Oregon falls furthest in CEO survey of best states for business

Discussion in 'Blazers OT Forum' started by tlongII, May 21, 2010.

  1. barfo

    barfo triggered obsessive commie pinko boomer maniac Staff Member Global Moderator

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    Well, I think it is wonderfully diverse state too, so at least we agree on that. But how do ocean, valleys, mountains, deserts reduce unemployment specifically? Tourism is down due to the economy, that's part of the problem.

    barfo
     
  2. BLAZER PROPHET

    BLAZER PROPHET Well-Known Member

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    If I wanted to move a business (depending on the type of business), I'd look at several things. One of the main ones is livability. Then the quality & quantity of the workforce. Of course, other things like unions, cost of living, taxes, type of government also plays an important part. So I would think we'd get at least a good hard look initially due to the beauty of the state.
     
  3. tlongII

    tlongII Legendary Poster

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    How about construction? Unfortunately part of the problem with our housing prices lies with our liberal urban growth boundaries which limit where housing construction can occur. If these were relaxed we could have more available land and thus lower housing prices. This would drive an increase in the construction industry and therefore create more jobs.
     
  4. barfo

    barfo triggered obsessive commie pinko boomer maniac Staff Member Global Moderator

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    So how do you explain the fact that most businesses are located in relatively unlivable places (some of them with higher costs of living, stronger unions, and higher taxes than Oregon)?

    Myself, I think the answer is most businesses don't move. Most businesses stay in the same place they were started, and they get started in the places where people happen to be.
    And what determines where people happen to be when they start a company? Three things: where they grew up, where they went to college, and where they are working when they decide to strike out on their own. The first one is just a matter of population, and we are obviously at a disadvantage there. The third is a chicken and egg problem - saying the way to attract more jobs is to have more jobs is pretty useless advice, albeit correct. The second one is really the only thing a state can truly do something about. Unfortunately, this state has had its head up its ass for its entire history about the value of higher ed, and the fact that Portland itself lacks a real university is a huge problem as far as economic growth goes. Now, admittedly we've done a great job of adjusting by becoming a destination for 20-somethings to move to for lifestyle reasons, but it would still be better to have the university.

    barfo
     
  5. barfo

    barfo triggered obsessive commie pinko boomer maniac Staff Member Global Moderator

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    In a general sense that's probably correct - lower land prices will lead to lower housing prices. However it is not the case at present that there is a lack of available, buildable, cheap land within the UGB. Go out to Happy Valley and look around - it's all for sale and not that expensive. The problem is there is no demand.

    barfo
     
  6. tlongII

    tlongII Legendary Poster

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    I don't believe that. I think on a relative basis the housing prices here are still extremely high. The low demand is because of the poor economy and high unemployment.
     
  7. barfo

    barfo triggered obsessive commie pinko boomer maniac Staff Member Global Moderator

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    I didn't say they weren't - in fact I agree with you that they are. I said there was land available to build more houses on, if anyone wanted to build houses.

    Yes, of course. And that's why the UGB is irrelevant to construction. If you did away with the UGB tomorrow, the economy would still be poor and unemployment would still be high, so why would anyone suddenly start building houses?

    barfo
     
  8. tlongII

    tlongII Legendary Poster

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    Because if you lower the cost more people could afford it. Thus driving more demand. Thus driving more construction. Thus driving a healthier economy.
     
  9. barfo

    barfo triggered obsessive commie pinko boomer maniac Staff Member Global Moderator

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    Lowering the cost of building new houses won't drop the price on existing houses, unless a whole bunch of new houses actually get built.
    And how much savings per house do you think we are talking about here?

    barfo
     
  10. tlongII

    tlongII Legendary Poster

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    The hell it won't! All you need is the opportunity to build new homes inexpensively and you can bet it will drive existing home prices down.
     
  11. barfo

    barfo triggered obsessive commie pinko boomer maniac Staff Member Global Moderator

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    Sure. Again, how much money do you think we are talking about here? Do you think land is a huge fraction of the price of a house?

    barfo
     
  12. tlongII

    tlongII Legendary Poster

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    That depends. Currently the location is probably the main driver of the cost of the land besides size of the lot. In the more desirable areas land is a significant portion of the cost of the home. I would have to look up the percentage though. Making more land available and at lower prices would drive down the price of the structure as well though.
     
  13. barfo

    barfo triggered obsessive commie pinko boomer maniac Staff Member Global Moderator

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    In the more desirable areas more expensive homes tend to get built, so I'm not sure about that. Probably the highest land/price ratio is older, run down homes in good neighborhoods, and the lowest is McMansions jammed onto tiny lots. But the more desirable areas aren't the right comparison anyway. Your idea is that people who can't afford houses now will buy out in the boondocks because it is cheaper. So we are talking about cheap houses on cheap land outside the UGB, vs. cheap houses on the cheapest land available inside the UGB.

    I'm not clear on how you think just the possibility of building outside the UGB would drive down prices. Would a seller think to himself "well, someone could start building a slightly cheaper house today and have it ready to market several months from now, so I'd better drop my price today"? Would a buyer say "well, if someone actually built a house outside the UGB, and if I waited several months for it to be built, I could save a little money, so I'll offer less"? Would a buyer who can't afford a used house in town even be considering buying a new house, anywhere? Seems unlikely to me. I think you have to have an actual, not a theoretical, alternative to make the price change.

    barfo
     
    Last edited: May 23, 2010
  14. BLAZER PROPHET

    BLAZER PROPHET Well-Known Member

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    I'm not so sure I agree. I mean, it is true that most businesses do not relocate, but there times when larger amount than usual do. We're in one of those times now. As an example, businesses are leaving Oregon at a higher rate at present due to recent tax increases to support a union entitlement program that is only getting worse. I remember 15 years ago when businesses were exiting CA. Several moved into Klamath & Lake Counties (where I lived). So it does happen and on a flux scale. I used to work for Farmers Insurance Claims. We had a huge regional office building at I-5 & Hwy 217. Due to high taxes the entire operation (over 800 employees) was moved to Vancouver, WA. Nationwide Claims (over 1,000 employees) is moving to CO due to high taxes and cost of living in Portland. A good friend of none worked for a print facility in WA that closed and moved due to union involvement. There are numerous other examples I know of, so while most businesses do not move, many do.

    As to why businesses start where they do, I really don't know. Your thought are at least partially correct I am sure. As to why more businesses are in The People's Republic of Multnomah County, I am sure it is because where there are more people, more businesses start. It may not be where they want to be, but it stands to reason it's where they have to be. I think the next decade will be very difficult for Oregon business. Twenty years of poor leadership is now coming home to roost.
     
  15. barfo

    barfo triggered obsessive commie pinko boomer maniac Staff Member Global Moderator

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    You for some reason ignore the businesses that move into Oregon, and focus only on those that move out. I'm not convinced the out-migration is actually larger than the in-migration. Nevertheless, the number moving in either direction is a tiny fraction of the total.

    barfo
     
  16. BLAZER PROPHET

    BLAZER PROPHET Well-Known Member

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    There was a time when I'd say you are correct, but certainly not now. I can recall when Oregon was allowing companies to not owe taxes for years if they would just come or stay here. Those days are gone. Long gone. Now, the order of the day is to punish businesses in this state and I hardly see that as an incentive for businesses to come here.
     
  17. barfo

    barfo triggered obsessive commie pinko boomer maniac Staff Member Global Moderator

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    How many businesses do you think have left Oregon, how many businesses do you think have moved to Oregon, and how many businesses total do you think there are in Oregon?

    barfo
     
  18. barfo

    barfo triggered obsessive commie pinko boomer maniac Staff Member Global Moderator

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    Curiously, here's a completely different story about that:

    barfo
     
  19. tlongII

    tlongII Legendary Poster

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    No, that's not it at all. I see more affluent people buying nicer homes at better prices thus driving a trickle down effect.
     
  20. barfo

    barfo triggered obsessive commie pinko boomer maniac Staff Member Global Moderator

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    Ok, so the affluent people buy houses outside the UGB and sell their houses in town for less money, enabling poor people to buy them. Great, but don't those houses have to be built for the more affluent people to buy them? Still not seeing how you intend to get the construction started.

    barfo
     

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