Richard Florida on the Red-Blue Dirt Gap
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January 04, 2015, 06:22 PM
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Here’s a Richard Florida article in the New York Times that I would have been happy to write ten years ago:

Is Life Better in America’s Red States? By RICHARD FLORIDA JAN. 3, 2015

… Blue states, like California, New York and Illinois, whose economies turn on finance, trade and knowledge, are generally richer than red states. But red states, like Texas, Georgia and Utah, have done a better job over all of offering a higher standard of living relative to housing costs. That basic economic fact not only helps explain why the nation’s electoral map got so much redder in the November midterm elections, but also why America’s prosperity is in jeopardy.

Red state economies based on energy extraction, agriculture and suburban sprawl may have lower wages, higher poverty rates and lower levels of education on average than those of blue states — but their residents also benefit from much lower costs of living. For a middle-class person , the American dream of a big house with a backyard and a couple of cars is much more achievable in low-tax Arizona than in deep-blue Massachusetts. As Jed Kolko, chief economist of Trulia, recently noted, housing costs almost twice as much in deep-blue markets ($227 per square foot) than in red markets ($119).

Driven by oil, the fracking boom and exurban sprawl, many of the red state economies are experiencing a vigorous (if ultimately unsustainable) spurt of growth. Thanks to loose land-use regulations and low labor costs, detached, single-family homes can be churned out quite cheaply, generating more middle-wage, low-skill jobs. And since red states spend less per capita on education, infrastructure and social welfare than their blue state counterparts (and many of them receive more federal dollars than they contribute), their tax burdens are lower, too. …

For blue state urbanites who toil in low-paying retail, food preparation and service jobs, for the journeyman tradespeople who once formed the heart of the middle class, for teachers, civil servants, students and young families, the American dream of homeownership — or even an affordable rental apartment — is increasingly out of reach. Adding insult to injury, rapid gentrification in these larger knowledge hubs brings the constant threat of displacement of creative workers. For even the much better paid techies, engineers, financiers and managers who are displacing them, the metropolitan version of the American dream is a cramped condo or a small house and a long commute. Many are opting to move to cheaper red states instead, further driving their growth.

Inequality has grown fastest over the past three decades in larger states with more vibrant knowledge economies, like Massachusetts, New York, New Jersey and Connecticut. In 1979, the most unequal states were poor conservative states — Mississippi, Louisiana, Arkansas, Alabama and Georgia. By 2012, New York, Connecticut, California and Massachusetts joined Mississippi, Louisiana, Florida, Georgia, Texas and Tennessee among the 10 most unequal states.

Is the current decline in gasoline prices going to be around long enough to revivify the exurbs that crashed when oil prices peaked in June 2008, when it cost me $87 to fill the minivan’s tank versus about half that today? I have a vague impression that gasoline prices go up fast and down slow (why is that, anyway?). So maybe the Hummer will make a comeback?