American cities and suburbs are converging

by on October 11, 2017 at 12:48 pm in Current Affairs, Economics, Web/Tech | Permalink

That is the theme of my latest Bloomberg column, here is one excerpt:

The internet has been another equalizer. You can enjoy texting and social media from just about anywhere, and our near obsession with these activities is equalizing urban and suburban experiences, possibly for the worse.

Arguably, sex and alcohol were once more prominent in some American cities than in American suburbs. But the new generation of American youth seems less interested in these activities anyway.

As American travel infrastructure decays, and traffic congestion worsens, what we used to call cities and suburbs won’t be able to rely on each other so much, as trips become too exhausting and time-consuming. That too will encourage cities and suburbs each have their own mix of jobs, retail and cultural opportunities.

There is much more at the link.

1 rayward October 11, 2017 at 12:56 pm

Do we really need flying cars and spaceships to Mars? What we need is transit to make travel less “exhausting and time-consuming”. Of course, it won’t happen, it won’t happen because those who determine whether we invest in transit don’t use it, traveling instead by private aircraft.

2 Steve Sailer October 11, 2017 at 2:31 pm

“Do we really need flying cars and spaceships to Mars?”

“Blade Runner” promised us flying cars and spaceships by 2019, along with mass immigration and overcrowding. The latter are arriving right on schedule, but the flying cars and off-world colonies are lagging.

3 Harun October 11, 2017 at 2:53 pm

Travel is really not that more exhausting than it used to be. People are just used to instant gratification now.

4 msgkings October 11, 2017 at 3:01 pm

Travel is in fact significantly LESS time consuming and exhausting than it used to be. Compare flying to trains, or 1950s cars to today’s, or Uber to not-Uber.

5 Doug October 11, 2017 at 4:00 pm

What about flying in the 80’s and 90’s vs. flying now?

6 mobile October 11, 2017 at 4:13 pm

Significantly cheaper now. And still cheaper if you avoid no-frills airlines to approximate an 80s level of ambiance and amenities.

https://www.theatlantic.com/business/archive/2013/02/how-airline-ticket-prices-fell-50-in-30-years-and-why-nobody-noticed/273506/

7 Albigensian October 12, 2017 at 12:18 pm

Traffic congestion in and around most American cities is much worse than it was in 1959, street parking availability is lower, paid parking costs more. BUT cars are much safer, as well as more reliable and durable, and more pleasant to drive. Air conditioning was very rare in 1950s cars; info-tainment was an AM radio (if that), so at least if you’re sitting in traffic it’s easier to amuse and/or inform yourself. And in addition to Uber there are car-sharing services for those who want to be able to drive a car but only infrequently and for a short time.

In 1959 it cost 15 cents to ride the New York subway; adjusted for inflation, that would be $1.25 now, but today’s price is $2.75. In some ways the New York subway is better than it was in 1959 (the cars are air conditioned) but in other ways it is worse (hard plastic seats instead of padded wicker) and although updated controls may enable rush-hour trains to run closer together I don’t think the trains go any faster. So, even if it’s better it’s twice the price but not twice as good.

Air travel is cheaper, less comfortable, much safer, but no faster. In 1959 the fatality rate per passenger-mile in commercial air travel it is now. Nothing today flies faster than the Boeing 707 did in 1959, and the time between arriving at the airport and wheels-up surely is longer. air fares are significantly lower in the cheap seats; today’s business-class fare is roughly comparable with 1959’s coach fare (and offers similar comforts and amenities).

Buses are air-conditioned, and as suburbs have grown more commuter-bus service has become available. It’s probably easier to commute by bicycle than it was in 1959; certainly popular-price bicycles are far better. Is it necessary to note that there was immensely more improvement in transportation between 1901 and 1959 than between 1959 and today?

8 Albigensian October 12, 2017 at 12:20 pm

In 1959 the fatality rate per passenger-mile in commercial air travel was about one percent of what it is now.

9 zacky October 15, 2017 at 11:16 am

There is significantly more cars, congestion and VMT everywhere I can think of

10 mulp October 11, 2017 at 4:08 pm

The only people whose votes count travel only by private planes?

Then why have they fought adequate funding of the FAA and FAA mandates for every plane to install $10,000 transponders in their planes?

I’m betting Trump will delay the Obama Jan 1 2020 ADS-B out transponder mandate for all planes to fly in most of the US airspace. By delays and feature stripping the transponder cost is down to about $1000 after Federal subsidy, but installation by competennt aircraft mechanic is extra. 18% of mechanics seem incompetent because that’s the share of non performing ADS-B installs.

Current statistics are only about 30,000 planes out of an estimated 100,000 to 150,000 aircraft have correctly installed ADS-B out transponders, more than 7 years after the mandate rule was issued. Congress directed the FAA to do this in the 90s, just like the FCC directive to issue rules mandating DTV.

From Fortune July 2017:
“While passenger airlines have moved to upgrade their jetliners on time, operators of business jets have proved particularly slow to bring their aircraft up to spec. Government research shop MITRE estimates that out of 26,700 business jets in the U.S., 20,731 still needed to be equipped as of March 2017. “The industry should be doing double what it’s doing now, per day,” says Mark Francetic, regional avionics sales manager for Duncan Aviation, one of the handful of companies equipped to perform ADS-B installs. “Right now if we continue on our path, we’re looking at meeting about 50 percent of airplanes.” ”

Bet Trump attacks Obama on the job killing mandate to pay factory workers and aircraft mechanics to install ADS-B equipment on all aircraft by 2019 at the latest. And then claims privatizing the FAA will immediately cut air control costs and speed flights by increasing the density of aircraft in flight.

11 Dan Lavatan-Jeltz October 11, 2017 at 9:23 pm

ADS-B transponders offer no value. There are a lot of perfectly functioning aircraft without electrical systems that have been safely operating for nearly a century and have far better operational records than competing modes of transportation and the assault-happy airlines. $10k is a lot, more than enough to buy lunch with a Senator.

12 Albigensian October 12, 2017 at 12:28 pm

An obvious compromise would be to allow the use of portable ADS-B out units in at least some aircraft. Perhaps combined with mandates to improve the performance of these, such as storing the ICAO code in a SIM-like insertable to reduce input errors, and better provision for the device’s antenna.

13 zacky October 15, 2017 at 11:14 am

Transit does not work without at least one dense node. Suburb-to-suburb commuting and often city-to-suburb commuting can’t ever be efficiently be covered. It’s as much a landuse issue as it is a transit investment issue

If you want to see this exemplified check out the VTA lightrail in Silicon Valley. It may be the least efficient in the world

14 Miguel Madeira October 11, 2017 at 12:59 pm

A thing that could be useful to remember, specially when looking to other countries, is that,afaik, the American city-suburb dynamic is largely an eccentricity – in many (most?) countries, the middle class live in the city, and the lower class live in the suburbs (or in slums, or in very high density apartment buildings, remembering the “projects” in some US cities).

Suburbs of Lisbon, Portugal:

http://mw2.google.com/mw-panoramio/photos/medium/65805869.jpg

15 A Truth Seeker October 11, 2017 at 1:05 pm

“As American travel infrastructure decays, and traffic congestion worsens, what we used to call cities and suburbs won’t be able to rely on each other so much, as trips become too exhausting and time-consuming. That too will encourage cities and suburbs each have their own mix of jobs, retail and cultural opportunities.”

So that is what America has become: a feudal country beset by decay and dreaming of autarky.

16 Hoosier October 11, 2017 at 1:05 pm

“Think instead of how the urban and suburban areas of Atlanta, Dallas, Houston and Orlando really don’t differ that much.”

Yep, and that’s why those cities are so blah. Scares me if the whole country is going to that model.

17 Jeff R October 11, 2017 at 2:26 pm

Orlando is indeed sort of awful, from what I remember. On the other hand, parts of Northern VA that are kind of hybrid city/suburb are kind of cool, in my opinion. Not bad places to live at all.

18 TMC October 11, 2017 at 4:46 pm

I’m there a lot, for work. It’s not bad but pretty boring. Suburbs of Atlanta, Dallas, Houston and Orlando are more interesting.

19 Clay October 11, 2017 at 4:01 pm

I don’t know, Tyler has acknowledged on many occasions that these generic suburbs of places like Dallas or Atlanta are where you find the great cheap ethnic food he so loves.

20 The Other Jim October 11, 2017 at 1:13 pm

Right — people are fleeing the cities due to “NIMBYism.” Uh huh. Sure thing Ty.

I also enjoyed the reference to the “crumbling infrastructure” canard. Sure, I live in the suburbs, but obviously I’d love to spend every free moment in (far superior!) city…. but all the highway bridges have collapsed! And that’s why all the back roads are clogged with traffic! So now I have to spend my evenings in the bland suburbs, poor me…

21 Engineer October 11, 2017 at 1:34 pm

Yea, me too.

As I type this, am looking out back windows at the 10 acre lake this part of the subdivision is built around.

You’d have to pay me a lot to live in the city. To live in a place like NYC, a LOT.

22 The Cuckmeister-General October 11, 2017 at 1:42 pm

Oh don’t worry since you’re a cuck engineer you won’t have to ever worry about a lot.

23 Hoosier October 11, 2017 at 2:25 pm

Suburbs around 10 acre lakes aren’t the norm. Traffic times in the cities Tyler mentions above do suck- I live in one- although I’m not sure infrastructure spending will do that much to improve things.

I grew up in a suburb and it was great- but that’s mainly because I spent so much time outdoors and knew all my neighbors well. I don’t suspect that is the norm anymore from listening to friends in the ‘burbs. I don’t see the appeal anymore, other than it’s safe place to stay put in your house and enjoy the items you bought on Amazon and be on the internet.

24 Harun October 11, 2017 at 2:55 pm

You can go out on your patio and sit in your hot tub in NYC, too.

Oh, wait, you actually can’t.

25 Albigensian October 12, 2017 at 12:33 pm

BUT New York City is far from a typical American city. Not only is it old (pre-automobile) but four of it’s five boroughs are islands or are on islands, which surely does constrain transportation to and from them.

Chicago is pre-automobile also (which gives it a central downtown), but without physical barriers to westward expansion it can and does just sprawl out all over the prairie.

26 Anonymous October 11, 2017 at 3:35 pm

Rode my bike to our lake. It is 62 million square miles!

But that is retirement. One hour commutes sucked. No “kinda.”

27 Engineer October 11, 2017 at 3:55 pm

No, not the norm, but not really rare. In my overall community (4000 plus homes) there are 5 lakes, all man made. There are about 60 houses that back on our lake. We have the waterfront view, but a quite small back yard.

It’s safe, kids can walk to school (excellent, but as we discussed a few dats ago, that’s mostly who lives in the cachement area), landscaped and well maintained common areas, good sidewalks for walking, etc. Shopping, medical, library, etc within a few minutes. Easy to get around.

And the relatively low cost of housing leaves something left over to spend on other things.

There would be some attractions to the city if you make enough to insulate yourself from the city – private schools, private car, guarded residence, etc and to take advantage of what’s available – but that’s very few people.

28 Church Lady October 11, 2017 at 3:22 pm

NYC is a cesspool of debauchery and sin!

29 Art October 13, 2017 at 9:13 am

Yeah. Ain’t it great?

30 JMCSF October 11, 2017 at 11:21 pm

People in NYC get paid a lot.

31 Floccina October 11, 2017 at 1:20 pm

What infrastructure decay? http://conversableeconomist.blogspot.com/2016/03/insights-on-infrastructure.html

“In 2014, the number of bridges that were rated as structurally deficient was just above 61,000, while the number that were rated as functionally obsolete, or inadequate for performing the tasks for which the structures were originally designed, was slightly below 85,000 (DOT 2015d). The number of structurally deficient bridges has declined on average 2.7 percent a year since 2000, below the 4.2-percent average annual rate of decline throughout the 1990s. The number of functionally obsolete bridges has also declined steadily since 2000, falling on average about 0.5 percent a year. Combined, these two groups accounted for just below 24 percent of all bridges in 2014, the smallest annual percentage on record.”

Moreover, when US infrastructure is ranked in comparison with other high-income countries, US looks OK.

“The World Economic Forum releases annual ratings that gauge the quality of infrastructure throughout the world, and its ratings for the United States are displayed in Figure 6-4. These ratings are determined on a 1-7 scale, with a higher score indicating a better quality level. In 2015, the United States received a rating of 5.8 for its overall infrastructure, which was above the 5.4-average rating across the world’s advanced economies, the 3.8-average across emerging and developing Asian nations, and the 4.1 global average. However, the overall U.S. rating for infrastructure in 2015 was noticeably below its level in the mid-2000s, falling nearly 8 percent since 2006. In comparison, the overall infrastructure rating for the world’s advanced economies increased about 2 percent over the same period.”

32 Brian Donohue October 11, 2017 at 1:39 pm

+1

33 Jeff R October 11, 2017 at 2:08 pm

I would wager Tyler was referring to something like this:

Mass transit construction costs in the United States appear to be far higher than what European countries pay for comparable projects.
The Second Avenue Subway in New York City, for example, is being built at a cost of nearly $1.7 billion per kilometer while new subway lines are being built in Paris, Copenhagen, and Berlin for about $250 million per kilometer.

http://econlog.econlib.org/archives/2017/05/saving_cost_con.html

Basically, the idea is that cities with extensive mass transit infrastructure like DC, Chicago, and NYC are likely doomed to see that infrastructure decline because it’s become so costly to renovate or add to it. Part of Scott Alexander’s cost disease.

34 Harun October 11, 2017 at 2:57 pm

Because our elites never ever look at reducing costs.

Not also, the love of the chimerical “if we copy European Single Payer, we’ll save so much money!” claim. They could investigate and save on infrastructure and save money, too. But they decline the hard, technocratic work to do that. They’d rather increase taxes and create a new social program.

35 P Burgos October 11, 2017 at 3:52 pm

There was actually a brief article in Vox about how some congresscritter had introduced into legislation some funds to investigate ways to save on infrastructure, but that piece of legislation was anonymously removed in committee.

36 Al October 11, 2017 at 2:11 pm

+1

But this is a bloomberg article. Bloomberg has become increasingly statist in the last year as the mayor gears up for a run on the democratic ticket. This means all articles and all coverage must conform to the party line.

It has gotten so painful that I would much rather listen to cnbc during my commute than to bloomberg. Sadly TuneIn is awful at updating the podcasts which leaves me with little option but to listen to some bloomberg pravda once in a while.

37 poorlando October 11, 2017 at 5:22 pm

I found this to be the case too. Bloomberg TV used to be really good at covering business and the stock market, and I used to watch it religiously. Ever since the presidential campaign up to the present, it’s been 24/7 about how Trump is crazy and going to destroy the world, as well as how Brexit is going to be the end of the UK. The mask has come off and now Bloomberg’s leftist/statist bent has gotten too much in the way. Too bad there is no other free streaming channel offering what Bloomberg used to.

38 anon October 11, 2017 at 5:40 pm
39 anon October 11, 2017 at 6:09 pm

For anyone keeping track, I think it was February when someone asked me about Trump, and I decided to put it out there. I said there would come a time when Trump was isolated and alone in the White House, what then?

If I recall correctly, Thomas seethed. How dare I troll with something that outlandish.

Well, per Vanity Fair, we are there.

40 Beliavsky October 11, 2017 at 1:21 pm

“As American travel infrastructure decays, and traffic congestion worsens”

Some innovations have improved transportation. I hate driving into the big city near me, but Uber is about 1/3 cheaper than a taxi, and when self-driving cars arrive, the cost of getting in to the city will fall further. If I do drive in, Google Maps tells me how long the trip should take and gives me directions.

41 Al October 11, 2017 at 2:18 pm

Note that even the level 2 autonomous driving offered in Tesla cars (and the CT6 and, I think, E class) makes longer commutes much more bearable. I no longer loathe the traffic in my city.

42 Harun October 11, 2017 at 2:58 pm

You can also listen to an excellent podcast or music while you drive without any ads.

Its really not so horrendous.

43 chuck martel October 11, 2017 at 1:28 pm

It was so much more convenient back in 1910 when urban streets were packed with horse-drawn delivery trucks and the commute was by trolley or shank’s mare.
https://geneajourneys.files.wordpress.com/2013/06/scaled-image.jpg

44 anon October 11, 2017 at 1:30 pm

These observations are fine.

Development is influenced by a lot of actors and groups in the US, some with short and some with long time horizons. That might lead us to build and tear down a bit more than rigid planners. But maybe building malls that are right for the 70’s, and tearing them down in the 10’s is fine too. Creative destruction.

I am not sure the condo redevelopment going on near me will stick, but developers will be out in 5 years, and most first round owners will be out in 20. I suppose condo developments are harder to recycle.

45 anon October 11, 2017 at 2:15 pm

I think Tyler is describing some ebb and flow, rather than an endpoint.

46 The Cuckmeister-General October 11, 2017 at 1:51 pm

You guys should appreciate Tyler more without his writing to distract you all of you would have to alisten to that Blackman banging your wife.

47 8 October 11, 2017 at 2:33 pm

I notice this as well. The urban dwellers are moving into the suburban areas as the wealthy gentrify the cities and ship out welfare recipients. Now there are random shootings, liquor store robberies and home invasions a few times a month in places that used to see this a few times over the course of several years.

48 anon October 11, 2017 at 2:48 pm

Want to share the zip code so we can check that?

49 Andao October 11, 2017 at 3:27 pm

Disagree. If you’re young and ambitious today, the only options are NYC or SF. If tech is the great equalizer, why are these two urban areas increasingly desirable places to live? Concentration seems to be increasing, not decreasing.

50 Anonymous October 11, 2017 at 3:37 pm

I would amend that to “super competitive.” Moderate fortunes are made many places.

51 A Truth Seeker October 11, 2017 at 5:18 pm

Particularly Brazil. According to prestigious American business magazine Fortune, the richest banker in the world is Brazil’s Mr. Safra, who supports President Tmer’s reforms and is a noted philantropist.

52 anon October 11, 2017 at 5:40 pm

That’s not suspicious at all.

53 A Truth Seeker October 11, 2017 at 5:56 pm

There is nothing suspicious about Mr. Safra. Under President Temer, Brazil had become an economic powerhouse.
Mr. Lehman, Brazil’s richest person, has studied in Harvard and is also a noted philantropist with interests spanning from education to tennis and controls America’s Budweiser and Heinz.

54 poorlando October 11, 2017 at 5:30 pm

I don’t know if SF is “increasingly” desirable. The second derivative is negative. When Silicon Valley tech companies have to expand, they are doing so outside of California to places where energy and real estate are much cheaper.

55 Potato October 11, 2017 at 6:27 pm

+1

The future looks interesting. Any tech job that can be offshored will be gone in 15 years. The difference in cost is mind blowing between a Chinese QA/dev team and an American one. Non client facing finance is being sent elsewhere, Delaware anyone ?

It makes me wonder what will remain in nyc/sf. Obviously client facing jobs will remain. Prestige counts. But that basically leaves trading and sales. Sales includes investment banking, marketing, B2B etc. And someone to interface with the China teams. Or handle supply chain management. Someone has to manage the offshore teams.

What will the white collar class say when they realize they’re even more offshorable than blue collar folks? Upper middle class America is going to look like the guy that gets laid off in Office Space. What, exactly, do you do here? Shit won’t hit the fan until the next recession. Then managers will start looking hard at what can be moved.

Can’t outsource a plumber or electrician.

56 anon October 11, 2017 at 6:38 pm
57 A Truth Seeker October 11, 2017 at 6:48 pm

Americans h.ave their sold their firstborn right for a mess of Chinese pottage and sold their children in bondage to the Communist Moloch.

58 Komori October 12, 2017 at 12:33 pm

Chinese or Indian QA and dev teams are cheaper, but cheaper isn’t always better. I’ve been in the industry for a couple decades and I’ve seen this cycle repeat itself over and over:

First someone in the executive suite gets the bright idea that they’ll save money by outsourcing dev and/or QA.
Second it’ll look cheaper at the start, but then quality goes to hell and costs ramp up as they scramble to bring it up to snuff (and since you can’t test in quality, and throwing more devs at a problem doesn’t necessarily help either, it never works). By this point the original exec has received his bonuses or stock or whatever and moved on.
Third, they’ll pull it back in house to get things fixed.
Then it starts all over.

Moving the work to elsewhere in the US is already happening, too. This tends to go a lot better, since the culture, language, and time barriers are all much lower. This is unlikely to stop, no matter how attractive people think Silicon Valley is, because there is a huge cost difference, even in other relatively high-priced areas. I know of a few firms that have moved development to Austin and forced devs to either leave or move (they’re part of what’s driving property values up here, since they don’t have a damn clue what a non-SV property market looks like and pay outrageous prices for things). Of course, some of the companies are also using this to get rid of dead-weight, since there’s a lot of that even in SV.

It’s going to take a long time for companies to spread out like you suggest, though. Managers really like face to face meetings, and management by butts-in-seats is easy. The Harvard MBA standards don’t work well with distributed teams either (they’re bad enough with single locations). Not even cost issues have been able to overcome management resistance to this in most cases, so it’s going to be at least a couple generations (as the oldest and most hidebound retire out) and a credential revolution (MBA training) before this becomes widespread.

59 enoriverbend October 11, 2017 at 6:51 pm

I agree with poorlando. Even if we restrict ourselves to looking at software development (excluding other tech jobs), Silicon Valley is not the universe.

A lot of people don’t realize that even today, most US software jobs are somewhere other than Silicon Valley — it has only 11% of the jobs. And the growth rate there is slowing.

Once you adjust for COL differences, you can live as well or better being a developer in Austin TX, the Research Triangle or Charlotte in NC, Chicago, Boston, Atlanta, and of course there is the huge sucking maw of the feds in DC.

60 Andao October 13, 2017 at 3:36 pm

I think your COL argument is telling. If I want a comfortable lifestyle, I could be lured to NC. If I want to be on the bleeding edge of tech and work with the best in the field, I have to be in SV. What type of employee will each area attract?

61 enoriverbend October 13, 2017 at 11:19 pm

I’m not sure “best in the field” is as clear-cut either. There are interesting firms doing interesting work in lots of locations, and I somehow doubt that all 72,000 employees of Google are all doing cutting-edge work, although I am sure that some novices want to work there under the impression that they will.

In that regard, it’s sort of like the gaming software industry, which is notorious for being considered extremely hip and cool by 22-year-old graduates; and that only means that they can be abused and worked half to death for a salary that doesn’t compensate them properly.

62 Clay October 11, 2017 at 9:35 pm

Maybe domestically, but in a global market one can hardly leave out Seoul or Shenzhen, among others

63 A Truth Seeker October 11, 2017 at 5:57 pm

There is nothing suspicious about Mr. Safra. Under President Temer, Brazil had become an economic powerhouse.
Mr. Lemann, Brazil’s richest person, has studied in Harvard and is also a noted philantropist with interests spanning from education to tennis and controls America’s Budweiser and Heinz.

64 lowering the bar October 11, 2017 at 9:33 pm

“Arguably, sex and alcohol were once more prominent in some American cities than in American suburbs. But the new generation of American youth seems less interested in these activities anyway.”

And with it, lower crime rates. Just look how much less corruption there is on wall street and in Washington, D.C. today than in the 70s. Trump and Hillary look like boyScouts compared to Nixon and Carter (and yes, I know Hillary could only be a boy scout since they started letting girls in today).

65 Slocum October 12, 2017 at 6:52 pm

“But using your residential location to drive your lifestyle and mindset may be a thing of the past”

I know it’s not Tyler’s thing, and so it seems not to have occurred to him, but for people interested in outdoor recreation, where you live remains very important. The city/suburb divide doesn’t matter much, though — it’s proximity to mountains, lakes, oceans, beaches, wilderness areas, etc (along with weather) that matters. This is a major reason why the Denver, SLC, Seattle, and Portland have done well in recent decades.

66 Edwin Maldonado October 24, 2017 at 5:03 am

The course of Electronics and Automation studies about the activities to improve the operation of equipment and machinery in the development of processes, optimization of resources and reduction of operating and productive costs in the industry. A professional engineer of this career has a handle and uses the technologies appropriately, controls the electronic systems the development of information technologies. In the world of work you can work controlling industrial plants, innovation and modernization of machines, equipment and tools and their corresponding automation in productive activities. .

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