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THE GREAT RESET – A NEW WAY OF LIFE

June 30, 2012

Except for some exceptional boom periods, housing has never been a good financial investment.”  Richard Florida; The Great Reset

                                                                                                                                                                                                       

It used to be the business of America was business.  Now the business of America is homeownership.  To recover and grow again, America needs to get over its ‘house passion’. “  Edmund Phelps, Economist

                                                                                                                                                                                                                

Among people of similar financial status, those who chose to rent in 2004 had more wealth in 2009 than those who bought their homes.”  Wendell Cox, Suburbs and Cities:  The Unexpected Truth

                                                                                                                                                          

                                                                                                                                                                      

 

The Strib’s “Big US Cities Boom as Young Adults Shun ‘Burbs’ “ headline caught my attention this morning. The accompanying  AT A GLANCE Box reported:

  • Primary cities in large metro areas over time grew more than surrounding suburbs.
  • City growth in 2011 surpassed or equaled suburbs in 33 of the nation’s top 51 metro areas, compared to only 5 in 2000-2010.
  • 52 of 73 cities over 250,000 showed faster annual growth in 2011 than their average growth in the last decade.

 I assumed, hopefully, that the article was reporting evidence that the Reset that has to come from grass roots had begun and now had been noticed by the press.   I should have known better.  The press are, of course, still back in the 20th century with the politicians.

The story reported that young adults were “spurning homeownership in the suburbs for shorter-term no-strings-attached apartment living, public transit, and proximity to potential jobs in larger cities “– not as a part of the Reset, or the New Normal, but because nothing has been done about the weak job market, high unemployment, delayed careers, a college debt burden and availability of only lower-wage positions.

The authors assured the audience however, that economists believed this city boom was only temporary,  because, after all, the last time people moved to the cities was prior to 1920.  Ah yes, that was the spatial fix caused by the Long Depression of 1873, wasn’t it?  Then we got out of control again; crashed in 1929, headed into the Great Depression of the 30s; experienced a second reset and spatial fix as people moved to the suburbs that lasted well into the 60s.

And here we are again.  Another crash in 2008 and we are now looking for the spatial fix to slowly end the Great Recession. 

I hope I am right and the Strib is wrong.  I hope this spatial fix does not peter out; we need it to become a grassroots happening so we can move forward.    If the stats are correct, I could be right and we could be moving in the right direction.  If we are, do you think the Press and Pols will come along with us, or will they prefer to stay in the safe world of the 20th century?

 

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