More than ever Millennials and baby boomers are ditching their spread-out suburban lives and packing it in for the city.
Columbia Professor Vishaan Chakrabarti wrote in a New York Times Op-ed last week that lower crime, better schools and more parks are making cities increasingly appealing while the difficulties of attaining mortgages and car loans, combined with a new environmental and social consciousness, make suburban living seem retro and ill-fitting for today's society.
Professor Chakrabarti, author of A Country of Cities: A Manifesto for an Urban America joined the Daily Ticker to discuss what he calls the “beginning stages of a historic urban reordering.”
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“I think these trends are going to continue because we’re facing a new set of challenges and opportunities as a country,” says Chakrabarti. “Our economy has shifted almost completely towards a service economy…[and] we have a new environmental consciousness.”
Chakrabarti also points out that there are about 80 million Millennials who, by-and-large, want to live in cities—and not just big cities. “Millennials are repopulating Detroit, they’re in places like Baltimore and St. Louis. It’s really a nationwide phenomenon coast-to-coast.”
Young people today are trying to live a more environmentally friendly and compact lifestyle, they don’t want car loans or huge heating bills and they’re still trying to pay off student loan debt, says Chakrabarti. “They’re actually trying to restructure their lives in a financial model that I don’t think our markets or our government has really caught up to yet.”
And it’s not just Millennials; baby-boomers are also trending back to cities. Though they have disposable income they’d like to be near world-class medical care and culture.
So what’s the problem here? “Our research shows that about 90% of the GDP and about 86% of U.S. jobs are concentrated on about 3% of the U.S. landmass,” says Chakrabarti. Yet cities are still heavily subsidizing suburbia.
There’s a mortgage-interest deduction to homeowners, even wealthy homeowners, “largely to buy bigger houses.” About $42 billion dollars a year go to highway upkeep, which is four times more than what’s going to rail, infrastructure and mass transit. Additionally, suburban school systems often get more money than urban school systems, according to Chakrabarti.
“The real economic drivers for the country are our big cities and they’re giving away most of their money to the areas around them,” he says.
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