|Lathrop is in San Joaquin County, in the Central Valley. It is in California's 18th Congressional District, represented by Dennis Cardoza, who has been trying to get meaningful mortgage relief to save the district's housing base, to avoid the ever increasing numbers of abandoned homes - at one point he told me he had the highest rate of foreclosures of any Congressional District in the country.
Lathrop lived through a boom, with population doubling in 10 years, causing a tripling of house prices. Egan notes that median house prices have since dropped from around $500,000 to about $150,000. About one in 8 homes is in foreclosure. Unemployment is around 16% - although of course that last figure is far less severe than places like downtown Detroit or in the cities of Southside Virginia like Martinsville.
Egan does not think what he saw represents a permanent condition: after all, as he puts it,
That great American natural resource - tomorrow - will have to save the suburban slums.
He then offers a startling statistic: that through immigration and high birth rates, the United States will 100 million people by 2050, noting
If you don't believe me, consider that we've added 105 million people since 1970. This is more than the population of France. More than Italy. More than Germany. Currently, we have a net gain of one person every 13 seconds.
Certainly we will need more housing. That may rescue some of the now abandoned homes in Lathrop, which at peak prices had a median affordable by only 11% of the residents of the valley in which the town sits.
Of greater importance is the lesson that can be learned. California has a broken tax system, which encouraged required municipalities to expand municiple boundaries in order to increase their tax bases to serve the increasing population - clearly it was younger families that needed schools among other services. The result? These municipalities
let developers plow up walnut groves and vineyards and places that were supposed to be strawberry fields forever to pay for services demanded by new school parents and park users.
Unbridled expansion has its share of problems. Let me offer a few observations from my own experiences of living in the DC metropolitan area since 1982. Over the years as we have driven west to the Blue Ridge Mountains we have watched as the countryside has been consumed with new subdivisions, new shopping centers, big box stores. In Virginia localities are quite limited in their ability to control development, as Virginia still operates under strict application of Dillon's Rule, which has enable developers to utilize the General Assembly (state legislature) to block and zoning or land use regulation that would prevent most of their efforts. The result has been unbelievable sprawl through what used to be gentle countryside. The developers were often not responsible for the additional services required to support such development - schools, fire houses, and most of all roads. Traffic jams became a horrid part of everyday existence.
But at least in most of Northern Virginia there was a relatively stable employment situation, and the communities subjected to such development were able to provide most of the necessary services (although not roads, which are a state function). We after all do not have a Proposition 13, severely limiting the taxing power of the state or of the municipalities, a proposition that has destroyed what had been the best public school system in the nation and is on its way to destroying what is still among the better public university systems.
I live in Northern Virginia. I teach in Prince George's County MD, on the other side of Washington. It has a proposition that limits taxing power. It also has a local government on which developers have long exercised too much influence - the immediate past County Executive, Wayne Curry, had been a lawyer for development interests early in his legal career and maintained close relationships with many key developers. PG (as it is often abbreviated) is majority African-American, with many moving out from DC or moving up from the Carolinas to be near relatives. To make housing affordable, it saw a boom in townhouse communities. Yet a family with two small children would, a few years back, be living in a townhouse worth 150,000 or less. The cost to educate each child was several times the taxes derived from that townhouse. Even if you could collect 1% of the value of the property (and that is significantly higher than the actual rate), the return from that townhouse would only be 1,500, when a decade or so back the County was spending about 7,000 on each school child. And absent the development of commercial real estate, there was an insufficient tax base to fund the schools. Eventually Prince George's learned to restrict town house development so that each new housing unit was not further causing problems such as finding the funds to school the children living in such townhomes.
Egan notes that there are places on the West Coast where the housing situation is not in crisis. Cities like San Francisco, Portland, Seattle and San Diego all have fairly strict rules on development to hem in sprawl, although developers fight against the restrictions by arguing that it will price out middle class families. The developers argue the cities will become too expensive, and will began to empty out.
Egan offers this response:
It hasn't happened. Just the opposite. The developers' favorite role models, the laissez faire free-for-alls - Las Vegas, the Phoenix metro area, South Florida, this valley - are the most troubled, the suburban slums.
the suburban slums - with empty lots, empty houses, strip malls being abandoned or their tenants replaced with "Cigarette City" or "Cash Advance" - the kinds of stores we associate with inner city decay.
Egan quotes Edward Abbey, even as he says the language might not be totally applicable to Lathrop and the surrounding area. The words he offers are "growth for the sake of growth is the ideology of the cancer cell." I wonder if those words might be more applicable to the way our national economy has been approached by administrations Democratic as well as Republican. They caught my attention: the ideology of the cancer cell is powerful imagery.
Egan's words will infuriate many who believe the market is god, the only possible solution to all our problems, even as we have seen what has happened to our financial system absent regulation and oversight. Too many free market - no regulation - low tax advocates read Adam Smith selectively. After all, his model of the market presumed that all players had perfect knowledge, and as is clear Goldman Sachs had more knowledge than either the Federal Government or AIG, which tipped the scales to the Henry Paulsons and Lloyd Blankfeins and against everyone else.
Egan's final words will be a slap in the face to such people. They should also be a slap in the face to wake the rest of us up. They come immediately after he points at Las Vegas and the other sites of unbridled development, including the valley in which Lathrop sits:
Come see: this is what happens when money and market, alone, guide the way we live.
Welcome to Slumburbia. And remember what we are already seeing:
Nobody is home in the cities of the future.