Thursday, November 26, 2009

The Effects of the Crisis - Part 4


This is part four in a set of articles about the losers of the American economical crisis. The first article described the background to the topic of these texts (including the connection to peak oil). In the previous text I wrote about those who formerly had well-paid jobs, but, who due to the economical crisis, have fallen both quick and far from their former positions in society. In this text I write about those who have lost their jobs, and about "creative" solutions to people's housing problems.

What do you do when you understand that you are financially vulnerable and want to do something about it by lowering your costs and your financial risk? An obvious answer is to move to something smaller. It doesn't sound like a big thing to do, but if you are 50 years old and have a few teenage children who have lived a great part of their lives in the same house, it might well be an emotional challenge to take such a decision. And, you naturally want to sell your old house for a reasonable price. You might be able to live with a lower price if you can buy a new house that has also fallen in price... and if you manage to get your house sold at all.

Only a few years ago, 4 out of 10 houses sold were investments in a second home, a house that was not the seller's main residence. This according to the CEO of "Distressed Property Institute" (what a name!) that organizes courses for real estate agents about how to deal with houses whose owners are about to be evicted. California had the largest number of evictions last year, around 500 000, and Florida was number two with almost 400 000 evictions. Also Las Vegas has seen a lot of evictions, and every 13th house in the city is now owned by a bank (since the original owner has been evicted). In the third quarter 2009 evictions hit a new record as more than 900 000 Americans were evicted from their homes (40 000 more than in the previous quarter). In addition, seven million homes are currently "in the foreclosure process or likely to be seized". These days also people living in more expensive properties are being evicted. In June, the most expensive third of all houses were represented by 30% of all evictions. Then again - what to do if you see the writing on the wall and realize that you you can't bear the costs of keeping on living in your house? With a weaker economy, sinking house prices and high unemployment, ever more people need to find solutions that were difficult to imagine just a few years ago:

“Siblings are moving in with one another to help pay the mortgage. Adult children who've lost homes to foreclosure are moving back home with Mom and Dad. Even spouses in the throes of divorce are putting off separating, living together in awkward cold wars because they can't sell their houses.”

As I wrote in the previous text, not even those who earlier made a lot of money can now feel safe - especially if they have lived over their means. Or in Titus Maccius Plautus' more than 2000 years old words: "I am rich as long as I don't pay my debts"! Take Chris Henning for example who had a six-figure income in the 1990's (guesstimate is between 8000 - 20000 USD/month) and who "invested" her money in gadgets and a second home in Florida - a home that she refinanced three times since 2002 in order to be able to shop, buy, purchase and consume even more.

“During the boom, Henning subscribed to the conventional wisdom that housing prices couldn't slide. "Looking back, I thought, 'How naive could I have been?' “

The answer is that she was naive enough to not once in her 66 years think that the economy, the stock market and the house prices might sometimes fall, instead of always rising. Others have experienced the same nasty surprise, for example Colt Phillips, who after 15 years in the mortgage industry was forced to move home to his parents at the age of 40. After being evicted from their 460 (!) m2 (5000 ft2) big house (that costed almost one million dollars), Colt, his fiancee and their two dogs moved into the parents' 130 m2 (1400 ft2) big house. Now Colt is looking for a new job (he still hopes for employment in the mortgage industry) and his fiancee, formerly a loan processor, nowadays works at Home Depot.

Not only featured in an USA Today article (above), Colt has also had the opportunity to write an article about his own situation in the prestigious New York Times (where his parents' home has suddenly shrunk (?) to 100 m2 (1100 ft2) and felt crowded). In this article you can read the story as seen from Colt's own perspective. I can only with difficulty shake off the feeling that he hasn't learned anything at all yet. He has lived with his parents for one and a half years and complains that he doesn't have enough money to play golf or "do much socially" (go partying, I presume). He feels that he is isolated, "like a monk". But most unrealistic is in my view his hopes for the future.

What he did as a mortgage broker was setting up FHA loans. He has been in contact with some potential employers (real estate) and hopes that he can works with these loans again; “FHA loans have historically allowed lower income Americans to borrow money for the purchase of a home that they would not otherwise be able to afford”.

Other unrealistic dreams are:
- "I’m still hoping that the mortgage business will take off again."
- "Our elected officials are trying to fix this mess, and Congress may come through with some helpful programs."

He further states that he could imagine taking a job that pays 10 USD per hour, but not yet. Such a job would take too much of his time. He wouldn't have the time to look for a better job and he prefers concentrating on hunting for a job with a salary good enough to allow him and his fiancee to move back to a place of their own again - "even if we just rent one". At the same time he says he misses having a job, that a job gives meaning to everyday life and that he misses the opportunity to interact with other people. In an attempt to show how much he has matured and learned he says:

"I never saw this recession coming. I made great money when times were good, but I spent a lot. […] When the economy comes back, I’m going to be a smarter investor."

In spite of already being halfway run over by a metaphorical truck, he has not yet understood that the future might not necessarily look like what he has experienced up until now. How angry won't he be if (or when) he has to bite the bullet and lower his expectations? It is often said that "hope is the last thing to die". In many cases hope is a good thing. But there are also cases when it is not functional or sensible to hope - for example if what you are hoping for is unrealistic or borders on pure fantasies or is delusional. The difficult thing is, of course, to realize what is attainable and what is unrealistic.

Personally I believe that Colt's expectations are way to high when he thinks that he will be able to 1) work with setting up mortgages so that people who can't afford to buy a house can buy a house, and 2) being a better investor "next time". But who knows, he might be lucky and land a job. In spite of it being utterly absurd, the FHA loans still exist (so far) - and there are still more people around who have learned nothing yet.

Other individuals who move back to their parents see more advantages than disadvantages. When Kanessa Tixe's dad had finished building a large house and then lost his job, she, her stepbrother and stepsister all moved to that house to share the costs. They eat their meals together, feel that they have come closer to each other, and think that it is important to stick together when the times are tough.

Also Jeffrey Root, who has moved back to his parents together with his young wife, sees many more advantages than disadvantages. The move seems to have made a big impression on him and has fundamentally altered his priorities:

“Root says people should look for unexpected joy in the struggle. “Reading all these negative stories and stuff, I [...] realized people don't know what it's like to live without an iPod," […] "I'd say we're really spoiled ... We really do need to look at what's important. […] Staying close to your family in times of need, that's the most important thing in the economic crisis," he said.”

In spite of these examples, some "experts" warn in excessively negative terms of moving together and make it sound embarrassing - as if the people who do it have many alternatives to choose between...

“challenges include lifestyle differences, generational differences, depression, money squabbles and other issues when relatives huddle together for economic relief. […] Moving in with relatives can be ‘demoralizing, humbling, dehumanizing […] You lose that sense of independence, privacy and self-esteem, [...] You lose somewhat of your identity’.”

We thereby return to "identity" which I have written about earlier in these texts about the effects of the crisis. The topic fascinates me, and I have a certain understanding for the great obstacle this might constitute to people. "We are not the kind of people who..." surely make some keep doing irrational things and continuing to choose not to see the situation as it is.

In spite of going bankrupt, the Jensens had a hard time selling stuff that carried great symbolical value to them:

“The couple agonized over the decision to sell their grill and riding mower, two signature representations of home ownership for many people. "It was like some big symbol of our failure," says Jensen.”

To lose your status in the eyes of society is both an outer and inner trip. It is easy to fall very quickly (lose one's job, be evicted from one's house) without understanding, realizing, and catching up mentally. How long can you feel as if you are a real estate agent in spite of (soon) two year having passed since you last sold a property? For how long - how many months or years - will you stick to the dream of returning to your old employment, your old salary, your old consumption habits and to your old position in society? When almost half a million Americans have lost their job every month this year and certain businesses (like construction and real estate) fall to pieces like a house of cards, you finally reach a point where it is not longer rational to think that you can get your old job and your old life back. When and how do you build a new identity that is not built on delusional dreams about something that most likely will never materialize?

This text has been about those who have had to give up the American dream about a huge home of their own in the suburbs. In part five of this series I will describe those in an even worse situation and who are prepared to take just about any job.

This text was originally published in Swedish on October 23, 2009.

Thursday, November 19, 2009

Suburbia is unsustainable

I recently wrote about James Kunstler's book "The Geography of Nowhere" and about the fact that the car society (“made in the U.S.”) is grossly unsustainable. There is hardly any structure less durable after global oil production peaks than the countless and endless American suburbs. The American way of life epitomizes the wasting of cheap energy. To build and to live in a sprawling suburb and to be so totally dependent on cars is not a good position to be in when heating (or air conditioning) becomes expensive and when driving a car and maintaining a “thinned-out” infrastructure (electricity, water, roads) becomes prohibitively expensive. The fact that detailed zoning laws by default prohibits commercial activities in residential areas (for example neighborhood stores), means that the nearest supermarket is usually located so far away that any options beyond the car are hard to imagine for many Americans. 

We know that many American suburbs have problems with "subprime loans" and foreclosures today, but I think many people here in Sweden do not understand how bad things really are in some places in the United States. When I wrote about "The Geography of Nowhere", I linked to the 12-minute long film "Foreclosure Alley". I recommend it again as it opens doors and gives shocking glimpses of a total crisis of monumental unpreparedness and desperation. People who are evicted from their large, beautiful (new) houses lose hope and can't pull themselves together together to try to sell their stuff and lack the strength to pack up their stuff (or they do not have anywhere to take them) before they have to leave them. 

The business models that are presented in the film are fascinating in their perversity. Spraying dead lawns green to make them look more attractive is a great example of a Potemkin village and of the fact that surface nowadays is more important than substance. I have not been able to drop the idea and found this article about Nick Terlouw and his Greener Grass Company as well as the accompanying 2 minute long news flash fascinating. Nick works in Stockton, California, "the ground zero of the foreclosure issue," and the paradox is of course that the more people that are evicted, the better the business for the Greener Grass Company. 

A customer says that "it turns the grass green and makes the neighborhood look decent again." The fact that the grass looks fine is important, that it actually still is dead (and the human tragedies that can be imagined behind each dead lawn) becomes a secondary matter. "After the spraying, the grass had a sparkling appearance and looked not only alive but also lush and thriving" - and all this for only 200 dollars! How can someone lose hope and think that there are problems that human inventiveness cannot solve when Greener Grass Company proves how easy it is to far surpass what nature has given us! Further research has led me to the company Tate Turf Painting - "the leader in grass painting" ("We have developed a process that can have a lawn a beautiful, natural looking green within a matter of hours"). Tate Turf can provide you with everything you need to start up your own greenwashing business (equipment, color and training). 

Any change has its winners and its losers. Among the more humorous (?) phenomena are skateboarders who use real estate brokers' sites or satellite imagery from Google Earth to find empty houses with large pools, which they then convert and skate in. At an internet forum, a skateboarder writes 'God bless Greenspan, patron saint of pool skatin' ". Well then, at least one person looks at the current economic situation and likes what’s going on. 

Moving back to "Foreclosure Alley", I think we can agree that it is shocking, but it does not say much about how this situation could occur or what will happen in the future. I therefore went back and read "The next slum?" again. It is written by Christopher Leinberger, a professsor of urban planning at the University of Michigan, and it was published in The Atlantic Monthly in March 2008. I read it last spring, before the subprime crisis had reached hurricane strength, and the article made a deep impression on me. While subprime loans at the time had emerged as a problem, this was before the financial and economic crisis crisis crashed the party (the explosion occured half a year later, in the autumn of 2008). 

What Leinberger’s article describes is how some recently-built suburbs - the furthest away from everything and everyone, therefore most dependent on cars and bought by the financially weakest players on the market – are collapsing. One example is Windy Ridge, 110 kilometers (!) Northwest of Charlotte, North Carolina. In late 2007, 81 of 132 homeowners had been evicted. Thieves had broken into empty homes to steal wires and sell them for the value of copper. In some cases, the walls had been smashed to get at copper pipes, and also brass and aluminum were desirable materials to steal from abandoned houses. The market value of a looted house naturally falls a lot. “a ‘notice of foreclosure’ letter affixed to its door [is] like a big billboard saying 'come and take me'." When do we get "house-sitters" (compare this future profession with babysitters or parking attendants) who may live for free if they guard and manage a bunch of abandoned houses in order to maintain as much as possible of their value? 

The 50 homeowners who still lived in Windy Ridge now had new neighbors; homeless, drug addicts and criminal gangs that slowly entered the area and made it their home. It is easy to imagine that the woman who was interviewed had no further desire to live in Windy Ridge after a stray bullet went through her son's bedroom and into her own. But what are her options? Who in their right mind would like to buy her house at a price that has even a teneous connection to what she paid for it only a few years earlier? 

The sad story of Windy Ridge is repeated a year later in the story of Lehigh Acres, Florida. In early 2009, houses were sold for a fifth of the top prices three years earlier. Besides drugs, marihuana cultivation and scrap thieves, hunger and desperation is becoming a growing concern among those who remain. Houses have started to be sold again, but average price is ony 45 000 $ - one third of the costs of building the houses. 

In Windy Ridge and other areas where (many) homeowners have been evicted, you finally reach a breakpoint or a tipping point; when a sufficient number of houses stand empty the whole area changes, crime increases and those homeowners who remain become trapped in a vise as they can’t get a “decent” price for their houses and move on. Leinberger’s article is based on the premise that even before the subprime crisis exploded, Americans' preferences for housing was slowly changing. After 60 years of migrating to the suburbs (further and further away from the city), the pendulum started to swing back. The consequences are that many suburbs that currently still look nice are "living dead" and face a bitter fate. Their fate is similar to many American inner cities that in the1960s and 1970s declined into becoming slums with high crime rates, poverty and decay. This in turn accelerated the flight away from the inner cities for everyone who could afford to get away. 

The triump of the suburbs began in earnest after World War II. Escape from New York (1981) portrayed the city's low-water mark - the city was in such a state of decay and so unloved that nothing remained but to put up a fence around it and turn it into a prison. Today, the city has instead become hip through TV shows like Seinfeld, Friends and Sex and the City. 

But what will happen with all the scattered "McMansions" that exist today? If we take Desperate Housewives’ upper-middle-class "Wisteria Lane" and downgrade it one or two levels, where does that leave us? It is possible to imagine a suburbian cul-de-sac makover - from a handful of scattered houses to a "real" street with houses and shops that you can walk between without a car. Or perhaps you could tear down a few houses and build a nice park? Neither proposal will become common for a couple of different reasons. First, they are costly. Second, you would have to buy many plots and houses at one sweep, something that is difficult if only a few owners object to the plan. Third, there are currently major political and legal obstacles to implementing such projects. Fourth, the existing infrastructure is not well adapted to denser settlements. 

A more likely scenario is that prices in (certain) neighborhoods continue to fall until they hit rock bottom and the houses are purchased by families with very low incomes - or they might be bought and subdivided so that each house can accommodate multiple tenants. Some might become cheap hotels (flop houses) where you can rent rooms by the day, the week or the month. Still, it is difficult to see how those living in a distant suburb can earn a living when they are stranded far from the city, from jobs and even from the nearest supermarket. Another problem is that today's American suburban houses (even the bigger and nicer houses) are cheaply constructed and will not last that many years without extensive maintenance work. 

The neighborhoods best positioned to survive more or less unscathed from the scenario above are those that are economically prosperous, situated close to the city or along rail tracks or that are near a walking-friendly suburban center. 

In an article from this year
, Leinberger points out that the problem is deeper even than the number of foreclosures and that it can take a generation or longer to work through the societal changes that so far have only started in the United States. About half of all Americans want to live in detached houses (in suburbs), but 80% of the U.S. housing stock is currently situated there, while only 20% is situated in cities or city-like environments ("walkable urban arrangements"). Since we replace houses only slowly, it can easily take up three decades for supply and demand to become balanced, and a study shows that there may be more than 20 million empty homes in America's suburbs 15 years from now. Just as Kunstler argued already 15 years ago, Leinberger says the U.S. has built too many houses, to much office and retail space and all of it situationed in the wrong places:

”For the owners of that retail or housing space, every dollar that they invest will be money they don’t get back. That is another definition of a slum. There’s no incentive to invest in a slum. So here you are. You buy a 4,000 square foot house [370 m2] 40 miles [65 km] outside town. You think, wow, I got great value. But when the roof begins to go, you just patch it, because if you put a new one on it’ll cost $20,000, you’ll still be at the same selling price. So, why do it?”

There will be losers. And, yes, this is junk we’re putting up now. What’s the life expectancy of particle board and plywood under even the best of circumstances? So you have a suburb full of flimsy houses in the middle of nowhere, with no incentive for upkeep. That’s an ugly situation.”

Leinberger's text reflects the main current trends in the United States, but the joker in the deck is of course peak oil. If energy becomes radically more expensive, it is an even worse idea to live far away from everything and everyone, and the painful process of restructuring living arrangements in a whole society will be even faster and cause more harm and suffering. What do the trends above mean for us here in Sweden? Our houses are smaller and are built more densely in our residential suburbs. We also have better public transportation, even in suburbia. I would in any case, personally, for sure not buy a nice house far away and make myself totally dependent on having one or two cars to get to work or the grocery store.

This text was originally published in Swedish on June 11, 2009.

Thursday, November 12, 2009

The Effects of the Crisis - Part 3


This is the third part in a set of texts about the losers of the American economical crisis. In the first part I described the background to these texts (including the connection to Peak Oil). In the second part I wrote about those that have been forced to cut down on expenses and curtail their consumption. This text is about those that have had to adapt to lower incomes - either because their working hours or wages have been cut, or because of losing their well paid jobs and having had to accept a drastically lower salary.

One of them is Laura Glick, a 29 years old woman who during her best years as a real estate agent made over 100 000 dollars. After seven month of unemployment she applied for one of 150 announced jobs at the department store Kohl's - in competition with 1200 other applicants. When unemployed, she was forced to survive on less than 1 400 dollars a month and had to do away with expensive habits such as cigarettes and visits to the vet for her pets). The open job positions at Kohl's paid between seven and twelve dollars/hour. If she gets a job closer to seven than twelve dollars/hour she will work more than 40 hours a week in order to earn more than the 1 400 dollars she currently gets in unemployment benefits.

Still, her case is nothing compared to Carlos Araya's. As an oil trader at the New York Mercantile Exchange - the world's largest commodity market - he used to earn 200 000 USD a year. He began to work at NYME when he was 23 years old and worked his way up from the floor during the following 15 years. He didn't think twice about ordering lobster, the finest meat and 200 dollar wine bottles at the fashionable Palm Restaurant at Manhattan. He now works at that restaurant. From time to time he meets some of his former colleagues - some give him their support, others belittle and grin at him, and other again are unemployed and ask him if the restaurant is hiring...

Carlos is one of 25 000 persons whose job in New York's financial sector has disappeared in the last two years, and he now has to survive on his new wage of less than 2 000 USD a month (not even 15% of his previous income). He has started to lose hope about ever returning to the financial business. To make ends meet his wife has started working as a secretary again. She leaves home at six in the morning, and Carlos works until one or two at night. They work in shifts looking after their two young daughters, but there are few opportunities for the family to spend time together. Their apartment costed almost one million dollars when they bought it four years ago, and the monthly expenses plus fees and taxes are more than 50% higher than the approximately 4 200 dollars Carlos and his wife earn together every month. Their savings are running out fast and they don't know what to do.

These and other similar stories contain some food for thoughts. Should we pity Carlos? To what extent is his current situation a result of unfavorable circumstances, and to what extent is it the result of bad decisions that he and his family has made? What pity and what sympathy "should" we have for someone who made 200 000 dollars a year and for years on end ordered expensive wines without blinking? Say that you for example compare this with his current colleagues at the restaurant... And why stay in an unsustainable expensive apartment instead of moving to something more reasonable prices as soon as possible? It is not all that easy to find the direction of your moral compass when you read about Carlos or these portraits of former Lehman Brothers employees at the anniversary of the investment bank's bankruptcy.

No matter if you pity or not pity Laura and Carlos above, loss of earlier-wellpaid-now-gone jobs have consequences far beyond the individuals directly affected. When Carlos (and his friends) don't work in Manhattan any longer also Jack Yang's lunch restaurant at the 46th street has a hard time and has to fire staff.

The 25 000 lost jobs in the New York financial sector mentioned above (the number comes from New York State Department of Labor) is completed by Bloomberg's estimate that ten times that number of jobs have been lost in the financial sector (in the entire USA) between the beginning of 2008 and mid-2009. That means decreasing incomes also for many small businesses and service workers like housecleaners, waiters, hair dressers, dry cleaners, beauty salons, gardeners, nannies and jewelers. When the times were good, Jessica Rosa was a waitress at one of New York's hottest bars and earned 50 000 USD a month - despite only working three days per week. According to some calculations, more than three jobs disappear in other sectors for every lost job in the financial sector, and the higher your income is, the more you consume of services provided by other professionals:

”But every step they take toward self-reliance — each shrub they prune themselves, each cupcake they bake from scratch — hurts the people and small businesses that have long provided these services professionally.”

It is a contradiction that those who cut their expenses and start doing things themselves hurt those who make a living from providing these services. As things previously regarded as necessities are redefined as luxuries, these DIY-ers can start to take pride of their own abilities and accomplishments, but at the same time have a bad conscience on the behalf of those whose incomes they take away.

Another story that makes me feel ambivalent is the family Ferrell story that I will describe in some detail here. Mother Sharon is a housewife and the family has four children (two pairs of twins that are 7 years and 20 months respectively). Daddy Jeff works as an "industrial hygienist", evaluates health hazards in the workplace, and has a salary of 6000 USD per month. Because of the disastrous finances of the state of California, he is on furlough and has been forced to work two days less every month with a corresponding (9%) salary cut. When the family have paid their bills, housing expenses and car insurance each month, only 1 200 dollars remain for all other expenses (gas, diapers, food). The loss of 500 dollars per month forces this family to go down on their knees.

On the one hand it is absurd that a family - even with four children - can not survive on an annual income of 72 000 USD (and with considerably lower taxes than here in Sweden). Yet today they live on the margin, and they hardly seem to have been able to save any money even in the best of times. Instead they have obviously - as so many others in the U.S., Sweden and elsewhere - lived from hand to mouth.

A look at the slide show that accompanies the story and a closer read of the text gives us some clues to the reasons behind their current situation. Their enormous and wonderful house is situated in the countryside, in the middle of nowhere (65 km/40 miles outside the city of Sacramento). They of course need two cars and Sharon drives a mini-van. The monthly expenses of 360 dollars for gas are difficult to cut (in spite of the - for me - bargain price of less than one dollar per liter of gas in the U.S.). Instead of repairing the broken air condition in the van, Sharon tries to drives only when the weather is cool or when she knows that she can park in the shadow.

The cuts their expenses, the family have cut their visits to the hair dresser's, plan meals one month in advance, don't vaccinate the family's four cats and dogs, have started to use their baking machine instead of buying sliced bread, and taking fewer photos to avoid spending money on film and on developing photos. They also consider canceling their satellite television (55 dollars per month) and their eldest daughters' ballet lessons (315 dollars per month).

The family Ferrell have put themselves in a situation where they have a difficult time trying to survive on less money than than what they made when the good times were rolling. A single month without income would open up the abyss beneath their feat. The family was very vulnerable even in the best of times, and now is not the best of times. We should remember that the size of houses (and with them the prices and costs of living in them) have swelled in the U.S. during the last decades. Just sixty years ago, a newly built detached house was 90 m2 (980 ft2) on average. Forty years ago that newly built house had increased 50% in size to 140 m2 (1500 ft2). Twenty years ago that house was over 190 m2 (2100 ft2) and five years ago (2005) that house was 220 m2 (2350 ft2) large. And with every square meter/feet, the price and the costs increase.

One could blame the Ferrells' for a lifestyle built on the absence of reflection and long term planning. But if we take a closer look, we are all the Ferrell family - indeed, our entire culture is a family Ferrell-culture. Kurt Cobb quotes the author Thomas Homer-Dixon who pins down our cultural framework (our blinders).

”Collectively we have been behaving like adolescents – believing we're invulnerable, living for today while ignoring tomorrow, and sneering at anything that smacks of prudence.”

What he means in this context is that adolescents are prepared to jump feet first into projects that would make many elder people hesitate and reflect. To realize and understand both in the brain and in the guts that not everything will necessarily end up the way would like them to, is according to Cobb and Homer-Dixon a sign of maturity. The opposite is ”[to] remain in an adolescent state preferring an optimistic gloss on a simple-minded model of the world”.

The financial industry has worked from (and remained in) this immature and childish position, and maybe also all doctrinal neoclassical economists who see growth as the solution to all problems and always see new - eternal - growth just around the corner. And this too is the state that the family Ferrell have been in. And all to often you and I have been there too. What makes everything complicated and what makes me ambivalent is that all Ferrell families out there have simultaneously been victims and willing actors (perpetrators?) in this drama. To see them (us) as only one or the other is to make things too easy. To see them (us) as both victims and actors/perpetrators is what makes it so darn difficult to judge and to decide what is wrong and what is right.

This text has used three portraits to describe those that are directly affected by the economical crisis and that have come upon rough times. In the fourth part of this series, I will describe those that are worse off and have had to move back to their parents after their own living situation has collapsed.

This text was originally published in Swedish on October 13, 2009.

Friday, November 6, 2009

"The geography of nowhere" by Kunstler (1993)

Although James Howard Kunstler’s "Geography of Nowhere: The rise and decline of America's man-made landscape" (1993) is more than 15 years old, there are good reasons to take a look at his book at this particular point in time as it clearly is more relevant today than when it was published. In hindsight, it is possible to see that much of what James wrote was on the spot - almost prophetical - even if it is only now that this is becoming more and more obvious to more and more people.

James is a man with an almost sacred mission, and he preaches his doctrines as intensively as a teleevangelist preaches the glory of Jesus. He hammers in his message again and again and repeatedly comes back to two issues that overlap and interact and that penetrate all aspects of Americans’ daily lives; cars and houses. Anyone who wants to get to know James’ very critical views can check out his blog, Clusterfuck Nation, where he writes a new column every Monday. 

There is a whole complex of issues and industries that interact around cars, energy (oil), financing, road construction, (lack of) public transportation, politics, philosophy, etc. Houses (buildings) are really much broader than just the domiciles we live in and comprises both of private homes as well as commercial and public buildings. The way U.S. houses have been built, and cities designed, and the central role of cars all depend on each other, meet and are bound together by the arteries of American Society – its roads.

Since I have have lived in the U.S. myself, several questions that I have wondered about are answered by this book. Why are most neigborhoods in the U.S. built so that it is impossible to manage without a car? How is it possible to build roads without sidewalks in residential areas? Why are there are no neighborhood stores and why is the nearest supermarket always so far away? Why are the streets amazingly broad even in quiet residential neighborhoods? Why are so few people taking a stroll through their neighborhood and why are so few places within walking distance that are worth visiting in the first place?

The last question is not difficult to answer. The streets are broad, the blocks are huge and the distances are large; it is incredibly monotonous and boring to walk beside a completely straight road for 20 or 30 minutes. The whole environment is constructed so as to be traversed safely by a car traveling at 40-60 km/h and the restless brain of a curious human is just not getting enough stimulation when you are out walking in an American residential neighborhood. It is similarly very boring to walk any longer distances next to a Swedish highway or expressway.

Regardless of what the actual speed limits happen to be, the 12 meter wide roads of American suburbia are designed to be ultra-safe (for drivers) so that even a mediocre car driver can whoosh by in 70-80 km/h without risking the destruction of the car. The primary function of those roads is to channel suburban cars to the highways. The big losers of this arrangement are children who can not move freely outside of their homes without risking life and limb (beyond the fact that there are few destinations worth visiting within walking or biking distance).

Since children still need to get to school, many ride school buses to get there - a separate public transport system that "operates at huge expense, is restricted to children, and runs only twice a day". Based on their limited freedom of movement, it is understandable that many young Americans’ highest dream is to have their own car as soon as they reach the age of 16. James notes that it is basically impossible to live in any U.S. neigborhood built since 1950 without having access to a car.

Another aspect of the human-built landscape that James dislikes is that it is cheap. Cheap to build, cheap to demolish, and, it looks cheap. Many neighborhoods consist of identical houses on identical lots along identical streets in identical neighborhoods. People travel along identical highways along which there are identical strip malls. Everything looks like everything else and nothing looks like something special. It is this "nowhere" that James refers to in the title of his book:

long-distance car travel on an interstate highway is literally like going nowhere fast”. […] There is little sense of having arrived anywhere because everyplace looks like noplace in particular. […] we chose to live in Noplace, and our dwellings show it. In every corner of the nation we have built places unworthy of love and move on from them without regret.”

James writes a lot about the crappy architecture; outside of the cities cookie-cutter houses and shopping barns are erected – buildings of poor quality that do not deserve our love, or even to be taken care of. Little of what is built is meant to last for longer than in a decade or two, which means that as houses have “progressed” from being crafted to becoming a commodity - which are now consumed. In many places in the U.S., the plot is worth much more than the house and it is not uncommon to tear down an old house and build a new, rather than to maintain something that was never meant to withstand the test of time. Over time, the emotionally-charged “home” has moved towards becoming an interchangeable “house”, a place where a family “happens” to reside, eat and sleep at the moment, but which can quickly be “flipped” if something better turns up. 

James was very aware of the importance of oil to the American economy and of America's dependence on (imported) oil already back in 1993 when he wrote the book. He warned aginst continuing on the road taken, but was of course preaching to deaf ears. In addition to (significant) negative social effects of an atomized and dispersed society, and adverse effects on human physical and mental health, James characterizes the built environment of the U.S. as the greatest misallocation of resources ever: 

America has now squandered its national wealth erecting a human habitat that […] will not be usable very much longer […] suburban sprawl is too expensive to operate, too costly to maintain […]. To lose it is tragic not because America will be deprived of such wonderful conveniences as K-Marts and drive-in churches […] but becuase it was a foolish waste of resources in the first place, and it remains to be seen whether its components can be recycled, converted to other uses, or moved.”

Today, 15 years later, we can in hindsight see that instead of changing direction during the 1990s and early 2000s, the course of action was to press the accelerator, borrow more money, build more houses and more suburbs, buy more cars and build more roads. James already at the time predicted that based on the enormous amounts of resources that had already been squandered by building a car society, the course of action would be to continue to "throw good money after bad" rather than attempting to imagine alternatives and ways to change society so as to make it less dependent on cars (and oil).

Many different factors now conspire and together indicate that we have reached the end of the road, and that James's 1993 predictions are coming true, "Today's posh suburbs could easily become tomorrow's slums." Very shocking to me was this one year old and 12-minutes long film, "Foreclosure Alley" from Southern California. In the wake of “epidemic” of foreclosured homes, new depressing business opportunities appear; spraying brown dead grass green so as to make the plot and the house look more vibrant and attractive, and, to empty and throw away all that is left behind in a foreclosured house, including furniture, photographs, toys, food and fully functional consumer electronics in the shortest possible period of time. Some of yesterday's brand new suburbs (the most recently built which are furthest away from the cities) are becoming ghost towns where squatters and criminal gangs move in as the previous homeowners move out and leave empty houses behind.

Although the U.S. is in the eye of the storm when our current solutions for transportation and and housing are "challenged" after peak oil, we Europeans can not sit back and believe that we will escape the coming changes unharmed. But it is a fact that our position is significantly better. Already in the nascence of “happy motoring”, in the early 1900s, Europe was forced to import the majority of its oil while the U.S. had huge, seemingly endless resources of oil. Even though there are many car-huggers also here in Sweden, our relationship with the car is still a pale copy of the Americans' long love affair. We have smaller, more fuel-efficient cars, higher gasoline prices, more dense settlements, we drive less, build fewer and narrower roads and have better developed public transportation systems. Our starting point is thus in many ways better, but unfortunately also we tend to - even in this late hour - to place headless bets on more airfields and runways and on expanding or building new highways, instead of more cycle paths and better public transport system.

This text was originally published in Swedish on May 25, 2009.