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    Two Visions of America by Don Jans

    California Population Decline is Real

    By Jerry Sullivan, City Watch LA

    THE STATE OF OUR STATE – Has the California proposition changed fundamentally? And does it matter for real estate?

    The answer to the first question is yes—the state had a net population decline in 2021, the first drop since it began annual counts more than a century ago. That followed another historic reversal, noted in 2018, when the number of Californians leaving the state exceeded new arrivals from around the world for the first time.

    Those trendlines matter in ways that headlines about California being over – a periodic theme in the national media for decades – never did.

    And they matter to real estate, especially in Southern California—a place that willed itself out of chaparral country, midwifed the birth of Hollywood, invented the Jet Age, redefined the American Dream and became a West Coast bookend to Ellis Island.

    All of that grew out of a real estate hustle that peddled parched land as paradise. The scheme relied on constant population growth, presuming eternal desire for Southern California’s lifestyle and land.

    The recent dip in population suggests that presumption has been punctured.

    The decline is real – an empirical data point. It also aligns with perceptions in many precincts that Southern California’s promise is being spoiled by public corruption, homeless encampments, and a push for residential density that flies in the face of the backyard-as-rec-room culture that has defined the place.

    There are more specific reasons for concern in a recent report from Chapman University titled “Restoring the California Dream,” penned by Joel Kotkin and Marshall Toplansky.

    You can check the report yourself here—but for now consider this brief excerpt and the challenge it sums up:

    “Nearly 80 percent of all jobs created in the state over the past decade paid less than the median income, a percentage far below our prime competitors. The inconvenient truth is that in key metrics such as housing costs and income growth, most Californians are doing worse than their counterparts elsewhere.”

    A clear takeaway is that California can no longer be sure it is a magnet for newcomers from around the nation and world. Texas beckons, and for every person who just has to live near the ocean there are eight or 10 who just want their own house. California can no longer count on Californians either. Florida looks better to a lot of well-heeled folks who have grown tired of getting hit with tax hikes only to see the public sector fail to perform the basic chores of government—shelter for the homeless in Los Angeles, public safety in San Francisco, getting unemployment checks sent out of Sacramento during a pandemic.

    The report from Chapman makes a lot of sense but is gaining little traction with public officials. That’s likely because the public sector has gotten a reprieve from a reckoning thanks to a gusher of tax revenue from initial public offerings and capital gains on shares of tech outfits from Silicon Valley to Silicon Beach.

    We all know that the stock market can’t go up forever – tech stocks have already taken a hiding this month. So it’s important to ask how long California can live in denial.

    New York City’s history might offer a hint. Comparisons of California to New York are plentiful – and generally unwise—but there are exceptions to the rule if we look back into the
    Industrial Age.

    New York’s greatest challenge of recent times started in the wake of World War II, when a general-turned-politician named Dwight Eisenhower got elected president and started to build an interstate highway system. It was a defense project—despite its obvious civilian applications—inspired by Eisenhower’s experience with the logistics of invading Europe.

    New York was the largest center of industrial jobs in the U.S. in the early 1950s, when the interstate highway system began to take shape. The highways soon sped up the development of suburbs and new centers of industry, allowing the country to spread out— and eroding New York’s dominant position, prompting the first post-industrial transition for a major American city.

    It didn’t go well—plenty of denial for many years—and New York was disheveled, dispirited, and broke by the 1970s. The decline continued into the 1990s, when New York finally found the political will for policies that produced a turnaround.

    Now consider Southern California, where the information superhighway could have an effect similar to the toll that Eisenhower’s interstate highway system took on New York. Those physical roads opened up a world of new options for a lot of opportunities that previously had to run through Manhattan. The roadways of cyberspace have put the means of producing everything from podcasts to feature-length films within reach of just about anyone with any ambition anywhere in America. That’s the sort of stuff that used to run by default through the dream factory of Southern California.

    The region’s dominant city and driving force—L.A.—is looking disheveled these days, like a place that’s just a recession away from being broke. Walk a few blocks from City Hall—or drive around and check the freeway underpasses – and L.A. feels like New York circa 1970.

    That comparison might be taken to mean there’s another decade or so before the City of Angels is forced to face its demons.

    Don’t count on having that much time, though – the clock ticks faster in the Digital Age.


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    11 months ago

    Since 1990, the once Golden State has turned into the Browning State. Many cities have sections that look like a 3rd world country. The Democratic party has destroyed all that was once great about California. One of the most corrupt voting schemes in the country. They’ve made the state the #1 best place for welfare recipients, by encouraging them here. Crime, illegal immigration & unwarranted taxation is their accomplishments. The Red Hot Chili Peppers called it a long time ago…

    Michael A...
    Michael A...
    11 months ago

    Sixth graders could have done better financial research then did Calpers. LA is a city made up of Latino immigrants waiting for the next gov. handout. How are they going to pay the coming bills?

    11 months ago
    Reply to  Michael A...

    Your racism is showing.

    11 months ago
    Reply to  Caitlyn

    Only liars hate the truth

    11 months ago
    Reply to  Steve

    Guess you just outed yourself as a liar. And a faggot, Baby.

    Sheryl Hamlin
    11 months ago

    No mention about the hit to CalPRS and CalSTRS. Caiso wants $30.5 billion to upgrade grid for EV. Newsom wants universal healthcare. Homeowners and businesses will pay the bills.

    C E Voigtsberger
    C E Voigtsberger
    11 months ago
    Reply to  Sheryl Hamlin

    With the extra load being put on our electrical system, there is no way that windmills and solar cells are going to be able to support the demand that electrical cars are going to put on the grid. It’s too late to bring back the marvelous system we had in place in the 60s with steam generating plants along the coast. How many are left?

    One pays over $75,000 for an electric car that can’t even drive to SF from LA. My 1982 Mazda four door 626 could drive all the way to SF from Ventura when the speed limit was 55 mph on less than one tank of gas — and I still had to drive at 60 mph to avoid being run over by all the folks who just couldn’t stand driving at 55 mph.

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