StamfordCT

Working harder, making others richer

Bob Herbert wrote, in his 3/11/08 column entitled "Sharing the Pain", in part,

The American dream is on life support because men and women by the millions who want very much to work — who still have in their heads the ideal of a thriving family in a nice home with maybe a picket fence — are unable to find a decent job.

For years, families have been fighting weakness on the employment front with every other option imaginable.

• Wives and mothers have gone to work.   
  
• People have been putting in more hours and working additional jobs.
• And Americans have plunged like Olympic diving champions into every form of debt they could find.

Who has gotten the benefits of women spending many more years and many more hours per year in the workplace?  Who has benefited from Americans carrying more and more debt?  How does this relate to the run-up in the price of housing?  I said I'd write about these issues in another post.   This is it.

The Taxpayer at 72nd and Madison

In a recent NYT, there is an article about the building on the southwest corner of 72nd and Madison in NYC. Twice in the article and once in the caption to the photos, the building is referred to as a "taxpayer" or "taxpayer-style building."

The article describes the 2 buildings which have occupied the 48' by 100' lot on the sw corner of 72nd and Madison: the first was a 5-story mansion built in 1894, which was occupied by an ex-wife of William K. Vanderbilt II.  On the northwest corner stood Louis Tiffany's grand house, and Gertrude Rhinelander was building her chateau, now the Ralph Lauren store, on the southeast corner.  The mansion remained a private home until 1951, when it was

... replaced with a two-story-high taxpayer-style building, designed by Boak & Raad with severe simplicity.

Ralph Lauren acquired the old Rhinelander mansion for its flagship store in 1986, and seven years later took over the taxpayer on the site of the Cutting house. It has operated a store there since then.

Bob Herbert's 3/11 column, Sharing the Pain: The "Near-Poor"

Link: http://www.nytimes.com/2008/03/11/opinion/11herbert.html

It begins with the statement,

Now that the economic crunch is reaching those near the top of the pyramid, there is finally a sense that the U.S. is facing a real crisis.

The article goes on to talk about the large group of  "near-poor" in America -- the 60 million people who are "just one notch above the official poverty line," with incomes that range from $20,000 to $40,000 for a family of four.

We have always gotten a distorted picture of how well Americans were doing from politicians and the media. The U.S. has a population of 300 million. Thirty-seven million, many of them children, live in poverty. Close to 60 million are just one notch above the official poverty line. These near-poor Americans live in households with annual incomes that range from $20,000 to $40,000 for a family of four.

It is disgraceful that in a nation as wealthy as the United States, nearly a third of the people are poor or near-poor.

You can read the statistics, expressed in terms of income multiples of the Federal Poverty Guideline here.  I think you'll find them moving.

It isn't that I don't agree there is a problem -- readers of this blog likely know that  -- but must point out that defining the problem this way, as the authors of "The Missing Class" do, misses the point that $20,000 or $40,000 for a family of 4 in rural Alabama is very different from $20,000 to $40,000 in New York City or San Francisco, or any of our other major metropolitan areas, where the vast majority of us live. [See data about the cost of living in America's low-cost counties, and in America's major cities.]

Fortunes Made in Real Estate

Americans have a tendency to respect those who are "self-made men." This seems to include people whose fortunes have been made in real estate.  The latest example in the news is the outgoing governor of New York, whose father, Bernard Spitzer, reportedly has a $500 million portfolio of properties, most or all in NYC.

I have nothing against real estate developers in their role as developers.  They bring large amounts of money and multiple talents to bear to create new modern buildings on sites previously occupied by more modest buildings suitable to another decade or century. And when they build they generally create the venues in which dozens, even hundreds, of entrepreneurial visions can be made into reality, and where thousands, sometimes tens of thousands, of people can be employed in a single building.  Appropriate development of choice sites, served by existing infrastructure such as NYC's elaborate transportation system and things as prosaic as city water, sanitary sewers, stormwater runoff, and all the other systems that are paid for by we-the-people: schools, public safety, public health, libraries, courts, hospitals, etc., means that specialized work can take in the center of the central business district, conducted by people who come from a 360 degree radius.  It minimizes sprawl on the fringe, and makes the economy work more smoothly.

But there are other facets of the real estate business that I think are "opportunities for plunder" that should be restructured to serve the common good instead of the private good.  This involves a revision of our notions of what is right, what is just, what is rightly private property and what legitimately belongs to the commons.