I came across some interesting tidbits while putting together a post on LA mass transit over at Econlog, which I’ll share with you over here.
The Eagle’s Landing plan seeks to merge into its boundaries the primest real estate and wealthiest households from the city of Stockbridge, leaving behind a smaller, mostly African American population with fewer resources to pay for Stockbridge city services. The Eagle’s Landing city proposal will be voted on via ballot referendum on November 6, but Stockbridge residents who live outside the Eagle’s Landing footprint—the people who will be most hampered by the division—are not eligible to vote on it. Meanwhile, neither lawsuits nor letters from global finance agencies warning that the proposal could wreck economies across Georgia have been able to stop it.
And the reason for tearing Stockbridge apart to start this new city? It has something to do with cheesecake. Or at least cheesecake is what was emphasized in a conversation with Vicki Consiglio, the chair of the Committee for the City of Eagle’s Landing, held at the Eagle’s Landing Country Club.
“I serve on the Henry County zoning board,” said Consiglio, “and so I kept seeing all of these places like Bojangle’s, Waffle Houses, dollar stores, and all this going up in our county. And I was like, why can’t we get a Cheesecake Factory, or a P.F. Chang’s or a Houston’s? We have areas that have high incomes, so what’s the deal?” . . .
According to Consiglio, The Cheesecake Factory did consider coming to Stockbridge at one point, but balked after an income study revealed that the average median income was too low to justify placing a restaurant there. Consiglio blames this on Stockbridge, where median household income is $54,769. So in 2016, Consiglio and her neighborhood colleagues, some of them former Stockbridge city officials, began meeting to figure out what they could do to land if not a Cheesecake Factory, then a Cheesecake Factory-esque restaurant, because the dining halls and pubs in the country club would no longer do.
I’m sure Tyler Cowen or Scott Alexander could find a witty title for this story, but I’m sort of speechless. Any attempt on my part would (already has?) come across as condescending. BTW, there actually is a serious economic story here, relating to questions such as who absorbs Stockbridge’s bond obligations.
As an aside, I like key lime cheesecake–how’s that for bad taste!
2. Last week my wife and I drove through LA’s skid row neighborhood, which has an extremely dense concentration of homeless people. This is by far the poorest neighborhood I’ve ever seen while traveling throughout the US. Just a few miles away you have the ultra rich suburb of Beverly Hills. But here’s what I find surprising, the difference in poverty rates between Skid Row and Beverly Hills is less than I would have imagined. Beverly Hills is 10.2% poor while Skid Row is 41.8% poor.
You may be asking, “What’s so confusing out that; Skid Row is 4 times more poor, exactly what’s you’d expect.” No, I get that it’s poorer; I’m surprised the gap is not even larger. If you asked me to guess, I might have estimated that Beverly Hills was 2% to 4% poor—a few live-in nannies, plus the odd 30-year old living in his parents’ basement, while Skid Row was 80% poor. I’m surprised the gap is not even larger.
I’m too lazy to do the research, but is there some sort of national tendency for poverty rates to cluster close to the national average of 14%, regardless of how rich or poor a neighborhood is?
3. LA’s homeless problem got me thinking about the today’s rent control referendum in California. Obviously, I oppose all rent controls. At the same time, I doubt that rent controls are a major cause of homelessness. Think about the following three groups of people:
a. My daughter, and 5 other UCLA students who share two small rooms and one bath in a dorm.
b. Six illegal immigrants from Fujian who share a single room in a Chinatown apartment building, work in a restaurant, and send money home.
c. Six homeless men living in tents on LA sidewalks.
While LA’s housing policies undoubtedly make things a bit more difficult for the homeless, I’m really having trouble seeing how they could be a major cause of the problem. Around here, fast food restaurants are desperate to get unskilled labor, even at a starting wage of $13.50/hour ($27,000/year.) Now you may argue that $27,000/ year is a pretty low income in LA’s housing market. But that’s entirely missing the point. At no time in all of human history has it been assumed that poor people would be able to afford to live alone. The expectation has always been that lower income people will live in groups, to spread housing costs. If you have 4 people making $27,000/year, their combined income is easily large enough to share a decent LA apartment. Lots of young professionals share apartments in California.
Please don’t read this post as offering advice to homeless people. I understand that they may not be able to do what I suggest in the post. My actual point is entirely different—homelessness has very little to do with high housing costs. The reasons why it might be hard for 4 homeless people to get jobs flipping hamburgers and then share an apartment have little to do with cost; rather there are other more complex social issues. Maybe some have drug issues that make it hard to hold a job. Maybe some have mental health issues that make it hard to live with roommates. Maybe they face discrimination from landlords. I could imagine any number of reasons why it’s hard to get housing. What I can’t imagine is how any of this could be fixed by building more housing. If I’m missing something here, please enlighten me.