Crossppsted on New Geography

America has two basic economies, and the division increasingly   defines its politics. One, concentrated on the coasts and in college   towns, focuses on the business of images, digits and transactions. The   other, located largely in the southeast, Texas and the Heartland, makes   its living in more traditional industries, from agriculture and   manufacturing to fossil fuel development.

Traditionally these two economies coexisted without interfering with  the progress of the other. Wealthier gentry-dominated regions generally   eschewed getting their hands dirty so that they could maintain the   amenities that draw the so-called creative class and affluent   trustifarians. The more traditionally based regions focused, largely   uninhibited, on their core businesses, and often used the income to   diversify their economies into higher-value added fields.

The Obama administration has altered this tolerant regime, generating intensifying conflict between the NIMBY America and its more   blue-collar counterpart. The administration’s move to block the Keystone XL oil pipeline from Canada to the Gulf of Mexico represents a classic   expression of this conflict. To appease largely urban environmentalists,   the Obama team has squandered the potential for thousands of   blue-collar jobs in the Heartland and the Gulf of Mexico.

In this way, Obama differs from Bill Clinton,   who after all recognized the need for basic industries as governor of   poor and rural Arkansas. But the academic and urbanista-dominated Obama   administration has little appreciation for those who do the nation’s   economic dirty work.

NIMBY America’s quasi-religious devotion to the cause of global   warming is the current main reason for their hostility to the basic   economy. But it is all a part of a concerted, decades-long jihad to   limit the dreaded “human footprint,” particularly of those living   outside the carefully protected littoral urban areas.

Oddly, in their self-righteous narcissism, the urbanistas seem to   forget that driving production from more regulated areas like California or New York to   far less controlled areas like Texas or China, may in the end actually   increase net greenhouse gas emissions. The hip, cool urbanistas won’t   stop consuming iPads, but simply prefer that the pollution making them   is generated far from home, and preferably outside the country.

The perspective in the Heartland areas and Texas, of course, is quite different. They regard basic industries as central to their current   prosperity. Oil and gas, along with agriculture and manufacturing, have made these areas the fastest growing in terms of jobs and income over the past decade.

Of course, the apologists for the NIMBY regions can claim that they,  too, create economic value. And to be sure, Silicon Valley — now in a  midst of one of its periodic boom periods — Wall Street and Hollywood constitute some of the country’s prime economic assets. Similarly, highly regulated cities such as New York, San Francisco, Seattle,   Boston and Chicago offer a quality of life, at least for the   well-heeled, that draws talent and capital from the rest of the world.

But the NIMBY model suffers severe limitations. For one thing, these  high cost areas generally lag in creating middle-skilled jobs; New York   and San Francisco, for example, have suffered the largest percentage   declines in manufacturing employment of the nation’s 51 largest   metropolitan areas. Indeed with the exception of Seattle, the NIMBY   regions have all underperformed the national average in job creation for   well over a decade.

These areas are becoming increasingly toxic to the middle class,   especially families who are now fleeing to places like Texas, Tennessee, North Carolina and even Oklahoma. NIMBY land use regulations — designed   to limit single-family houses — usually end up creating housing costs   that range up to six times annual income; in more basic regions, the   ratio is around three or lower.

Ironically, America’s most ardently “progressive” areas turn out to   be the most socially regressive, with the largest gaps between rich and poor. Even the current tech bubble has not been of much help to heavily   Latino working-class areas like San Jose, where unemployment ranges   around 10%, nor across the Bay in devastated Oakland, where the jobless   rate surpasses 15%.

To succeed, America needs both of its economies to accommodate the   aspirations not only of its current population but the roughly 100   million more Americans who will be here by 2050. If the regions that   want to maintain NIMBY values want to do so, that should be their   prerogative. But stomping on the potential of other, less fashionable   areas seems neither morally nor socially justifiable.