So what does the populist anger registered in Massachusetts mean for the real estate markets? Nothing good.
First off, people are hurting, hurting bad. They are in debt, too many people don't have jobs, and they can't face higher tax burdens. Anything that smacks of more government and more spending sounds like bigger deficits and higher taxes, which they figure can only make things worse. The stimulus looks like a sop to the banks even though it might have staved off considerably higher unemployment numbers. But so what, in voters' minds their financial condition hasn't improved and their future prosperity appears jeopardized.
The alternative to stimulus is austerity--government spending cuts at the federal, state and local levels. That directly impacts jobs and services everyone has come to expect. Unemployment will go up, not down. Government jobs and contracts to private contractors get slashed. Infrastructure projects and repairs get put on hold, potholes don't get filled, sewer projects are delayed. Class sizes increase in schools, after school programs disappear, parks don't get tended, prisons can't handle convict loads, theaters close, arts groups don't get funding, research and development grants diminish, garbage collection becomes less frequent. The people who provide all these services will be put out of work and family incomes diminished further.
With more people out of work, can the government afford to increase unemployment benefits and welfare related spending? If not, spending cuts can be expected to scissor through social safety nets--at least poor people spend whatever they get in handouts.
Any way you calculate it, austerity means less money coursing through the economy
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Jonathan D. Miller
A marketing communication strategist who turned to real estate analysis, Jonathan D. Miller is a foremost interpreter of 21st citistate futures – cities and suburbs alike – seen through the lens of lifestyles and market realities. For more than 20 years (1992-2013), Miller authored Emerging Trends in Real Estate, the leading commercial real estate industry outlook report, published annually by PricewaterhouseCoopers and the Urban Land Institute (ULI). He has lectures frequently on trends in real estate, including the future of America's major 24-hour urban centers and sprawling suburbs. He also has been author of ULI’s annual forecasts on infrastructure and its What’s Next? series of forecasts. On a weekly basis, he writes the Trendczar blog for GlobeStreet.com, the real estate news website. Outside his published forecasting work, Miller is a prominent communications/institutional investor-marketing strategist and partner in Miller Ryan LLC, helping corporate clients develop and execute branding and communications programs. He led the re-branding of GMAC Commercial Mortgage to Capmark Financial Group Inc. and he was part of the management team that helped build Equitable Real Estate Investment Management, Inc. (subsequently Lend Lease Real Estate Investments, Inc.) into the leading real estate advisor to pension funds and other real institutional investors. He joined the Equitable Life Assurance Society of the U.S. in 1981, moving to Equitable Real Estate in 1984 as head of Corporate/Marketing Communications. In the 1980's he managed relations for several of the country's most prominent real estate developments including New York's Trump Tower and the Equitable Center. Earlier in his career, Miller was a reporter for Gannett Newspapers. He is a member of the Citistates Group and a board member of NYC Outward Bound Schools and the Center for Employment Opportunities.
