RCAAs and Plutonomies

h/t Daniel Henninger it the WSJ, from Liberalism’s Summer of ’17:

 (M)any of these urban revivals are producing a phenomenon economists now call “racially concentrated areas of affluence,” or RCAAs.

An area gets RCAAed when the residents who pack themselves into it are mostly white people whose median incomes are unprecedentedly greater than the city’s poverty level. Some of the most RCAAed cities are liberal duchies like Boston, Baltimore, Chicago and Philadelphia.

Economists for Citigroup have called cities like New York and San Francisco “plutonomies”—urban economies propped up by a plutocratic minority, which is to say, young professionals inured to both taxes and nearby poverty. But they vote their “consciences.”

Progressives are acutely aware of this embarrassing reality in cities under their control. A writer for In These Times identified the problem as “a lack of revenue caused by the refusal of Wall Street banks, big corporations and millionaires to pay their fair share in taxes.” Put forth solutions, he said, “to make them pay.”

“Make them pay” might work if the U.S. were East Germany, so that the wealthy could be captured and jailed as they tried to escape across the border.

We’re not living yet under a President Sanders or Warren, so the steady, documented outflow of residents will continue from New York, Connecticut, Illinois, Maryland, California and New Jersey.

Many of those now climbing over the Democrats’ blue walls were willing to live under the original liberal governance model that existed before 1960 because it recognized the legitimacy of private economic life. The wealthy agreed then to pay their “fair share.”

Today, private economic life, especially that of the urban middle class, is no longer a partner in the liberal model. It’s merely a “revenue source” for a system whose patronage is open-ended welfare and largely uncapped public-employee pensions. I’d describe the liberal-progressive governing strategy as ruin and rule…

Residents of the northeastern slab from New Jersey to Boston have been living off infrastructure created by their grandparents and great-grandparents during the golden age of American capitalism.

They are now asking the federal government, meaning taxpayers who live in parts of the U.S. not hostile to capitalism, to give them nearly $15 billion to replace the 100-year-old train tunnel beneath the Hudson River. Why should they? Why send money to a moribund, dysfunctional urban liberal politics that will never—as in, not ever—clean up its act or reform?

Maybe we need a new default solution to the urban crisis: Let internal migration redistribute the U.S. population away from liberalism’s smug but falling-apart plutonomies.

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