London Leavers – and what they mean for New York
Who lost London? In last Thursday’s Brexit vote, 40.1 percent of London voters chose to leave the European Union – a remarkably high result. Yet London Leavers have legitimate complaints. London, like New York City, is feeling the strain of being a physical and economic oasis in a world gone mad.
Compared with the rest of the United Kingdom, London is young, rich and cosmopolitan. The city’s average age is 34, compared with 40 for the country as a whole, and its percentage of elderly residents, at 11.3 percent, is far smaller than the nation’s 17 percent average. In comparison, Edinburgh, the capital of Scotland, voted by 74 percent to stay.
One reason for the tepid result: whether you’re of Viking, Pakistani, Nigerian or Chinese descent, you can’t help but think that London is already full.
Last year alone, Britain took in more than 335,000 migrants from around the world.
Just like New York, London attracts a disproportionate share of these migrants, and keeps breaking population records as a result. The capital surpassed 8.6 million people last year, up from a low of 6.8 million in 1981. New York City is on a similar trajectory, going from 7.1 million people in 1980 to 8.5 million today.
The stress of this surge is most obvious in housing and transit. Sadiq Khan, the city’s first Muslim mayor, won office last month on a platform of improving those two things.
The problem isn’t just that more people equal higher house prices. The city’s housing stock has become a repository for the world’s ultra-rich – in large part because of Western governments’ post-2008 bailout policies.
Since the financial crisis, the world’s governments have kept interest rates low. People who want to put their money in the safest assets, such as German government bonds, can expect negative interest rates.
So rich people figure that the most lucrative safe bet is Western real estate – so they have bought a lot of it.
On the day of the referendum, the news came out that even as the U.K. had grown to a record population, the population in Chelsea and Kensington, two of London’s richest neighborhoods, had shrunk. Absent global oligarchs had displaced people who lived there.
It would be one thing if these distortions were part of a free, capitalist society. But since 2008, the British government has owned big chunks of two of the country’s largest banks, the Royal Bank of Scotland and Lloyds. As in the United States, the British government chose to bail out investors in the banks, even as budget cuts meant shorter library hours and longer ambulance waits. Because London is more dependent on the national government than New York, the city has suffered from these service cuts far more acutely than New Yorkers have.
If you can’t live in Chelsea, you’ve got a long commute – on ever-more crowded trains. London’s Tube, like New York’s subway, is smashing ridership records.
But New York actually had more room to absorb new riders than London did. We have express-track subway lines, meaning that we can run more and faster trains on some lines to ease crowding. New York now carries 1.8 billion people a year on its subways, with London at 1.3 billion. London is building new capacity to catch up – and its famous double-decker buses take up the slack.
But above ground, the streets are also jammed.
Earlier this month, a New York Department of Transportation report noted that speeds in Gotham’s central business district are slower than they’ve ever been. That’s true in London, too, with cars moving at just 7.4 miles per hour. London, like New York, has seen a surge in for-hire vehicles from Uber and its competitors clog up its streets – and London, like New York, has vacillated about what to do about it.
Then, too, there is terrorism. As in New York, the vast majority of migrants and their British-born children are hardworking and peaceable. The tiny minority that is not peaceable has mercilessly killed in the name of radical Islam. In July 2005, 52 people died in London’s bus and Tube bombings. Three years ago, British soldier Lee Rigby was beheaded outside his London barracks.
Londoners, like New Yorkers, are accustomed to diversity. But it is not unreasonable for voters to worry about the long-term security implications of accepting millions more migrants, both legal and illegal, from the Middle East over the coming decades. That’s something that it would have to do as part of the European Union.
Ultimately, the central question is this: With London’s population set to grow to 11 million by the middle of the century, what is the cost to existing Londoners’ quality of life?
As Adair Turner, a grandee of London’s financial world, told the Financial Times earlier this month, “If immigration” – and, relatedly, population – “were the only issue, I could be a Brexiter. … If you ask people what is the biggest determinant of their standard of living, often it is the length of their commute. Some people say, ‘Oh, we’ll just build on the greenbelt.’ But people love the greenbelt. I think large-scale immigration of people who are willing to work in unskilled jobs also probably reduces the wage rate of the people who are there already.” Indeed.
Lord Turner presumably voted to Remain – but, then, his money insulates him from these real-life population pressures. Less wealthy incumbents of global cities are competing with the world’s human and financial capital for ever-scarcer resources.
The world’s global political and business elite pronounced itself stunned by the overall Brexit vote. But city-planning elites should be concerned, too. People will accept growth – but only when it comes with government that can competently manage that growth. Neither London nor New York has proven that it can do that.
Nicole Gelinas is a contributing editor to the Manhattan Institute’s City Journal. Follow her on Twitter @nicolegelinas.