The Disappearing Middle Class?

Virginia Postrel writes that the perception of a disappearing middle class is a function of land use regulation (Hat tip: Wall Street Journal):

Dallas and Los Angeles represent two distinct models for successful American cities, which both reflect and reinforce different cultural and political attitudes. One model fosters a family-oriented, middle-class lifestyle—the proverbial home-centered “balanced life.” The other rewards highly productive, work-driven people with a yen for stimulating public activities, for arts venues, world-class universities, luxury shopping, restaurants that aren’t kid-friendly. One makes room for a wide range of incomes, offering most working people a comfortable life. The other, over time, becomes an enclave for the rich. Since day-to-day experience shapes people’s sense of what is typical and normal, these differences in turn lead to contrasting perceptions of economic and social reality. It’s easy to believe the middle class is vanishing when you live in Los Angeles, much harder in Dallas. These differences also reinforce different norms and values—different ideas of what it means to live a good life. Real estate may be as important as religion in explaining the infamous gap between red and blue states.

The middle class is disappearing from Los Angeles, San Francisco, New York, Boston, and Washington because real estate in those cities is so expensive that middle-class people can no longer live in them. But that doesn’t mean that the middle class is disappearing from the United States. It’s just moving to Texas, North Carolina, Nevada, and other fast-growing areas that keep prices low by making it easy to build new housing.

As a long-time resident of and visitor to cities that are not on the coasts, I’ve been struck, not by the disappearance of the middle class, which seems absurd to anyone familiar with Charlotte, Raleigh, Richmond, Las Vegas, Alburquerque, Dallas, Houston, San Antonio, Austin, or dozens of other cities between the coasts, but by the vast expansion of the upper-middle class—or, to put it differently, by the tremendous increase in middle-class people’s standard of living. I grew up in middle-class neighborhoods; our houses ranged from 900 to 1700 square feet. (My family moved around a bit.) Now, the average new house in the U.S. is around 2600 square feet. Relatively new neighborhoods with houses at least that large stretch for miles in and around the cities I mentioned above. When I was young, a middle-class family was doing well to have a TV (19-inch, black-and-white) and a car; now, it’s routine for people to have several TVs (at least one of which is large-screen and high-definition, hooked up to VCRs, DVD players, and DVRs) and at least one car for each driver. A vacation used to involve driving to see relatives; now, it often involves flying to tour national parks, Europe, or those coastal cities that are too expensive to live in but still wonderful to visit.

As Postrel observes, the growing, middle-class-friendly states typically vote Republican; the coastal states increasingly vote Democratic. There’s justice in that. The red states live with the consequences of low levels of regulation; the blue states, with the consequences of high levels of regulation. The irony is that those urging higher regulation because of the disappearance of the middle class they observe in their own areas promote policies that would only exacerbate the problem and extend it to the rest of the country.

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