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The Death and Life of the California Dream

This entry was originally posted on my new blog CiviLogica, where I intend to cover a variety of topics related to public policy at various levels.

CNN recently reported on the fading California dream. Though California has arguably experienced a decline, the article gives short shrift to the complex history behind it. What little analysis it attempts is generally glib or else grossly uninformed. Most disappointingly, the article forgoes any deeper exploration of California’s quandaries, ignores what California is doing right, and abdicates the opportunity to propose a single solution.

Sadly, it is difficult to deny that the situation in California has deteriorated since the mid-twentieth century. Once possessing the best infrastructure, services, and public education system in the country, California has allowed its roads to crumble and its education system to slip to 30th in the nation. The piece begins with an account of one woman’s fight to preserve one of Orange County’s few remaining, name-sake orange groves. With language like “ticky-tacky subdivision,” “sprawling,” and “congestion,” it seems at first that the article may venture into interesting territory. The article also starts on the right foot when it correctly points out that California is an expensive state in which to live. Though it never says so explicitly, the state is home to six of the ten most expensive real-estate markets in the U.S. Indeed, the article does get a few things right, but nevertheless quickly falls into the trap of outdated assumptions and tired California canards.

The piece lapses first into the myth that California’s problems stem from its being too “crowded.” Some perspective is in order here. At 239 inhabitants per square mile as of 2010, California is only the 11th densest state in the union—it was even beat out by the likes of Ohio, Maryland, and Florida. New Jersey took the top spot with 1,196 people per square mile—almost exactly five times the density of California. Florida, which had a 2000 population density of 293 (excluding water), experienced a 17.6% increase in population from 2000 to 2010. Berkeley, already a notably dense and vibrant city, saw its population increase by nearly 11% in the same time period. It would seem that California’s problems and net outward domestic migration cannot be attributed to crowdedness alone, if at all.

Recounting the net loss of California residents to other states, the article next considers the very real and ongoing crisis of California’s middle class. It rightly places some blame on the cost of housing, but punts on the question of why housing costs so much in the first place. What the article fails to explore is how the high cost of California housing is in large part a product of downzoning, NIMBYism, tax policy, and sprawl-type models of development. California’s most economically successful urban centers have been rendered unable to keep pace with their commensurate housing demand because of low-density zoning and the unremitting difficulty of building infill housing. In addition, by increasing the relative attractiveness of sales taxes as a revenue stream, Prop 13 has discouraged residential development for over 30 years. Meanwhile, sprawl has lead to increased land, infrastructure, and service costs, thus contributing to both higher housing costs and the loss of California’s farm and wild-lands. In apparent ignorance of this obvious cause, the piece mourns the loss of Orange County’s orchards to drab, monotonous housing tracts, but then fails to consider the alternatives. It bemoans long, smoggy commutes, but doesn’t pause to wonder why so many people have to drive or what can be done about it. This avoidance of deeper issues is something of a pattern.

There is at least one other way in which Prop 13 is responsible for undermining California’s middle class. By allowing large corporations, the wealthy, and—yes—some of the elderly to pay a disproportionately small share of property taxes, California has shifted the burden on to young adults, new families, and the lower/middle classes. In tandem with California’s former budget-by-supermajority, Prop 13 artificially restricted the ability of both the state and localities to choose to pay for the infrastructure, education, and other essential services that have historically made California appealing to employers and residents alike. A robust middle class is built upon strong public institutions, such as excellent K-12 education and affordable, high-quality public universities. Yet these are the very programs Prop 13 has forced California to incrementally dismantle.  Any exploration of California’s dysfunction that fails to mention Prop 13 is woefully incomplete.

The piece next proclaims the plight of California’s economy but again fails to look beyond its own assumptions. Citing an anemic 1.8% increase in California GDP from 2009 to 2010, the author bemoans the “fall” of California’s economy.  Putting aside questions regarding GDP’s validity as an accurate measure of economic or human well-being, a closer look at the numbers still reveals a different and more nuanced picture. Even though metro-level 2010 GDP data are not readily available, a review of data from 2001-2009 tells a tale of two California economies. While the San Francisco-Oakland-Fremont Metropolitan Statistical Area (MSA) saw its per-capita GDP increase by 12.5% during this time frame, Modesto saw a mere 2.0% increase. For comparison, Austin, Texas saw its per-capita GDP increase by 5.0% during this same time-frame. While it is hard to tease out how income inequality skews the real-world implications of these numbers, it is nonetheless striking that the “crowded” and expensive San Francisco MSA beat out the comparatively cheap and roomy likes of Austin and Modesto. Taking an approach as glib as the article’s, one would have to conclude that the solution to California’s economic problems would be to make places like Modesto as dense and expensive as San Francisco. Whether this conclusion is valid is a long discussion for another time.

On the subject of ecological limitations, the article again beings with a kernel of truth; California’s carrying capacity and natural resource use are valid considerations for California’s future. Ironically though, the CNN article skips over more important resource questions as it hastens to mishandle the issue of water. The article repeats unblinking the tired story of California stealing water from other states, to which the simplest retort is: California will stop stealing their water, as soon as they stop eating its food. Only 20% of California’s water goes to urban uses, most of the rest goes to agriculture. As of the 2007 Agricultural census, California: ranked 2nd in cotton production; had three times as many acres in vegetable production as its nearest runner-up; was the nation’s top producer of dairy products; and grew a whopping 59.4% of America’s fruits, nuts and berries. California’s water shortage is driven far more by America’s taste for the state’s produce than by the thirst of California residents. The piece would have done better to instead focus on California’s use of coal, oil, and natural gas, as these represent demands that are neither sustainable nor quickly solvable. Arguably, such issues were avoided because they fly in the face of a narrative that views California’s decline as being different or disconnected from nation-wide problems.

In many ways, California’s obstacles are a microcosm of a national struggle. Understanding this is essential to recognizing how California is moving to meet our shared challenges. To be sure, the problems of Prop 13 and a frequently dysfunctional state government remain largely unaddressed. But in areas where California is slowly lurching towards solutions, it is already far ahead of its U.S. counterparts. California’s high-speed rail project, while controversial and still fragile, currently represents the most far-along effort of its type. Neither California nor the U.S. as a whole can meet projected travel demand with current infrastructure. With many airports and highways already at or near capacity, California is the first state to take the crucial step of investing in alternatives. California was also the first state to move to regulate the emission of greenhouse gases, an effort neglected by the federal government despite its climatic, environmental, and economic importance. With the passage of AB32 and SB375, California has made itself the first U.S. state to make even modest strides toward creating cities, economies, and livelihoods founded upon a low-carbon future. In these and other ways, California is at least groping its way towards solutions.

Though it reaches no substantive conclusions, the article at times seems to imply that California should become more like the states its former residents have largely settled in: Texas, Colorado, Nevada, and Arizona. Ironically, these states’ housing bubbles and low-tax policies are now coming back to haunt them, as they too face looming budget deficits and withering economies. Texas especially faces massive cuts to its meager social programs and already underfunded education system; Nevada and Arizona face budget woes of their own as their housing markets crater. It is worth noting that Austin, Texas, one of the best-performing destinations for California expatriates, is arguably the most California-like of all these locales. But instead of learning from California’s mistakes, these states—and indeed the whole country—seem determined to repeat them.

In unwitting parallel to the very state it prematurely eulogizes, the article is limited by the same stale attitudes that restrain California and stifle its resurgence. Adherence to uninspired tropes leaves the article bereft of comprehension and renders elusive the solutions absent from the piece—and, by and large, from the political discourse as well. Reestablishing California as it was—a beacon of possibility and resolve—requires renewed vision, not a quest for conformity or a race to meet other states at the bottom. California should welcome and encourage new residents and economic opportunity in a way that conserves land, energy, and natural resources. We cannot rest on our laurels or creature comforts, but should instead seek to do, each of us, our fair share. We must rediscover the California Dream not as a destination, but as enthusiasm for thinking big, an unwavering commitment to invest in our future, and as an enduring willingness to share, not just in the rewards, but in the responsibility of that dream.