May 5, 2009 City Council packet - Laserfiche WebLink

Home Browse Search

from higher unemployment Homeownership, Oswald found, is a more important predictor of unemployment than rates of unionization or the generosity of welfare benefits. Too often, it ties people to declining or blighted locations, and forces them into work —if they can find it —that is a poor match for their interests and abilities. As homeownership rates have risen, our society has become less nimble: in the tg5os and r96os, Americans were nearly twice as likely to move in a given year as they are today. Last year fewer Americans moved, as a percentage of the population, than in any year since the Census Bureau started tracking address changes, in the late 1940s. This sort of creeping rigidity in the labor market is a bad sign for the economy, particularly in a time when businesses, industries, and regions are rising and falling quickly. The foreclosure crisis creates a real opportunity here. Instead of resisting foreclosures, the government should seek to facilitate them in ways that can minimize pain and disruption. Banks that take back homes, for instance, could be required to offer to rent each home to the previous homeowner, at market rates —which are typically lower than mortgage payments — for some number of years. (At the end of that period, the former homeowner could be given the option to repurchase the home at the prevailing market price.) A bigger, healthier rental market, with more choices, would make renting a more attractive option for many people; it would also make the economy as a whole more flexible and responsive. Next, we need to encourage growth in the regions and cities that are best positioned to compete in the coming decades: the great mega -regions that already power the economy, and the smaller, talent -attracting innovation centers inside them —places like Silicon Valley, Boulder, Austin, and the North Carolina Research Triangle. Whatever our government policies, the coming decades will likely see a further clustering of output, jobs, and innovation in a smaller number of bigger cities and city -regions. But properly shaping that growth will be one of the government's biggest challenges. In part, we need to ensure that key cities and regions continue to circulate people, goods, and ideas quickly and efficiently. This in itself will be no small task; increasing congestion threatens to slowly sap some of these city -regions of their vitality. Just as important, though, we need to make elite cities and key mega -regions more attractive and affordable for all of America's classes, not just the upper crust. High housing costs in these cities and in the more convenient suburbs around them, along with congested sprawl 17