Rich Karlgaard - Life 2.0: How People Across the Country Are Transforming Their Lives to Make Their Own American Dream

CONTENTS

FOR MARJI, KATIE,
AND PETER

I go back to look at our house,

555 Hudson Street [in New York City],

and I know that I could never afford it now.

JANE JACOBS,

author of

The Death and Life of Great American Cities,

quoted in the May 17, 2004, issue of The New Yorker

PRAISE FOR

LIFE 2.0

Karlgaard leaves his Silicon Valley lair and sets out to explore flyover country from an up-close and personal perspective in his little Cessna Skyhawk. As he discovers the joy of controlling flight, he also discovers countless Americans taking control of their environment by moving to the hinterlands for higher-quality life with a sense of purpose.

John and Martha King, King Schools

Rich Karlgaard has crafted a delightful, and surprisingly moving, tale that will allay the greatest fear of many upwardly mobile Americans: Not death. Not even public speaking. But the terror of waking up, alive and well, a resident of Bismarck, North Dakota.

Michael Lewis, bestselling author of Moneyball, Liars Poker, Next, and The New New Thing

Aboard his sky cabin, Karlgaard flies in with a companion concept to David Brookss On Paradise Drive and Joel Garreaus Edge City.

Tom Wolfe

Rich Karlgaards stories show that America offers an array of routes to personal fulfillment that, while counterintuitive to those on the conventional fast track, offers great promise to those who are open to personal innovation.

Clayton Christensen, professor of business administration, Harvard Business School; author of The Innovators Dilemma; and coauthor of The Innovators Solution

Written with literary flair and analyzed with rare social and financial insight, Life 2.0 combines a gifted novelists sense of personal drama and pace with a technology visionarys insight into the future. Take an epochal ride in Rich Karlgaards aerobatic new book. Not only will it stretch your mind and widen the horizons of your life, it also could renew your health and wealth.

George Gilder, futurist and author

Talk about timely! Rich Karlgaard takes a thoroughly original approach to examining the sustaining upheaval in the American white-collar professional labor market. As someone who gritted his teeth and jilted Palo Alto for Vermont a decade ago, I was entranced by Karlgaards very human storiesand their very profound consequences. No one has a pat answer to the great jobs conundrumbut this fascinating treatise will make you think deeply, and may just give you the impetus to uproot. And, hooray, our amateur pilottour guide lived to tell the tale!

Tom Peters, management consultant and bestselling author

Life 2.0 is an original and exhilarating look at options many Americans dont realize are now open to them. Rich Karlgaards enthusiasm is contagious, based on the evidence he has found on his explorations from coast to coast. Anyone stuck in a traffic jam or beset by big-city woes will think long and longingly about the prospects this book lays out.

James Fallows, national correspondent, Atlantic Monthly

INTRODUCTION

Living Large in Smaller Places

T hree years ago a Forbes magazine colleague living in San Francisco told me that all her thirty-something friends were leaving town.

Where is everyone going? I asked.

Youd be surprised, she said. Sacramento. Portland. Boise. Tucson. Smaller places than that, even.

On one level I wasnt surprised. Housing costs in San Francisco had gone to the moon during the 1990s. The dot-com bust that began in mid-2000 had done zippo to slow down house-price inflation. Tiny two-bedroom condos in San Fran-cisco were fetching $600,000. Try paying the mortgage on that without a job. My colleagues friends simply had to leave town. They were running out of money.

Yet on another level I was surprised. People who had lived in a sophisticated city such as San Francisco, I was certain, would hold a snobs view of boonyack towns such as Boise. It would never occur to fancy urban dwellers to move there. Yet they have moved therein droves.

A fter eighteen years with Morgan Stanley in Dallas I now hang my shingle out at Smith Barney in McKinney, Texas (pop. 50,000), the county seat of Collin County.

MY LIFE TODAY

COMMUTE: One minute, thirty seconds each way (old commute: two hours round-trip)

COUNTRY CLUB: Three blocks from the office and six blocks from the house

INTERNET: At the office, industrial strength; at home, always-on digital

HOUSING COST: $0.73 per square foot versus high-end Dallas cost of $1.50 per square foot

CULTURE: Local community college

DINING: With two small kids, who really needs another trendy restaurant?

SCHOOLS: Exemplary rankingsone kid at school three blocks from home, another in special-ed program, but only five minutes away

INCOME: Down a little with rough brokerage industry conditions, but expenses way down also

IMPROVED WORK ATTITUDE AND FAMILY RELATIONSHIPS: Priceless

RONALD JOHNSON
McKinney, Texas

Okay. Lets stop here for a reality check.

I realize that droves is an imprecise word and, moreover, that out-migration from a dot-com boomtown such as San Francisco was to be expected during an economic bust. Also, havent we heard this song before? As I began to study U.S. internal migration patterns and regional economic development for Life 2.0, I learned that some carefully reasoned books had appeared during the last fifteen years that had predicted just such an out-migration from cities to smaller cities and towns. One of them, Penturbia, was written in 1991 by a University of California professor named Jack Lessinger. Penturbia asserted that high costs and urban crowding would drive the middle class out of cities and suburbs.

But it didnt happen. In fact, the booming 1990s economy produced quite the opposite result. It sucked the professional middle class into cities and their suburbs. (Was Lessinger wrong or just fifteen years ahead of his time? Good question. I think he was ahead of his time.)

Then in 1998 a futurist named Harry Dent, in a book called The Roaring 2000s, took a similar tack. He said white-collar professionals in big cities and suburbs lived with the daily stress of trying to handle two imperatives: being a success at work and creating a comfortable home. For many of us, this has meant buying a house in the suburbs where we could raise our families safely and affordablyand paying for it every day with an exhausting commute.

Ouch. Sound familiar?

Dent went on to say: We are about to see the next great population migration in our country, which will be the force driving real-estate appreciation in the next decade. An enormous number of people will escape overcrowded, expensive suburbs and move to a variety of small towns, new-growth cities, exurban areas beyond the suburbs, and even back to trendy urban areas. Whether youre looking for a new home or a new investment, you can be among those to reap the huge profits.