American and California Feudalism The Squeeze on the Middle and Working Class – Joel Kotkin and Marshall Toplansky – Chapman University

The title to the report linked here is California Feudalism – The Squeeze on the Middle Class. But research authors Joel Kotkin and Marshall Toplansky for the Center for Demographics & Policy at Chapman University themselves point out the relationship of their report to those who want to see America become more like California. They also use the phrase “working class” at least 7 times in their research brief.

The report never mentions manufactured housing. That doesn’t mean that there isn’t a relevance in their research to those seeking affordable homes, which can include manufactured homes, modular or other forms of prefabricated housing.

It may seem odd to focus on this subject while the coronavirus pandemic dominates the news. There is arguably a relevance, but that connection will be addressed in a report planned for another time.

This report and analysis will proceed in these steps. First, a recent video that features Kotkin speaking on related topics. That will be followed by pull quotes, not necessarily in the order they were found in their brief. Finally, there will be an MHLivingNews Analysis and Commentary.

 

Part I:

The Reasons Why So Many People Are Leaving California | Urban Policy Expert: Joel Kotkin, Feb 19, 2020.

 

 

Some pull quotes from the above video will be found below the next segment.

 

Part II.

Pull quotes from California Feudalism – The Squeeze on the Middle Class

Note that the bullets are not necessarily in the original report, which can be found linked here.

 

The Geography of California’s

New Feudal Order

“California over the past decade has created great, perhaps even unprecedented wealth, but it has done so in a way that has offered few benefits to the middle and working classes. Under Governor Jerry Brown’s father, the late Governor Edmund G. Brown, California emerged as a simultaneously capitalist and admirably social democratic society. Brown’s biographer, Ethan Rarick, described his leadership as having made the twentieth century into “The California Century,” with our state providing “the template of American life.” There was an ‘American Dream’ across the nation, he noted, but here we had the ‘California Dream.’¹¹

• Today’s state agenda is turning the dream into something of a nightmare.
• Part of the problem has been big losses in blue collar jobs, critical to the state’s working class. California lost 423,700 manufacturing jobs between 1991 and 2016.

 

High-tech Feudalism

In a way not seen since the land consolidation of the Middle Ages when lords established military control, or perhaps since the early days of the industrial revolution, the shift to a digital economy has created an enormous accumulation of wealth.⁶⁵

 

• The late futurist Alvin Toffler optimistically saw these tech firms critical to creating “the dawn of a new civilization,” with vast opportunities for societal and human growth.⁶⁸ Instead, the tech economy seems to be creating greater inequality, including in its Bay Area base. We may instead be heading gradually towards what the Japanese futurist Taiichi Sakaiya described as “a high- tech middle age,” where only a wealthy few control the commanding heights of the economy and political life. ⁶⁹

 

Today California’s economy is dominated by a handful of Bay Area tech firms that have expanded at one of the most dynamic paces in economic history. Most of these companies are in a relatively constrained geography along the San Francisco Peninsula. Together, these tech firms—Apple, Netflix, Facebook, Google—along with Microsoft and Amazon, have achieved a combined net worth equal to one-quarter of the NASDAQ and equal to the GDP of France. The S&P 500, the broad index of stocks, has a total market capitalization of approximately $24.2 trillion slightly more than the GDP of the country. They represent 15% of the entire S&P 500 companies’ market capitalization.³

• As the tech firms exploit their quasi-monopolies and enjoy exceedingly high profits, costs are unlikely to make them go elsewhere.⁶⁷

 

Who Loses Out? Millennials

The housing crisis has been felt most by those who will shape our future, minorities and millennials. Californians who are between 25 and 34 years old suffer the third lowest homeownership rate (25.3%) in the country, one-third below the national average, ahead only of New York and Hawaii.⁴⁵ In San Francisco, Los Angeles and San Diego, according to Census Bureau data, the 25-34 home ownership rates range from 19.6% to 22.6%, approximately 40% below the national average (Figure 11).

 

EXECUTIVE SUMMARY

California was built by people with aspirations, many of them lacking cultural polish or elite educations, but dedicated to hard work, innovation, family and community. A large number came from other countries or poor backgrounds: sharecroppers from the South, campesinos from Mexico, people fleeing communism and poverty in Asia, escapees from Hitler’s Europe or Okies and others fleeing the dust bowl.

This proud legacy is threatened. California has now taken on an increasingly feudal cast, with a small but growing group of the ultra-rich, a diminishing middle class, and a large, rising segment of the population that is in or near poverty. Indeed, amidst some of the greatest accumulations of wealth in history, California has emerged as a leader in poverty, particularly among its minority and immigrant populations and throughout its interior.

Something is clearly wrong with this picture. Yet our state leaders, and too many of our business and civic leaders, are convinced that California, far from being something of a cautionary tale, offers a great “role model” for the rest of the country.1 The state’s drift towards an ever more unequal, feudalized society, characterized by concentrated property ownership, persistent poverty levels, and demographic stagnation does not seem to concern our Sacramento leadership.

What needs to change? If we want to again be a place of opportunity for all, we need to dial down California’s increasingly expensive, messianic land use and climate change policies, which have dramatically increased housing and energy costs, forcing individuals and companies elsewhere. This will allow us to develop more housing and middle-class jobs, especially in more afford- able areas such as the Central Valley and the Inland Empire. A dramatic reform of our education system, which under- serves our next generation, particularly in poor and minority communities, needs to be enacted. Other steps, like investing in basic infrastructure—roads, dams, electric transmission—could boost the flagging blue collar economy of the state.

The most fundamental threat to the middle class in California is the state’s extremely high cost of living, which has largely been caused by unprecedented house price increases relative to household incomes. More than 80% of the higher cost of living in California is the result of higher housing costs.²⁴

California, adjusted for costs, has the overall highest poverty rate in the country, according to the US Census Bureau²⁵ (Figure 6). A recent United Way study showed that close to one in three of the state’s families are barely able to pay their bills.²⁶ Fully one in three welfare recipients in the nation live in California, which is home to barely 12% of the country’s population.27 Even more tragic has been an explosion in homelessness, a problem which has declined in much of the rest of the country.²⁸ Los Angeles County has roughly 50,000 homeless people, up 23% since last year and 75% since 2000. San Francisco streets have become unhealthy, due to the presence of syringes, garbage and feces.²⁹ Today, eight million Californians live in poverty, including two million children.³⁰

 

The Housing Crisis: Key Driver of Future Feudalism

At its essence, feudalism was about hierarchy, and the domination of land ownership by a relative few. In the era that preceded feudalism, a strong, land-owning middle class played a critical role in, for example, the Greek democracy and the Roman Republic. Later, from seventeenth century Holland to US post-war suburbia, dispersed ownership of land was a critical component of dispersed wealth and power and the strengthening of the middle orders. Property remains key to financial security: Homes today account for roughly two thirds of the wealth of middle-income Americans³² (Figure 8)…”

 

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Part II a – Kotkin video and related notes.

The entire research brief is found at this link here. It is worth noting at this point some pull quotes MHProNews used in a related article cited Kotkin that called for a decoupling of the U.S. from China in business and trade.

• “It is not possible in most of California to live decently on $40,000 a year.”
• Kotkin describes himself as a moderate, pro-business Democrat “for most of my life.”
• Kotkin says that the policies in California were caused by politicians who were “economically illiterate” and behave like an “amoeba” that can be pushed into a given direction. He asserts that unlike Texas, where Democrats and Republicans alike often have business experience, in the California legislature, he asserts that most Democrats have little or no business experience.
• Kotkin explained that when businesses are chased out of California by green or other policies, they will create a larger carbon footprint overseas. He says if a factory moves to China, they are powered by coal, while in California that same business may get its energy from natural gas or nuclear energy, the later of which are clearly cleaner energy sources.
• Rephrased, he points out the self-contradictory results of policies that may be well intended but have a practically poor outcome. California politics, he says, “is narcissism of the worst kind.” People that want to feel good about themselves and how they look, even though the impacts are problematic or harmful.
• He said there are more drug addicts than high school students in San Francisco, and more dogs than kids. The author asks, is that the role model for the rest of the country? “I don’t think so,” Kotkin answers his own question. He says that people don’t understand that climate policies effect the housing costs, while tax, regulatory and other policies that impact businesses and thus what jobs are available.
• Kotkin says he is “an old journalist” who started his career in 1975. He said, “I am horrified at the state of journalism in this country.”
• When someone writes a story, he rhetorically asks, did that reporter talk to someone with a different opinion? He compares media in California more like the media in the old Soviet Union, covering only those topics the writers or editors find interesting. Saying that “Most of us were liberal” in journalism in his day, but he asserts that the norm was to “let the public hear both sides” of a given issue.
• At about the 20:29 time mark in the video, he said that journalism in his era wanted the public to “understand the subtleties.” The author and educator said that the way he judges an article is – “Did I learn something that I didn’t know,” before, whether he agrees with the writer or not. By contrast, he says that articles today are often just presenting just “one side.”
• Kotkin recounts that his boss during his time at the Washington Post didn’t have a high school degree but praised him as a great working-class journalist. Now, reporting is all about being “credentialed.” He mentions consolidation of media and the dropping pay for reporters among the problems that foster the currently low state of media in America. He said that most journalists enter the field with a social justice agenda instead of helping people to see things and understand issues that they may not have realized otherwise.
• He said, “Because the newsrooms are so imbalanced ideologically and are so young, there is no one to challenge their points of view.”
• As a Democrat, he says that in a “non-partisan” way that people “need to be more critical of the current regime.” The Golden State needs to be more pro-business and middle-class oriented. While he expresses disdain for Republicans and President Trump, he also said that the GOP has an opportunity to reach many in his state based on the clear notion that what has been occurring under mainly Democratic rule isn’t working, but he questions if they will do so.
• Kotkin sarcastically said near the end of the video that with all that his state has to offer in terms of its natural appeal, “It takes policy genius of some diabolical sort to push people out of California.” He is calling for a ‘fight against feudalism’ in California. The author/educator says that most politicos in his state from either party are narrow hacks that represent specific interest-groups and that “There is nobody who stands up for the interests of the vast majority of Californians.”

 

 

Part III. MHLivingNews Analysis and Commentary

As noted, the Chapman University research brief never mentions manufactured homes, modular homes, prefab housing or mobile homes. That wasn’t their focus. Let’s also note that we’ve stressed for years that to us these are not partisan issues. Indeed, Democrats and Republicans who have studied manufactured housing tend to widely agree on the value proposition.

 

The tragedy of what Kotkin and his fellow researchers at Chapman University have revealed could, from the vantage point of affordable housing advocates, be summed up like this.

• What their data, research and narrative paint a picture of how land-use, “green,” and other public policies have negatively impacted their population steadily over time.
• That means, in the light of the report linked below, that due to the Manufactured Housing Improvement Act of 2000, the artificial policy barriers that California has erected could be breached.

In conjunction with affordable housing, the means to buy that housing is also an obvious requirement. Once more, the Congress has already passed the needed legislation.

 

 

For those who wonder about the quality of manufactured homes today, the report below sheds light.

 

 

Additionally, decades of third-party, nonprofit and university level research – akin to Chapmans, but manufactured home focused – demonstrates that manufactured homes are surprising in their quality, durability and affordability.

 

How is it possible that the laws needed are already in place, but the widespread knowledge of that is lacking? Kotkin partially answers that question in his critique of modern journalism. Additionally, the consolidation of journalism into every fewer hands – plus the loss of numbers of independent local newspapers and tens of thousands of reporters – are all contributing factors.

 

 

Finally, Kotkin and his colleagues used the phrase “exploit their quasi-monopolies.” The problem of problem of monopolization is something we’ve dealt with too.

 

 

The truth is hiding in plain sight. While others come at these issues from a variety of different vantagepoints, this brief look at their research directly and/or indirectly underscores several points we’ve been reporting on for years.

Namely, that there is a significant need to provide more affordable housing, which manufactured homes provide. Doing so would increase the personal wealth of that state and the nation as a whole.

 

Once the issues are understood, the stark nature of the choices become clear. For instance, people will either discover tent cities and cardboard boxes on their streets, underpasses, sidewalks and parks or they will make full use of existing laws that make more affordable manufactured homes possible.

 

 

The more the causes of the current scenario are understood, the logic of supporting the use of more manufactured homes becomes increasingly clear.

 

 

That’s plenty to digest, so we’ll call it a day on that note, because it is five o’clock somewhere. “We Provide, You Decide.” © (Affordable housing, manufactured homes, lifestyle news, reports, fact-checks, analysis, and commentary. Third-party images or content are provided under fair use guidelines for media.)

(See Related Reports, further below. Text/image boxes often are hot-linked to other reports that can be access by clicking on them.)

By L.A. “Tony” Kovach – for MHLivingNews.com.

Tony earned a journalism scholarship and earned numerous awards in history and in manufactured housing. For example, he earned the prestigious Lottinville Award in history from the University of Oklahoma, where he studied history and business management. He’s a managing member and co-founder of LifeStyle Factory Homes, LLC, the parent company to MHProNews, and MHLivingNews.com. This article reflects the LLC’s and/or the writer’s position, and may or may not reflect the views of sponsors or supporters.

Connect on LinkedIn: http://www.linkedin.com/in/latonykovach

 

 

 

 

 

 

 

Related References:

The text/image boxes below are linked to other reports, which can be accessed by clicking on them.