Mode-Hot 2011

The news of yet another senseless shooting death of a young man in Portland begs the question: how does Portland compare to other major American cities in terms of firearm homicides?



Pretty well it turns out.  According to the CDC, Portland's annual firearm homicide rate of 2.2 per 100,000 (2006-2007 data) is one of the lowest among the largest 62 cities in the US, which average 9.7 per 100,000.  The only other similar sized cities that are close are San Jose, which is lower at 1.5, and San Diego, which is a bit higher at 2.8.  So, in general, Portland has a very low incidence of firearm homicide which makes the recent killings no less tragic or infuriating, but does provide some perspective.



The extreme case, by the way is absolutely horrifying: New Orleans has a firearm homicide rate of 62.1, almost 30 times higher than Portland's.  At what point, I wonder, does the federal government step in and take over the completely ineffectual police force?



Things aren't all rosy for Portland (no pun intended) in terms of firearm deaths.  Portland is actually well above average in terms of firearm suicide where the 62 city average is 4.7 per 100,000 but Portland's is 6.4 (San Jose is 2.1 and San Diego is 4.3 by comparison).



I leave you with some interesting notes on the data from the CDC:

Although firearm homicide rates tended to be higher with increasing urbanization and among youth relative to persons of all ages, this was not the finding for firearm suicide rates. The 50 largest MSAs collectively had an annual all-ages firearm suicide rate of 5.0 per 100,000 persons aged ≥10 years, and 52% of these MSAs (26 of 50) had rates lower than the national rate of 6.5. Central cities within these MSAs collectively had an annual all-ages firearm suicide rate of 4.7, and 55% of these cities (27 of 49 cities with reportable all-ages firearm suicide statistics) had rates lower than those of their MSAs. Youth firearm suicide rates were comparatively low, with a composite rate of 1.3 for the 50 largest MSAs and an identical composite rate of 1.3 for their central cities. Males accounted for more than 87% of firearm suicides (ages ≥10 years) nationally and for all MSAs collectively.



Notable patterns by geographic region were observed. All-ages firearm homicide rates generally were higher for MSAs in the Midwest (seven of 10 above the median MSA rate of 5.4) and South (13 of 21 above the median rate) than for MSAs in the Northeast (six of seven below the median rate) and West (eight of 12 below the median rate). All-ages firearm suicide rates were generally higher for MSAs in the South (15 of 21 at or above the median MSA rate of 6.3) than for MSAs in the Northeast (six of seven below the median rate), Midwest (six of 10 at or below the median rate), and West (seven of 12 below the median rate); the highest rates were concentrated in the South and West.



***



During 2006--2007, firearm suicide and firearm homicide were the fourth and fifth leading causes of injury death in the United States, respectively. For youths aged 10--19 years, firearm homicide was the second leading cause and firearm suicide was the fifth leading cause of injury death nationally. The statistics presented in this report indicate that firearm homicide rates were higher and firearm suicide rates were lower among residents of the 50 largest MSAs compared with the nation as a whole; residents of these MSAs represented 54% of the U.S. population during 2006--2007, but accounted for 67% of firearm homicides and 41% of firearm suicides nationally. Similarly, for youths aged 10--19 years, residents of these MSAs accounted for 73% of firearm homicides and 39% of firearm suicides nationally. More than 85% of violence-related firearm deaths occurred among males, both nationally and for the 50 largest MSAs collectively.

Note that the statistics given above are for the City of Portland and other cities proper. The statistics for MSA's can be found by following the link.

The Case-Shiller Home Price Index for January is out and the dismal news for the Portland housing market continues.  This is not surprising as a couple of years of high unemployment is bound to have a serious impact, but depressing nonetheless.  



Here is a nice sortable table of the January numbers courtesy of the Wall Street Journal.  The headline numbers for Portland are a 7.8% decline since January of the year before and a 1.8% decline from december to January.



I do finally think that we are moving in the right direction in general, the jobs numbers have been good and overall US growth is pretty healthy, but it will take a while before we see these improvements make their way into property values.

Portland got another national star turn this morning on NPR with a story about the migration of twenty somethings to the city despite relatively high unemployment and low pay.  The usual suspects are trotted out as reasons - lifestyle, hipsters beget more hipsters, etc.



It seems to me, however, there are two points that keep getting missed in the discussion that provide the essential linkages to provide at least a plausible explanation of the phenomenon.



The first is that as societies grow more affluent one of the biggest jumps on consumption we see is a jump the the consumption of leisure time. Affluence buys us rest and relaxation - and the related vacations, travel, etc.  This has been true for some time, over the 19th and 20th centuries we saw the amount of leisure time increase dramatically in high-income countries.  But I wonder if now what were are seeing is a generation that puts more worth on lifestyle as opposed to more material goals.  So it is now no longer just more leisure time, but the quality of your leisure and your work time.  Being in a community that affords quality leisure time activities, like minded individuals and a pleasant atmosphere is worth a lot to the youth of the 21st century in America.  For this reason they are cashing in on the compensating wage differential - accepting lower pay for the chance to live in Portland.  And they are not just willing to accept lower salaries, but are actively looking for places that match their preferences and thus are willing to move without job prospects - suggesting that the value they place on lifestyle is extremely high.  This is not lack of ambition, but just the opposite - the ambition to make a life that is the most fulfilling holistically, not just materially.



The second point is that this should be a source of comparative advantage for the city not disadvantage.  The recent report from ECONorthwest lamenting low salaries, in my mind, got it all wrong.  The fact that skilled wages are depressed (if, in fact, they are - they did not account for education) are a sign of an incredibly successful job done by city government in creating a place where educated young people want to come and live.  They are willing to pay for the chance to live here and they do so by accepting lower wages.  Is is also a source of economic strength: that there are talented people here willing to work for less means that Portland should be a good place for companies to come and set up shop.



Anyway, when thinking about the path that led us to the Portland that is now the media darling. I always think about the downtrodden, blue-collar city of my youth that specialized in cheap, home-grown diversions.  It was a great place to be a college student or aimless twenty-something even then, as rents were incredibly cheap, you could go to the Mission Theatre for free and then spend your few dollars on local beer.  What more could you want?  I think that these trends start slowly and then gain feedback momentum and this is where my consciousness begins - Portland in the early 80s.  Looking back we look for big answers, but often the roots are humble.

Portland hits a new low. And I am now ready to declare my relative optimism (that home values would end the year not much worse then when they started) too optimistic. Portland homes lost, on average, 7% of their value from November of 2009 to November of 2010. And since near in neighborhoods like mine have not done quite so badly, the suburban areas must be especially bad.



Anyway, here are the numbers as compiled by the Wall Street Journal:

Home Prices, by Metro Area

Metro Area	November 2010	Change from October	Year-over-year change  ↓
Atlanta	100.67	-2.5%	-7.9%
Chicago	119.57	-2.2%	-7.6%
Detroit	67.26	-2.7%	-7.1%
Portland	139.92	-1.6%	-7.0%
Phoenix	104.85	-1.1%	-6.4%
Seattle	141.57	-1.1%	-4.7%
Cleveland	100.12	-2.0%	-4.4%
Minneapolis	118.8	-2.1%	-4.4%
Charlotte	113.61	-0.4%	-4.3%
Dallas	114.88	-1.1%	-4.2%
Tampa	134.05	-0.8%	-4.0%
Las Vegas	100.59	-0.4%	-3.5%
Miami	143.81	-0.2%	-3.5%
Denver	125.02	-1.2%	-2.5%
New York	169.75	-1.0%	-1.7%
Boston	152.76	-1.0%	-0.8%
San Francisco	137.23	-1.2%	0.4%
Los Angeles	173.28	-0.4%	2.1%
San Diego	160.08	0.1%	2.6%
Washington	185.42	-0.1%	3.5%

In this recessed economy municipalities are struggling with diminished revenue in the same way states are. It is becoming harder and harder for them to provide the same services in this new economic reality. So many cities are looking for new ways to impose fees for services that were once funded with general revenues. Portland is no different.



And so the mayor saw the big wad of money spent on fall feaf removal as an opportunity to raise new revenue by imposing a leaf cleanup fee for the neighborhoods where the cleanup occurs. The problem with this tactic is twofold: charging specific fees for public goods is dumb public policy, and ironically, allowing households to opt-out actually makes it dumber.

Here are the numbers, nicely displayed thanks to the Wall Street Journal:

Home Prices, by Metro Area

Metro Area  ↓	August 2010	Change from July	Year-over-year change
Atlanta	109.09	-0.8%	-2.0%
Boston	158.35	-0.3%	1.5%
Charlotte	116.6	-0.4%	-3.4%
Chicago	126.7	0.4%	-2.9%
Cleveland	107	-0.3%	-0.4%
Dallas	119.41	-1.1%	-1.7%
Denver	128.57	-0.1%	-1.2%
Detroit	71.54	0.5%	-0.1%
Las Vegas	101.03	0.1%	-4.5%
Los Angeles	175.55	-0.4%	5.4%
Miami	147.47	-0.3%	-1.0%
Minneapolis	126.53	-0.3%	2.9%
New York	175.27	0.2%	0.1%
Phoenix	108.84	-1.3%	0.4%
Portland	147.02	-0.9%	-2.3%
San Diego	163.99	-0.6%	6.9%
San Francisco	142.83	-0.3%	7.8%
Seattle	145.93	-0.8%	-2.4%
Tampa	137.53	-0.5%	-4.1%
Washington	188.26	0.3%	4.8%

The news is bad: Portland is losing ground and in the top group for lost value. Not at all surprising given the unemployment situation.

Once again, farmed out to the Wall Street Journal, after all nothing much is happening in Portland to make a specific graph worthwhile - we have pretty much been holding steady since the beginning of 2009.  The sobering fact here is that this represents the tail end of sales influenced by the government tax credit, we may start to see another wholesale decline soon given the current moribund state of residential real estate transactions.

Home Prices, by Metro Area

Metro Area	June 2010	Change from May	Year-over-year change
Atlanta	109.74	1.7%	2.0%
Boston	157.83	1.2%	3.4%
Charlotte	117.24	0.7%	-2.7%
Chicago	124.9	2.5%	-0.1%
Cleveland	107.26	1.3%	0.8%
Dallas	121.14	1.0%	1.2%
Denver	129.19	0.7%	1.8%
Detroit	70.04	2.5%	0.8%
Las Vegas	101.77	-0.6%	-5.2%
Los Angeles	175.66	0.6%	9.2%
Miami	146.92	0.4%	1.1%
Minneapolis	125.91	2.5%	10.7%
New York	172.76	1.3%	0.2%
Phoenix	110.98	0.0%	6.0%
Portland	148.73	0.5%	0.2%
San Diego	163.82	0.4%	11.2%
San Francisco	142.55	0.3%	14.3%
Seattle	146.83	0.0%	-1.8%
Tampa	138.58	0.2%	-1.6%
Washington	185.77	1.7%	7.3%

Once again, I am farming this out entirely to the Wall Street Journal.  Portland's home values increased slightly from April and from the previous year, but what little improvement there was most likely is representative of the federal incentive programs.  Portland is, and always has been, unexceptional - middling in terms of increases and decreases in home values. Here is the WSJs chart: