Last week, Matt Yglesias argued in Vox that the federal government should move jobs out of the Washington region to places with lower costs of living and which need job growth. Is this a good idea?
Yglesias suggests agencies that don't have to be here—from the NIH and National Weather Service to the SEC and FAA—move to places like Detroit, Cleveland, and Milwaukee. Beyond just helping Midwestern cities that were thriving only two decades ago (and that have the infrastructure to support bigger economies), he suggests such a move would help take care of the problem of local “small c conservative” governments that aren’t doing enough to accommodate the growing population.
Here’s a bit more of what he has to say:
A sensible approach would be for the federal government to take the lead in rebalancing America’s allocation of population and resources by taking a good hard look at whether so much federal activity needs to be concentrated in Washington, DC, and its suburbs. Moving agencies out of the DC area to the Midwest would obviously cause some short-term disruptions. But in the long run, relocated agencies’ employees would enjoy cheaper houses, shorter commutes, and a higher standard of living, while Midwestern communities would see their population and tax base stabilized and gain new opportunities for complementary industries to grow.
This isn’t a new idea. It’s also a popular one with small government conservatives who think that by dispersing agencies that government can lower high overhead costs. Others think that politicians and bureaucrats in Washington are too insulated from the issues of everyday Americans and that a move would jolt agencies and institutions out of complacency. Others, like Iowa Congressman Rod Blum, just appear to resent the growth that has come to the city in recent years.
Thankfully, Yglesias isn’t so callous, claiming that the DC region’s economy would ultimately be okay even if a large share of federal jobs left. And unlike others, he isn’t advocating for a wholesale move.
Many federal jobs are already outside the Washington region
This argument comes with the assumption that a large share of federal jobs are only in the DC region. That’s just not true. Only around 15% of federal jobs are located in or around Washington. Our region actually ranks fourth when it comes to federal government as a share of the total population.
There has actually been a long steady march of government jobs out of DC, which generally makes sense because operations that can be done cheaply tend to get moved to cheaper areas. In his article, Yglesias cites the US Treasury as an agency that does need to stay in the region, but it turns out that a lot of the payment processing done by the Treasury’s Fiscal Service Department happens in Parkersburg, West Virginia, five hours away from Washington and in an area that counts among areas needing all the economic help it can get.
And there are tons of other federal offices across the country. NASA has facilities in Cleveland, Houston, and Pasadena; the IRS has offices in Austin; the CDC is in Atlanta. The list goes on and on.
“At some level,” writes GGWash contributor Bryan Rodda, “there just aren't that many jobs to decamp out of this region. The Office of Personnel Management’s most recent data (2013) shows 2.7 million federal civilian employees, of which only 350,000 are in the DC metro area and 2.3 million already are not. You can argue to shift some of that 350,000 around...but there's a limit here to what you could really do.”
Yglesias says a huge shift like this wouldn’t hurt our region, but it would
Yglesias cites sequestration, a series of automatic spending cuts enacted in 2013 that predicted big federal government layoffs, as a sign that the Washington area would bounce back if a big chunk of federal jobs left, but a reduction in activity and growth is not the same as a wholesale move.
This argument gives way too much credence to the idea that the Washington area is living high on the hog when the fact is that housing demand and job growth is uneven around the region.
Silver Spring, for example, which is home to NOAA and the National Weather Service, faces a huge office vacancy rate that would only get worse if both offices had to relocate somewhere else. And Arlington County has been hit hard just with government agencies only moving to Alexandria, as well as Base Realignment and Closure, which shifted many defense department jobs from Crystal City to Fort Belvoir, Fort Meade, and even Alabama.
The reason the Washington economy is strong and resilient is largely because of that investment from the government over the years. The region is trying to move away from dependence on government, but there's a long way to go.
If we we want to create government job growth in other areas of the country, then we could just do that. There’s lot of work that needs doing that would require the government to hire more. If that hiring can happen outside of Washington, that's a reasonable approach.
The federal government can make a place more diverse. Could it do that elsewhere?
One good point in the article is that federal government jobs and their rules for hiring can help make an economy more diverse. That’s the exact thing that happened here in the Washington region.
Greater Greater Washington contributor Dan Reed writes:
Part of Yglesias' argument seems to be that moving federal jobs to other parts of the country would help economically disadvantaged areas (and people) find work. Yet the federal government in DC has been a huge factor in building the middle class here, because historically it was one of the few places that prioritized diversity in hiring. If you were a woman, black, or gay, you could work for the government when other employers were legally able to discriminate against you.
Are they less deserving of jobs than, say, white working class people in Indiana, simply because they live in a more "affluent" area?
Alex Baca, who lived in DC for a long time before relocating to San Francisco and then Cleveland, agrees with Dan that the federal government has helped make the region more welcoming to more people. But she also wonders whether Yglesias’ proposal is a good one because it’d bring the benefits Dan mentions to other places in the country:
Regarding federal government institutions specifically, I am absolutely with Dan on its role in building the DC area's black middle class. That institutionalized diversity in hiring is something I loved about being in DC, and a major factor in my wanting to return home. We shouldn't ever forget that.
But looking forward, would it be useful for offices that prioritized diversity in hiring to be located elsewhere across the US? From my perch in Cleveland, I think so. I'm not saying this in defense of the white working class, a trope I find insufferable that is sucking up all the air here. I say this because the white working class, and the white white-collar class, is predominate and preferable to employers here already. Our mayor is feckless and there's no bench for political leaders here, because the city, over two centuries, has outsourced its work to foundations and nonprofits. More federal employment here might culturally counteract that.
Living here is made me realize that there was a bunch of cultural, emotional, and largely unquantifiable factors that trickled down from the federal government's presence to create the D.C. area that I considered safe and accepting. It's why immediately post-election, I started plan out how quickly I could move up my timeline in Cleveland so that I could come home. I like it here, but I don't feel safe in the same way. And I wonder all the time if a more noticeable federal presence would help with that.
It’s important to think about how much of an impact the federal government has had on our region beyond just economics. And while seeing those impacts spread around through more federal hiring elsewhere would be great, taking them from this region would not be.
We need to drop the narrative that moving out of Washington would be an instant solution to a number of problems. Instead let’s focus on finding ways to make government more efficient, housing more affordable, and jobs more lucrative. That’s more worthwhile than trying to play a win/lose game with entire region’s economies.