A new feudalism? Housing costs, business structures and the pricing out of the middle class

US geographer, Joel Kotkin has been speaking for a while about how the nature - social and economic - of his home state of California is changing towards what he calls a "New Feudalism":

Today California is creating a feudalized society characterized by the ultra-rich, a diminishing middle class and a large, rising segment of the population that is in or near poverty. Overall our state now suffers one of the highest GINI rates — the ratio between the wealthiest and the poorest — among the states, and the inequality is growing faster than in almost any state outside the Northeast, notes liberal economist James Galbraith. The state’s level of inequality now is higher than that of Mexico, and closer to that of Central American banana republics like Guatemala and Honduras than it is to developed states like Canada and Norway.

Kotkin (and fellow author, Marshall Toplinsky) describe how, once housing costs are considered, the supremely progressive state of California has the USA's highest rates of poverty. Despite this, Californian politics is dominated by the wealthy few and those who live off advocating for the poor. As Kotkin & Toplinsky despair that "no prominent California politician, left or right, has addressed seriously the collapse of the state’s dream of upwardly mobility".
The causes will be familiar to anyone looking at the development of and challenges facing London:

The real problems lie with policies that keep housing prices high, an education system that is a disgrace, particularly for the poor, and a business climate so over-regulated that jobs can be created either in very elite sectors or in lower-paying service professions. Even in the Bay Area in coming decades regional agencies predict only one in five new jobs will be middle income; the rest will be at the lower end.

The result of this situation is that feudalism - a modern serfdom - Kotkin describes. A wealthy few, that shiny knights and ladies of the elite serviced by poorly paid workers unable to join the asset merry-go-round. Even relatively well-paid workers will be trapped by a choice between their job and moving to another, more affordable place - stay renting forever (or hope for the financial break that gets them into the gentry) or move somewhere colder, poorer and far way where they can buy a home and raise a family.

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