The Moldy Massachusetts Miracle: Elitism Doesn't Work Well in Economic Policy Either

By Kotkin, Joel | The American Enterprise, October-November 2004 | Go to article overview
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The Moldy Massachusetts Miracle: Elitism Doesn't Work Well in Economic Policy Either

Kotkin, Joel, The American Enterprise

A midst the coverage of John Kerry's nomination in Boston last summer, the region that produced him--New England--received remarkable little intelligent scrutiny. For the most part, the area was portrayed as quaint, idiosyncratic, and brainy, a kind of screwball seafood stew of Harvard, the Red Sox, and ethnic diversity spanning Yankees, Italians, Irish, and a host of more colorful recent newcomers.

Some suggested that New England also provides a compelling economic model for the rest of the country. "What New England has achieved economically," gushed Newsweek's usually sensible Robert Samuelson, "is precisely what Democrats aspire to do politically."

There is a long tradition of looking to New England as an exemplar of what is best in America. This is particularly marked among the Eastern elites, many of whom have fond college and graduate school memories of the region. Yet as one looks at contemporary America--more Southern, more Western, and less Eastern than at any time in its history--New England may be an odd place for a national party to search for role models.

This is all the more true since New England isn't exactly booming. Over the past quarter century, John Kerry's native land has created far fewer jobs than the rest of the country, many of its people have moved elsewhere, and it has lost its position as high-tech Mecca to other parts of the country.

Massachusetts is particularly troubled. Between May 2001 and May 2003, Massachusetts alone lost over 110,000 jobs. Just since 2002, some 40,000 workers have dropped out of the Boston job market. After enjoying a small population gain in the 1990s, the city itself has been losing residents since 2000.

In most of the country, such developments would have local elites in a state of panic. But in New England, particularly around Boston, the response has been along the lines of "What, me worry?" Doug Fisher, director of economic development for Northeast Utilities, one of the region's primary providers of electrical power, traces this odd phenomenon to the fact that the area's dominant leadership, including the university-centered intelligentsia, are getting along just free.

"The sad fact is that there is little room for upward mobility here," laments Fisher, whose firm is headquartered in Hartford and covers some of the region's more decidedly blue-collar areas. "Our situation here is not sustainable. There are storm clouds coming in, but it's hard to get the leadership to pay attention."

Many local economists and business leaders, Fisher adds, increasingly do not focus on job creation, but on creating as much wealth per capita as possible. This notion, described by Case Western Reserve economist Paul Gottlieb as "growth without growth" represents an economic politics suited for the entrenched professoriate, land-owning gentry, media types, and stock market operators who increasingly dominate the finances of the Democratic Party.

"The real argument here is between jobs and income," believes Fisher. "We still have plenty of money, and people think that's all that matters. We are becoming an economic development cul-de-sac and a lot of people like that." The idea that that would resonate with Democratic tradition, however, seems peculiar at best.

The prescriptions now pushed by most New England Democrats favor regions with little population growth, particularly those with a dearth of children--the little tykes have quite a negative impact on per capita income. The ultimate hell-holes, by their standards, are places with strong rates of in-migration and family formation, like Phoenix, Houston, Las Vegas, or San Bernardino-Riverside.

As a California Democrat and Bush opponent, I find it distressing to see this kind of perspective gaining currency in my party. At its heart, New England-style economics replaces more traditional populist notions such as commitment to expanding opportunity for families and small businesses with an ethic that favors instead the environmental, cultural, and economic preferences of people who already have wealth and property.

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The Moldy Massachusetts Miracle: Elitism Doesn't Work Well in Economic Policy Either


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