When House Prices around Harvard Fall Ghettos Will Return
The wealthy of New England won’t take pay cuts, or ask for additional taxes to help the poorer neighborhoods. That may be a long-term tragic mistake.
When I suggest to anyone in Cambridge that home prices may not, in the future, double every five years they say the same thing, “As long as Harvard is in Cambridge we’ll be okay.” That’s a very short memory. Most of Cambridge was in the dumps 20 years ago and racial tensions were high. What about the 364 years between 1636 to 2000?
The Boston area hasn’t become desirable because of Harvard alone. Just as important is MIT, Boston University, Boston College, Northeastern, the Fenway schools, Brandeis, Tufts. All these schools have benefitted from the network effect and safe streets.
The State government’s nonchalance that Boston can’t lose the qualities that make it a magnet for students and businesses belies misplaced overconfidence.
That Governor Baker is a better politician than a 3-year-old does not do anything for me. I judge by what I see.
Five months in and Baker and the State Legislature leave us with this:
- NO free masks at every post office or other government building
- NO robust contact-tracing because there’s …
- NO free one-day testing, anywhere, anytime, anywho
- NO free hotel rooms for quarantining
- NO pay subsidy so workers don’t feel they must work to feed their family
- NO cutting all government pay by 10% (to pay for all above)
- LITTLE ACTION on bringing the state together for equal treatment, whatever wealth or race
- NO detailed plan to protect the university ecosystem WITHIN the neighborhoods that serve them coffee, beer and food.
There’s a big misconception that because there have been few university layoffs they are muddling through just fine. Wrong!
Universities cannot afford to look vulnerable before the tuition checks clear! Once colleges have received Fall tuition and have an idea what Spring will bring they will be forced to cut expenses to avoid going under.
You wouldn’t cancel a restaurant reservation just because they laid off a few waiters.
But if universities lay off people you DO re-consider your enrollment. Why take a chance? If they go out of business your degree may one day be worthless or the butt-end of jokes.
The future is already here:
In the 2nd wave of college cuts, which I’m guessing will begin in October, my back-of-the-envelope says around 8,000 New England jobs will be lost in the next 12 months with an economic cost of near $600 million.
In the past few years domestic enrollment in colleges has been declining. In the higher-ed business, as in big-city real estate, foreign money (mostly Chinese) have been keeping both healthy.
International students, about 1 million nationwide, are 15% of all students. Global travel restrictions are preventing them from buying U.S. educational services. Further, the U.S. and China are in an economic and political war that continues to grow. And of course, Covid-19 is keeping many at home.
We’ve run out of a growing stream of rich kids from the U.S. and China. Massachusetts lawmakers have not shared their assessment of where a new batch is coming from.
Why do we need many colleges? The public has spoken and they don’t need many retail stores or movie theaters. The attraction of big-city college neighborhoods is also in decline. Too many small stores, artist venues, entertainment, the places that make Boston romantic have been priced out of the area.
If I’m going to live in a sterile city I might as well be warm year-round.
Without steady stream of talent from universities why set up business in a high cost, high tax state, when other areas like Arizona, Texas, etc., are warm? Or let me put it his way, tomorrow’s students aren’t going to gravitate toward States where every time they buy a beer part of the money goes towards paying for pensioners.
They aren’t going to live on a campus where a wrong stop on the T gets them beat up.
By the time Massachusetts realizes how much ground it has lost it may be too late. The street gangs will be back and the 1970s will start all over again.