Quality Of Life

In a post a few days ago, I considered the GOP’s current definition of “crime”–noting that, to Republicans,  breaking federal rules is no longer criminal, and locally, “crime” only happens in Blue cities and states.

It’s another example of the widening perceptual gap between urban and rural Americans. City folks are increasingly Democratic; rural inhabitants increasingly Republican/MAGA.

Ideally, the decision where to live wouldn’t be viewed as political. Some people like owning tracts of land and being close to nature; others (like your truly) appreciate the energy generated by density and diversity. It is–or should be– simply a matter of individual preference.

Of course, it’s never that simple. Public policies matter.

There are measurable reasons that some places in America attract people, while others are emptying out. (Ironically, Red state culture war policies inflict the most damage on rural areas where residents are most supportive of those policies– anti-abortion laws have accelerated the departure of all doctors, not just ob-gyn practitioners, and educational vouchers hurt public schools in rural areas where thin population cannot support private alternatives).

For those who have a choice, the decision where to live often depends upon the perceived “quality of life,” an assessment of the amenities that make a city or state attractive to a majority of potential businesses and individuals.

Michael Hicks recently shared what the data tells us about that question.

Hicks began by noting that most of Indiana (and the Midwest generally)  is in economic decline. Projections are that more than 50 Hoosier counties will experience a declining population through 2060.

A dozen counties will be projected to grow faster than the nation through 2060. The remaining 30 or so will be projected to grow more slowly than the national rate—a pattern known as relative decline. Indiana and the Midwest will still be prosperous, in a global sense. But, relative to most of the nation, the coming decades will see us slipping farther away from the nation.

Research has identified the characteristics of places that do continue to attract residents.

Growing places almost always have most of the same positive attributes. Their schools are good and attractive to families, they are safe, their residents are better educated than average, and they have growing housing stock with good public infrastructure. Growing places enjoy recreational options, both private and public. And, there are few barriers to employment or starting a business, such as restrictive occupational licensing or heavy regulatory burdens

Research tells us that–duh!– when people aren’t moving to an area, it’s because they don’t wish to live there.

The primary reason people don’t wish to live in a place is that it doesn’t have the neighborhoods they want. The reasons for not moving to a place are as varied as human interests. But, for the median family, the common factors are that schools aren’t sufficiently good, crime is too high or infrastructure is too decayed.

That research also tells us that policymankers’ preferred emphasis on “economic development”–luring businesses–is misplaced. As Hicks notes,

No matter how successful a community is at luring new factories and warehouses, unless you can attract their highly paid workers to your town, it will have no lasting effect. If your business attraction efforts make your community less desirable for people, it will actually weaken your local economy. It is a costly business with inherent risks.

In the post-COVID world, people are increasingly mobile, making business attraction less important. Here there is some new policies. Some places are trying to attract remote workers through financial incentives. It is possible someone will figure out a magic incentive. However, the evidence I’ve seen suggests that fundamental conditions such as good schools, safe neighborhoods and recreational opportunities trump financial incentives every time.

Hicks stresses the importance of local government. I absolutely agree–in theory. Unfortunately, in Indiana, municipal governments are severely constrained by our retrograde state legislature.

In Indiana, cities and towns don’t have anything remotely like home rule: It took three legislative sessions to get permission to vote on a local tax to fund adequate transit. When Bloomington tried to ban plastic grocery bags, the legislature passed a bill divesting local governments of authority to do so. Education policies are dictated by a General Assembly determined to privatize public education. For years, dollars for street repair have been doled out based on “lane miles,” irrespective of the difference in traffic counts/wear and tear–a lane on a little-used county road gets funded the same as a lane on a traffic-choked Indianapolis thoroughfare. And efforts to address the number of guns on city streets run headlong into the resistance of “Second Amendment” fanatics in the Statehouse.

Those few among our legislative overlords who understand what Hicks is saying don’t care.


Quality Of Life

The unrepresentative Representatives who infest Indiana’s legislature have gone home, leaving  citizens to consider the multiple harms done during the concluded session. One harm that was mostly overlooked was their refusal to invest in Indiana’s state parks.

As the Capital Chronicle has reported,

Indiana Senate Republicans’ disregard for our parks and for the benefits they bring to Hoosiers’ quality of life was on full display recently when they zeroed out Gov. Eric Holcomb’s requested investment of $25 million for the President Benjamin Harrison Land Trust.

The Trust is the mechanism through which the state purchases land for conservation and parks. As the Chronicle editorialized,

Our Indiana parks and natural spaces are a treasure. They bring more than a connection to nature. They bring jobs, economic growth, and a quality of life that attracts and retains talent…. A 2016 study commissioned by the Indiana Chamber of Commerce and the Wellness Council of Indiana stated, “infrastructure related to traditional wellness activities (such as trails, playgrounds, parks, and open green space) matter more than ever in where people and subsequent businesses relocate.” 

Parks are highly prized and extensively utilized–a quality of life asset–and as Michael Hicks recently documented, economic growth is tightly tied to quality of life indicators. It’s one reason some places grow while others shrink.

First, most migration is concentrated among younger people with high human capital. Yes, retirees move, as do folks in mid-life, but most don’t. One result of the age concentration of migrants is that this movement of people also drives natural population change of births minus deaths. So, places with net in-migration tend to thrive over the coming decades, while places that lose folks do not.

Migration of people is driven by three factors; economic opportunity, quality of life and housing elasticity. Housing elasticity is simply whether the supply of housing adjusts to demand. With the exception of a dozen or so large metropolitan areas in the U.S., housing elasticity plays no meaningful role in household migration. In fact, the Midwest currently benefits from bad housing policies in other regions such as the West Coast. Thus, migration in the Midwest really comes down to economic opportunity and quality of life.

For most of American history, people moved for better farmland, better jobs and/or better places to start businesses. As the role of educated workers has grown, however, and the share of college graduates explains nearly 80 percent of the growth and earnings in a city, people began to value more than just economic opportunity in their location choices.

Today, research shows that jobs follow people, not business-friendly tax climates.

In 1980, few places enjoyed both economic opportunity and high quality of life, but as of 2019, they are highly correlated…

Over the past couple of decades, families found that their location choices were vastly expanded. Economic opportunity was tied to the places where people clustered, and people clustered where the quality of life was good.

In the 60s and 70s, the perceived differences between places was driven by nature–climate, mountains, lakes– not government. That has changed.

The empirical evidence is now extraordinarily clear. Places with restrictive social policies in the United States fail to become destinations for economic opportunity. They struggle to attract and retain their share of well-educated people. That trend is sure to continue, if not accelerate.

Another change: in the 2000s, a national focus on school quality emerged.

At the same time, labor markets began valuing education far more heavily. So, for the past couple of decades, it has become obvious that the quality of a K-12 and college education were prime determinants of economic opportunity for individuals.

In the post-COVID environment, the role of quality of life is even stronger. Today a quarter of all young, educated people have full-time remote jobs, and half work at least partially remote. The certain effect of this is that the amenities (and dis-amenities) of a region will weigh more heavily on prospective residents than ever before.

So, what do we know about the characteristics of a high quality of life?  Excellent schools, natural amenities/climate, and local recreational opportunities head the list. 

What is new is the fact that the effect of quality of life on population growth is close to four times larger after COVID than in the decade before. Much of that is due to remote work accelerating the existing trends. We don’t yet know how long that will last, but my guess is for at least a generation. We also know that a welcoming social climate matters.

Meanwhile, Indiana’s legislature continues to pursue an outdated low-tax strategy, shortchanging education and parks, among other quality of life amenities, and doubling down on  misogyny and homophobia.

No wonder we’re not thriving.


How NOT To Do Economic Development

According to a recent report in the Capital Chronicle, the Indiana Economic Development Corporation wants a massive increase in funding. It justifies that request by insisting that larger expenditures are necessary to keep Indiana competitive in the national job market,  “especially as Indiana pivots from manufacturing to the “economy of the future.” Those industries — electric vehicles, semiconductors, agricultural technology — will need incentives to come to the Hoosier State.”

The article describes the nature of the “incentives” that will be offered: purchases of land, tax credits, a “Deal Closing Fund,” and others.

If you are interested in the details, you can find them at the link. My reason for highlighting the article is that it underlines Indiana’s persistent–and exclusive– focus on an economic development approach that is essentially bribery.

There’s a lot wrong with that focus.

First of all, even when successful, it uses tax dollars generated by Hoosiers to reward/bribe enterprises new to the state, rather than trying to grow businesses and employers who are already here. Second, it is an approach that buys in to the “zero sum” game being played by American states that are encouraged to bid against each other to lure Enterprise X,  which, if successful, simply moves the site of employment to state A from state B, rather than adding positions to the nation’s job market.

But my biggest beef with the bribery approach is that it misconceives and misunderstands what makes a state attractive both to business and to skilled workers.

In a recent interview, the new CEO of Techpoint spoke of that organization’s commitment to working with partners “to bring more people of color and women into the sector.” Indiana is currently 37th in tech employment, and–as I have previously noted– there are reasons for that.

Economic development– the addition of skilled workers and new companies–depends  on a state’s quality of life. That quality may be enhanced by good weather and natural beauty (assets Indiana mostly lacks), but it is a far more capacious concept.

As one economic development firm explains,  improving quality of life raises a destination’s desirability, attracts (and retains) population, adds revenue, and boosts recognition and reputation.

As the Brookings Institution has found,

There is compelling new data that these traditional economic development tools may be ineffective compared to investments in quality of life and place. Our research on smaller communities has found that community amenities such as recreation opportunities, cultural activities, and excellent services (e.g., good schools, transportation options) are likely bigger contributors to healthy local economies than traditional “business-friendly” measures. Smaller places with a higher quality of life experience both higher employment and population growth than similarly situated communities, including those that rank high by traditional economic competitiveness measures.

Research has shown that people are willing to pay higher housing prices and even accept lower wages to live in places offering a higher quality of life, and that businesses are willing to pay higher real estate prices and offer higher wages to locate in places with more productive workers.

After estimating quality of life (what makes a place attractive to households) and quality of business environment (what makes a place especially productive and attractive to businesses) in communities across the Midwest, we found quality of life matters more for population growth, employment growth, and lower poverty rates than quality of business environment. 

As the article notes, policymakers can’t build a Great Lake, mountain, or other natural feature. But they can focus on enhancing other quality of life aspects and providing solid public services for their current residents.

The Brookings analysis found that one of the strongest factors associated with higher quality of life was spending on public schools, “with public school quality and the availability of early childhood education being two of the most important factors for working parents.”

Bottom line?

The findings reinforce that local leaders and economic developers should prioritize quality of life strategies over tax incentives and lax regulation. The long-standing Midwestern community economic development strategy of low taxes, business incentives, and loose environmental regulations usually doesn’t work, and has often proven disappointing to communities that have given away tax dollars and reduced business standards without seeing substantial returns. Low business taxes often hide a hidden opportunity cost by reducing available funding for local schools and other public amenities. 

If our legislative overlords really wanted to attract skilled workers–including female workers and workers of color– they would fund child care and pre-K programs. They would work to create great public schools and excellent transit systems. (They would also leave medical decisions to the professionals who understand the complexities of those decisions, rather than imposing the beliefs of fundamentalist Christians on all Hoosiers.)

Pledging billions for bribery while ignoring quality of life isn’t a viable economic development strategy.


Minority Rule, Courtesy of Gerrymandering

In addition to its website, Talking Points Memo sends out a morning newsletter to subscribers. A few days ago, that newsletter (paywall) included two paragraphs that sum up the single biggest challenge facing American democracy.

The success of the abortion rights coalition in ballot initiatives from Kentucky to Michigan showed that abortion can be just as powerful an incentive to vote for those who support abortion access as for those who oppose it.

For many House Republicans, that shift would, in another world, alter their behavior. With majorities in even deeply red states supporting abortion access, you’d expect these lawmakers to moderate their position. But thanks to the dearth of competitive House districts due to cumulative years of gerrymandering, many of them have more to fear from a primary challenge from the right than a general election against a Democrat.

I have frequently posted about the effects of gerrymandering. Probably the most damaging consequence is voter suppression; as I have often noted, people who live in a district considered “safe” for the party they don’t support lack an incentive to vote. When the disfavored party doesn’t turn out, that also depresses the votes for that party’s  candidates for statewide office.

Here in Indiana–a state that has been identified as one of the five most gerrymandered states in the country–our legislature is beginning a session in which the Republican super-majority continues to disregard the demonstrated priorities of its Hoosier constituents.

Several Republican lawmakers appear to oppose the Governor’s call to invest in the Hoosier state’s inadequate, struggling public health system. For that matter, there appears to be no appetite for confronting Indiana’s dismal ratings in a wide variety of quality of life indicators. As Hoosier Democrats recently pointed out: 

Hoosiers have a F rated quality-of-life and the state has a D- rated workforce, a C- rated education system, the third worst maternal mortality rate in the nation, and the country’s most polluted waterways. It appears Republicans will once again ignore the warning signs from Indiana’s top business leaders and their taxpayer-funded reports and instead choose to focus on their extreme agenda.

CNBC lists Indiana as one of the ten worst states in which to live.

Over the past couple of days, I’ve posted on just one part of that extreme agenda, the GOP’s war on public education. Other efforts include our lawmakers’ continuing war on LGBTQ Hoosiers– especially on  trans kids and anyone in the medical community who dares to serves them.

Indiana isn’t alone, unfortunately.

In 2015, two political scientists– Martin Gilens of Princeton and Benjamin Page of Northwestern–published a study concluding that the preferences of US voters barely matter. Or as they put it, “economic elites and organized interest groups play a substantial part in affecting public policy, but the general public has little or no independent influence.”…

Gilens and “a small army of research assistants” compiled nearly 2,000 polls and surveys that asked for opinions about a proposed policy change. Since he wanted to separate out the preferences of economic elites and average citizens, he only used surveys that asked about respondents’ income. He found 1,779 poll results that fit that description, spanning from 1981 to 2002. Then he took the answers of median-income voters to represent what average voters think, and the answers of respondents at the 90th income percentile to represent what economic elites think.

Next, the authors had to measure what interest groups thought about all of those issues. They decided to use Fortune magazine’s yearly “Power 25” lists of the most influential lobbying groups, but since it “seemed to neglect certain major business interests,” they added the ten industries that had reported the most spending on lobbying. Their final list includes 29 business groups, several major unions, and other well-known interest groups like the AARP, the Christian Coalition, the NRA, the American Legion, and AIPAC. Each interest group’s position on those 1,779 policy change proposals were coded, along with how strongly each group felt about each proposal. The results were combined to assess how interest groups in general, felt.

The study found that average citizens only get what they want if economic elites or organized interest groups also want it…

In contrast, the preferences of economic elites and interest groups — especially economic elites — are each quite influential.

In dramatically gerrymandered Indiana, the clear preferences/warnings of the state’s largest businesses and growing tech sector are routinely disregarded in favor of  the “influential elites” who evidently believe that low taxes are a more attractive economic development tool than a reasonable quality of life–a belief with which CNBC begs to differ.

Indiana’s super-majority does listen to the well-organized religious fundamentalists whose policy preferences repel the high-skilled workers our economy needs. 

As long as they can gerrymander, our unrepresentative representatives are safe from democracy– and their constituents.


I Guess This Doesn’t Include Indiana

Macleans has identified cities it dubs a “new brain belt.”

These are the places where they think the greatest innovation is happening today. Sometimes they are classic rust-belt cities but mostly they are university or hospital towns in the vicinity: Waterloo, Ont., instead of Windsor.

They identify characteristics of such places: high-tech facilities, quality educational institutions, taxpayer support for research, appealing living conditions and, most important for them, cultures of free thinking, in contrast to the “hierarchical, regimented thinking so prevalent in Asian and MIST [Mexico, Indonesia, South Korea and Turkey] countries.”

Or states like Indiana.

We have had several robust discussions on this blog about my theory of “paradigm shift.” Call it that, or focus on the narrower question (posed by MacLeans) whether your own city or state is “innovative” or “future oriented”–the question is one with which every Chamber of Commerce and Economic Development organization is wrestling: how does my city/ metropolitan area/state continue to compete and thrive in a world that is constantly changing? How do we get from here (wherever that is) to there (wherever that is)?

I was struck by the list of characteristics identified by MacLeans: of the five, four focused on human capital–more precisely, the development of an intellectual culture.

  • High tech facilities are built in places having workforces that can operate and manage them, places where both technical skills and comfort with technical innovation are plentiful.
  • The phrase “quality educational institutions” suggests the sort of yeasty and challenging environment that deals in questions, not answers–the sort of educational environment that produces new ideas and new ways of thinking about the traditional ones. (Quality is not defined by job placement statistics–sorry, Indiana Commission on Higher Education.)
  • “Taxpayer support for research” certainly doesn’t call to mind the penny-pinching, “I’ve got mine, Jack, and I’m holding onto it” attitude that has long characterized my own state of Indiana. It certainly doesn’t describe a state that would constitutionalize a cap on property taxes, lest those taxes somehow get raised and then–horrors!–spent on a common civic good like education. Or a better quality of life.
  • When you think about it, a culture of “free thinking”–the fourth intellectual attribute of forward-looking places–really leads to the only characteristic listed that doesn’t immediately connect to the life of the mind: a good quality of life. I don’t think you can have a good quality of life without such a “free thinking” culture.

People who enjoy engaging with ideas, with the arts, with people unlike themselves–people interested not only in acquiring new skills but in using those skills to improve their communities–are people who understand the organic nature and human importance of those communities, and the importance of their own connections to them.

There are people in my city–and I’d wager in yours–who are working hard to create a community that looks like that.

But at this point, my city– and most definitely my state— have a long way to go.