The middle class can't afford to live in liberal cities

This is a curious piece at the Atlantic by Derek Thompson which studies why the “income inequality” problem is so much more challenging in densely packed, liberal enclaves like San Francisco and Manhattan. That’s progressive-speak for wondering what somebody who works a blue collar job is supposed to do when they live in a place where decent apartments cost more than a million dollars.

San Francisco’s problem is bigger than San Francisco. Across the country, rich, dense cities are struggling with affordable housing, to the considerable anguish of their middle class families.

Among the 100 largest U.S. metros, 63 percent of homes are “within reach” for a middle-class family, according to Trulia. But among the 20 richest U.S. metros, just 47 percent of homes are affordable, including a national low of 14 percent in San Francisco. The firm defined “within reach” as a for-sale home with a total monthly payment (including mortgage and taxes) less than 31 percent of the metro’s median household income.

If you line up the country’s 100 richest metros from 1 to 100, household affordability falls as household income rises, even after you consider that middle class families in richer cities have more income.

Thompson drags this conversation off into questions which may be valid, but don’t seem to address the underlying realities or offer any solutions. For example, he hypothesizes that all homeowners have an incentive to restrict new housing construction. (The theory being that the more housing you find for sale in a given area, the lower the prices go, hurting the homeowner’s bottom line.) But, he argues, liberal populations take that one step further and add layers of environmental protection requirements on to building codes. (Think of things like requiring that most of the building’s water be recycled or that a certain percent of the electricity it consumes has to be generated by solar panels.) That compounds the problem, pushing the cost further out of reach for the middle class.

Perhaps, but I can’t imagine that such factors are the real drivers of this issue. It’s a comparatively recent phenomenon and the cost of living in cities has been staggering compared to rural areas for as long as I can remember. And why wouldn’t it? When you amass that many people in one place, the space fills up quickly. Competition for space – both residential and commercial – expands quickly. New construction permits become more rare because space begins to run out and any subsequent construction will require either the demolition or significant reconstruction of an existing building.

People living in cities tend to earn higher wages, and this fact often tempts the undereducated to strike out for the bright lights to improve their lot in life. What’s less advertised is the fact that those somewhat higher wages generally don’t make up for the astronomically higher costs for everything one needs to simply exist. This is probably a big factor in why so many young people in major cities continue to live with their parents as adults – an idea unheard of in the more rural areas such as where I grew up. In too many places a “normal” income will not afford you even an apartment, except in the worst and most dangerous parts of town.

But is liberalism a factor in all this? The author makes a good point that I hadn’t previously considered. It seems clear that it is a compounding factor, but not the driving cause.