Random MOCO Pic of the Day--A Reminder that It's Been a Violent Summer in the DMV

I saw this car sign while I was out and about yesterday and it reminded me what a violent summer it's been in the DMV.

Things are especially bad in DC where the total number of murders, 106 as of September 5th, just surpassed the total number of murders for all of 2014.

Things are better in MOCO, but the trend lines are worrying.  In 2013 Montgomery County recorded 8 murders.  In 2014 the number of murders increased 137% to 19.  As of September 5th, the county has recorded 12 murders.

We don't know if these increases are short term aberrations or the beginning of something more substantial.  Either way, it's been a long, hard summer for too many DMV families.    

What will Negative Net-Migraiton look like in the DMV?

Today's Washington Post has a provocative article about new census data showing that population growth in the region is slowing down.  Most of the slow down is attributed to out-migration rather than birth dynamics.  Basically, more people are moving out of the region than are moving into it.  Population growth hasn't ceased in large part because birth rates are making up the shortfall. 

There is, of course, variation within the region.   Net migration (number of people moving to a place minus the number of people leaving it) is still positive in parts of the region.    DC still has positive net migration.  So, too, do Loudoun, Prince Georges, Montgomery, and Prince William Counties.  However, the city of Alexandria, and Arlington and Fairfax Counties now have negative net migration.

The Post attributes the shift in large part to "sequestration," which led to cuts in government budgets across the board.  Although many municipal leaders hoped the cuts would be restored, most haven't been.  And, Virginia localities, where beltway bandits set up shop, took the biggest hit.

The hand-wringing has already commenced.  Unlike other parts of the country, the DMV has experienced a largely uninterrupted growth spurt, nearly 20 years by some estimates.  Even the recession didn't really slow things down here.  In fact, people who lost jobs in other parts of the country often found work in DC--as was the case with one of the out-migrants profiled in the story.

So, what are the consequences of negative net-migration?  As with most shifts, there will be winners and losers.

Likely winners? 
* The region's commuters might see a small, but measurable improvement on commuter routes.
* So, too, might metro riders.  Metro ridership is already down.  Factors posited to explain the drop include rising prices, poor reliability, packed trains, more telework, and a reduction in the transportation subsidy for federal workers.  Ridership might decrease even more if negative net-migration continues to be a trend.  In fact, most migrants to the area have been public transportation-loving millennials.  If they opt to go elsewhere, then the trains might not be as packed.   
* First time home-buyers might benefit as well.  Inventory has been low since the 2008 recession.  Indeed, many homeowners put off selling their homes, choosing to wait until housing prices rebounded to their bubble (or near bubble) levels.  However, people who lose their jobs, or can't find ones to begin with (see: sequestration) are often willing to take a little less money when they sell. 
* The DMV's middle and lower-income residents.  They aren't complete winners (see below), but a slow down might make things a wee bit more affordable for people without top dollar incomes.  For the last ten years or so most development has been targeted to the luxury market.  If those people aren't coming here, developers of newly built apartments and condos might lower their prices.  Fewer people and somewhat lower prices also eases the displacement pressure the city's low income residents face. 

Likely losers? 
* Municipal Tax Coffers.  Fewer people means fewer people to tax.  And, fewer tax receipts means either tax hikes, or cuts in service.  It's hard to predict where tax hikes or cuts would be focused.  Most likely, though, there will be more cuts than taxes.  And, as a general rule, cuts usually hurt the poor more than the wealthy.
* Home Sellers.  People trying to sell their homes in the DMV have been incredibly lucky when compared with the country as a whole.  The DMV's housing values didn't fall as much as those in many other parts of the country, and they rebounded more quickly as well.  As a result, it's been a sellers market for much of the last 5 years (purchasers at the height of the bubble excepted).  With fewer people churning into the city, it will be harder to sell houses, and probably take more time as well.
* The DMV's Hipster Street Cred.  After years of being described as 'dowdy,' crime-ridden, wonky, arrogant, and type A, the DMV finally started appearing in all those urban top 10 lists.  You know, those lists of the 'Top 10 place to be a hipster,' or the 'Top 10 places to drink craft beer.'  That could change if the millennials decide to head elsewhere.  What's a hipster wonk to do? I guess they can always go back to yakking about policy over decidedly unhip (gasp) pitchers of beer.   

'Uber This!' Said the Taxi Driver.

I'm about to kick it old school.  In the process I'll probably freak out a few hipsters.  And, I'm sure to attract the wrath of an economist or two.  But, here goes... 

Consumer welfare shouldn't trump the welfare of those who produce what consumers buy.  The goal should be to find some balance between the two. 

Unfortunately, consumers are today's gods while producers are pesky obstacles to progress.  Let's take a case in point.  The Uber debates.  

For those of you who live outside the DMV or in places without Uber, it is basically an informal taxi service.  Because you have to be an Uber 'member' to catch a ride with an Uber driver, Uber isn't registered as a taxi company.  I put 'member' in scare quotes, however, because all it takes to gain membership is a simple download of the Uber app.  The app let's you request a ride and see the closest drivers near you.    

I've never taken Uber.  It started to get big about the time I had a baby, and since my little one can't ride in a car without a car seat, all taxis (formal or otherwise) are a no-go for me at the moment.  I'm not completely out of the loop though.  A friend used Uber to catch a ride from my house to hers the other night.  I watched her request a ride and peered at the map showing where all the Uber cars in the area were.  We were able to guestimate (with accuracy) how long it would take for one to arrive.

All of which is to say that I get the attraction of Uber.  Uber gives you more options (especially in the suburbs where getting a taxi is harder than in the city), and it is often faster at pick-ups than traditional taxis are.       

It is annoying, however, to see Uber described as "rais[ing] consumer welfare." That's what the IGM Economic Experts Panel recently did.  It is also annoying to hear Uber's legions of fans describe it with the kind of hyperbole usually reserved for tent revivals in the South.  One Uber fan on Business Insider wrote: "Uber has changed my life and as God is my witness I will never take a taxi again." 


Really?  So that's what Scarlett O'Hara was talking about--a ride to Atlanta. 

On the face of it IGM is right.  Uber does improve consumer welfare.  However, it does so at the expense of a lot of other things. 

What are those other things?  Thanks go to the Washington Post's Catherine Rampell for pointing out some of these in her recent op-ed about Uber.  She notes, for example, that despite claims to the contrary, Uber isn't all that green.  Indeed, their goal is to be immediately available to anyone who requests a ride, and that means flooding the streets of big cities with Uber drivers.  The inevitable result is a lot of idling cars.  According to Rampell there's also evidence that people take Uber instead of greener options, like buses and metrorail.

There are other problems with Uber, though, that can't fit into the space of an Op-ed in the Washington Post.  Here's where MOCOMusings comes in.  Let's look at the drivers.  Driving a taxi can be a middle class job, although a difficult one.  You know that feeling you get after a road trip where you've done all the driving?  The cramped legs, twitchy fingers, and achy back.  Taxi drivers often do road trip amounts of driving everyday.  So, they get those feelings everyday.  The regulations can also be a pain--you can't refuse customers (even though many do by simply 'not seeing them), and your car has to pass frequent inspection. 

The job can be worth it, though, because the pay is decent, the regulations and fares are predictable (and only change on an annual basis, if at all), and you've got flexibility (need to pop into the store to get something for your kid, you can do it).  Uber's model will destroy or undermine all of that.  In fact, its business model vis-à-vis its employees is to off-load most of the risks onto its drivers.  Drivers have to buy their car (although it must fit Uber's specifications), pay for the insurance, deal with aggressive/drunk customers, compete with the heaps of new drivers Uber keeps hiring, and accept fare reductions that often happen on a whim.  Oh, and let's not forget the commission the drivers have to pay Uber, a fee also subject to unannounced change.  Don't believe me?  Check out this post on a near strike by Uber drivers based on some of these practices.   
 
The taxi-riding public can demand omnipresent services.  It is their right, I suppose.  But, the Uber-riding public among them might want to stop equating their demands with all that is good and holy.  Uber provides its service in much the same way Nike and other large corporations do--at the expense of their labor.  And, all those economists who tell you Uber is great for the flexibility-demanding American workforce are just deluding themselves.  Uber is an attractive option for many drivers because they can't find a job elsewhere. 

Somewhere in Michigan (I presume), Henry Ford, who believed workers should be paid enough to be consumers, is turning over in his grave. 

Are We Asking the Wrong Question about Where Gentrification Happens?

For the most part, when we discuss gentrification we talk about neighborhoods.  Neighborhood X got a yoga studio, or Neighborhood Y got a new Whole Foods.  If multiple neighborhoods gentrify at the same time, we might also talk about its affects on the city as a whole.  But, the city line is usually the spatial perimeter that bounds our discussion. 

But, what if we are asking the wrong question?  What if gentrification is actually a process that affects the nation as a whole, creating gentrifying cities and disinvested cities instead of  gentrifying neighborhoods and disinvested ones?  

At this point, you might be thinking--"What you talkin' about Willis?"  

Well, according to a new study by Rebecca Diamond highlighted on the Washington Post's wonkblog, that is what is happening.  The dual affects we often associate with gentrification--investment in some areas and disinvestment in others--are are national in scope.  To use a locally inspired metaphor, some cities are like Logan Circle while others are like Langley Park. 

Instead of income, however, Diamond uses education to measure gentrification on the national scale, with the key metric being college degrees.

Turns out,  people with college degrees tend to flock to places where there are lots of other college grads.  Over time, you get a sort of path dependency.  A city manages to attract college grads, which in turn attracts more college grads.  This trend also puts upward pressure on salaries, which in turn drive an increase in restaurants, museums, and other cultural fare. Streets get safer too. San Francisco, Boston, Philadelphia, and Washington DC are good examples of this trend.  In the early 1990s, for example, DC recorded over 400 murders.  Last year, it recorded 103, even though the city is much larger today. 

On the flip side, places that don't attract college grads see their relative, and in some cases real status decline.  Their wages are lower and they have fewer amenities.  Crime takes a turn for the worse.  Toledo, Detroit, and Baton Rouge are good examples.


I think Diamond's work is fascinating (if ultimately depressing).  It means Americans are becoming even more segregated (in this case along class lines).   

But, none of this means local-scale gentrification will go away anytime soon.  It is easy to look at 14th Street in DC and see the DMV as a booming metropolis full of good jobs, good eats, plentiful entertainment, and safe streets.  But, someone still has to work in the low wage jobs that clean the office buildings where those good jobs are located, bus the tables at the fancy see-and-be-seen restaurants, wash the beer glasses recycled many times over in hipster bars, and police the drunks that come out of them at night.  Low wage workers aren't teleported in for the job.  They live in the DMV too, and the growing gap between their salaries and those of the folks noshing at Le Diplomate continue to leave its mark.

If you want to see how this plays out in your own world, ask the person who cleans your office building where she lives the next time you get the chance.  Chances are she lives in a suburban, and quite likely exurban location.  By the way, when I asked this question at my workplace, the answer was Gaithersburg.          

Fighting for Millennials--City/Suburb edition

City and Suburb have history.  There are slights, fights, outright insults, and more than a fair share of cold shoulders.  So, it probably shouldn't surprise us that they'd fight over millennials as well.

Until recently, however, everyone thought the city had won that battle (many times over).  We're constantly bombarded with stories about millennials' preference for urban hotspots.   

Well, it turns out (according to a recent Washington Post article) that a lot of millennials can't actually afford to live in the city, or can only afford to do so if they shack up dorm style in 1 and 2-bedroom apartments.  And, let's not even discuss group housesmillennial warehouses. Turns out millennials at the upper end of the age bracket are also having trouble 'upsizing' inside the city when they get in a family way.  Two bedroom apartments are in short supply and even more ridiculously expensive than the city's already ridiculously expensive 1-bedrooms.   

What does all of this mean?  Well, we know that millennials are moving into the city at higher rates than any other age group.  But, it turns out they are also the largest age group moving out. 

Who could have seen this coming?  Everyone, it seems, but the stewards of Mayor Gray's 'One City,' who've been busy celebrating the luxurification of the District of Colombia.  It was, after all, Gray's former Director of Planning, Harriett Tregoning who called 14th Street's transformationinto the Champs Elysees"fascinating, anomalous and wonderful for the city!"

But, never fear millennials, neighboring Prince George's County has your back!  After the Washington Post published its article, Eric Olson, a county council member in Prince George's County came a' courtin'!  Turns out PG County has bike trails, some walkable neighborhoods, access to public transportation, and most of all affordable rent. 

I don't have a dog in this fight (I live in MOCO), but I'd hate to see the battle for millennials reduced to a battle over which is better--city or suburb.  The real problem is that the DMV is an expensive place to live, and the closer you get to downtown DC, the more expensive it becomes (with some notable exceptions).  There's also a dearth of affordable housing in the city, and many of its close-in suburbs.  Until that problem gets addressed, the real segregation lines will continue to be economic (and social), not generational. 

DC's new transportation plan: Green elitism?

Yesterday's Washington Post had an interesting article about the DC Department of Transportation's long range transportation plan.  Unfortunately, like a lot of green initiatives, it is fairly elitist.   

First, let's start with what the plan proposes.  There are new features like water taxis and streetcars as well as improvements to the existing metro and bus system.  Bikers will also get a boost with more paved road reserved for bikes lanes.  There's even a plan to charge commuters a toll to drive into the city. The goal is to make DC greener by forcinggetting people out of their cars.

So, why is this plan elitist?  Three interconnected reasons.  The first is that the plan doesn't take into account the changing distribution of the region's working class and poor populations.  DC's Poor and working class population used to live (primarily) in inner city areas.  They often faced disinvestment and high crime, but there was one benefit to their location--proximity to public transportation.  As DC has gentrified, many of these people have been pushed into the suburbs, or even exurbs.

Second, public transportation becomes less available and efficient the further you move from the city.  There are fewer bus lines and wait times between buses can be more than half an hour.  Likewise, metro stations tend to be located further apart in the suburbs, and the hub and spoke nature of DC's system means that it is often difficult to move from one suburb to another without routing through the city first.  These difficulties are compounded for poor and working class people who also have to find a way to get to their nearest metro stop.  Most can't afford to live within walking distance of a station because rents/home prices tend to be higher near them.  This means that car dependency is not just a choice (as it is often presented) but an unavoidable fact of life for many people at the bottom half of the income spectrum.

Third, if you charge people to drive into DC, you are essentially instituting a regressive tax.  That is, the people who cannot afford to live in the city or near a suburban metro stop will be the ones who have to pay it.  Some will pay it because they have no choice.  But, others, especially those at the bottom of the scale may simply avoid the city altogether--not because they want to but because they can't afford the cost or time it would take to enter it via public transit.     

There's nothing wrong with making it easier to move around DC without a car, but unless and until public transportation in the entire DMV is improved, the city should stick with carrots and leave the sticks behind.  Otherwise, DC's green will come with a side of exclusion. 

Renting in the District, Gangnam Style

I feel sorry for Emmy, a British Bulldog profiled in a Washington Post article yesterday about the competition for renters among DC's new luxury apartment complexes.  

Emmy's job is to bounce between the apartments of millennials who want a bit of fur to pat after a hard day.  That's right, tenants "will be able to pick her up in the lobby, take her upstairs to their apartment or for a walk, and return her as they would a library book, a DVD or bowling shoes."

Emmy's place of bondageemployment is 2M, a new apartment complex developed by the William C. Smith & C0.

Yup, this is what luxury looks like when its marketed to millennials.  Age-appropriate symbols of luxury.  Your kitchen will have granite counter-tops and stainless steel appliances.  You'll have cupcakes delivered on your birthday (from Georgetown Cupcakes of course because you could also end up on TV).  And, the concierge will drop off your dry-cleaning while you're out hustling for a date with your wing-lady Emmy in tow.      

Emmy's just the latest feature designed to make an apartment building--in this case 2M--stand out in the sea of granite counter-tops, rooftop decks, and cupcakes that has become the new DC.

What does all of this say about the DMV as a whole?

First, the District is becoming an attractive place for the wealthy to live.  This wasn't the case even 15 years ago.  1-bedroom apartments at one of the new luxury properties profiled in the Post article, for example, ranged from "$1,786 to $2,347."  The range was even higher for 2-bedroom apartments--"$2,315 to $3,145."  That's right, some people are paying more than 3k a month for a two bedroom apartment. 

But, poor and working class people haven't gone away--someone still has to work those minimum wage jobs.  In fact, it's an open question whether the region is actually getting wealthier or whether the city is simply catering to the wealthy at the expense of everyone else.  And, this brings us to our second trend.  As the city gentrifies, working class and low income people who used to be able to afford to live in the city are now heading to the 'burbs.

Of course anyone who's tried to buy or rent in the close-in suburbs knows that rents aren't much of a bargain there either.  So, poor and working class people frequently settle outside the beltway, or even further afield, in the exurbs (think Gaithersburg in MOCO).

A new distribution of wealth and poverty is emerging in the DMV.  We'll keep tracking it here, and hoping Emmy finds a real owner.