Exurbs are the New Rust Belt

Here is where economics, politics, and technology converge.

Trumpism is driven by exurban voters. There just aren’t enough people in the rural areas to drive a competitive candidacy. It’s obviously the exurbs.

Exurbs are suburbs of suburbs. Their locations shift as people move further away from urban employment centers. When my folks moved to Orange County in the 1970s, Huntington Beach was an exurb. Today Riverside County, where my sister lives, is an exurb.

Exurban economies are based on gasoline and real estate. Drive until you qualify. The money is far away so you need a big car, and a lot of gas. Doing anything requires a drive. Serving the needs of a car-centric society is what the exurbs are all about, supporting people with shopping and services.

When I was young, exurbs were in fashion. Control of resources added more to economic growth than anything else, but for that to become value, the resources had to be used. That’s what exurbs do best.  Technology meant future growth, but only in the last decade has technology become central to the economy.

This is the important point.

When an industry dominates like this, political power will move toward it, and away from older sectors, which are no longer driving as much value. The sectors being drained may protest, but those protests will come to nothing. You’d might as well protest gravity as economic change. The manufacturing “Rust Belt” protested the move to the exurban “Sun Belt” in the 1970s, but in the end it didn’t matter.

Something like that is happening now. Economic and, thus, political power, are draining away from the resource industries, draining away from the exurbs, and moving toward technology sectors. Exurbanites feel this happening, but they are powerless to stop it, just as people in industrial cities felt it happening 40 years ago and were equally powerless.

I hear this whenever I talk to my sister. She complains about immigrants, about drugs, about the problems of the central city coming after her and her neighbors.  It drives her politics. She loves Trump because his policies seek to reverse these realities.  You can see it on the ground. In the TrumpTime, the exurbs are great again, just as manufacturing had a false dawn in the late 1970s.

Midwestern and eastern manufacturing centers liked Jimmy Carter, too. He endorsed their interests, and his enemies in the oil industry were their enemies. But the Sunbelt was irresistible.

The same is true today. Technology concentrates economic power in a handful of places. Cities that have heavy tech industry investment – Boston, New York, Washington, Seattle, San Jose, Los Angeles – this is where the money is.

Something else is happening to the economy, under the surface, which I have also written about. This is the rise of biology.

Techniques like CRISPR-CAS9 are like operating systems for DNA, and CAS-9 is likely to be Apple DOS, not iOS. Sciences like proteomics are starting to tell us how the orders of DNA are carried out. Biology and biochemistry, driven by cloud computing and software applications, are the means through which we’re starting to gain financial benefits in understanding how living things work, just as we were just starting to benefit from Moore’s Law in the 1970s.

Ironically, it’s this science that saved Jimmy Carter’s own life, through a medicine called Keytruda that allowed his immune system to work against his cancer.

Each generation’s breakthroughs stand on what came before. Oil was built on manufacturing, manufacturing on utilities, utilities on railroads, and Moore’s Law also uses physical resources more efficiently to increase wealth. Just as oil created the exurbs as markets for its products, so Moore’s Law has built software as markets for its products. This is where the money is. Software makes the Cloud Czars powerful.

The center of the biology economy will be in research centers, like the one my son is working at in Minneapolis, around the University of Minnesota. Research institutions are today’s primary economic drivers. Businesses congregate around them, no matter where they may be located, whether that’s in a central city or in in the sticks. As I’ve noted before Iowa City is becoming bigger than Cedar Rapids, and Lincoln is becoming bigger than Omaha. Boulder is pulling economic activity north out of Denver.

In Georgia, where I live, this is bringing Athens into the metro area, but some far-sighted leaders saw the trend coming, and did things to redirect it. By making Georgia State a full research university and accepting enormous growth in its student body by absorbing nearby community colleges, Atlanta’s population is being increasingly concentrated in the city.

At some point, politicians are going to recognize that this is where the battle for growth lies and try to respond. But no matter where the growth happens, biology requires a highly concentrated solution of brains. While in theory you can write software anywhere, biology requires big machines, both for discovery and for delivery of its benefits. It also requires big teams, made up of people with deep education, in order to accelerate progress.

Drug companies have been running an experiment this decade on how much economic power this can generate. Pharma outfits that used to price their goods based on the cost of research are now hiking those prices, claiming in some cases that, since the drugs extend life, they should get the value of that extended life. They’ve been getting away with it, because often there is one cure for a condition, and we’re talking about your life here. What will you pay for your life? We’ll take everything you have.  

The political impact of all this should be obvious. Trumpistan is shrinking, Techlandia is expanding, and if anything, biology is making the economy even more-centralized than it was before. The best thing Riverside County could do for itself is fight for more research money at UC-Riverside and create entrepreneurial resources so breakthroughs can be monetized near the campus.

Maybe, once they realize that Mexicans are a symptom of their problems, that poor people gravitate to cheap real estate, building slums where slums can be built, and that the answer is to not be so slummy, Riverside County will refocus. But not today. Not until politics beats sense into their economy.