Is Los Angeles underrated? By Matthew Yglesias

www.slowboring.com

Is Los Angeles underrated?

Matthew Yglesias

12 - 15 minutes

Before heading to LA last week, I was at an Econ Twitter conference and mentioned the upcoming trip to several people, most of whom remarked that in their view, Los Angeles is underrated.

I always enjoy LA when I visit, and it’s truly a city that contains multitudes in terms of the sheer range of neighborhoods that exist in and around the city. But I said I was skeptical of the underrated thesis because, on its face, Los Angeles is extremely expensive. And what’s particularly noteworthy about the high cost of LA living is that while there are absolutely plenty of rich people out there, it’s a distinctly less-rich city than a lot of the other very expensive American metro areas.

Looking at the National Low Income Housing Coalition’s annual report on this, they say the HUD fair market rent for a two-bedroom apartment in the Boston-Cambridge-Quincy housing market is $2,399 versus “only” $2,044 in the Los Angeles-Long Beach-Glendale market. But the area median income for the Boston area is $140,200 per year compared to $91,100 for LA.

I normally find it annoying when affordable housing people want to discuss this issue in terms of price relative to income, because that confusingly mixes together two different issues. Housing scarcity and low income — though both bad — have totally different causes and solutions. But I do think it’s a useful lens if the issue you want to examine is “ratedness.” Boston and LA are both cities where homes are objectively expensive. The main driver of that in both cities is that the cost of buying a house on the open market is far higher than the hard costs of constructing a new one. And the main driver of that is that land is expensive in these metro areas, and a range of land use rules prevent the full deployment of the available technology for overcoming land scarcity. But the fact that LA is so much more expensive relative to income than Boston shows that there’s a kind of “excess demand” for the Los Angeles lifestyle in a way that isn’t true of Boston.

And it doesn’t take a brain surgeon to figure out why. Our visit featured overcast skies with highs in the 60s, which led to people constantly talking about how bad the weather was. But by Boston standards, that weather is fine! People hate cold winters, they enjoy sunshine, and LA has a bunch of natural amenities besides good weather, including beaches, cool-looking mountains, and the general Californian proximity to a broad range of different stuff (skiing and the desert!). Then on top of that, this awesome bustling city has everything from a full complement of pro sports teams to a symphony and a legendary food scene. It’s not only a great place to live, but it’s also widely recognized as a great place to live, which is why the price of housing is bid up in a way that isn’t fully explainable in terms of high incomes or bad policy. People just like it there.

This brings me to one of my great Discourse Peeves, which is that while people love to talk about stuff being overrated or underrated, my sense is that these disputes often hinge not on disputes about the thing itself but on disputes about the ratedness of the thing.

Back when we had more of a monoculture, I think this wasn’t necessarily such a big deal.

Television shows played in real time and went up against each other head-to-head. If it’s 8 p.m. on a Thursday night and you’re tuning into “Timecop” (ABC) or “Promised Land” (CBS) rather than “Friends” (NBC), then you are an eccentric person who believes that “Timecop” is underrated and “Friends” is overrated.

Not everything was as clear-cut as that particular Thursday night broadcast television standoff. But the existence of clear-cut cases of the consensus served as at least a regulative ideal for the concept of ratedness. There were a handful of significant music magazines, and they would publish best album of the year lists. If they were all pushing an artist you didn’t like, that artist was overrated — especially if the album was also commercially successful.

These days, though, gatekeepers’ influence is greatly diminished by the internet. You do get amusing divergences between the shows that get written about a lot and the shows that are most popular with the public. But even today’s very most popular shows have dramatically smaller audiences — fewer people watch “Yellowstone” today than watched “Diagnosis: Murder” 25 years ago — and the shows that get written about a lot reflect metrics about what things people like to read about on the internet rather than critics' judgment about which shows are best.

The result is a world where not only is it harder to get clear information regarding how things are rated, but where the real truth for a huge share of things is that nobody’s heard of it. We live in a more fractured landscape where nobody knows what’s going on. That means making claims about the ratedness of various things is increasingly difficult, and I think requires a higher level of precision than most people are accustomed to bringing to this kind of discourse. I have a pretty good sense of what people in roughly my age and demographic bracket think about things, and the world is always very exposed to the views of Brooklyn-based writers, but beyond that it’s often quite hard to know what anyone thinks about anything.

I’m always struck by the fact that even though I inhabit a mental universe in which “everyone” knows TSA procedures are largely ineffectual security theater, most people appear to believe that barring liquids from carry-on luggage is doing important things to keep America safe.

This is not a huge mystery. It just turns out that the bulk of air travel discourse is done by people who fly a lot (I’ve been on 16 flights this year), but that’s an idiosyncratic minority of the population.

This illustrates a kind of general principle with regard to ratedness in a highly fragmented society. What people implicitly mean when they say something is overrated or underrated is compared to their sense of what their social niche thinks. But your niche, whatever that niche is, is going to be idiosyncratic and weird because all niches are idiosyncratic and weird.

And while you could, in principle, deviate from the niche in any direction, it’s likely that in practice you deviate in the direction of the general population.

So lots of writers and intellectuals seem to me to believe “Los Angeles is underrated” not despite the fact that Los Angeles is highly rated but because it’s highly rated. Writers and intellectuals are an idiosyncratic group (as are all groups!) that perhaps deviates somewhat from the national norm in downrating Los Angeles a bit. So then people with the normal, widely-held view that it’s good decide that they are making bold statements of dissent. But if you just ask people about southern California, most of them readily agree that it’s really nice. And while lots of people leave California, one of the main reasons they cite is that it’s very expensive, which again mostly tends to underscore that it’s very popular.

In a world of niches, normal opinions can feel contrarian and are sometimes even labeled that way. I’m a notorious “contrarian” political pundit, but my broad worldview that Joe Biden is good but maybe a bit too indulgent of left-wing activist groups is pretty clearly in line with the median voter. A lot of prominent columnists seem to observe a norm whereby if you’re broadly pro-Biden, you should never criticize him from the right on any topic, even though I don’t really believe these columnists genuinely can’t think of a single topic on which they personal diverge from the progressive consensus.

Then on the flip side, you have people who, for marketing reasons, position themselves as more contrarian than they really are. “I, like most people, think southern California has good natural amenities and that its largest city seems like a nice place” is kind of banal in a way that “Los Angeles is underrated!” isn’t.

My read of the evidence, though, is that people actually overrate the value of nice weather.

Everyone we ran into in LA kept apologizing for the “bad weather,” even though coming from the east coast, the weather seemed fine to us.

And this is how people end up making systematic errors and overrating the value of moving to a warm climate. It’s very genuinely true that cold winters make people miserable and researchers find that during the winter months, people who live in tropical or subtropical areas are happier than people who live in temperate or cold ones. But this relationship reverses in the spring and summer. Basically, if you suffer through a cold winter, you get a kind of spring high that people who live in places where it’s nice all the time miss. There was nice weather during my last week in Chicago, and there was a visible euphoria all throughout Hyde Park that you don’t see in a place with good baseline weather.

Some of that is pure psychological response to novelty, but some of it is a social response as well. When the nice weather is a special occasion, people make special plans around it — they meet up with friends and do things that take them out of the mundane banality of daily life. If good weather is your daily life, then banality creeps back in.

It can be hard to think clearly about this. If it’s February in the suburbs of Cleveland and you take a trip to Arizona to play golf, that really will make you happy. From that, it’s easy to infer that if you moved from Ohio to Arizona, you’d be happier all the time, but this is almost certainly wrong. The correct lesson to draw from the fact that it’s fun to take a vacation break from bad weather is that you’d be happier if you took more vacations. As Arthur Brooks writes, “research shows that frequent, short vacations—if you can take them—are a good strategy for raising overall well-being, because they circumvent the adaptation problem.”

Of course he puts the “if you can take them” proviso in there because vacations cost money. On the other hand, you can exploit the mass public’s aversion to cold weather for financial gain. In the Minneapolis metro area, the fair market rent for a two-bedroom apartment is $1,329 (65% of the LA figure) whereas the area median income is $118,200 (130% of the LA figure), meaning the typical Angelino could probably save a bunch of money by moving to the Minneapolis area and get a raise. That would free up plenty of cash to take some trips.

I used to be fond of slightly trollish framings of things, and might express the idea of the previous section by saying something like “good weather is overrated.” But I’ve come to think that’s counterproductive and bad.

So I want to be really clear and say that people’s sense that bad weather is bad and good weather is good is totally correct. The specific error people are making that leads them to underrate Minneapolis is that they aren’t thinking through exactly what it is that they like about nice weather. Springtime euphoria in temperate climates is real. The subtropical happiness advantage during the winter is real. Going on vacation somewhere warm during the winter months is a ton of fun. Good weather is good!

But if you move for the nice weather, then what you gain in avoiding winter misery is largely lost in the absence of the spring euphoria. This doesn’t mean living in a warm place is bad, only that it’s probably not worth making large sacrifices for — whether that’s a financial sacrifice or a loss of proximity to extended family or whatever else. This is also, I think, the general point about things being over or underrated — claims about this tend to lack specificity and clarity in a way that’s bad. I think there is definitely a sense in which LA is underrated in “the discourse,” but in practical dollars and cents reality, it seems like there is, in fact, very high demand for Los Angeles. By contrast, Minneapolis and its suburbs just don’t have much profile in the discourse at all except when some particularly newsworthy event happens there. There isn’t much contrarian juice to wring out of an idea like “Minnesota has high living standards and also it’s cold,” but I do think there is an exploitable monetary advantage there.