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When i was young, we were taught that Americans are used to moving and this is the main reason why America is rich: people easily pack up and move to where the

When i was young, we were taught that Americans are used to moving and this is the main reason why America is rich: people easily pack up and move to where the opportunities are, so businesses don't starve without workers and people don't sit in the dirt in the hopeless places for the rest of their lives. It is strange to see that this seems to be no longer true and people feel so attached to literally hopeless places they found themselves in.

lazulicurio 10y ago
Armchair hypothesizing: increased use of consumer debt[1] to purchase housing and transportation, combined with modern technology that makes it increasingly difficult to avoid debt collection[2], puts a severe damper on peoples' ability to move and find a "fresh start". [1] http://www.tradingeconomics.com/united-states/households-debt-to-gdp http://www.tradingeconomics.com/united-states/households-deb... [2] Or any negative PR that happens to be recorded in the annals of google for all eternity
- anovikov 10y ago
  Very good point. I have thought for a long time that the whole fake economy where people seem able to buy things they can't actually afford must backfire in some way. And so it does. Maybe solution is change in legislation that will scrap the mortgage industry, and make sure people buy properties in cash, or not at all? For example, don't make mortgage interest tax-free, enforce harder criteria for mortgage takers (like, no mortgage loan can be for over 50% of property value or 100% of pre-tax annual income of the buyer's household?). Yes most people will become renters for life, as they are in Europe, but at least this problem will be solved.
  - pm90 10y ago
    How will it solve this problem, really? This will funnel money into the hands of landlords. A lot of people will lose the only equity that they have. Wall street will get even more money to blow away... What you call fake economy is actually pretty real, yes its maybe not used responsibly by a lot of people. But lets remember this: while a lot of rural folks are feeling the pain (quite literally, looking at the opiod epidemic) the American economy as a whole is doing pretty fantastic. A ton of people are comfortably building equity in their homes.
    - lazulicurio 10y ago
      > A ton of people are comfortably building equity in their homes IMO, this is exactly the root of the issue though. You can't bring your home with you when you move. Having your only major equity stored in an illiquid and immobile asset is extremely constraining. I am sympathetic to the idea of wanting to own a home. I'd like to afford owning one myself one day! But we can't keep pushing housing costs higher and higher on mountains of debt that keep people chained to their property. Maybe getting rid of the interest reduction or enforcing more stringent mortgage conditions aren't the solution, but I think that somehow we have to get the price of housing to go down (and IMO there's no single solution; it's going to involve a combination of zoning reform, mortgage and financing reform, tax reform, and some sort of compensation for dropping property values for people who don't have savings apart from the value of their home).
amelius 10y ago
Different places might also require different education.
- anovikov 10y ago
  So essentially you mean that there is no good place where someone without a college degree can move? That's maybe true, but well, people in the cities have the same problem.
leggomylibro 10y ago
I completely agree, but there are good reasons not to want to move. If you've lived and worked with the same people for the past 30 years, you may not want to pack up and leave that tightly-knit community when the factory shuts down. Further, if you have a mortgage, it may well go underwater as property values plummet. On the other hand, the US has (had?) an array of social programs to help people in those situations transition into new roles. The Atlantic published a pretty good piece* on why they haven't wound up working out as well as they could, and it does sound like a major reason is that people won't move to where the jobs are. And regardless of their reasons for wanting to stay, that usually is on them, isn't it? Otherwise, they're essentially asking the government to subsidize their lifestyle choices. * https://www.theatlantic.com/business/archive/2016/10/trade-winners-losers/504584/ https://www.theatlantic.com/business/archive/2016/10/trade-w...
- reubenswartz 10y ago
  I think the property value issue is important. If a major employer closes and people want to leave/no one wants to move there, property values go down. Even if you're not underwater, you're in a much worse position. To move to a place with more opportunity is much more expensive, especially if you have no guarantee of long term, stable employment.
  - anovikov 10y ago
    No one has that guarantee these days. Also you are in a much worse position regardless of if you sell or not.
maxerickson 10y ago
It can be a meaningful statistical effect without being an absolute. Maybe a portion of Americans are more inclined to move and the economy benefits from that.
lkrubner 10y ago
One of the problems has been the disappearance of reliable economic growth areas, to which people could move. For instance, from the 1930s to the 1980s California went more than 50 years without a recession. For 50 years it seemed as if the economy of California would alway grow. If you were a farmer in Iowa and the price of soybeans collapsed, and thus you were bankrupt, you could move to California and start over. And likewise, at different times, Florida was also booming, and many oil rich states, whenever the price of oil was high. But since the 1980s the number of reliably booming areas has decreased. The current boom in Silicon Valley is not a mass phenomena -- it creates tens of thousands of jobs instead of millions of jobs. And it very much gives off the vibe of being a temporary bubble, so people are less inclined to sell their house in Iowa and move to San Francisco, as there is the risk they will arrive just when the bubble is ending.
coldtea 10y ago
Well, by moving out you hurt/drop family, friendship and community ties, any sense of belonging to a place, the desire to improve where you live (why bother? You might be elsewhere in 5 years), and general stability in your life. Unless you're some starry-eyed kid that dreams of making it in Hollywood or SV or NY's art scene etc (and the people in those places rarely care for such jobs), you don't particularly like to move. You might bite the bullet and do it if you're hopeless and jobless, but in order to move, opportunities need to be there for you elsewhere. In an era of increased de-industrialization and crushing of the working/middle class, they don't exist as much. And I'm not sure about the past being much different. Americans used to be very concerned with getting their house with the "white picket fence" etc to just carelessly hop from one place to another. Besides they used to have jobs for life in decades past (factory, corporate, etc) -- only those that really wanted it moved to make it big, not just because they were forced (talking post-depression era of course). Also: "Indeed, it is widely believed that internal migration rates in the United States—that is, population flows between regions, states, or cities within a country—are higher than in other countries. This belief is not exactly wrong, but reality is more complex. For example, the Dust Bowl migrants of the 1930s were not representative of their time, but rather were an exceptional case during a period of markedly low internal migration (Ferrie, 2003; Rosenbloom and Sundstrom, 2004). While the United States has historically had one of the highest migration rates in the world by many measures, citizens of some other countries—including Finland, Denmark and Great Britain—appear equally mobile. Moreover, internal U.S. migration seems to have reached an inflection point around 1980". https://www.federalreserve.gov/pubs/feds/2011/201130/201130pap.pdf https://www.federalreserve.gov/pubs/feds/2011/201130/201130p... And: https://www.nytimes.com/interactive/2015/12/24/upshot/24up-family.html https://www.nytimes.com/interactive/2015/12/24/upshot/24up-f...
msluyter 10y ago
Tyler Cowen's mentions our decreased mobility in his book "The Complacent Class." Here's a bit from an interview in the Washington Post[0]: WP: Some of the lack of mobility is due to high rents in cities, which keeps many people out, right? You cite some research that shows if it was cheaper to move into American cities, GDP growth would be much higher, and the economy would be more dynamic. Cowen: Enrico Moretti’s estimate is that GDP would be 9.5 percent higher. That figure is hard to estimate, but it’s not a tiny effect. Right after WWII, adjusting for inflation, an apartment in Manhattan cost $530 a month. That’s unimaginable today. It’s a big reason why mobility has become problematic. [0] https://www.washingtonpost.com/news/wonk/wp/2017/02/28/upper-class-elites-might-hate-trump-but-they-were-key-to-his-success/ https://www.washingtonpost.com/news/wonk/wp/2017/02/28/upper...
- anovikov 10y ago
  Well, overall rent vs income nationwide didn't change right? So that ratio may change only depending on how good are the opportunities in the particular place.
anovikov 10y ago
Here is my explanation: plain and simple population aging. People simply got older. Median American is 10 years older now than 50 years ago. Less testosterone, their hunting instinct got weaker, they grew fat (in both direct and indirect sense) and are less adventurous. When things go south, 50 years ago they will pack up and move, now they sit in the dirt and remember the Good Old Days. Sadly, there is absolutely no way to fix this (while Trump's plan to shut down Obamacare and effectively cripple Medicare is a step in 'right' direction LOL)
pnathan 10y ago
That is how I was raised as well: move to where the jobs are. Don't self limit.
user5994461 10y ago
People moved to a new city and got a job for 10 solid years, while starting a family and buying a house. Nowadays, people move, they get a job that is uncertain to last years, while they can barely afford rent and any mortgage is over 30 years assuming you had the down payment which you don't.
tropo 10y ago
Some don't mind moving... to another rural place. That doesn't really change things of course. Rural people really are different from urban people. There are probably brain differences here, both conditioned and genetic. When you are in a city, how do you feel? Do you feel stimulated, energized, excited, enticed, and intrigued? Do you feel nervous, fearful, tense, harassed, endangered, overstimulated, stressed, strangely lonely despite crowds, contaminated by the filth, and vulnerable? Normal urban people do not own the land they live on and often can not even access all sides of the building. The owner of the land and/or building gets to set rules. Is this perfectly normal or even beneficial? Is it instead a dystopian nightmare without freedom? Do you think "There are lots of people here, so I'm safe" or "There are lots of people here, so I'd better be wary"? Do you nap or openly use your phone on a subway? Do you clutch your belongings close, eyeing other passengers as threats, ready for fight or flight?

lazulicurio 10y ago

Armchair hypothesizing: increased use of consumer debt[1] to purchase housing and transportation, combined with modern technology that makes it increasingly difficult to avoid debt collection[2], puts a severe damper on peoples' ability to move and find a "fresh start". [1] http://www.tradingeconomics.com/united-states/households-debt-to-gdp http://www.tradingeconomics.com/united-states/households-deb... [2] Or any negative PR that happens to be recorded in the annals of google for all eternity

anovikov 10y ago
Very good point. I have thought for a long time that the whole fake economy where people seem able to buy things they can't actually afford must backfire in some way. And so it does. Maybe solution is change in legislation that will scrap the mortgage industry, and make sure people buy properties in cash, or not at all? For example, don't make mortgage interest tax-free, enforce harder criteria for mortgage takers (like, no mortgage loan can be for over 50% of property value or 100% of pre-tax annual income of the buyer's household?). Yes most people will become renters for life, as they are in Europe, but at least this problem will be solved.
- pm90 10y ago
  How will it solve this problem, really? This will funnel money into the hands of landlords. A lot of people will lose the only equity that they have. Wall street will get even more money to blow away... What you call fake economy is actually pretty real, yes its maybe not used responsibly by a lot of people. But lets remember this: while a lot of rural folks are feeling the pain (quite literally, looking at the opiod epidemic) the American economy as a whole is doing pretty fantastic. A ton of people are comfortably building equity in their homes.
  - lazulicurio 10y ago
    > A ton of people are comfortably building equity in their homes IMO, this is exactly the root of the issue though. You can't bring your home with you when you move. Having your only major equity stored in an illiquid and immobile asset is extremely constraining. I am sympathetic to the idea of wanting to own a home. I'd like to afford owning one myself one day! But we can't keep pushing housing costs higher and higher on mountains of debt that keep people chained to their property. Maybe getting rid of the interest reduction or enforcing more stringent mortgage conditions aren't the solution, but I think that somehow we have to get the price of housing to go down (and IMO there's no single solution; it's going to involve a combination of zoning reform, mortgage and financing reform, tax reform, and some sort of compensation for dropping property values for people who don't have savings apart from the value of their home).

amelius 10y ago

Different places might also require different education.

anovikov 10y ago
So essentially you mean that there is no good place where someone without a college degree can move? That's maybe true, but well, people in the cities have the same problem.

leggomylibro 10y ago

I completely agree, but there are good reasons not to want to move. If you've lived and worked with the same people for the past 30 years, you may not want to pack up and leave that tightly-knit community when the factory shuts down. Further, if you have a mortgage, it may well go underwater as property values plummet. On the other hand, the US has (had?) an array of social programs to help people in those situations transition into new roles. The Atlantic published a pretty good piece* on why they haven't wound up working out as well as they could, and it does sound like a major reason is that people won't move to where the jobs are. And regardless of their reasons for wanting to stay, that usually is on them, isn't it? Otherwise, they're essentially asking the government to subsidize their lifestyle choices. * https://www.theatlantic.com/business/archive/2016/10/trade-winners-losers/504584/ https://www.theatlantic.com/business/archive/2016/10/trade-w...

reubenswartz 10y ago
I think the property value issue is important. If a major employer closes and people want to leave/no one wants to move there, property values go down. Even if you're not underwater, you're in a much worse position. To move to a place with more opportunity is much more expensive, especially if you have no guarantee of long term, stable employment.
- anovikov 10y ago
  No one has that guarantee these days. Also you are in a much worse position regardless of if you sell or not.

maxerickson 10y ago

It can be a meaningful statistical effect without being an absolute. Maybe a portion of Americans are more inclined to move and the economy benefits from that.

lkrubner 10y ago

One of the problems has been the disappearance of reliable economic growth areas, to which people could move. For instance, from the 1930s to the 1980s California went more than 50 years without a recession. For 50 years it seemed as if the economy of California would alway grow. If you were a farmer in Iowa and the price of soybeans collapsed, and thus you were bankrupt, you could move to California and start over. And likewise, at different times, Florida was also booming, and many oil rich states, whenever the price of oil was high. But since the 1980s the number of reliably booming areas has decreased. The current boom in Silicon Valley is not a mass phenomena -- it creates tens of thousands of jobs instead of millions of jobs. And it very much gives off the vibe of being a temporary bubble, so people are less inclined to sell their house in Iowa and move to San Francisco, as there is the risk they will arrive just when the bubble is ending.

coldtea 10y ago

Well, by moving out you hurt/drop family, friendship and community ties, any sense of belonging to a place, the desire to improve where you live (why bother? You might be elsewhere in 5 years), and general stability in your life. Unless you're some starry-eyed kid that dreams of making it in Hollywood or SV or NY's art scene etc (and the people in those places rarely care for such jobs), you don't particularly like to move. You might bite the bullet and do it if you're hopeless and jobless, but in order to move, opportunities need to be there for you elsewhere. In an era of increased de-industrialization and crushing of the working/middle class, they don't exist as much. And I'm not sure about the past being much different. Americans used to be very concerned with getting their house with the "white picket fence" etc to just carelessly hop from one place to another. Besides they used to have jobs for life in decades past (factory, corporate, etc) -- only those that really wanted it moved to make it big, not just because they were forced (talking post-depression era of course). Also: "Indeed, it is widely believed that internal migration rates in the United States—that is, population flows between regions, states, or cities within a country—are higher than in other countries. This belief is not exactly wrong, but reality is more complex. For example, the Dust Bowl migrants of the 1930s were not representative of their time, but rather were an exceptional case during a period of markedly low internal migration (Ferrie, 2003; Rosenbloom and Sundstrom, 2004). While the United States has historically had one of the highest migration rates in the world by many measures, citizens of some other countries—including Finland, Denmark and Great Britain—appear equally mobile. Moreover, internal U.S. migration seems to have reached an inflection point around 1980". https://www.federalreserve.gov/pubs/feds/2011/201130/201130pap.pdf https://www.federalreserve.gov/pubs/feds/2011/201130/201130p... And: https://www.nytimes.com/interactive/2015/12/24/upshot/24up-family.html https://www.nytimes.com/interactive/2015/12/24/upshot/24up-f...

msluyter 10y ago

Tyler Cowen's mentions our decreased mobility in his book "The Complacent Class." Here's a bit from an interview in the Washington Post[0]: WP: Some of the lack of mobility is due to high rents in cities, which keeps many people out, right? You cite some research that shows if it was cheaper to move into American cities, GDP growth would be much higher, and the economy would be more dynamic. Cowen: Enrico Moretti’s estimate is that GDP would be 9.5 percent higher. That figure is hard to estimate, but it’s not a tiny effect. Right after WWII, adjusting for inflation, an apartment in Manhattan cost $530 a month. That’s unimaginable today. It’s a big reason why mobility has become problematic. [0] https://www.washingtonpost.com/news/wonk/wp/2017/02/28/upper-class-elites-might-hate-trump-but-they-were-key-to-his-success/ https://www.washingtonpost.com/news/wonk/wp/2017/02/28/upper...

anovikov 10y ago
Well, overall rent vs income nationwide didn't change right? So that ratio may change only depending on how good are the opportunities in the particular place.

anovikov 10y ago

Here is my explanation: plain and simple population aging. People simply got older. Median American is 10 years older now than 50 years ago. Less testosterone, their hunting instinct got weaker, they grew fat (in both direct and indirect sense) and are less adventurous. When things go south, 50 years ago they will pack up and move, now they sit in the dirt and remember the Good Old Days. Sadly, there is absolutely no way to fix this (while Trump's plan to shut down Obamacare and effectively cripple Medicare is a step in 'right' direction LOL)

pnathan 10y ago

That is how I was raised as well: move to where the jobs are. Don't self limit.

user5994461 10y ago

People moved to a new city and got a job for 10 solid years, while starting a family and buying a house. Nowadays, people move, they get a job that is uncertain to last years, while they can barely afford rent and any mortgage is over 30 years assuming you had the down payment which you don't.

tropo 10y ago

Some don't mind moving... to another rural place. That doesn't really change things of course. Rural people really are different from urban people. There are probably brain differences here, both conditioned and genetic. When you are in a city, how do you feel? Do you feel stimulated, energized, excited, enticed, and intrigued? Do you feel nervous, fearful, tense, harassed, endangered, overstimulated, stressed, strangely lonely despite crowds, contaminated by the filth, and vulnerable? Normal urban people do not own the land they live on and often can not even access all sides of the building. The owner of the land and/or building gets to set rules. Is this perfectly normal or even beneficial? Is it instead a dystopian nightmare without freedom? Do you think "There are lots of people here, so I'm safe" or "There are lots of people here, so I'd better be wary"? Do you nap or openly use your phone on a subway? Do you clutch your belongings close, eyeing other passengers as threats, ready for fight or flight?