California is spending billions to house its increasing population of unhoused people. But it hasn’t come close to building enough to meet its ambitious goal of ending homelessness. And many Californians have lost hope that it ever will.

California is spending billions to construct a high-speed rail system. But it hasn’t come close to completing what would be the first such line in the nation. And many Californians have lost hope that it ever will.

In the face of these crises, what is to be done? One option would be to sit around and lament two massive failures of government, and conclude that mega-projects are just too challenging for our state.

Or we could steel ourselves and embrace the wisdom of Dwight Eisenhower—who famously said: “If a problem cannot be solved, enlarge it.”

In that spirit, I suggest we solve the big problems of homeless housing and high-speed rail by combining them into something even larger.

So, I hereby propose—very modestly—Homeless High-Speed Rail.

You read that right. Finding permanent lodging for unhoused people, already declared the state’s top priority by Gov. Gavin Newsom, would become the new, urgent mission of our flagging high-speed rail authority.

Under Homeless High-Speed Rail, the state’s unhoused people would no longer have to live in cars or temporary shelters or controversial encampments. Instead, everyone would have the option to take a sleeping-car berth on a brand-new bullet train.

Sure, this fusion of housing and high-speed rail might create some new challenges. But it would solve even more problems.

To pick just one example: advocates and media have long criticized our state government for its confusing mix of competing homelessness initiatives. The state splits up housing funding among different local governments, who complain that the flow of money is not consistent enough to solve the crisis. The state’s official auditor, along with other experts, has called for consolidating state and local programs on homelessness.

My proposal does just that—by consolidating every single state and local program to house homeless people under one single state agency: the California High-Speed Rail Authority.

Now, some cynics might look at that combination and call it crazy—a mere merger of two giant dysfunctional money pits. And they wouldn’t be entirely wrong.

The state has spent more than $20 billion on housing and homelessness since 2019—but the number of unhoused Californians has grown by one-third. Meanwhile, the high-speed rail project has secured $25 billion—but is still as much as $10 billion short of the $35 billion required to complete its first segment, in the Central Valley. Both projects will require tens of billions of dollars in additional funding to achieve their goals.

But what cynics are missing, amid all the red ink, is how these two failing programs, in combination, could save each other money.

Building homeless housing is incredibly expensive—Los Angeles is paying more than $800,000 for some one-bedroom units. But much of the cost is in expensive California land, high-cost California labor, and time-wasting California permitting processes. None of which are factors when people are housed on rail cars.

Instead, using housing money to buy rail cars—with private bathrooms—means that the high-speed rail authority could devote more of its funding to building rail and stations (which might also be used for housing).

Talk about a win-win!

Indeed, combining homeless housing and high-speed rail could answer objections that dog both programs.

For example, cities often can’t build homeless housing because of aggressive opposition from neighborhood NIMBYs. But NIMBYs would lose their developer targets, and their backyard objections, when housing is simply zooming past, at 200 miles per hour.

And on the high-speed rail side, hosting homeless Californians answers persistent questions about whether there would be enough riders to support the project. Surveys show little public interest in using high-speed trains, especially because the first segment will run between the smaller cities of Merced and Bakersfield.

But in a Homeless High-Speed Rail project, unhoused individuals would provide a large and steady ridership base.

Strange as my proposal may seem, almost nothing about it is new.

Keeping homeless people constantly on the move sounds cruel, but it is already an established and popular policy across California. After all, cities and police are always tearing down homeless encampments, and forcing unhoused people to keep moving.

In addition, the idea of converting spaces intended for other purposes into housing isn’t new. The state, cities, and counties have already converted dozens of hotels to serve as housing for the unhoused, under Projects Roomkey and Homekey. A Bay Area housing activist even offered a plan to house homeless people in old railcars.

If you board L.A. Metro or the San Diego trolley or other local transit systems in the state, you’ll see that individuals without homes are California’s most dedicated train riders. Thousands of unhoused Californians all but live on these local trains now, because of the low-cost shelter they provide. Indeed, homelessness is so much a part of transit that, earlier this year, BART adopted its first Homeless Action Plan, which includes promises to develop housing itself.

Of course, there will be some Californians, perhaps millions, who object to the whole concept, finding it perverse. These misguided moralists, a few of whom write columns, will say that California is a very rich place that surely can afford to house all its people and to build the same high-speed rail system that two dozen other countries have. And they will claim that California must learn to build and manage giant new housing and infrastructure projects if it’s going to survive the adaptation challenges of climate change.

In theory, these skeptical Californians will probably be right. But California doesn’t operate on theory. It operates on an unmanageable budget process, a volatile tax code, and a broken governing system that both parties refuse to fix. It has a state government that can’t adopt modern technology or manage a payroll, much less translate its people’s democratic preferences into major action. The way California operates now, the state will never have enough housing for the homeless, or a real high-speed spine for its transportation networks.

So, before you dismiss my modest proposal, just ask yourself: In the face of massive failures, when doing big and essential things is nearly impossible, is there any plan too awful to take off the table?

The post A Modest Proposal<span class="colon">:</span> Give High-Speed Rail to Unhoused Californians appeared first on Zócalo Public Square.

Don’t bank on California, especially when banks are involved.

Silicon Valley Bank’s collapse is widely discussed as a harbinger of the future, a sign of problems and disruptions in the technology businesses that were its best customers. But this bank failure, the second largest in U.S. history, actually fits a very old pattern—of California and its industries putting the economies of the nation and the world at risk.

Our state’s history of precipitating economic crisis is singular, and rooted in the same California characteristic that so often makes us successful. We aren’t content to make slow, patient investments. We want to get rich as fast as possible.

Our need for speed originates in the Gold Rush that made us a state and occasioned the rapid development of banks—and often, their even faster failures.

Banks were formed in defiance of the 1849 state constitution, which barred banking. Banks also ignored the first state legislature which—in a preview of the legislative incoherence that prevails to this day—prohibited debt while also setting interest rates

The banks proliferated—and failed in damaging ways.  The history of San Francisco of the 1850s is one of financial panics and depressions, followed by attempts to climb out of them. (One San Francisco banker, the future Civil War general William Tecumseh Sherman, helped end an 1855 panic by keeping his institution open during a bank run.) Giant banks sprung from nowhere, and disappeared quickly. The Bank of California, the first commercial bank in the West, was founded in 1864 and soon became the second-richest bank in the country. It failed in 1875, contributing to a panic and the death of its founder. (It later reopened.)

Catastrophe only spawned new banks. After San Francisco’s 1906 earthquake, banker A.P. Giannini set up a makeshift outpost in North Beach with gold and silver rescued from the ruins of an earlier venture. Eventually, he would establish Bank of America, which pioneered branch banking and, in the 1980s, was briefly the world’s largest. (After a 1998 merger with NationsBank, Bank of America moved its headquarters to North Carolina.)

Bank of America endured, but spectacular failures mark the recent story of California banking. Over the past two generations, California has regularly authored crisis and global recession.

The savings and loan crisis of the late 1980s and early 1990s was in part the product of bank deregulation pushed by a California president, Ronald Reagan, and furthered by California lawmakers. In the late 1970s, as inflation rose, the federal government raised interest rates, and many savings and loan associations (also known as thrifts) struggled to remain solvent. California’s lax regulatory response allowed the state’s thrifts to try to escape their woes by making speculative real estate investments, which only compounded their problems.

This deregulation was most shamelessly exploited by the Lincoln Savings and Loan Association, based in Irvine, and its head, Charles Keating, who used depositors’ money to make high-risk investments. More than 20,000 people lost their life savings. Keating, seeking to evade federal regulators and keep control of his thrift, compromised state banking regulators and five U.S. senators, the so-called Keating Five, including California’s own Alan Cranston. Keating was eventually convicted of fraud, but freed on appeal.

Hundreds of savings and loans closed for good. The federal government seized some thrifts and bailed out others, at an estimated cost to taxpayers of more than $100 billion.

The 21st century has seen two California-driven busts. The first came in 2000, when the dot-com bubble burst. Venture capitalists and investment banks had been funding tech start-ups, few of them profitable or with real business plans, in great numbers in the late 1990s. The collapse of many of those startups, and of tech stock prices, helped spark a national recession.

But that recession proved minor compared to the Great Recession that arrived in 2008. That global economic meltdown is often blamed on Wall Street banks. But it, too, was invented in California.

Then, as now, the Golden State had the biggest and most expensive housing market in the country. Our middle class, in its aspirational desperation to buy houses and keep up an unaffordable standard of living, led the way to ever-growing consumer and mortgage debt. Our banks and mortgage companies—including Calabasas-based Countrywide Financial, once the nation’s largest mortgage lender—led the way in making bad subprime loans that left borrowers owing more than their homes were worth. Countrywide and its friends on Wall Street also recklessly securitized those loans; they were then traded on markets, with many investors not understanding the risks.

When the housing market crashed and foreclosures proliferated, the carnage included stock market collapse, double-digit unemployment, record bankruptcies for people and local governments, giant state budget deficits, and mass layoffs among public workers and in many industries. In California, family income declined, the middle class shrunk, and income inequality surged to the highest level in at least 30 years, according to the Public Policy Institute of California.

Californians are proud of the size of their state’s economy, the world’s fifth largest. But when an economy of that scale crashes, it extends beyond borders, contributing to economic malaise from Madrid to Manila.

That’s why world markets declined sharply when news broke of depositors fleeing Silicon Valley Bank. California’s leading tech companies and their workers did their banking at these institutions, so many have assumed the contagion will spread, as it did before. It remains to be seen whether aggressive action by the U.S. government to seize Silicon Valley Bank, and guarantee even uninsured funds, will contain the damage.

These days, major global institutions track and offer reports on “systemic risks” or “mega-risks” to the future of the world and its economies. The World Economic Forum has a report on risks that covers natural disasters, inequality and its impacts, climate change, democratic decline, aging infrastructure, technological disruption, war, terrorism, and infectious diseases.

Maybe they should add California, with its talent for spectacular financial failure, to the list.

The post Who Will Protect the Global Economy From California? appeared first on Zócalo Public Square.

My answer: In the same place everyone should—the backyard.

My little shrine’s location honors one of contemporary California’s crazier contradictions. Even as state government regulates more and more of our lives and livelihoods—even the straws through which we drink—it has embraced a historic deregulation of the spaces behind our homes. And even as Newsom has intruded more deeply into daily realities than any previous governor, he has become, improbably, the great liberator of our lots.

That’s the man-bites-dog context behind the governor’s recent signing of a package of bills including SB 9, the California Housing Opportunity and More Efficiency (HOME) Act. By allowing most homeowners to build a second home in their backyard, or turn their lot into a duplex, the HOME Act may spell the end of single-family zoning in California.

SB 9’s approval comes on top of 2019 legislation that Newsom signed to give homeowners more freedom to build accessory dwelling units (ADUs), or granny flats, in their backyards, and in place of garages.

What explains the transformation of our ruling San Francisco technocrat into our very own Backyard Bolívar?

The short answer is that the horrors of the housing crisis, with ever-escalating real estate prices and a resulting surge in homelessness, has overwhelmed longstanding opposition to housing from environmentalists and NIMBY groups. Building backyard housing is cheaper than other forms of affordable housing (construction for an ADU often runs between $100,000 and $150,000, versus more than $400,000 for a new affordable unit in an apartment building in urban California). And because homeowners rather than taxpayers bear the building costs, it’s an attractive way to create desperately needed units.

The longer answer is about the special power of the backyard in the California imagination.

The idea of a patio or backyard space for living has its roots in our Spanish past, and the haciendas that included shaded outdoor spaces to keep interiors cool. The California backyard also owes a debt to the 20th-century designer Cliff May, who is considered the father of ranch house. The California dream became associated with homes that linked the indoors and the outdoors, creating patio, pool, and backyard spaces where we spend most of our time.

There was an irony in California’s rapid adoption of this mode of living. Local governments approved the building of these homes with large outdoor spaces—but limited what you could build in those spaces. Guest houses, granny flats, and additions were often banned, particularly on smaller lots. The stated justifications for such limits often involved parking and traffic; the unstated justifications were to keep out the sort of people—poorer or non-white—who might be more likely to rent your guest house.

Today’s backyard liberation sweeps aside those restrictions on building. This particular mode of deregulation has won some progressive support because it uses private space to a solve a public problem—our lack of housing.

But in this shift lies a new irony: freeing homeowners to build in their backyards also threatens the very existence of the backyard. If people seize this opportunity to build out back, it could change California’s culture and landscape forever.

To the bad, some of our pool parties and barbecues will become things of the past. To the good, it’s healthier and safer for elderly Californians to live out their days in granny flats in their kids’ suburban backyards than in exurban cabins in the path of wildfires. Plus, denser living can be more energy-efficient, and fewer backyards means less outdoor watering.

More important, an embrace of backyard building could produce more housing. If one out of eight California homeowners used their new backyard freedom, we’d have more than 1 million additional housing units. But this new housing won’t necessarily make our divided state more equal.

Backyard freedom benefits those of us lucky enough to have backyards. It makes our single-family homes more valuable, since we now have the right to build more. And it’s already creating more opportunities for builders and fledgling modular home companies. But it also provides openings for financial institutions (and even internet companies) to buy up large groups of homes, add units they can lease, and gain even more control over the state’s rental market.

As a homeowner, I’m one of the potential winners. But I don’t have the cash to build my own ADU, and there are as yet no common financing instruments for such projects. When I called the out-of-state firm that holds my mortgage to ask about how to do an ADU, they had no idea what I was talking about. And even if I could borrow the money, I don’t have the time or skills to manage such a project. Surveys suggest most California homeowners can’t or won’t build an ADU.

But it sure would be nice to have rental income to help with the mortgage, especially since journalism is a less than sturdy profession. And an ADU might save money if it could become a home for my elderly parents or disabled relatives.

For now, I mostly enjoy looking at my small backyard and imagining what I might build some day, if I ever got my act together.

I also like how backyard freedom has put my own small city in its place. A few years ago, a city planning staffer responded with suspicion and hostility when I asked if I could replace my decrepit garage with a shed or small house. But, just last week, the city sent homeowners a letter offering to legalize any previously unpermitted guest houses or additions, and providing a link to the virtual planning desk for anyone with backyard building ambitions.

So, yes, I’m not ashamed to say that I put together a small shrine to the governor in my backyard—and not just because the neighbors can’t see it there. It has a couple of photos from his 2019 signing of the ADU bills, the text of SB 9, and a copy of his jargon-filled 2014 book, Citizenville.

Now I’d like to add a small bust of the governor (though those are harder to find than a cheap California house) and some candles (the battery-operated kind, of course), which I’d happily light in gratitude to Newsom and the rest of our backyard gods.

The post Will Granny Flats Replace Green Lawns in California’s Backyards? appeared first on Zócalo Public Square.

I glimpsed one answer to that question while driving to Deuel Vocational Institution, between the San Joaquin County cities of Tracy and Manteca. The demise of Deuel, which shuts at the end of September, is more than just the first closure of a state-owned prison in a generation. It also opens a prison window on the future of our landscapes, and on the peculiar predations of California progress.

Heeding my phone’s directions from Oakland, I exited I-205 at Tracy and followed Grant Line Road out to the prison. En route to that human warehouse, I had to navigate a thoroughfare lined with another breed of warehouses: massive logistics facilities for our nation’s retailers.

On Grant Line, I encountered two Amazon warehouses big enough to blot out the sun, distribution centers for Home Depot and US Foods, and huge facilities labeled with the names of third-party logistics companies NFI and APL. The Federal Emergency Management Agency had a major regional distribution warehouse there, too. And very near the prison stood the largest of all the warehouses, still under construction (its eventual occupant undisclosed), appearing twice as tall as all the others.

By the time the road forked right and I could see my destination, the 68-year-old prison seemed small.

This juxtaposition of older prison and newer logistics facility is not just about zoning and geography. It’s a changing of the guard, and of the guards. Just as that Old Testament prophet Isaiah foresaw the beating of the swords of war into ploughshares for agricultural cultivation, 21st-century California realities point to a new prophecy:

Out with the mass incarceration, in with the mass commerce.

Two different trends, both accelerated by the pandemic, are working together here. The first is California’s rapidly declining prison population—reduced to less than 100,000 in recent years by court rulings, sentencing reforms, and early inmate releases to limit COVID’s spread. As a result, the state has been ending contracts with private prisons and moving to close some of its older state-owned prisons.

The second trend is the surge in internet commerce, which has produced a surge in warehouse construction on the cheaper land in edge cities and along rural highway corridors where many of our prisons were built.

In recent months, as I’ve driven to California prisons that are targets for possible closure, I often find myself struggling to locate the correctional facility among seas of logistics facilities. A typical example is the state prison most in need of closure—the criminally expensive-to-maintain California Rehabilitation Center—which is hidden behind an ever-growing swarm of warehouses off I-15 in Norco, in Riverside County.

But the intersection of prison and warehouse involves people, not just land.

Prisons disproportionately house poorer and non-white Californians—the same people that warehouses disproportionately employ. Indeed, new warehouses are often the rare places open to hiring people with criminal records—and more so in recent years, with progressive attitudes toward ex-offenders coinciding with a growing shortage of labor.

But there is a dark side to warehouse employment: working inside these facilities can feel like prison. Employees are under intense surveillance and monitoring. They can be punished or fired for taking time away from work—even for rest breaks or to go to the bathroom.

So, state lawmakers, who in previous years wrestled with conditions inside prisons, are turning to the question of how to make warehouses feel less like prisons.

Earlier this month, the California legislature approved AB 701, a bill with first-in-the-nation regulations of warehouses. If signed into law by the governor, the bill would require disclosure of how companies surveil and monitor their employees.

Warehouses would have to disclose the quotas and algorithm-based metrics on work speed they use to judge workers. Companies could no longer penalize their workers for “time off tasks,” including going to the bathroom. The bill also requires the state to adopt new regulations to help reduce the high rates of on-the-job injuries in these warehouses.

Assemblymember Lorena Gonzalez, the bill’s sponsor, has expressed particular concern about an Amazon warehouse being built in Otay Mesa, on the east side of her San Diego-area district. That facility, and similar warehouses, will neighbor existing correctional facilities, including a notorious immigration detention center (which the ACLU is trying to close), and the Richard J. Donovan Correction Facility, the only state prison in San Diego County.

Back in Tracy, on my drive down Grant Line Road, I tried to enter a couple warehouse facilities to talk to workers, but the places were too well-guarded. Accessing the closing prison was far easier. The old guard house, where visiting cars have to stop, was empty. And the entrance gate of the prison itself was wide open, with the inmates having already been relocated. After looking around the property, I helped staff carry out some computers for re-use by probation officials.

Standing there, it was not hard to imagine this old prison site—and those of the other 11 state-owned prisons that are at least a half-century old—being repurposed for warehouses.

It became even easier after I drove 25 minutes up to Stockton, where the last state prison closed in 2003, the Northern California Women’s Facility. But I couldn’t find the site. Its former address lies amid distribution centers and a massive intermodal facility for logistics, where cargo is switched from trucks to railcars (or vice versa) on its way from warehouse to warehouse.

The post Out With Mass Incarceration and in With Mass Commerce appeared first on Zócalo Public Square.

That’s the real import of the more than 100 bills that have been introduced in the legislature to change housing policy in various ways. None of the current proposals is up to the task of getting the state to build sufficient housing. But the varied legislative activity—proposals to cover production incentives for builders, rental assistance, streamlining regulations, new regional planning initiatives, increased enforcement of state housing laws, and even taxation of second homes—clearly signals the state’s intention to take a leading role in how California houses itself.

The prospect of a Sacramento intervention is usually worrisome. But this one should be welcomed. The threat of the state seizing power may be one of the few levers that could prompt the biggest obstacles to new housing—local governments—to get out of the way.

One can hardly blame state government for aggressive meddling in housing. California has a nasty history of destabilizing calamities: from the run-up in housing prices in the 1970s that produced the Prop 13 backlash; to the debt-fueled mid-2000s increases that led to the housing crash and the Great Recession.

Today, California’s crisis is rising prices resulting from a profound failure to create enough units to meet the population’s needs. While the state needs an estimated 180,000 new units a year, it has been getting less than half of that. By one estimate, the resulting shortage is a $140 billion annual drag on the state economy. Companies and individuals leaving the state most often cite housing costs as their top reason. Home ownership is at the lowest rate in California since the 1940s.

The crisis also represents a public health issue. Millions of Californians pay so much for housing that they have less to spend on health care, food, education, and transportation. Housing costs force Californians into long commutes that damage our health, infrastructure, and environment. And housing prices are one big reason why California suffers from the greatest homelessness and the highest poverty rate of any state.

Adding to the difficulty is the bewildering mix of federal, state, and local policies that affect housing. Federal and state programs support people who seek housing and those who wish to provide moderately priced housing. But such programs are tiny compared to the need for subsidies in expensive California; the Legislative Analyst’s Office found that most low-income households receive no assistance with housing, and that nearly twice as many households are on waiting lists for housing vouchers as there are available vouchers.

Local governments add to the shortage by passing and enforcing limits on housing development, density, and sometimes rents themselves. This local hostility to new housing is fueled by NIMBYism, environmentalism, and a state fiscal system that encourages local governments to pursue retail development (which produces sales tax for local coffers) instead of housing.

The state has a great deal to do, but its goal should be straightforward: more housing. That should mean more assistance to those seeking housing, more incentives to produce more housing, and fewer regulations that limit housing. But the politics are wickedly complicated, even by California standards.

The debate is already dividing key interests that must come together to pass ambitious laws. Labor is split on housing, as building trades unions oppose reforms to lower housing costs, a change that would benefit working-class members of service sector unions. There also are divides among environmentalists (between those who embrace denser development and hardliners who oppose any growth at all), advocates for the poor (between those who want to revive poorer communities with new housing and those who fear new housing will merely displace poor people), and even among Republicans (between those who want to protect older people and their housing values and those who want more housing for the young families in their inland communities).

“I’m not super optimistic about the state being a positive force in housing yet,” says Chris Hoene, executive director of the California Budget & Policy Center. “The number and range of proposals suggests that there isn’t consensus yet among state leaders and housing advocates about what levers to pull.”

Some of the more than 100 housing bills could make things worse, by adding to the costs of housing, or creating disincentives for local governments to approve housing. It’s also difficult to make even small gains in encouraging more housing for poor and working-class people.

State Senator Toni Atkins of San Diego, for example, has built a formidable coalition behind a bill to provide a dedicated funding stream to support below-market housing. Politically, such funding would be a major breakthrough. But the legislation would produce just $250 million a year, a fraction of the tens of billions in affordable housing needs statewide.

And subsidized housing reflects only a fraction of the California housing market. The Legislative Analyst’s Office has called for a focus on encouraging additional private housing construction in high-demand coastal areas. Shortages there, the legislative analyst said, have rippled across the state, sending people further inland in search of cheaper housing, and driving up housing costs for everyone in the process.

The crisis is urgent and has been years in the making, and the state’s legislative efforts to gain power over the problem could take many years, with hiccups and mistakes. Is there any way to go faster? Perhaps, but it would require the politically difficult step of empowering developers.

One model, with roots in Massachusetts, gives private developers, nonprofit organizations, and local authorities great powers to challenge land-use regulations that prevent housing development. The developers get an especially free hand in localities that fail to meet state requirements on housing. The Massachusetts model thus puts local governments on the defensive. They can no longer say no to housing projects; they either must make plans for housing, or watch as developers do as they please.

Such pressure from the state may sound extreme. But so are the consequences of our housing shortage.

The post Aggressive State Meddling Could Fix California’s Housing Crisis appeared first on Zócalo Public Square.

Californians used to envy residents of our beautiful, wine-and-wealth-drenched Central Coast. Now we have reason to pity them.

And not just because Nicole Kidman has thrown her star power into producing a TV series based on the premise that Monterey’s women might be murderers.

The past year has brought one calamity after another. Last summer’s Soberanes Fire burned a vast swath around Big Sur for 83 days, fouling the region’s air and becoming the most expensive wildfire to suppress in U.S. history. Central Coast communities suffered some of the most severe water shortages in the state during the drought. And when this winter’s rains came, the Central Coast was hit with flooding, landslides, and the failure of a vital bridge.

Then there’s this: A new report from the Public Policy Institute of California (PPIC) shows the Central Coast is California’s capital of child poverty.

Santa Barbara County, of all places, had the highest poverty rate for young children (30.8 percent) in California from 2012-2014, the years for which the most recent data was available. Other Central Coast counties—Monterey and San Benito—had the second-highest child poverty rate. The report (which includes excellent maps on poverty among the very youngest children, ages 0 to 5) shows childhood poverty running especially high in the region’s bigger towns, especially Salinas and Santa Maria.

You might be surprised to read that, given that most narratives about California poverty involve the Central Valley, Inland Empire, or the far north state. None of the four counties where more than 25 percent of all residents live in poverty—Fresno, Imperial, Merced, and Tulare—are in the Central Coast region. In fact, the prosperous Central Coast has three cities—Santa Cruz, San Luis Obispo, and Santa Barbara—that ranked in the top 12 of all metropolitan areas nationally in a recent survey of residents’ well-being.

But don’t be shocked. The geography of California poverty has been flipped by coastal prosperity itself.

More advanced methods of measuring poverty—by accounting for differences in the cost of living and the use of safety-net benefits across regions—have captured regional shifts in poverty. In the process, they have revealed greater poverty on the Central Coast.

The region’s very high cost of living, most notoriously around housing prices, leaves even people who earn well above the traditional poverty line quite poor. Consider, for example, the poorer person living in Santa Barbara who considers moving to the poor San Joaquin community of Tulare.

In Tulare, the cost of living would be lower. But you’d also be less likely to be working, and you’d be making relatively less when you work, which would leave you relying more on social services to support your family.

In Santa Barbara, poverty is different, and in some ways tougher. In that city, the cost of living is much higher. You’re more likely to be able to get a job, and even a job that pays more than you’d make in the Valley. But you’ll still be well short of what you need to cover housing, medical bills, and other expenses that add up to a high cost of living. And your higher income might make you ineligible for safety net programs that would help.

“In the Central Coast counties, cost of living is higher and social safety net receipt is lower,” says PPIC research fellow and labor economist Sarah Bohn. “So both factors are driving up poverty rates there, relatively speaking.”

The Central Coast’s predicament contributes to an updated picture of the stresses of a state in which poverty and wealth are neighbors. Despite the frequent association of poverty and unemployment in the popular imagination, most poor children in California live in families with at least one working adult. And, even in an era when California’s job growth is leading the nation, working people are struggling to keep up with the rising cost of living. The PPIC analysis found that child poverty rates in the state are still substantially higher than before the Great Recession.

And such families don’t have enough help. Eligibility for social programs is still tied to a federal poverty line that does not account for regional differences, and lags reality in a high-cost state like California. For example, federal guidelines now list a single person living in poverty as making under $11,770; for a family of three, that number is $20,090. But the California Poverty Threshold—a statistic that is similar to the federal poverty line but varies for local cost of living—is $14,787 for a single adult and $26,492 for a family of three in Santa Barbara County. (The Self-Sufficiency Standard—what a single adult needs to pay for basic needs—is $27,000 in Santa Barbara County, and $59,000 a year for a single parent with two children.)

To put it another way, poverty programs don’t have all that much impact in places where it’s expensive to live. The Central Coast’s predicament is a strong argument for changing that. And change would involve new policies.

First, California’s wealthier jurisdictions need to get better at reaching those eligible for programs. (Fresno County tends to be better at getting safety-net benefits to eligible residents than Bay Area counties like San Mateo and Marin.) Second, more programs should be adjusted to make eligibility easier—and benefits more generous—in costlier regions.

The Central Coast’s child poverty also speaks to the scandalously minimalist response by the state and its local governments to California’s shortage of housing. The huge run-up in housing prices here—the median home price in California is 2.5 times the national average—is not merely a financial headache for the ambitious. It’s a poverty issue. And you can see it in the excessive overcrowding in high-poverty neighborhoods from Santa Maria to Salinas.

It’s a cruel irony that many of the coastal California cities and counties that have imposed tight restrictions on new housing and development also are home to levels of poverty that don’t get enough attention. Such communities should be aggressively challenged. Their NIMBYism, rationalized as “preserving community character,” is actually making people poorer.

None of these changes will come easily or quickly. In the meantime, say a prayer for the kids of the Central Coast.

The post Welcome to the Affluent Central Coast, California’s Child Poverty Capital appeared first on Zócalo Public Square.

Those reasons—economic anxiety, budget surpluses, tax schemes, housing prices, prison reform, health care expansion, urban wealth, and political opportunism have combined to create today’s “homeless moment” in California.

For decades, combating homelessness has been a civic obsession in the San Francisco Bay Area, with its long tradition of progressive politics and generous homeless services. Now that homeless hubbub has spread statewide. To the surprise of many at the State Capitol, a $2 billion bond to pay for housing for the mentally ill homeless—previously a backburner issue in tax-and-education-obsessed Sacramento—became a central focus of this month’s budget negotiations. And around the state, local law enforcement officials have stirred the pot by claiming that recent measures to reduce the California prison population have exacerbated the homeless problem.

In Los Angeles, which has the nation’s second largest homeless population according to federal figures, homelessness has become the dominant political debate. Mayor Eric Garcetti has talked big about addressing the problem—declaring an emergency, promising that no military veterans will be living on the street—and now faces criticism for weak follow-up. L.A.’s city and county governments are now ensnared in huge debates about how to pay for additional public housing.

A similar pattern—of big plans to end homelessness followed by conflict about how to do it—has emerged in cities from Redding to Riverside. In San Diego, with America’s fourth largest homeless population, a leading city councilman called for ending all homelessness by the end of this year. (He’s since backed off). In Orange County, there have been calls for a “homeless czar” to speed up the building of shelters and housing. In Fresno, Mayor Ashley Swearengin just held a press conference at the city’s baseball stadium to tout a plan to end homelessness in the next three years. In Sacramento, homelessness was a leading issue in the just-concluded mayoral election, with the victor pledging to build more housing for the homeless.

Given all this drama, you might expect that the number of homeless people is rapidly rising. To the contrary, homeless counts (the accuracy of which is another big debate) show relatively flat or even declining homeless populations in most of these cities. So why the sudden urgency? The short answer: the homeless are now more visible to the rich people who drive civic conversation. Fancy restaurants and new high-end housing have brought wealthy folks into urban neighborhoods and old industrial areas that once were havens for the homeless. Downtown L.A., home to a large population of unsheltered homeless for decades, has rapidly been transformed from one of the most affordable to one of the most expensive places to live in the city.

At the same time, anxiety about housing has never run deeper. The housing crisis of the previous decade cost many Californians their homes. California’s total failure to build housing—we’ve produced just one new unit for every eight new Californians in this decade—has led to sky-high prices. Many Californians are forced to spend more than half of their incomes on housing, and the prospect of sleeping on the street no longer seems so unlikely.

Politicians, who read polls showing this growing fear, have seized on the opening. Homelessness has become an almost perfect issue for politicians. Expectations of success are low (homelessness is persistent) so any progress can be spun as heroic. Few homeless people vote, so democratic accountability is close to nothing. And the issue doesn’t have a strong partisan profile, so there is room for political horse-trading and risk-taking.

Downtown Los Angeles’ Skid Row.

In an extraordinary public letter late last year, Santa Cruz Mayor Don Lane urged experiments with different approaches to the problem—and took himself to task for not having done so previously. “I am as responsible as anyone in this community for our failure to address our lack of shelter and our over-reliance on law enforcement and the criminal justice system to manage homelessness,” he wrote. “I have been a direct participant in many of my city’s decisions on homelessness. I have failed to adequately answer many of the questions I am posing.”

Such self-criticism is easier for politicians when money is on the way. The federal government has stepped up funding for housing the homeless—especially for veterans. The state is running a surplus, and a state fund for mental health services, funded by the Proposition 63 tax on millionaires, is so full of extra dollars that even Gov. Brown, a notorious tightwad, agreed to borrow $2 billion from it to fund housing and other services for the homeless. He and the legislature also threw another $400 million in affordable housing dollars into the budget.

In some places, the notion of a homelessness emergency is seen as a justification for a money grab. L.A. County supervisors want the state—which famously limits local taxation—to permit them to impose their own millionaire’s tax to pay for more homeless programs. That money, of course, could free up other funds for other purposes—which is all the more reason to decree a homelessness emergency.

To be fair, much of this money will be spent on a strategy that has shown some success—providing permanent supportive housing for the homeless. This housing-oriented approach is a welcome departure from decades of efforts to fix the ills of the homeless—be they substance abuse or trauma or mental illness—before getting them housing.

But the focus on housing is narrow for a problem this complex. And today’s windfall for homeless services is unlikely, in California’s volatile budget system, to last. Even if it did, the disparate nature of the funding—a bundle of incentives and grants—isn’t efficient enough to create the capacity to cover the fluid and shifting homeless populations in California cities.

In his acclaimed new book, Evicted, Harvard professor Matthew Desmond argues that ending homelessness would require greater ambition than anything on the table in California, or anywhere else in the U.S. He advocates “universal housing” as a clear right, like the well-established right to public education.

Under Desmond’s proposal, the government would issue housing vouchers to families below a certain income threshold so that they pay no more than 30 percent of their income on housing. The vouchers could be used to live anywhere they wanted—just as families use food stamps to buy groceries almost anywhere.

Such rental assistance is common in other developed countries like Britain and the Netherlands, which don’t suffer from American-style homelessness. In the U.S., universal housing via vouchers would cost $60 billion, Desmond estimates—real money, but a mere fraction of the hundreds of billions spent subsidizing the housing of wealthier people via the mortgage-interest tax deduction.

Universal housing wouldn’t have much chance of passage in Washington. But universal housing is just the sort of idea that California should try—if this homeless moment is really about ending homelessness.

The post What’s Behind California’s Sudden Urge to Help the Homeless? appeared first on Zócalo Public Square.

Her name is Poland.

No joke.

I see by the look on your face, California, that you are a bit shocked at this news. I realize that, when you think about your place in the world, you compare yourself to other big states, like Texas (economically) or New York (culturally). And when you’re feeling proud, you trot out the gross domestic product figures that put you in the top 10 of all countries around the world, up there with Italy and Russia and ahead of India.

But I’ve gotta tell you: These usual points of comparisons are too different to be instructive. Texas, for example, is a much bigger place in area, and has more than 10 million fewer people, than California. And the countries with similarly sized economies are much too big—think of Russia’s nine time zones or India’s more than 1 billion people—to make comparisons to California all that useful.

If you really want to understand who you are, California, you need to examine the country that most resembles you in size and population. And that country is Poland. Like you, Poland is home to 38 million people. And California is just slightly bigger in land area, but not by much (160,000 square miles for you, 120,000 square miles for them).

And that’s not all these two places have in common. For all their differences in history, today Poland and California are both crossroads that sit on global dividing lines between major regions. Poland and California each look West hopefully, and see the potential for growth by trading with prosperous continents (Western Europe and Asia, respectively). And—let’s face it—both look nervously East toward oil-rich, war-mongering, fading empires that aren’t nearly as democratic as they claim to be (Russia and the United States, respectively).

There has never been a better time than right now to take a hard look at Poland. Few countries have had a better time of it over the last quarter-century. Capitalizing on the end of the Cold War and the expansion of the European Union, Poland has experienced extraordinary growth, averaging 4 percent a year. (The social transformations have been nearly as stunning in this conservative, Catholic country; the northern city of Slupsk recently elected an openly gay mayor, something San Francisco hasn’t yet managed.) Most strikingly, Poland was the only major European economy to avoid a recession during the financial crisis; its economy is more than 20 percent larger now than it was in 2007. Long-term projections show Poland growing faster than other European countries through at least 2030.

What could you, California, hope to learn from examining Poland?

The most obvious—and important—lesson is how absurdly rich California remains. For all its growth, Poland’s economy, at $520 billion in GDP, is barely one-fourth the size of California’s $2 trillion economy. Despite being poorer, Poland’s recent investments in infrastructure dwarf California’s—Poland is now spending three times more in actual dollars on infrastructure than it did in 2006. That disparity should put the lie to the popular notion in California that the state doesn’t have the money or resources to make bigger investments in its future.

Comparing the two places on education also holds lessons. In K-12, Polish kids actually do better on measures of reading, math, and science than California kids. But California’s advantage in the quantity and quality of our universities more than compensates for that earlier deficit. Only two Polish universities show up in global rankings, while the outsized economic impact of California’s universities—in the workers they educate and the innovations they spur—is a big reason why California is so prosperous. In this context, Gov. Jerry Brown’s miserly attempt to limit state investment in the University of California looks—to use a Polish word—glupi.

The contrast on jobs is instructive. California business types tend to oppose efforts to raise wages and complain that it costs too much to employ people here. But when you look at Poland, you’re reminded that cheap labor—while useful to Western European companies that outsource work there—means that people have less money to pump into the economy. On the other hand, California labor unions routinely push to restrict how companies hire and fire their workers. Among Poland’s biggest handicaps are burdensome labor regulations and protections that discourage hiring, firing, and switching jobs. The takeaway: California’s combination of very high wages and more flexible labor markets—features of your economy since the 19th century—help make the state great.

Another big difference involves globalization. California is home to far more global companies than Poland. And California, despite recent declines in immigration, far surpasses Poland in attracting and keeping immigrants. Poland will have to change that if it wants to catch up with places like California economically.

The good news: Polish eyes already have turned to California to try to figure out how the country can improve itself. Late last year, the Polish government even held a Polish American Innovation Week in the Golden State, with events in Los Angeles, San Francisco, Berkeley, and Stanford.

Much of the conversation was about how to build universities, innovative companies, and labor markets that are more like California’s. I dropped by and chatted with Polish Undersecretary of State Katarzyna Kacperczyk, who speaks seven languages and studied economics at Columbia University. I asked her a lot of questions about Poland. She asked me much better questions about California—the kind of questions you get from people who, while they may lag behind, are gaining on you.

I wish Californians thought as much about our European sister as the Poles think about us.

The post Were California and Poland Separated at Birth? appeared first on Zócalo Public Square.

So why do we keep telling ourselves that we’re still seeking the same California dream? “California dream” has become a verbal tic in speeches, a graffiti we scrawl on signs and headlines, without thinking about its meaning. Democrats and Republicans alike, as they assumed new offices this month, pledged to defend the supposedly enduring California dream. In his inaugural address, Gov. Jerry Brown even suggested that the aspirations of today’s California were much the same as those of his 19th century California ancestors.

It’s time to stop this nonsense. Ceaselessly paying lip service to that old California dream—of this state as a great destination for people from around the world, as a gateway to rapidly acquired wealth and good health for the middle class, as a magnet of youth offering the best and cheapest education, as the capital of leisure, as a place of open land and sprawling suburbs—perpetuates a false picture of what the state has become. And that makes it harder to come up with new dreams and aspirations that fit today’s California.

To be fair, the old California dream was once powerful. The historian H.W. Brands has shown that the California dream “of instant wealth, won in a twinkling by audacity and good luck,” replaced the old American dream—a dreary and modest Puritan deal—after the Gold Rush. And that dream had some basis in reality. From its beginnings, California was a place with some of the highest wages in the world. Our abundant and talented workforce used those wages to educate their children and dream up all kinds of inventions, from mining equipment to the Internet.

But the dream was mostly myth. Many Californians got ahead here because of exploitation of labor—miners benefited from the forced labor of natives, the Irish from the boycott of the Chinese, and my Dust Bowl Okie forebears advanced out of orange groves when Mexicans were brought in to do the hardest work. And the waves of California growth that Brown recounted in his speech—railroad and silver booms, citrus and fruit in the 1880s, oil and auto in the early 20th century, aircraft before and during World War II, aerospace in the post-war era—were also bubbles that popped and did real damage to many lives. The dream’s real impact was to keep drawing people here from other states and countries; the energy, labor, and sheer numbers of new arrivals made this a fast-growing place.

It’s time to awaken from that old dream and look in the mirror. We are a great place—I wouldn’t want to live anywhere else—but we are not the same state we keep saying we are.

We are no longer that great destination for people dreaming of a new life. A majority of us are now native-born Californians. We have many immigrants, but few are new arrivals. The younger, working-class people who once flocked to California are leaving. And so we are not as young as we think we are—the birth rate is below replacement, and the number of children in the state declined by nearly 200,000 in the past decade.

And for all our millionaires and billionaires, California is defined not by easy leisure, but by hard work and struggle. Our unemployment rate is higher than the national average. We have the country’s highest poverty rate, according to measures that take into account cost of living and the value of government assistance.

Getting a piece of California has never been harder. Education costs have risen more quickly here than elsewhere. More than half of the nation’s 50 most expensive real estate markets are in California. Home ownership is falling.

We’re even losing our diversity advantage—Houston is now a more diverse city, racially and ethnically, than Los Angeles. For all our dreams of open space and inviting suburbs, we are more urban, and more defined by our cities, than ever. No other state has three cities as great as San Francisco, San Diego, and L.A., and our inland metropolises are giants in their own right: Fresno has more residents than the cities of Atlanta or Miami.

What is the dream of this new California? It’s tempting to dodge the question, and note that a state this big has many different dreams. After all, here is a list of just some of the musicians who have recorded the song “California Dreamin’”: the Beach Boys, America, R.E.M., Jose Feliciano, The Carpenters, Baby Huey & the Babysitters, the Four Tops, Bobby Womack, Queen Latifah, The Seekers, George Benson, Eddie Hazel, Raquel Welch, Alvin and the Chipmunks, MIA, the Italian project Colorado, the Russian rock band Mumiy Troll, Meat Loaf, and Diana Krall. You know the version from the California lottery ads? That was sung by a Belgian women’s choir.

But the truth is there is a new California dream, one that might seem modest but is quite grand when you consider all the difficulties of being a Californian these days.

The dream, put simply, is to be able to stick it out here. California is a struggle, so we dream of a good struggle, of finding our footing, of figuring out some way to beat the statistics and buy a house and pay the mortgage and educate our kids. We dream of treading water, which isn’t so bad—the water here is usually warm.

The dream of sticking it out can be seen in the narratives that drive our politics. Many of us worship the god of sustainability; we’ve poured most of our big-picture futurism into efforts to save the state’s environment and the planet, from new alternative fuels and solar to driverless cars. It’s telling that when people talk about dreamers in California today, they’re talking about unauthorized immigrants whose dream is to be able to stick around.

This new dream is also why opposition to taxation remains strong in such a liberal place. It already costs so much to live here, so why add new taxes and make it harder to stick around? We’re also reluctant to make big investments in infrastructure and people. Instead of working to transform the lives of working-class people, we prefer narrow policies to make their struggle a little less burdensome, maybe at $15 per hour. And our most foolish actions—throwing subsidies at the rich people who run Twitter and Hollywood and pro sports teams—come from the fear that high-profile institutions won’t stick around, but will instead pick up and move elsewhere.

The new dream of sticking around is also, of course, a dream about growing old. The elderly population of California is expected to double in the next generation. Many of us dream of being able to retire here, and of having kids who can afford to stick around themselves so we can see our grandkids.

That’s a very different dream than the old one. It’s about continuity, not rapid change; about attachment, not finding your own space; about California not as a place to which you can escape, but as place where you can belong. We Californians dream today of nothing less and little more than being able to stay here, so that we might keep dreaming in this wonderful and difficult state.

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Over the past two years, Mathews has written Zócalo’s “Connecting California” column, which appears in 30 media outlets across the state. He’s asked people in all corners of California for their ideas and dreams—and used their answers to offer such an assessment to a large crowd at Grand Central Market.

The iconic California dream was of rapidly acquired middle-class wealth, said Mathews—and it is “older than the American dream, which is a slightly poorer cousin of the California dream.” The American dream was a Puritan dream of modest wealth, accumulated year by year; according to historian H. W. Brands, the California dream—following the Gold Rush—was one “‘of instant wealth, won in a twinkling by audacity and good luck.’”

This dream was based partially in reality: Late-19th-century California offered high living standards and high wages, and California has a history of excellent public education and innovation. But the dream was also part “nonsense,” said Mathews. You couldn’t just grab a piece of property and be set for life. Profit and exploitation, boom and bust, have always come hand-in-hand here.

So what is a more realistic dream in today’s California?

“We are not a land of leisure,” said Mathews. California is a center of industry, technology, and work. This state is the opposite of its reputation for flakiness; scholars have found that California is one of the top places in the country for worker productivity. And the state attracts more venture capital in some years than the rest of the U.S. combined. California pays more in federal taxes, and gets back less in federal benefits, than virtually every other state. “The next time someone from out of state calls Californians flakes,” said Mathews, “you tell them that we’re the ones subsidizing your flakiness.”

California is also a state of high poverty rates and middle-class struggle, with more than half of the nation’s 50 most expensive real estate markets. California no longer attracts the young, poor, and ambitious, said Mathews—those people are leaving for other states.

California is no longer a magnet for immigrants, either. The state’s immigrants are settled rather than being recent arrivals. Today, a majority of Californians are native-born. This means Californians are becoming more like one another—and as a result, “we are, dare I say, less sexy than we used to be,” said Mathews.

Yet each California city and region still maintains a character separate from the rest of the state; it’s difficult to figure out what connects us to one another. The economy of the southern San Joaquin Valley, with its oil and gas production, seems a lot like Texas; economically, the Bay Area has more in common with Seoul and Boston than it does with Riverside.

So how does one sum up all these regions and diverse communities?

Mathews said that all of California’s major regions today are less a permanent destination or escape for people from around the world—and more often a crossroads. People come to California to live and work and go to school for a while, then they return home or head somewhere else.

“We are no longer a state of arrival,” said Mathews—and so “the dream is no longer to show up and do well.” Rather, it’s “to be able to find a way to stick it out here.” Paradise, in today’s California, is more like Survivor, where everyone is scheming a way to stay on the island.

Yes, there are still crazy-rich Californians, living glamorous lives, and holding onto crazy-big dreams. But they are in the minority “Most of us who are pursuing our dreams are seeking grit, not glamour,” said Mathews.

That’s due in part to the high cost of living here. In the audience question-and-answer session, Mathews was asked whether he’s spoken with anyone who has a new vision for housing—one that would allow more Californians to stay here.

“There are a lot of ideas,” said Mathews, but they’re mostly at the local level. Although cocktail party conversation all over the state centers on housing costs, the subject is not part of the larger statewide political conversation. None of the new politicians who took office last week mentioned it in their announcements; it hasn’t been a component of any major speeches.

Why, asked another audience member, do Californians cling to the narrative that high taxes make it difficult to run a business here? How does this square with the fact that the world’s most valuable companies continue to be founded here?

Mathews said that the narrative is flawed because low taxes have not made Alabama a wealthy state, and high taxes have not made Sweden a poor country.. But in some parts of California, lower taxes or regulatory exemptions might help economies—and in other parts of the state, they don’t make sense. “We’re not easily one state, and regulation policy in one part of the state doesn’t make sense in the other,” he said.

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