The New American Landscape: Just Add Zombies
If, like Donald Rumsfeld and me, you sit up at night worrying about the unknown unknowns, you may enjoy the methodology argument over 24/7 Wall St. editor Douglas McIntyre's gallery of America's new ghost towns.
The gallery lists counties with housing vacancy rates above 50 percent. Because most of the places on the list are vacation areas such as Martha's Vineyard, commenters at The Atlantic are arguing that McIntyre is picking up noise due to most-of-the-year vacancies at vacation homes.
The introduction to the piece seems to take seasonal changes into account, arguing "that traffic has disappeared as the recession has caused people to sell or desert vacation homes and delay trips for leisure." Having grown up in a resort town, I can testify that the difference between an off-season vacation spot and the Zone of Alienation is not always clear.
It is clear to me that you would have gotten a better read on the economy over the last four years by using common-sense fact-gathering or even intuition than by applying macroeconomics or expecting trends to follow precedent. (You can always tell who the real estate agents are on Facebook because when a grisly new statistic comes up for home prices or sales, they say things like, "This means the market for rentals is going to be hot, hot, hot!")
But there's only so far that can get you. Much as I enjoy being the prince of darkness, it is just plain fact that nearly every day I see more closed-up storefronts and empty billboards throughout Los Angeles. But people in Washington, D.C., and Texas tell me their experience is quite different. Which experience is closer to the truth in a country where GDP keeps going up yet indicators of actual economic activity continue to be anemic, flat, or falling?
Today's seemingly good news on unemployment contains its own share of noise. There is no widely acceptable measurement of how much the decline comes from people getting jobs again and how much comes from people graduating from job-seeking to "marginal attachment to the labor force." The fact that the Labor Force Participation Rate remains unchanged at 64.2 percent suggests the modest rate of new job creation (reported by ADP yesterday) is not exactly putting people to work like a ward boss. Calculated Risk's historic measure of percentage job losses, if I'm doing the numbers right, indicates it's going to be 2018 or so before we get back to a 2007 level of employment:
Job growth, despite our leadership's best efforts, can only follow business growth, so the pickup in jobs will be different throughout the country – with Texas vs. California giving the starkest and most popular contrast between growth and stagnation. The question isn't why we have ghost towns but why we don't have more of them.
The desertion of unproductive or uncompetitive areas is part of the evolution of an economy. That's especially true at the level of local resorts: Cheaper air travel and the normalization of casino gambling throughout the country didn't help my place of birth. But it's true of other local economies too. Dig this fire insurance map of Tombstone, Arizona (with the Birdcage Theater and the OK Corral both indicated!) to see how thriving the Town Too Tough to Die was in 1888. And one county on The Atlantic's list already contains one of the country's most famous original ghost towns – Bodie, California. My sense of justice and order in the universe tells me Los Angeles should become America's next ghost town, but I have a terrible feeling that won't happen.
