The Second Avenue Subway, opening day

We have entirely too few epic engineering projects; to finally get to ride one is fun! Today the Second Avenue Subway, a century in the making, opened:

second avenue subway

The subway stops don’t feel like typical subway stops because they lack the grime that usually marks them in the same way cold marks the winter solstice.

second avenue subway 2

The active part of this round of subway construction began in 2007; while the subway should’ve opened years ago, it is nice to see it open at all. One gets a sense of the sublime from epic engineering works, and, as Zero to One argues, we’ve collectively lost faith in our ability to build big things and tackle serious problems. The new subway is evidence to the contrary.

Still, one hopes the next phase of the line goes better. Matt Yglesias explains some of this phase’s problems in “NYC’s brand new subway is the most expensive in the world — that’s a problem: The tragedy of the Second Avenue Subway.” On a per-mile basis the Second Avenue Subway is the by far the most expensive subway in the world, and it’s by far more expensive than similar projects in crowded first-world cities like London, Paris, and Tokyo. We’re not getting much bang-for-the-buck and that needs to change.

New York has so far been “Slow to Embrace Approach That Streamlines Building Projects.” Management and labor have been eagerly lining each other’s pockets. That’s particularly unfortunate because the infrastructure is desperately needed and has been desperately needed for decades if not longer.

Second Avenue Subway 3

To be sure, the stations are much more functional than most others, and their mezzanine levels impress. One wishes, however, for fewer mezzanines and more total stations.

Second Avenue Subway selfie art

As you can see above, someone thought through the selfie-friendly art that lines the stations.

Today is still a historic occasion and one does not so often get the chance to participate directly and obviously in history. It may be churlish to note this, but my train spent five to ten minutes waiting due to “train traffic ahead of us” between 63rd Street and 72nd Street. Some things may be new but others are too familiar.

People vote with their feet, and also the U.S. is not Sweden

Two pieces about Anu Partanen’s book The Nordic Theory of Everything: In Search of a Better Life say much about the blindness of some writers: “Stockholm Syndrome: Spotify threatened to abandon Sweden if the government didn’t address over-regulation and sky-high taxes” is poorly titled and more interesting than the title suggests, and so is “What’s So Special About Finland?” Neither says much about the book itself but both together say much about the U.S. media interest in Nordic countries.

Following the Nordic model would make large parts of the U.S. population worse off; that’s why people are moving away from Nordic-model cities and states and towards inexpensive, laissez-fair cities and states.

Let me elaborate. Partanen and most media people are not normal and have not normal needs, desires, and willingness to pay for big-city amenities. But most people aren’t willing to pay for those things that’s why sprawly cities, especially in Texas, are the ones that’re experiencing the fastest population growth in the U.S. People choose to move to them much more so than New York or L.A. or a handful of other media capitols. Partanen and her husband live in NYC as writers. I get the appeal, but they’re relatively low-earners in the second-most-expensive city in the country, and New York is in many ways least like the rest of the country. Partanen even says:

First of all, the taxes are not necessarily as high as many Americans think. One of the myths I encounter often is that Americans are like, ‘You pay 70 percent of your income in taxes.’ No, we do not. For someone who lives in a city like San Francisco or New York City—where you have federal taxes, state taxes, city taxes, property taxes—the tax burden is not very different [than the tax burden in Finland]. I discuss my own taxes in the book and I discovered this to be true: that I did pay about the same or even more in New York than I would have paid on my income in Finland. I’ve talked to many Nordics in the U.S. who say the same thing.

So SF and NYC are already paying these crazy taxes… and apparently not getting much in return. Why then should the rest of the U.S. seek to emulate them? When I’ve said that I think Seattle is a much better value than NYC, in part because of crazy tax issues, people often respond, “So you don’t like public schools or fire fighters?” But Seattle, Austin, Nashville, and other similar cities seem to have those public services too, without anything like NYC’s cost of living. So the solution to high taxes and not-great services in those cities is to pay even more? If so, I’m not too surprised most of the US does not want to be more like Scandinavia (or SF).

To be fair, it would be interesting to see what happens if SF, NYC, and LA disempowered municipal unions and liberalized their zoning codes, both of which would lower costs substantially. For now, though, we’re seeing all three cities systematically drive people out. They’re choosing places that are not very Scandinavian.

Partanen and her husband are not very representative of the overall American experience. It’d be interesting to read a story about Finnish people who move to relatively inexpensive suburbs, don’t spend an overwhelming amount on housing, and basically like their lives. A European friend of mine, for example, has a sister who was born in a medium-sized European country and is basically doing that in Florida, and she seems to like it.

People who live in NYC are self-selected to be obsessive weirdos (who also often want to write books). Which is fine. I’m one of those people but I’m also aware that I’m atypical.

In short, revealed preferences show that most Americans prefer a non-Nordic model. They also show why state-level taxation is better on average than federal-level taxation, since at least people who don’t like state-level taxation regimes can easily move to another state. Score one for the Exit, Voice, and Loyalty world.

Why did cities freeze in the 1970s?

Home is where the cartel is” discusses a topic that you’ve seen referenced many times on this blog: “A case can be made that divisive hot-button issues like inequality and immigration ultimately derive from housing dysfunction.” Yet Waldman points out that the prescription many commentators, including this one, want—housing market rationalization—is unlikely to be attractive to the mass of existing owners/voters. The piece is not easily excerpted and should really be read in full before you continue, but here is one important point:

The libertarian “deregulatory” rhetoric by which market urbanists sometimes make their case is counterproductive. Telling people to think of their homes as a commodity upon which market forces should be brought to bear in order to ensure production of housing services at competitive prices is obtuse. People purchase property, rather than renting, largely to gain security and control, to escape the vicissitudes of the market.

In short, in my own discussions I’ve probably been framing the issue in the entirely wrong way if I actually want to persuade most people. Waldman’s is among the most interesting posts I’ve ever read on the topic, and I’ve been mulling it since I read it a couple days ago. I finally realized one of the things that bothered me: Extreme zoning seems to have really gotten started in the ’70s or early ’80s. One reason NYC is still so dense is that people from the seventeenth century up until the ’70s had a fairly easy time replacing existing buildings more or less when they felt like doing so.

One can see physical evidence of the housing freeze in places like Seattle. Both Capitol Hill and the U-District had, for decades, one twenty-something story building each, which were almost landmarks. They were built just before Seattle comprehensively banned most high-rises—a ban that lasted until the 2000s. Had the market been allowed to function normally, single family neighborhoods would’ve gradually transitioned into duplexes or townhouses, or small apartment buildings, and areas with small buildings would’ve gradually seen midrises and high rises grow. But Seattle basically froze the market. So did L.A. and many other locales. In 1970, L.A. was zoned for ten million people. In 2010, when our technology was vastly inferior to the 1970s, it was down to 4.3 million. That is odd and helps explain why L.A. used to be the  land of opportunity and is now the land of exclusion. So do parking requirements, which can increase housing costs in L.A. by as much as a third.

[Note to people who keep emailing me: that thing about technology today being inferior to the ’70s is a joke.]

What changed in urban planning and/or city politics in the ’70s? That to me is a key question and one I can’t really answer. The diffusion of Jane Jacobs’s ideas is one possible answer, but her answer still found fertile political and legal soil. Perhaps the backlash from the Robert Moses of the world was a part of the problem. “S” wonders if it was white flight.

Up until the Petaluma City Plan, growth was (relatively) unconstrained, especially in cities. After Petaluma, it wasn’t. In many parts of what we now think of as high-cost cities, the city feels frozen in time since… the ’70s.

Cities have always had rich neighborhoods and poor neighborhoods, but freezing cities seems to have occurred relatively recently. So has the most vociferous talk of “gentrification.”

I primarily bring this up because if parochial land-use policies were only adopted in the last couple decades, they may be more reversible and less a part of human or political nature than is sometimes assumed. But Waldman’s point about the politics of contemporary land-use controls remains and I don’t know how to overcome the dynamics he points out. Not all problems have solutions.

Jeff Fong has one excellent response and you should read it.

EDIT: Via Twitter, Dan Keshet suggests I read William Fischel’s Zoning Rules, which may answer the questions above. See also “When the Market Built Housing for the Low Income.”  That era was not long ago!

Fischel says that in the 1970s

the growth-control movement was born and spread almost as rapidly as zoning originally did [in the 1910s and 1920s], though its effects were regionally selective. I argue that a combination of modern forces induced this change, but the most important was the 1970s period of inflation, which helped transform housing from a consumer good to an investment and thus gave rise to a political class I have called “homevoters.” (163)

Homevoters ensure that “zoning can go too far and prevent economically desirable increases in density and hinder what many people regard as the desirable mixing of socioeconomic groups within communities” (164).

If you see anyone arguing about what happened in the 1970s without even engaging in Fischel’s ideas, you know they a) aren’t thinking in terms of comparative history, b) don’t understand the history of the period, and c) likely don’t know what they’re talking about.

Do millennials have a future in Seattle? Do millennials have a future in any superstar cities?

Over in the Seattle section of Reddit someone asked, “Millennials of Seattle: Do you believe that you have a future in this city?”* My answer started small but grew until it became an essay in and of itself, since “Seattle” is really a stand-in for numerous other cities (like NYC, LA, Denver, and Boston) that combine strong economies with parochial housing policies that cause the high rents that hurt younger and poorer people. Seattle is, like many dense liberal cities, becoming much more of a superstar city of the sort Edward Glaeser defines in The Triumph of the City. It has a densely urbanized core, strong education facilities, and intense research, development, and intellectual industries—along with strict land-use controls that artificially raise the cost of housing.

Innovation, in the sense Peter Thiel describes in Zero to One, plus the ability to sell to global markets leads to extremely high earning potential for some people with highly valuable skills. But, for reasons still somewhat opaque to me and rooted in psychology, politics, and law, (they’re somewhat discussed by Glaeser and by Tyler Cowen in Average is Over), liberal and superficially progressive cities like Seattle also tend to generate the aforementioned intense land-use controls and opposition to development. This strangles housing supply.

The combination of high incomes generated by innovation and selling to global markets, along with viciously limited housing supply, tends to price non-superstars out of the market. Various subsidy schemes generate much more noise than practical assistance for people, and markets are at best exceedingly hard to alter through government fiat. So one gets periodic journalistic accounts of supposed housing price “crises.” By contrast to Seattle, New York, or L.A., Sun Belt cities are growing so fast and so consistently because of real affordable housing. People move to them because housing is cheap. Maybe the quality of life isn’t as high in other ways, but affordability is arguably the biggest component of quality of life. Issues with superstar cities and housing affordability are well-known in the research community but those issues haven’t translated much into voters voting for greater housing supply—probably because existing owners hate anything that they perceive will harm them or their economic self-interests in any way.

Enlightenment_heathSomewhat oddly, too, large parts of the progressive community seem to not believe in or accept supply and demand. Without understanding that basic economic principle it’s difficult to have an intelligent discussion about housing costs. It’s like trying to discuss biology with someone who neither understands nor accepts evolution. In newspaper articles and forum threads, one sees over and over again elementary errors in understanding supply and demand. I used to correct them but now mostly don’t bother because those threads and articles are ruled by feelings rather than knowledge, per Heath’s argument in Enlightenment 2.0, and it’s mentally easier to demonize evil “developers” than it is to understand how supply and demand work.

Ignore the many bogeymen named in the media and focus on market fundamentals. Seattle is increasingly great for economic superstars. Most of them probably aren’t wasting time posting to or reading Reddit. If you are not a superstar Seattle is going to be very difficult to build a future in. This is a generalized problem. As I said earlier, voters don’t understand basic economics, and neither do reporters who should know better. Existing property owners prefer to exclude rivalrous uses. So we get too little supply and increasing demand—across a broad range of cities. Courts have largely permitted economic takings in the form of extreme land-use control.

Seattle is the most salient city for this discussions, but Seattle is also growing because San Francisco’s land-use politics are even worse than Seattle’s. While Seattle has been bad, San Francisco has been (and is) far worse. By some measures San Francisco is now the most expensive place in the country to live. For many Silicon Valley tech workers who drive San Francisco housing prices, moving to Seattle immediately increases real income enormously through the one-two punch of (relatively) lower housing prices and no income tax. Seattle is still a steal relative to San Francisco and still has many of the amenities tech nerds like. So Seattle is catching much of San Francisco’s spillover, for good reason, and in turn places like Houston and Austin are catching much of Seattle’s spillover.

See also this discussion and my discussion of Jane Jacobs and urban land politics. Ignore  comments that don’t cite actual research.

Furthermore, as Matt Yglesias points out in The Rent Is Too Damn High: What To Do About It, And Why It Matters More Than You Think, nominally free-market conservatives also tend to oppose development and support extensive land-use controls. But urban cities like Seattle almost always tilt leftward relative to suburbs and rural areas. Why this happens isn’t well understood.

Overall, it’s telling that Seattlites generate a lot of rhetoric around affordable housing and being progressive while simultaneously attacking policies that would actually provide affordable housing and be actually progressive. Some of you may have heard the hot air around Piketty and his book Capital in the 21st Century. But it turns out that, if you properly account for housing and land-use controls, a surprisingly large amount of the supposed disparity between top earners and everyone else goes away. The somewhat dubious obsession that progressives have with wealth concentration is tied up with the other progressive policy of preventing normal housing development!

This is a problem that’s more serious than it looks because parochial land-use controls affect the environment (in the sense of global climate change and resource consumption), as well as the innovation environment (close proximity increases innovation). Let’s talk first about the environment. Sunbelt cities like Phoenix, Houston, Dallas, and Atlanta have minimal mass transit, few mid- and high-rise buildings, and lots and lots of far-flung sub-divisions with cars. This isn’t good for the amount of carbon in the atmosphere, or for the amount of driving that people have to do, but warped land-use controls have given them to us anyway, and the easiest way to get around those land-use controls is to move to the periphery of an urban area and build there. Instead of super energy efficient mid-rises in Seattle, we get fifty tract houses in Dallas.

Then there’s the innovation issue. The more general term for this is “economic geography,” and the striking thing is how industries seem to cluster more in the Internet age. It is not equally easy to start a startup anywhere; they seem to occur in major cities. It isn’t even equally easy to be, say, a rapper: Atlanta produces a way disproportionate number of rappers (See also here). California’s San Fernando Valley appears to be where anyone who does porn professional wants to go. New York still attracts writers, though now they’re exiled to distant parts of the boroughs. My own novels say, “Jake Seliger grew up near Seattle and lives in New York City” (though admittedly I haven’t found much of a literary community here, which is probably my own fault). And so on, for numerous industries, most of them too small to have made a blip on my radar.

These issues interest me both as an intellectual matter and because they play into my work as a grant writer. Many of the ills grant-funded programs are supposed to solve, like poverty and homelessness, are dramatically worsened by persistent, parochial local land-use policies. Few of the superficial progressives in places like Seattle connect land-use policies to larger progressive issues.

So we get large swaths of people priced out of those lucrative job markets altogether, which (most) progressives dislike in theory. Nominal progressives become extreme reactionaries in their own backyards, which ought to tell us something important about them. Still, grant-funded programs that are supposed to boost income and have other positive effects on people’s lives are fighting against the tide . Fighting the tide is at best exceedingly difficult and at worst impossible. I don’t like to think that I’m fighting futile battles or doing futile work, and I consider this post part of the education process.

Few readers have gotten this far, and if you have, congratulations! The essence of the issue is simple supply and demand, but one sees a lot of misunderstanding and misinformation in discussions of it.

In addition, I don’t expect to have much of an impact. Earlier in this essay I mentioned Joseph Heath’s Enlightenment 2.0: Restoring sanity to our politics, our economy, and our lives, and in that book he observes that rationalists tend to get drown out by immediate, emotional responses. In this essay I’m arguing from a position of deliberate reason, while emotional appeals tend to “win” most intuitive arguments.

By the way: In Seattle itself, as of 2015 about two-thirds of Seattle’s land mass is reserved for single-family, detached houses. That’s insane in almost any city, but it’s especially insane in a major global city. Much of Seattle’s affordability problem could be solved or ameliorated by something as simple as legalizing houses with adjoining walls and no setback requirements. The housing that many people would love is literally illegal to build.

Finally, one commonly hears some objections to any sort of change in cities:

* “It’s ugly / out of character for the neighborhood:” As “How Tasteless Suburbs Become Beloved Urban Neighborhoods” explains, it takes about 50 years for design trends to go from “ugly” or “tacky” to “historic.” It’s hard to rebut people saying “that is ugly!” except by saying “no it isn’t!”, but one can see that most new developments are initially seen as undesirable and are eventually seen as normal. “Character” arguments, when made by owners, are usually code for “Protect my property investment.” It’s also not possible to protect the “character” of neighborhoods.

* “Foreigners and their money are buying everything up and making them more expensive:” Actually, real estate is, properly considered, an incredible export:

The key is to let more development happen in the in-demand, centrally located areas where the economic benefits are largest and the ecological costs the smallest, not just “transitional” neighborhoods and the exurban fringe. Take the existing stacks of apartments for rich people and replace them with taller stacks. Then watch the money roll in.

* “Gentrification is unfair:” Oddly, cities began to freeze in earnest, via zoning laws, in the 1970s. One can see this both from the link and from Google’s Ngram viewer, which sees virtually no references to gentrification until the late 70s, and the term really takes off later than that.

If gentrification is unfair—and maybe it is—the only real solution is to build as much housing as people want to consume, which will lower real prices towards the cost of construction. Few contemporary cities pursue this strategy, though. No other strategy will work.

EDIT: See also “How Seattle Killed Micro-Housing: One bad policy at a time, Seattle outlawed a smart, affordable housing option for thousands of its residents.” The city’s devotion to exclusionary housing policies is amazing. It’s not as bad as San Francisco, but compared to Texas it’s quite terrible.

* I’m reading “Millennials” as referring to people under age 30 who have no special status or insider connections. Few will have access to paid-off or rent-controlled housing in superstar cities. They’ll be clawing their way from the bottom without handouts. In cities like New York and San Francisco, a few older people have voted themselves into free stuff in the form of rent control. Most Millennials won’t have that.

Links: Fiber, sex lives, suburbs, competition, food (which may all be linked)

* “Startup claims it will build fiber network in LA and wireless throughout US;” like everyone else I will express skepticism.

* “Why So Many People Care So Much About Others’ Sex Lives,” which makes a number of points I’ve observed at various times.

* “Don’t Send Your Kid to the Ivy League: The nation’s top colleges are turning our kids into zombies,” which matches my (anecdotal) experience.

* “Multiple Lovers, Without Jealousy: Polyamorous people still face plenty of stigmas, but some studies suggest they handle certain relationship challenges better than monogamous people do;” has anyone written the great polyamorous novel? Could anyone?

forgotten bike and pink woman* Suburban sprawl and bad transit can crush opportunity for the poor.

* Nicola Griffith: Who Owns SF?

* Dubious-seeming, but: “Are siblings obsessed with moral hazard?

* Germans Love Getting Naked at the Beach. So Should We. Maybe.

* “French Food Goes Down,” which I have heard independently from other sources; I find it interesting that many countries that start with or develop a major lead in some field eventually lose that lead. Think of Japan’s giants losing out in consumer electronics to Apple and Samsung.

* Important news rarely covered: “Rand Paul introduces bill to reform civil asset forfeiture;” for background and a terrifying story, see Taken: Under civil forfeiture, Americans who haven’t been charged with wrongdoing can be stripped of their cash, cars, and even homes. Is that all we’re losing?, in The New Yorker

* “What ‘Women Against Feminism’ Gets Right.”

* The power of Google used for evil, or, why I will never rely entirely on Gmail or associated services, and you shouldn’t either. Note however that the author is not blameless.

The inequality that matters II: Why does dating in Seattle get left out?

In “Amazon is killing my sex life: The tech boom in Seattle is bringing in droves of successful, straight single guys — all of them insufferable,” Tricia Romano writes about how she “wasn’t going to be able to get it up for a boring tech dude” and says that “as Amazon grows, the number of (boring) men grows too.” In Palo Alto, men “had money, but they were boring.” Meanwhile, “On the dates, they flash money around.” By now you sense a theme. In Romano’s narrative—which I don’t entirely buy, but let’s roll with it—these guys could make an effectively infinite amount of money and that money in her view wouldn’t improve their dating prospects. They are yuppie losers to a refined writerly sensibility.

Romano doesn’t make an interesting connection to national income inequality. By now much of that argument is well-known, and Piketty’s Capital is one surprisingly famous take, though I am a bleacher skeptic. Still, there is a lot of media noise around income inequality, perhaps in part because media people tend to congregate in very expensive cities like New York and L.A., where making six figures can feel genuinely middle class and where the proximity to the stupendously wealthy invites invidious comparisons.

Nonetheless, Romano’s article should be required reading for anyone who writes about or inveighs against inequality in purely financial terms. In the U.S. there are many different status ladders and finance is only one. For many, like Romano, it’s not even the most important one.

Income is not the only thing that one can choose to optimize and indeed of the guys I know the ones who get or seem to get more / better women tend not to be the richest. Artists or the artistically inclined tend to have lower income but higher-seeming satisfaction. The “seeming” qualifications are important because it’s hard to tell from the outside what someone really feels, but in the absence of better measures I tend to accept what appears on the surface.

Elliott Rodger, the guy who murdered half a dozen people at UCSB, apparently “Led A Life Of Luxury” but still felt like he couldn’t get laid. Clearly there were many things wrong with Rodger, but money did not alleviate those things. He was on the right side of monetary inequality and the wrong side of dating inequality.

I don’t have a major point in this except to note that there is a (media) obsession with income inequality. That obsession tends to gloss other status ladders and other things people value. Some kinds status can also convert into money: certain kinds of fame, for example. Attractive women can earn supernormal wages through stripping or prostitution; I’m not arguing those are desirable life choices but they are viable options for some people and not others. There are still some strength- and endurance-based jobs that guys find within reach—think commercial fishing and fracking.

I’m focusing on sex in this post but that is merely a salient one and there are others, like academia. Romano probably values being a writer more than making a lot of money. In “Taxing a Professor’s Privilege,” Megan McArdle writes about how job guarantees are financially valuable even if that value isn’t traditionally measured in dollars (she also wrote the post that gave this post its title: “The Inequality That Matters“).

If those guys Romano dated imbibed the messages that a) their earnings matter tremendously to women and that b) being at the top of the financial heap matters most, then they’ve presumably misallocated resources. They’d be better off with less time working at Amazon and more time reading Starting Strength and hitting the gym.

Romano’s post doesn’t sit alone. It’s got a similar vibe to “I Got Shipped to California to Date Tech Guys,” which sounds like the beginning of a romantic comedy but is really a jeremiad about what it seems to be about.

To be sure, everyone seems to like to complain about dating, so maybe everyone, everywhere, complains all the time. For most of my life I’ve heard straight women complain about men and straight men complain about women. The specifics of the complaints change but the complaints themselves remain.

Finally, as with so many modern social issues this is tied into building restrictions and real-estate issues, since many guys who are exciting but not rich presumably can’t afford to live in Seattle. Seattle and many other areas (New York, L.A.) could improve both dating prospects and finances through increasing the supply of housing, as Matt Yglesias argues at the link, but they choose not to.

How the politics of envy (or “income inequality”) work in the broadest sense

Tyler Cowen writes in “Paul Krugman on the political salience of inequality” that

I see the inequality issue as having high salience for NYT readers, for Democratic Party donors, and for progressive activists. It has very little salience for the American public, especially with say swing voters in southern Ohio or soccer moms. Unlike in Singapore or South Korea, where the major concentrations of wealth are pretty hard to avoid for most people, American income inequalities are well hidden for the most part.

McLean is one of the wealthiest towns in Virginia, but if you drive through the downtown frankly it still feels a bit like a dump. I’ve never wanted to live there, not even at lower real estate prices. You don’t stumble upon the nicest homes unless you know where to look. Middleburg is wealthier yet, but it has few homes, feels unreal, and most people don’t go there anyway. If they do, they more likely admire well-groomed horses and still read Princess Diana biographies. They are not choking with envy over the privileges of old money rentiers, and there is no Walmart in town to bring in the masses (who probably would not care anyway).

(Emphasis added.)

This describes greater Seattle as well: how many people outside the area have heard of Medina, city of mansions? Even within the area, most people who mention it only do so as “the place where Bill Gates lives,” despite the many other freakish palaces there. Those who live in Issaquah (further east, away from Seattle proper) don’t appear to care what happens in Medina and even if they did their political ability to affect Medina is limited. Seattle is not exactly like Cowen’s Virginia—Bellevue now has a real downtown where people want to live and go, for example—but the similarities are real.

The only place I’ve lived which seems to generate envy of major concentrations of wealth is New York, perhaps because a) of the demographics, or at least the people I tend to hang out with and b) many average people see / walk by very expensive buildings. I regularly walk by the new skyscraper on 23rd and Park or Lex where Rupert Murdoch is reputed to have bought a $80 million penthouse. Though he seems unlikely to invite me up for a martini and canapés, his dwelling is much more in your face than Medina or other wealthy places in Seattle; when I live in and near Seattle I never walked by or even got near Bill Gates’s house.

Among those I know who have been to Bill Gates’s house, all were Microsoft interns who are more likely to want to be the next Gates than they are to resent him. Gates and other tech zillionaires also appear to generate very little ill will locally. That may be another difference from New York, since tech zillionaires are widely seen as having earned their money by providing value, while finance riches may not be seen in the same way.*

Later in the post Cowen also links to Seattle’s $15 minimum wage debate, despite the many well-known problems of the minimum wage. If Seattle were serious about making poor and lower-middle class people better off, the city would be focused on providing more housing and not in effect putting gates in front of current and potential residents. But the same people who want higher minimum wages are the ones who hate and protest housing supply increases. There are many ways to make people materially better off and some ways, like building, are much closer to being Pareto efficient. The same political dysfunctions that afflict Seattle are common elsewhere too, in places like Santa Monica.

* I don’t have a strong opinion on those because I don’t know enough to judge, though I have heard plausible views about why finance increases liquidity and enables capital to find useful purposes and plausible views about how finance is an increasingly zero-sum game focused on enriching insiders and corrupting the political process.

%d bloggers like this: