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  #1  
Old Posted Jan 3, 2018, 2:32 AM
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America’s forgotten towns: Can they be saved or should people just leave?

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By Heather Long January 2 at 2:25 PM

One of the great debates in American politics and economics in 2018 is likely to be how to help the country's forgotten towns, the former coal-mining and manufacturing hubs with quaint Main Streets that haven't changed much since the 1950s and '60s . . . .

Traditional economics says people living in these struggling towns should just move. Many of the United States' urban centers (and surrounding suburbs) are booming. If jobs are plentiful in Denver (unemployment rate: 2.6 percent) and Salt Lake City (unemployment rate: 2.8 percent), then Economics 101 suggests it's time for a big migration west from the Rust Belt to the Boom Belt . . . .

But the reality is Americans have become homebodies. People in the United States are moving at about half the rate that they did in the 1970s and '80s, according to census data, and no one really understands why. There are obvious economic barriers to moving. It's expensive and risky to leave a place your family has been living in for generations, and there's no guarantee the job you move for will still exist in a few years. But there seems to be something deeper holding people in place.

A high school vocational tech teacher in central Ohio — who asked not to be named, to speak freely — told me: “Most of our students will not give the slightest thought to relocating should they not be able to find good employment here. They cite all the [usual reasons], but a big one is just plain fear of the unknown. My students think Columbus is a big, scary city. Many have never even been out of the county.”

Among economists, a major rethink is underway about how to help people in forgotten towns, and it's starting to filter into policy debates in Washington. The mentality is shifting from “let's get these people to move” to “let's get new jobs to these towns” . . . .

Nobel Prize-winning economist Joseph Stiglitz . . . . is advocating for totally transforming what these towns are known for, taking them from blue collar to green collar — or even high-tech hoodie. Stiglitz points to Pittsburgh as the true American success story, a place that evolved from a steel city into a tech and health-care hub . . . .
https://www.washingtonpost.com/news/...=.33ab5f085c55

I might add that Detroit (!!) may in the same process although without the stimulus of a prominent university's involvement it may be have a tougher row to hoe.

When it comes to the "big scary city" issue, I have some personal knowledge. For several years I worked on the Navy base at Treasure Island in the middle of San Francisco Bay. On the island was a lot of enlisted Navy housing and in that housing were a lot of young families of junior Navy personnel from the heartland. When I would ask them had they done this or that in San Francisco, about 3 miles away across the water and connected by the Bay Bridge, they would express horror of that "big, scary cty" in which I personally lived and incredibly few had ever been there.

San Francisco as seen from Treasure Island

https://inhabitat.com/treasure-islan...elopment-plan/
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Old Posted Jan 3, 2018, 2:53 AM
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forgotten by whom?
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  #3  
Old Posted Jan 3, 2018, 3:02 AM
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Originally Posted by dc_denizen View Post
forgotten by whom?
Unless you have an opinion, you may have to ask Jeff Bezos. I bet Amazon ships to them, though.

On the other hand, does anyone actually want to address the issue here? Should the unemployed and seemingly unemployable of heartland towns on the outs just leave, whether or not anybody has forgotten them other than the WaPo headline writer, or could they become successful with a totally new business model?
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Old Posted Jan 3, 2018, 5:34 AM
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To address a side-issue mentioned in the article:

Why don't people move? I vote for lack of savings. Prior to 1980, people were consistently saving 10% or more of their income. After 1980 that number started to decline and now it's typically closer to 5%. Over a 5-year period for someone earning $25,000/year that's about a $6,250 difference and could easily mean the difference between feeling confident about being able to finance their own move and feeling trapped.

Couple that with the fact that the people most likely to benefit from such a move today, people with a college degree, are far more likely to have significant education loan payments further dampening their confidence in their ability to self-finance a move.
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Old Posted Jan 3, 2018, 6:12 AM
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Detroit has UofM and a plethora of other universities.

Who coined "Boom Belt"?

I'm not sure what any of this has to do with moving west when as long as we're judging the "plentifulness" of jobs by the unemployment rate, major cities in the "rustbelt" have extremely low unemployment rates but media really loves to paint that picture huh.
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  #6  
Old Posted Jan 3, 2018, 1:00 PM
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The unemployment rate in the "Rust Belt" is barely higher than in the "Boom Belt".

I'm mystified as to why one would expect some mass exodus based on a 1% difference in unemployment rate (4% compared to 3%).
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Old Posted Jan 3, 2018, 1:57 PM
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Quote:
Originally Posted by emathias View Post
To address a side-issue mentioned in the article:

Why don't people move? I vote for lack of savings. Prior to 1980, people were consistently saving 10% or more of their income. After 1980 that number started to decline and now it's typically closer to 5%. Over a 5-year period for someone earning $25,000/year that's about a $6,250 difference and could easily mean the difference between feeling confident about being able to finance their own move and feeling trapped.

Couple that with the fact that the people most likely to benefit from such a move today, people with a college degree, are far more likely to have significant education loan payments further dampening their confidence in their ability to self-finance a move.
That, and why bother moving when any extra money you'd make would just be sucked back into the bloated housing costs of the bigger city? You can be poor and miserable where you are, or you can go through the colossal hassle of moving and looking for work, and be poor and likely as miserable somewhere unfamiliar where there are myriad more restaurants and shops you can't afford to patronize because now your housing costs four times (or more) what it used to.
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Old Posted Jan 3, 2018, 2:32 PM
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Quote:
Originally Posted by Pedestrian View Post
https://www.washingtonpost.com/news/...=.33ab5f085c55

I might add that Detroit (!!) may in the same process although without the stimulus of a prominent university's involvement it may be have a tougher row to hoe.

When it comes to the "big scary city" issue, I have some personal knowledge. For several years I worked on the Navy base at Treasure Island in the middle of San Francisco Bay. On the island was a lot of enlisted Navy housing and in that housing were a lot of young families of junior Navy personnel from the heartland. When I would ask them had they done this or that in San Francisco, about 3 miles away across the water and connected by the Bay Bridge, they would express horror of that "big, scary cty" in which I personally lived and incredibly few had ever been there.

San Francisco as seen from Treasure Island

https://inhabitat.com/treasure-islan...elopment-plan/
Sounds like small town folk that live within shouting distance of a city. There's still plenty too, especially in poorer states like Mississippi and Alabama. It's unthinkable for a few of us but more common than you think.
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Old Posted Jan 3, 2018, 2:42 PM
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The title doesn't correlate with the context of the article.

Is the question really can these cities do something to keep their young and educated natives who crave a plethora of high-paying job opportunities from leaving? What I will say in response is that I certainly don't see these places doing enough to compete for corporate expansions and relocations that would bring along these opportunities.

Yes, these cities may also have low unemployment, but that's only part of the equation. The question is how do they compare in the number of new jobs being created and the type of jobs that are being created (high or low paying?).
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Old Posted Jan 3, 2018, 2:52 PM
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Quote:
Originally Posted by Crawford View Post
The unemployment rate in the "Rust Belt" is barely higher than in the "Boom Belt".

I'm mystified as to why one would expect some mass exodus based on a 1% difference in unemployment rate (4% compared to 3%).
What type of jobs are there by comparison? There's a difference between 1,000 McDonald's jobs and 100 high tech jobs.
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Old Posted Jan 3, 2018, 5:29 PM
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Rust Belt cities are loaded with call centers, distribution centers and any other type low paying service sector job...and little else. It's also why you can buy a decent sized house for $50,000. Very very few opportunities for a professional career in most of these cities. Very few cities there have managed the transition from manufacturing to high level industry work; Columbus, Pittsburgh come to mind.
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Old Posted Jan 3, 2018, 6:23 PM
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Why are sunbelt posters constantly bringing up weather? How many people relocate exclusively because of weather? What's that profile like? My assumption would be retirees.

Isn't Columbus doing pretty well recently? A lot of that is driven by Ohio State, but positive change is positive change. Cincinnati is also in pretty good shape. Toledo and Cleveland not so much.

I think the issue is much larger than "the steel mill is gone and everyone is unemployed." There are economically depressed towns littered across the southern and western portions of the US. The underlying issue of a few cities being home to the educated and affluent while the rest is left to rot is what's responsible for these cities and towns across the US with seemingly no future.

The US educational system could also be improved. Community Colleges across the country should be free. I know there are some programs like this in existence, but if you can push a kid to get his or her associates, a getting a bachelors in suddenly a lot less daunting.
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Old Posted Jan 3, 2018, 6:23 PM
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Has anyone mentioned the home ownership issue?

Home ownership rates in the US, at least prior to the recession, were higher than many economics believe is ideal. People who own their homes are much less able to physically relocate for economic reasons. And they're most unable to do so during a downturn, when housing prices have also declined alongside employment, or when the economic situation in their local area has led to declining or stagnant house prices.
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Old Posted Jan 3, 2018, 6:26 PM
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Quote:
Originally Posted by 10023 View Post
Has anyone mentioned the home ownership issue?

Home ownership rates in the US, at least prior to the recession, were higher than many economics believe is ideal. People who own their homes are much less able to physically relocate for economic reasons. And they're most unable to do so during a downturn, when housing prices have also declined alongside employment, or when the economic situation in their local area has led to declining or stagnant house prices.
Home ownership rates in the US are near or at record lows. A lot of people got burned and never recovered financially to the point where they could purchase a new home. Maybe the rent in essentially all coastal cities is too damn high?
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Old Posted Jan 3, 2018, 6:48 PM
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The south and southwest just happen to have a better economy due to non-climate related reasons.
I don't know if I'd go that far. It's very much a mixed bag in both instances. The economies of northern blue states drives a lot of the economic growth in the US. Poverty rates are also higher in the south. Incomes and educational attainment are lower as well. Whether that means the northern US has a better economy is debatable I guess, but it's definitely not a clear answer either way.
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Old Posted Jan 3, 2018, 6:53 PM
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Originally Posted by JManc View Post
Rust Belt cities are loaded with call centers, distribution centers and any other type low paying service sector job...and little else. It's also why you can buy a decent sized house for $50,000. Very very few opportunities for a professional career in most of these cities. Very few cities there have managed the transition from manufacturing to high level industry work; Columbus, Pittsburgh come to mind.
I thought most call centers were in places like Texas or Nevada.
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Old Posted Jan 3, 2018, 6:54 PM
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Originally Posted by IrishIllini View Post
Home ownership rates in the US are near or at record lows. A lot of people got burned and never recovered financially to the point where they could purchase a new home. Maybe the rent in essentially all coastal cities is too damn high?
If so that's good. The home ownership rate was too high before the recession.
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Old Posted Jan 3, 2018, 6:57 PM
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Household incomes, if anything, are higher in the Rustbelt than in the Sunbelt. And unemployment rates are roughly the same. I don't think there's much of a difference in relative job availability.
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Old Posted Jan 3, 2018, 7:06 PM
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I don't know if I'd go that far. It's very much a mixed bag in both instances. The economies of northern blue states drives a lot of the economic growth in the US. Poverty rates are also higher in the south. Incomes and educational attainment are lower as well. Whether that means the northern US has a better economy is debatable I guess, but it's definitely not a clear answer either way.
There are two Souths; the cities which are booming and the rural areas which have historically been poor. Poorer than the north. The latter areas are not growing and this is not where northern transplants are settling; it's Houston, Charlotte, Atlanta, Dallas, Nashville and so on. This is where the job and economic growth are.

New York state used to be an economic powerhouse (hence the nickname, Empire State) with all major cities booming and prosperous. Today, other than NYC, everyone else is barely hanging on. The state lost jobs to southern states decades ago who offered far more lucrative business climate to operate in and they left NY in droves. And southern states continue to attract new business not just domestic but overseas as well.
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Old Posted Jan 3, 2018, 7:12 PM
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JManc, I think you're conflating regions with metros.

Houston obviously has more job opportunities than Utica; you're comparing a dynamic metro of 7 million with a super-rusty town of 50k. But small town Texas is basically like Utica, and big metros in the north are basically like Houston.

Half the counties in Texas are in long-term decline. It's basically three metros that account for almost all the Texas growth. And in the North, even super-rusty metros like Detroit have tons of high-paying jobs.
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