Making the California Dream affordable again
If you don’t think the California Dream is in trouble, consider these sobering facts:
- Between 2012 and 2014, the income needed to purchase a median-priced home in California climbed from $56,324 to 93,593.
- Forty percent of the full- and part-time workers in Los Angeles earn less than $13 an hour.
- Tuition costs for California colleges will go up as much as 5 percent a year for the next five years under a proposal approved by UC regents.
In his opening remarks at the “High Cost of the California Dream” panel, moderator Matt Miller, a Washington Post columnist, noted that stagnant wages and the rising costs of housing, health care, transportation and education were taking the luster off the Golden State.
If these trends continue, will California’s great weather and top-flight universities be enough to attract and retain the talent needed to keep its economy growing?
Joel Singer, CEO of the California Association of Realtors, is not so sure. “In a sense, the recovery we’ve seen has come almost too far, too fast,” he said. “Housing prices are almost three-quarters, even 80 percent of historical highs. . . . As a result, our affordability versus the nation is a problem.
Singer and others agreed that increasing housing density is the best way to make more affordable housing available to Californians.
Raising wages so people can buy those homes is also crucial, said Roxana Tynan, executive director of the Los Angeles Alliance for a New Economy. She expressed confidence that a measure to increase the minimum wage in Los Angeles will go to the voters, possibly in the next year. If that happens, she said, more than 600,000 Angelenos could be lifted out of poverty, providing a multibillion-dollar boost to the state’s economy.
Tynan added, quoting Texas politician Jim Hightower: “Money is like manure. You have to spread it around to make things grow.”
But former L.A. Mayor Antonio Villaraigosa warned that Californians will have to make tough trade-offs if they want to keep the dream alive. That means supporting politically unpopular measures, like reducing pensions for public-sector employees.
“We have got to control our costs so we can reinvest in people,” he said. Commenting on the news of the day, Villaraigosa also predicted that California would be a huge beneficiary of President Obama’s immigration reform plan.