Joe Shmoe Shrugs: Kotkin on California's Middle-Class Exodus


Urban theorist Joel Kotkin talks with the Wall Street Journal's Allysia Finley about why people with opportunities are leaving the Golden State. 

While a lot of the material will be familiar to regular readers, Kotkin, a sometime Reason contributor, makes a point worth singling out: Although Republicans predict the state's steeply progressive tax rate will result in millionaire flight, the evidence suggests it's really the middle class taking it on the arches: 

"Basically, if you don't own a piece of Facebook or Google and you haven't robbed a bank and don't have rich parents, then your chances of being able to buy a house or raise a family in the Bay Area or in most of coastal California is pretty weak," says Mr. Kotkin.

While many middle-class families have moved inland, those regions don't have the same allure or amenities as the coast. People might as well move to Nevada or Texas, where housing and everything else is cheaper and there's no income tax.

And things will only get worse in the coming years as Democratic Gov. Jerry Brown and his green cadre implement their "smart growth" plans to cram the proletariat into high-density housing. "What I find reprehensible beyond belief is that the people pushing [high-density housing] themselves live in single-family homes and often drive very fancy cars, but want everyone else to live like my grandmother did in Brownsville in Brooklyn in the 1920s," Mr. Kotkin declares.

"The new regime"—his name for progressive apparatchiks who run California's government—"wants to destroy the essential reason why people move to California in order to protect their own lifestyles."

Housing is merely one front of what he calls the "progressive war on the middle class." Another is the cap-and-trade law AB32, which will raise the cost of energy and drive out manufacturing jobs without making even a dent in global carbon emissions. Then there are the renewable portfolio standards, which mandate that a third of the state's energy come from renewable sources like wind and the sun by 2020. California's electricity prices are already 50% higher than the national average.

Oh, and don't forget the $100 billion bullet train. Mr. Kotkin calls the runaway-cost train "classic California." "Where [Brown] with the state going bankrupt is even thinking about an expenditure like this is beyond comprehension. When the schools are falling apart, when the roads are falling apart, the bridges are unsafe, the state economy is in free fall. We're still doing much worse than the rest of the country, we've got this growing permanent welfare class, and high-speed rail is going to solve this?"

These complaints are coming from a Jerry Brown voter who thought the new/old governor would be able to think "outside the box." Kotkin is no conservative. His real interest is in the way government planners can't stand the revealed preferences of the population, a point he discussed in this Reason.tv interview

If this point of view doesn't have a recognizable constituency, it's because the elites are so accustomed to  a world of trains that will never run, houses nobody can afford and quarter-million-dollar gardening projects that they have lost all connection to reality. 

The other day, the L.A. Times ran an editorial unironically calling L.A. Mayor Antonio Villaraigosa the "Transportation Mayor." As you can see, the piece contains no factual evidence beyond the assertion that the stumpy chief executive "presided over a term of unprecedented growth in the city's transit network."

What that means in practical terms is that part of the Expo light rail line will open later this month, nearly $300 million over budget and with no projections of how many people will ride the train. 

In broader terms, Viallraigosa has managed one result you wouldn't have thought possible: L.A.'s population has been flat and GDP has been falling since he took office, yet its traffic problem has gotten worse. There's no way anybody with practical experience of trying to survive in L.A. on less than $92,000 a year could have written the deathless lines to the left.  

According to Kotkin, California has experienced a net loss of four million people in interstate migration since the beginning of the 1990s, and most of these have been younger families. That's a recipe for longterm stagnation, and it helps explain why the state's tax revenues fall short of projections except in the rare year when there's a Google IPO or similar event.

But in a strange way it is sustainable. There are places in the developed world that get by with a lordly overclass, a layer of welfare recipients far below, and basically nothing between the two. In that respect, the progressives' dream of turning California into a Pacific version of Manhattan might come true. 

How will all this get explained in the next heavyweight installment of Kevin Starr's more-admired-than-read multivolume history of California? The first seven closely printed volumes generally kept to the official line that wise public expenditures and visionary megaprojects created a middle class paradise on the West Coast. 

How will the official story stand up when it turns out you can't afford to keep paying for three different state college systems, boards of horse racing and chiropractory, free bus rides to Dodgers games and 278 state parks? Early betting: It will all turn out to be Prop 13's fault.