but good government, that buys a good-sized house, within half an hour of work, and high-quality public schools. In L.A., it doesn’t.

  9. I must say I moved away ~a decade ago mostly because the QOL was deteriorating faster than I could lower my expectations. But I will say the QOL in that state with 25M or so fewer people was wonderful. You really can’t beat the weather, the wildly diverse landscapes, the once-enlightened and early-adopting public policy…maybe one day they’ll come back. Starti

  10. Never liked California, except for San Diego. If I lived on the West Coast, Seattle would likely be my choice. That’s not in California, is it?

    If you love jazz, you almost have to live in NY. San Francisco has California’s best jazz, but it’s not even close.

  11. It’s weird how so many people here think “CA = LA.” California has 36.5 million folks; LA (County) just shy of 10 million, and LA (City) just shy of 4 million. I completely agree with Matt about California being the best place in the world, and I’ve lived in and loved LA for many years, but CA has places for everyone: San Diego is often rated the most pleasant city in America, coastal Orange County is actually quite nice and Santa Ana a great city, Long Beach is very cool, Santa Barbara has the best climate in the world, all the little beach towns up the coast, the Bay Area (which I’m not fond of much, but I hear quite a few people, especially folks who like the Northeast more than I do, are), our National Parks, even our State Parks, etc., not to mention the most diverse cuisine in America and perhaps the world. However, Kahn is missing one thing – the Central Valley and up into Redlands and down into El Centro, all those folks tend to have a much less nice quality of life, especially because of inland pollution (I’m looking at you, Bakersfield) and perpetually high unemployment.

    And to Andrew: that $80,000 a year isn’t going to get you too far in many coastal large cities, either, if what you wrote is your standard. But a person in LA making $80,000 can afford a fairly large rental, not that bad of a commute, and certainly private school. $80,000 in LA is still quite a bit (more than $20,000 over the median for the county, and more than $40,000 over the median for the city). Hell, a person making $80,000 could even make it in Newport Beach without too much trouble.

  12. California has better weather and scenery than almost anywhere in the Western world.

    Its social landscape, however, is every bit as important as its physical landscape. And the quality if the two diverge pretty heavily.

    (Oh, and California also has Fresno and Bakersfield and Indio. It ain’t all Santa Monica, bub.)

  13. I on both sides – there are great things about Cali, and also as J says, QOL is in the eye of the beholder.

    What’s a little bit fun about LA — which I live in for family reasons only, even though I also love it, sort of — is it’s so big, there are decent odds of finding a corner that’s got what you’re looking for. We have horsey bits. We have skyscraper-y parts.

    But Andrew has a point — it’s mostly a place for people with money. The middle class and poor have a much much lower QOL. Interestingly, I find myself in the beginning stages of rejecting what they call TOD design here, b/c it’s a theory pushed by academics who/whom(?)(sorry my grammar is slipping/gone) probably all live in detached homes. I think we’re green enough already. And the parks and ocean are all on the Westside. Which no one ever wants to discuss.

  14. I am sort of hoping that the redevelopment/pay to play has actually gone far enough that even the Westside will rise up against it.

  15. I’d move back to just about any place in the Bay Area in a flash if the price-to-buy dropped by half. People (mostly incumbents from the 70s-late 80s) with their housing expenses under control (and don’t have school age children, like myself, just recently, now) can choose to live an exquisite life indeed. And most of those other exquisite things cost hardly any money at all.

    Note: I’m not talking about just San Francisco, though the year I spent living South of Market next to the marina and the java hut (BEFORE the boom) was maybe the best of my life. Most of Marin County, Oakland Hills, other side of the hill, all down the peninsula, down to Los Gatos and Campbell, it’s just extraordinary. And tomorrow I’m off to Madrid->Granada->Barcelona, Mrs. Tilton. (Very exciting!) I really really liked Milan. I liked Genoa, but even though it looks better than San Francisco, the weather was ghastly when I was there in July.

    And just for the zero-integrity wingnut droolers that infest this place: I live now in Prescott Arizona elev 5500′, lovely weather, and have hard 4wd just about every place in CA-NV-UT-CO and of course AZ and down into Baja. I am an expert dove and quail hunter (I don’t need a dog for quail). Life was much higher quality in the Bay Area, w/o kids of course.

  16. I live in Greenville (Really, Simpsonville, but Greenville is close enough.) South Carolina. Rated in the top ten communities in which to raise a child by Parents magazine. For under $100,000 you can buy a nice 3 bedroom house with a large fenced lot, within walking distance of shopping. There’s an IMAX five minutes away, Whole Foods 15. Wonderful park system, ditto for the hospitals. (As I have cause to know…) An hour and I can be on the Blue Ridge Parkway. A few hours in Charleston.

    That’s quality of life you don’t have to be rich to afford.

  17. Brett,

    I’ve lived in the South. Boy, oh, boy; hot and humid (really, really humid) most of the year. Did I mention it is also hot, hot, hot?

    The people are pretty polite which is nice. But, California does have LOTS better weather along with higher prices–could there be a relationship there?

  18. Nah, we’re up in the foothills, it’s only unreasonably hot for about 3-4 months. There’s a long spring and fall which are very nice, and plenty of nice days during the ‘winter’. (Which as a refuge from Michigan I deny SC really has.)

    The point, anyway, is that California can be nice if you’ve got plenty of money. There are places that are a lot more cost effective for getting quality of life.

  19. Greenville, SC is nice — as is Charleston, SC, but you have to understand that those two places are not representative of the entire state, for a variety of reasons (college populations and northern retirees among them). And Charleston and Greenville are not particularly cheap relative to average compensation but they are almost certainly cheaper than most of California.

    My husband and I are considering relocating to the Bay Area for a while after my daughter graduates from high school. Sick to death of D.C. metro . . .

    The one thing I really dislike about California, however, is that it has made a fetish of imprisoning people even for non-violent offenses, and its whole “prison industrial complex” mentality.

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