James Altucher’s piece about the death of New York City seems to me to be largely on target. Yet there are cities that aren’t suffering a comparable exodus, which “should” prompt the question: What makes the Big Apple so vulnerable? Why is Manhattan emptying out, possibly never to be refilled, when other cities are holding steady?
The question made me reflect awhile on New York’s unique economic structure. That NYC is the densest and most populous of our cities, everyone is aware. But the city’s singular economic pyramid is something non-New Yorkers might not have pondered.
Altucher is correct in fingering the expansion of Internet bandwidth as a key factor in the exodus. Without that expansion, the exodus would not be nearly the size it has attained. But other cities have enjoyed the same increase in bandwidth. What makes New York different?
It “should” be “obvious” that the effect of radically increased bandwidth is to make the transmission of information of all kinds faster and easier. NYC is no longer the manufacturing hub of the Nineteenth and early Twentieth Centuries. The pinnacle of its economy is informational: finance, data processing, publishing, entertainment, communications, promotion. Information, in this context, includes such things as real-time images and sound: the stuff of the typical meeting.
When information is the only thing being moved from person to person and place to place, physical proximity is unnecessary. Bandwidth is all that matters. So the quarter-million to half-million New Yorkers whose occupations are information-based have no need to gather in one dense, expensive, difficult-to-reach place.
But that’s not the whole story. “Obviously,” those hundreds of thousands of information-only workers are a small minority of the eight million persons who reside in NYC. What about the others: the ones who still work with physical objects that can’t be transmitted over the Internet? Why are so many of them fleeing the Big Apple?
In many cases, their trades are made economically viable by the people and businesses that pay their salaries and fees: the extremely profitable information-only industries and their well-compensated employees. In that regard, NYC differs from nearly every other American city. The vitality of the information-only sector, rather than being a cherry atop the economic sundae, is what sustains a great part – possibly the greater part – of the livelihoods of other city-dwellers.
Most of those non-information workers could still make a living without the patronage of the information-only sector, but for many it would not be comfortable at NYC’s level of expense. The loss of the information sector thus induces a degree of flight among the non-information workers as a second-order consequence.
New York City won’t die completely. It retains assets that Internet bandwidth can’t replace: in particular, a magnificent harbor and a transportation nexus that serves the whole Atlantic Seaboard. But present trends continuing – always a risky assumption, but what else do we have to go on? – it will diminish substantially and will remain diminished for a long time to come. Yes, the Wuhan virus and the media-promoted fear of it acted as triggers. Still, in an era in which ever fewer persons must interact physically with material objects to earn their livings, something with this effect was likely to happen along sooner or later.
I asked my younger daughter, who is one of those "information workers" and who lives in Brooklyn, if she had seen any signs of New York's imminent demise. She said that no restaurants or other small businesses in her neighborhood have gone out of business; she and her husband eat out frequently although her favorite restaurants are only serving outdoors diners; she has been to her office in Manhattan recently to pick up some stuff she needed and there seemed to be as many people on the streets as usual.
ReplyDeleteJust anecdotal, but it does make me wonder if the "New York is dying" stories are exaggerated because disaster gets more attention than stories that start with "All things considered, New York is still doing pretty well."
Fran,
ReplyDeleteJames Dale Davidson and William Rees-Mogg wrote "Blood in the Streets" in 1988; I read it when it came out.
I was a big fan of Toffler (Future Shock, etc) and George Guilder, so I figured in the '90s excessively packed cities would empty out. There was this network of networks thing coming out! As a devote of Jerry Pournelle and his Byte Magazine columns, I figured half the economy would be working from the country before the turn of the century.
That kinda missed the mark, but with Marxist death cults (BLM, Antifa) in the cities, acceptable bandwidth, and no federal crushing of the internet yet (though some big tech companies are a decent surrogate), the time is now. The ideas were present, and who wants to pay $6K a month to live in a shoe box with Soviet rules and NYC taxes - but I repeat myself.
IMHO, good riddance, the overpacked cities cannot die fast enough.
James
Fran,
ReplyDeleteJames Dale Davidson and William Rees-Mogg wrote "Blood in the Streets" in 1988; I read it when it came out.
I was a big fan of Toffler (Future Shock, etc) and George Guilder, so I figured in the '90s excessively packed cities would empty out. There was this network of networks thing coming out! As a devote of Jerry Pournelle and his Byte Magazine columns, I figured half the economy would be working from the country before the turn of the century.
That kinda missed the mark, but with Marxist death cults (BLM, Antifa) in the cities, acceptable bandwidth, and no federal crushing of the internet yet (though some big tech companies are a decent surrogate), the time is now. The ideas were present, and who wants to pay $6K a month to live in a shoe box with Soviet rules and NYC taxes - but I repeat myself.
IMHO, good riddance, the overpacked cities cannot die fast enough.
James
Ditto this for Los Angeles and the SF Bay Area. We decamped for Texas last month. Sadly, taxes here are rising, but otherwise, 2x the house for .75 the cost, and a lot less regulations and other crap to put up with. I routinely do things now that would have me tossed on jail or fined to penury in CA.
ReplyDeleteCali. pols are attempting a wealth tax that lasts for 10 years after one leaves. Methinks the limits of the value if beautiful west coast weather have been exceeded.
As I am wont to say, the city is dead, long live the city!
ReplyDeleteOf course, living in the Democratic Progressive Tyranny of Portlandia, I am watching the film at 2.88 times normal speed.
Come by sometime and watch the lunacy, it is worth the trip,
Mark "Maddog" Sherman