We’ve been seeing the startling pictures of the anarchy that reigns in Seattle on our TVs for nearly two months now.
Something has obviously gone terribly wrong in this stunningly beautiful American city.
The Manhattan Institute’s Jacob Vigdor goes behind the disturbing scenes of urban chaos to report on why Seattle is a failing metropolitan area.
Vigdor’s “Seattle’s Tarnished Dream” in the current City Journal paints a picture of a city with a generous safety net that is unaffordable for all but the rich. Seattle’s problem can be boiled down to this:
Seattle’s vaunted minimum wage is meaningless to those who can’t find work or who struggle for more than part-time hours.
Seattle is a city that was committed to social justice. It promised preschool for all, free community college and work regulations that improved the lot of the all who worked there.
Instead of turning into Utopia, however, Seattle priced itself out of the market for most regular folks:
Social benefits for the poor aren’t worth much if the poor can’t afford housing in the city that offers them. A family looking to find a place to live in Seattle must navigate a market where the median two-bedroom apartment lists for more than $2,600 per month. Lower-income families have been priced out into the suburbs. Drive south from Seattle into neighboring Tukwila, and you’ll see the child-poverty rate nearly triple, from 10 percent to almost 30 percent.
Seattle’s more socialist-oriented leaders might describe the city’s housing-affordability crisis as reflecting the failure of capitalism, but the problem has more to do with government overregulation. Three quarters of residentially zoned land in the city is restricted to single-family development. Seattle’s leafy pseudo-suburban neighborhoods, dotted with yard signs signaling support for disadvantaged and marginalized groups, thus make it extremely hard for members of those groups to move in. No political will exists to change these zoning rules on a citywide basis.
The city has placed well-meaning but counterproductive mandates on local businesses:
[T]he city has placed a series of mandates on employers: a high minimum wage (now $16.39 for large businesses), paid sick leave, secure scheduling, and so forth. Even in good times, these employer mandates don’t really soak the rich because the owners of low-wage-paying businesses often don’t take home much themselves. The most profitable businesses, in Seattle and elsewhere, aren’t the ones employing large numbers of workers. They are the ones, ironically, finding ways to use technology to make low-paid workers obsolete.
Washington state has no state income tax. This should be a big draw, right? It is for Texas and Florida, which also have no state income tax. But Seattle has opted for so much social justice spending that the city must constantly come up with new revenue-producing schemes. Voters are asked to approve levies for more “affordable” housing, libraries, transportation, etc.
This locks in otherwise unaffordable spending:
Each time voters approve a circumventing new tax, the associated spending programs receive a relatively recession-proof source of funds that can’t be diverted to other spending needs.
Meanwhile, such basic services as the police and fire departments are left insufficiently funded:
The functions of city government not directly supported by voter-approved levies, most notably the police and fire departments, compete for dollars from the city’s general fund, which relies on sales and business taxes. The 2020 budget projected $1.73 in revenue from these volatile, regressive sources for every $1 in support from property taxes. The liberal Institute for Taxation and Economic Policy rates Washington’s state and local tax regime as the nation’s most regressive; the Seattle-based Economic Opportunity Institute rates Seattle’s municipal tax regime as the state’s most regressive. Where Paul Peterson cautions against cities taking from the rich to give to the poor, Seattle takes from the poor to give to the poor.
. . .
The portions of Seattle’s agenda funded by dedicated property-tax levies will remain intact through the recession. There will still be free preschool and community college for the dwindling number of lower-income families that can afford to live in the city. We’ll still have world-class public libraries, bike lanes, and shiny (if mostly empty) streetcars traveling on deteriorating roadways. But the city’s safety net will be cold comfort to the unemployed, who continue to face astronomical housing costs while bearing the brunt of cutbacks to essential services.
Seattle doesn’t have to officially defund the police.
It was unofficially on track to do that long before the current crisis.