Sunday, August 12, 2012

The Great Plains, Joe Kotkin, The Wall Street Journal, 2006

A huge "thank you" to a reader who stumbled across this 2006 WSJ article and sent me the link

Look at how incredibly prescient Joel Kotkin was. This was at least a year before things really got going in North Dakota.

It begins:
At a time when the much-celebrated coasts creak from rising interest rates, faltering income levels and soaring energy prices, this windswept, energy-rich city of 57,000 on the western edge of the Dakota plains is experiencing the best of times. Cities like this one out in the far-off hinterland -- Iowa City, Sioux Falls, Fargo, Grand Forks, Rapid City -- now are enjoying job growth rates that, if they don’t rival Las Vegas, certainly put to shame those of most major metropolitan areas.

Unemployment is negligible and wages are rising across virtually all job categories.

Over the past five years, the fastest growth in per capita income has taken place in energy-rich Wyoming, Montana, North Dakota, New Mexico and West Virginia, while highly urbanized places like California, New York, Michigan and Illinois gather dust at the bottom of the pack. Tax revenues in these once hard-pressed states are also soaring; North Dakota’s surplus is now estimated at $527 million, representing more than a quarter of the state’s $2 billion annual budget.

Behind the good times are numerous factors, such as an Internet-enabled shift of technology and business service firms into the region, and a growing migration of downshifting boomers and young families. But perhaps the most dramatic change has come from an upsurge of energy prices that is turning places like North Dakota into a Nordic Abu Dhabi.

"We’re on the verge of a gold rush driven by energy," crows Bob Valeu, state coordinator for North Dakota Sen. Byron Dorgan. Mr. Valeu and other leaders here in both political parties see their state as a growing bastion of energy production for the U.S. Already North Dakota is among the major exporters of energy to the rest of the country, exporting roughly three-fourths of its 4,000 megawatts of electricity.
The article is a must for those interested in history of the boom as it was taking off. 

Remember the Poppers? The name pops up again:
Two decades ago the academics Frank and Deborah Popper described the development of the Great Plains as a mistake -- an expansion of too many people and farms into an environment unable to support them. They pointed, with some justification, to the depopulation of much of the area and suggested that it be "de-privatized," brought back to its "original pre-white state" and turned into "the ultimate national park." This notion was widely described as the "buffalo commons," and it gained some traction among environmentalists -- many of whom seem to regard people as a kind of blot on the landscape. Indeed the Plains -- parts of which are now suffering from a severe drought -- as a kind of human disaster area remains a popular theme among Eastern journalists: irresistible decline, dying towns, aging populations, a place to visit now before it all blows away.
Incredible stuff.

And, if you enjoyed this, you will really enjoy his article in the WSJ earlier this spring, "The Great California Exodus":
"California is God's best moment," says Joel Kotkin. "It's the best place in the world to live." Or at least it used to be.

Mr. Kotkin, one of the nation's premier demographers, left his native New York City in 1971 to enroll at the University of California, Berkeley. The state was a far-out paradise for hipsters who had grown up listening to the Mamas & the Papas' iconic "California Dreamin'" and the Beach Boys' "California Girls." But it also attracted young, ambitious people "who had a lot of dreams, wanted to build big companies." Think Intel, Apple and Hewlett-Packard.

Now, however, the Golden State's fastest-growing entity is government and its biggest product is red tape. The first thing that comes to many American minds when you mention California isn't Hollywood or tanned girls on a beach, but Greece. Many progressives in California take that as a compliment since Greeks are ostensibly happier. But as Mr. Kotkin notes, Californians are increasingly pursuing happiness elsewhere.
So many story lines. CBS News reports the same.

7 comments:

  1. I doubt that Mr. Kotkin is correct in his assumption that California's population is dropping.

    I am 83 years old, born and raised in Califorbnia, and I would be happy to see Mr. Kotkin move somewhere else. I am certainly not moving.

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    1. I don't believe Mr Kotkin said anything about the population of California decreasing. He said that the working middle class who pay taxes are leaving. The population of Egypt did not decline during the Mosaic exodus.

      Mr Kotkin is concerned that at some point, the tax code in California will be 100% of all income over $100,000. (Hyperbole, of course.) The good news is that this will occur long after many of us are gone. Folks older than 45 years of age have nothing to worry about. So, until then, enjoy the beach.

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    2. Over at the LA Times, today, August 13, 2012, a writer gave a rundown of who has left the state:

      GM- Gone
      Hughes Aircraft- Gone
      Lockheed-Martin - Gone to other parts of the nation.
      Boeing- Barely making it, ready to close in Long Beach.
      BAE - More layoffs.
      TRW- Gone
      Marquardt- Gone
      Rocketdyne- scaled back to near zero.
      CSC and Northrop-Grumman Corporate? In Virginia.

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  2. I live in Cali too and I can assure you neither me or anyone I know are "pursuing happiness" in an area that is a deep freeze for 6 months out of the year . It's great for ND region to experience an economic resurgence but when it comes to desirable places to live (good jobs, climate etc) ND will never come close to the top except for folks who grew up there and want to stay. Opportunities for such folks are better now but still marginal long term.

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    1. I thought the same, also, until I started blogging. Then, folks pointed out to me: Montreal, Calgary, Toronto, Oslo, Scotland, Anchorage, Juneau, and a host of other great places to live, all with questionably better/worse climates than Minnesota.

      To each his own. I was in stop and go traffic on Pacific Coast Highway yesterday; it was a fantastic experience going up to the J. Paul Getty villa. Later we learned that the Pacific Coast Highway, two hours of backed-up traffic was said to be the worst in 35 years.

      With regard to "except for folks who grew up there and want to stay," I thought the same thing. Until it turned out that men who came to North Dakota to work during the boom ended up bringing their families.

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  3. I live in a coastal area too. Quite where I live 9 months of the year. But a madhouse for three months. People love to visit the beach!

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    1. And with this hot spell, even more are headed to the beach. But it will soon be autumn......

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