Ep. 1830 - We Investigated The Collapse Of The American Mall

If you're listening to this podcast in America, the odds are overwhelming, actually about 70%, that you live within an hour of a rundown or abandoned mall. The vast majority of Americans can name at least one mall nearby that's either growing tumbleweeds or has a very high vacancy rate, and low customer traffic, along with, in almost every case, a high crime rate, when these things are obviously related. If you're one of the few Americans who can't name a mall that's failing, then in all likelihood, that will change very soon. Half of the malls in the United States have closed since the 1980s. By the end of the decade, projections suggest 87% of the existing large shopping malls in this country will also shut down. We'll have just a few hundred malls by 2030, along with a lot of creepy, dangerous, dilapidated buildings where malls used to be, but on the right side, we also have a lot more vape shops and pawn brokers. At the same time, bizarrely, a handful of malls are actually doing very well right now. Some of them are expanding. While 90% of the industry is shrinking or disappearing entirely. Why is that happening? Well, it's hard to explain, at least on the surface. I mean, off the top of your head, you could probably identify several different reasons for the collapse of America's malls from the convenience and lower cost of online shopping. That's the big one that comes to mind. Also, the COVID lockdowns, the priorities of private equity firms, to the rise of social media, and the decline of interpersonal interaction in general. We'll talk about all those causes in a moment. To one extent or another, they're all true in ways that you probably don't even realize. But the most important part, for the most part, the decline of malls, while a small number of malls are thriving, has been seen as a straightforward economic problem as a matter of supply and demand. Malls in general don't interest people anymore, so they're dying. They're obsolete, so they're gone now. That's how it works. No further explanation is required. Is that analysis wrong? Well, no, not really, but it's also incomplete. And for one thing, it ignores the cultural significance of the American mall and how malls were central to the social lives of millions of young people. For me personally, when I was a kid, like a lot of kids in the 90s, our local mall was the hangout spot. And now the idea of going and hanging out at a mall all day is totally foreign, not even possible for most people. My parents used to drop me off at the mall, like when I was 11 or 12, they'd just drop me off. I'd hang out there for several hours with my friends. And now every part of that seems alien, hanging out at a mall for several hours, actually hanging out anywhere in a physical location for several hours, dropping your child off at a place without direct adult supervision, having actual friends in real life. I mean, the whole thing is bizarre, like something out of an alternate universe. It's so bizarre that it triggers kind of an existential crisis. If you want to understand the popularity of movies like Backrooms, this offers a pretty good explanation. Young people are genuinely disturbed by the amount of empty space they see everywhere to the point that they're wondering if malls are even real, or just like a siop of some kind watch. So I'm in the mall. This place, so coming to the mall makes me realize we're living in a simulation. Like this can't be real. Like you're telling me, you're telling me this place right here that has two people working in there. They're selling enough hats. You're selling enough hats. Just to pay two employees. No, I don't believe it. I don't believe it. It's not real. Also, like some of these stores are like, okay, like maybe, right? Like women's lingerie, underwear, whatever. The buckle, I don't know. People still shopping there. I don't even know. I don't even know. Okay, like how you're telling me this place, icing sells enough. So there's enough $2 earrings to get to pay the rent. No way. And in this place, this place, what is it even? I don't even, what do they do? They're selling nail polish and candles. That's not a no. There's no way. Our phone case is no. It's like he's coming across the ruins of an ancient civilization, which he kind of is. And he doesn't know how to process it. We built vast structures all over the country and every single suburb and designed them for the express purpose of facilitating in-person human interaction, specifically the kind of interaction that leads to merchandise sales. Now those structures are hollowed out, but in many cases, they're still standing alone and empty. It's almost impossible for today's teenagers to imagine that when people flooded into these malls for the first time 70 years ago, they were a revelation. The malls were always crowded on the weekend. New malls were constantly popping up in new towns. The typical teenager felt like he was part of a growing country with new industries and markets opening up all the time all over the place. Young people associated the mall with their friends and their family with innovation and excitement and community. To give you an idea what it was like, this is footage from 1957 featuring the brand new Hillsdale Shopping Center in San Mateo, California. The mall contained a macy's, a sears, a farmer's market, market, and it blew people's minds at the time because they weren't used to centralized open-air shopping centers. So here's how the mall was announced to the public via the short film Shopping Can Be Fun. A new concept in merchandising. Watch. Yes, this is Hillsdale, popularly known as the heart of the San Francisco Peninsula. It is composed of some of the nation's great department stores, many of the leading national chain stores and important local merchandising names. The 50-acre center is bounded on the south by a large bustling sears robot store on the north by the unique farmer's market. The central mall is flanked by a well-balanced selection of retail stores in every field and price bracket which provides all customers with the most complete comparative shopping in the entire area. And now let's see just how a shopping can be fun, real fun at this modern and convenient shopping center. Hillsdale's first annual automobile show was launched with a horseless carriage caravan intermingling the cars of yesterday with a full showing of 1956 models. These cars paraded the entire peninsula area. So it's supposed to be basically the future of shopping in the post-war era. The concept of the so-called introverted mall where the structure was built to encourage people to remain inside, walking past numerous different stores on their way to their destination was a welcome development and not just because people could find the products they wanted in a pre-internet age, as just as far back as the 50s, people saw the mall as an ideal gathering place. The birthplace of the modern mall was in the Detroit metro area in Michigan, where the Hudson's department store and the architect Victor Grun set up four regional shopping centers, one for every cardinal direction, aptly named Northland Center, Eastland Center, Westland Center, and Southland Center and Northland, which the local's pronounce as two words like Disneyland instead of Northland, has an distinction of being the first large regional open air shopping center anywhere in the United States. And as Victor Grun put it, quote, "This is not just the opening of a shopping center, but an important milestone for city planners, architects, economists, merchandisers, and the American public at large." He was determined to give customers and businesses an alternative to rows of strip malls in every suburb. In addition to being inefficient strip malls were ugly and undesirable, with each store running its own operation for better or worse. Northland, on the other hand, was created by a single developer with executive authority over all construction. As a result, there was a much more cohesive and modern look, and customers were naturally drawn to it. It was seen as a genuine breakthrough at the time. As reported by City Lab, which compiled contemporaneous coverage of Northland's launch, the mall had a bank, a post office, an infirmary, fountains, even free gas for shoppers who desperately needed it. Anyway, it wasn't intended simply as a place for people to buy things. It was seen more like an indoor metropolis. It served a civic function, as well as a commercial one. And even beyond that, it was just a marvel of engineering. It was something that the entire community was genuinely proud of. The Detroit Free Press lost their minds over the thing. They wrote that quote, "The size of such a mammoth group of stores at Northland centers is often hard for the layman to visualize." They reported that the structure was built with nine million pounds of steel, which was, as they helpfully noted, the equivalent of four thousand autos. The mall, according to the paper, had the extraordinary capability of making two hundred million ice cubes daily. Parking lot could comfortably store more than eight thousand vehicles, which at the time meant that Northland offered the single largest parking lot anywhere in the world. Siegelab also notes that the mall even offered a lost car department for customers who couldn't find their vehicle. The lost car department would dispatch a Jeep to roam around the vast parking lot with the customer and tell looking for the vehicle. As a colonist with the Detroit Free Press, but it quote, "Wives who visit the new Northland shopping center will never want to go home. When they're not shopping, they'll just sit on the benches under the trees listening to the splashing of fountains and dreaming up new ways of spending money as women tend to do." Keep in mind, this was an an era where women could not obtain credit cards independently that have their husbands post on the card, otherwise they had no access to credit whatsoever. And within a couple of decades by the mid-70s, the mall was fully enclosed and much more developed. Everything was going well. In fact, the population around Northland and other malls in Detroit area, doubled from 1960 and 1970. There were more jobs available than ever before. It was an economic boom for a city that to put it mildly is no longer known for economic booms. As late as the early '90s, depending on where you live, the malls could bring the same type of benefits to your communities. In the Twin Cities metro area, the famous Mall of America, of course, open in 1992, complete with an amusement park, rollercoaster, hundreds of stores, a design that somehow kept people warm in the winter without a central heating system. Again, it was a marvel of engineering. And not just because of its size. And just like the Northland mall decades earlier, it blew people's minds. The footage from the opening of Mall America was shot just prior to the Somali takeover of Minneapolis and large parts of Minnesota generally. So you'll notice a distinct lack of fighting and shooting and stabbing in this footage. A distinct lack of diversity, which these things are not unrelated. Watch. The bargains are coming. Here you, here you. The mother of all shopping crowds was waiting as the doors open. Yes, shop till you drop. We are professional shoppers. By noon, the two parking ramps were filled with 13,000 cars. And that sent the mall's war room into action. We were able to divert to off-site parking properly and efficiently and effectively within five minutes. There was congestion on the roads, but the plans seemed to work. Meanwhile, the traffic jam continued inside the mall. It took almost an hour to get on some of the most popular amusement rides, and the wait continued in the food line. Well, I placed an order at about 127 and got the food at about 220. All officials say the delays were doing part to a green workforce. You sure you're out of variety. You can buy anything you want, I guess. This place has over 300 stores, some very specialized, just what this doctor ordered. And I've found a book that I've not been able to find anywhere else, human anatomy by an illustrator. Some people came just to look. This California man says he likes taking pictures of cultural icon. This is really one of them. This is a high water mark of where we're going. Well, he was right about that. It was the high water mark of where we're going. And it was all downhill from there. Northland is defunct now after a deep decline in foot traffic around the turn of the century. And the Mall of America potentially won't be far behind. Let's pull up some representative footage of what the Mall of America looks like today and the kind of, quote unquote, Minnesota residents who are spending time in this mall. Watch. In several videos circulating on social media and more widely reposted and shared over the past day, this incident from Wednesday night in the North Food Court at Mall of America. Crowds running is police broke up a fight among teenagers. A statement today from Bloomington Police Chief Booker Hodges, "Eed should be a time of peace. And some uses is a time to settle beefs. And that appears to be what happened here." The Mall of America is a traditional gathering spot for thousands of Muslims to mark the two "Eed holidays," the first of which came at the end of Ramadan on Wednesday. In fact, we did a story on this Mall of America custom eight years ago on that year's second "Eed holiday," and one of the organizers explained this tradition. Because the Mall of America is part of our Somali American culture. Here in Minnesota, we love Mars. We've got seven Somali Mars. So this is where we work, where we shop, where we enjoy. So that is really, we feel very safe and part of it. But because of the large crowds and especially teenagers, and is they due for other large events, Bloomington Police at extra officers on duty at the Mall Wednesday, in the end, they arrested three juveniles for disorderly conduct and obstructing police. They say it was a purely physical fight, no weapons involved, or even found. Well, just teenagers being teenagers. Pay no attention to the fact that they're all black. Every single one of them. I can't possibly be relevant. It's just how teenagers behave all across all cultures, across all family structures and races and ethnicities. Nothing to see here. And no, your ears did not deceive you. A sandwiched in between footage of the black teenagers fighting one another. You heard the news anchor say, quote, "The Mall of America is a traditional gathering spot for thousands of Muslims, a traditional gathering spot, the Mall of America." And then we hear the Somali guy say, quote, "The Mall of America is part of our Somali American culture. I actually know the Mall of America is not part of your culture. That's our culture. There's nothing to do with your culture." It's in the name, "Mall of America." We built it. It's for Americans. Somalia doesn't have a structure like the Mall of America because they're too primitive to draw the blueprint, much less begin construction. The fact that you people commit one acts of violence inside the building and make it undesirable for everyone else, does that mean it's part of your culture? Showing up to a place and destroying it and driving all the civilized people away does not make it yours or make it a part of your culture. What it means is you're destroying a very important piece of American culture, which is what invaders tend to do. In this case, the invaders are being welcomed with open arms by the people they're conquering. That's why the news anchor calls the Mall a traditional gathering spot for Muslims. You know what it was before that? A gathering place for Americans, people who obeyed laws and behaved in a dignified fashion when they're out in public. So much for that. Of course, it's not just Somalis who are making malls completely unusable. Somalis are concentrated mainly in places like Ohio, California, Maine, and Minnesota. And meanwhile, malls are failing all over the country. Now, one of the broader problems here is something we discuss at length in part one of our documentary "Real History of the Civil Rights Movement," which is one of the best documentaries we've done. Well, the simple version is that as part of the Civil Rights Movement, the government engineered massive demographic shifts that made malls far more dangerous. The Civil Rights Act, as we discussed in the documentary, was akin to an entirely new constitution. It was not, as you're taught in schools, a mere declaration of equality among the races. In fact, it was the exact opposite. The Civil Rights Act and the government policies that followed had the legal effect of authorizing a wave of anti-white terrorism all over the country, especially in the suburbs. Places where white people once felt safe in their homes and shopping malls and so on became war zones. The government provided housing vouchers to enable poor black families to rent property in white areas. So they were no longer confined to urban centers. The government also implemented busing at gunpoint, which didn't simply transport black students into white schools, but also force many white students into attend black schools, where in some cases, they were brutally attacked. Any landlord refused to rent to a black tenant, even for a legitimate reason, faced the risk of crippling lawsuits. And as elderly white people in places like East Fort Worth were abused and tormented for sport as documented and left behind in Rosedale, the government did nothing to help. Here's a strange reality. Success can actually create a financial emergency. Well, let's say business is going well. Great, congratulations. Well, now you have too many customers, which means you need another employee, except that employees need to be paid. Maybe you need another truck or you need more equipment. Perhaps you're low on inventory, you need to stock up. Maybe you need a bigger space. Some of your reward for making more money is that you need to spend a whole bunch more money that you may not actually have yet to spend. And this is what people mean when they talk about a good problem to have, which frankly is a weird term. You've spent years building a business. The opportunity finally arrives. Customers are standing there ready to give you their money. And you have to tell them no, because you weren't prepared for the growth. That's where Cardiff comes in. Cardiff helps business owners get access to the capital they need, when that opportunity shows up. So if you want bank-level rates without the bank-level delays, you need to check out cardiff.co/walls. You're going to be applying less than five minutes with no impact on your personal credit. Potentially get funded the same day for up to $500,000. And Cardiff isn't new to this at all. They funded more than $12 billion for businesses since 2004. Banks try to lock out small businesses. Cardiff has the key. Big banks may not want to approve your business loans, but Cardiff does. If you've been in business for at least a year and are pulling in $20,000 a month in revenue, apply now for up to $500,000 in same day business funding at cardiff.co/walls. Again, it's cardiff.co/walls. Real growth, fast funding, Cardiff are all better. The decaying old gray lady might as well line your cat box. New York Times readership among young Americans has totally cratered. Nobody wants a scolding lecture, pretending to be journalism. Here's a thing, while legacy media across the board hemorrhages trust. Prager U is the rising generation's last best hope. Millions of students log on every day for five minute videos in economics, history, faith, and freedom to teach the truth. Not what CNN and others want young people to believe. Prager U has no paywall, no smirking, newscasters, no bias dressed up as objectivity. Just the facts presented in an age-appropriate wholesome, all-American way. But Prager U runs on people like you. the government, not advertisers who despise you, give today and your donation is triple-matched, go to PragerU.com/DailyWire. It's PragerU.com/DailyWire. One legacy of the Civil Rights Act is that as a result of government-mandated demographic change, property values began to fall in suburbs that were once considered highly desirable. Many families moved further away to avoid the carnage, which was a rational decision, even though every history textbook presents it as an act of extraordinary white supremacy, white flight, they call it. These white people laughed and they took their high-paying jobs with them. The result is that malls became surrounded by low-income residents who were more interested in shooting each other than buying expensive shoes or anything like that, and they've left widespread defecitation in their wake. Many Americans over the age of 30 witnessed this transformation and can remember it vividly. My own mall, where my parents used to drop me off on supervised and was for many years a family-friendly place, became by mid to late teens totally unusable. They swapped out the preppy clothing stores for urban fashion outlets, and suddenly there were shootings in the parking lots and crime and fighting and violence. The piece of our community was taken from us. Here's another side by side for you. This is an advertisement from 1983 featuring a store called World Bazaar at the Greens Point Mall in Houston. Watch. You can go to Greens Point and get silk flowers, baskets for any occasion, even bamboo blinds. Sounds pretty nice. It has a bonus. It's near Sears, a convenient department store for middle-class families looking to pick up an appliance or maybe some other household essentials or get a pair of jeans, whatever. Greens Point doesn't exist anymore. It's been known for several years now as Guns Point Mall because of the constant shootings and car jackings and stabbings. So he was actually just killed at the mall or what's left of it a few months ago. Watch. Hey, we have a new insight into what's next for Greens Point Mall following a deadly shooting overnight. Yeah, police say a 19-year-old man died during an unsanctioned car meet-up just in miles live from the scene with more Jason. Hey there, guys. Yeah, police say these car meet-ups are a regular nuisance and problem here in the parking lot of Greens Point Mall, but like the old mall itself, they should eventually be a thing of the past. Houston police recalled to the former Greens Point Mall overnight for the same reason they've come here on the weekends before. Only this time a 19-year-old man died on the scene. There was an unsanctioned car meet here and during that at some point, shooting occurred. We saw multiple bullet holes in this pickup truck, although police say many potential witnesses scattered after shots were fired. Constantly on Sundays, the North Belt Patrol is dispatched this parking lot regarding these car meet-ups and reckless driving. And they come out here regularly on Sundays and run everybody off and end up making a rest when they can. This latest incident in the Greens Point Mall area prompted us to ask about ongoing redevelopment efforts. Right now, a fitness connection inside a former anchor store appears to be the last remaining tenant. There is no longer access to the mall's interior. And while this affordable housing complex recently went up on the south side of the mall, other projects have been slow going due in part. I'm told to multiple parties owning sections of the building. Aside from the police spokesman who appears to be heavily intoxicated for some reason, the most interesting part of the clip is the news that there's an affordable housing complex right next to Guns Point Mall. Imagine that. As best I can tell, he's referring to the summit at Renaissance Park, which is a government-backed housing project. And these kinds of housing projects are all over Houston, but let's focus on this one just to keep it simple. The city of Houston contributed more than $10 million to the project using federal funds that were allocated after Hurricane Harvey. And on top of the direct funding to build the affordable housing complex, the government also provided low-income housing tax credits to the developer in addition to tax exempt bonds, all of which dramatically lowered the upfront cost of building and also operating the apartments. And the way this works is that, in almost every case, the developer sells these tax credits to investors like big banks who are looking to lower their own tax bill. In exchange, the developer gets an immediate cash infusion to the tune of tens of millions of dollars, in this case. The only catch from the developer's perspective is that the apartment is illegally obligated to rent to poor people. And not only that, the rent is capped based on the income and family size of each tenant. Usually, it doesn't exceed 30% of the tenant's income or the typical median income in the area at a maximum. So ordinarily, a one bedroom apartment building like like this in Houston might cost $1,200 a month, but with the benefit of affordable housing programs and all the subsidies that you're paying for as a taxpayer, the rent drops to only $500 a month. No matter where you live, your federal taxes are being redistributed to the states to pay for programs like this. You're subsidizing other people's rent based on the income they're reporting. And you're subsidizing other people's rent so that your own communities can become less livable. We're going to assume that this program, like every other government program, is constantly defrauded, by the way. That's the other part of this. But even if it's not defrauded at all, which it is, it's still an insane idea because it's giving these people an incentive to maintain a low income or at least to report a low income. So the government has created a large housing complex full of poor people and given them an incentive to remain low income. And the government has placed this gigantic housing complex directly next to a mall that for many years was functioning normally. Now it's a decaying husk where people get shot every other week. This kind of thing is happening at an enormous scale all over the place. There's just one example. And by the way, in case it wasn't obvious, these affordable housing programs overwhelmingly benefit non-whites. So although we could say, well, this is for poor people, it's actually not really, very specifically, this is non-white is what ends up happening. In the case of that Houston complex, that area is around 60% Hispanic and 30% Black. That's 90% non-white if you're doing the math. It's a government policy that, by any measure, has a disparate impact in terms of benefiting people who aren't white. But as always, disparate impacts only works one way. You see, it's fine for the government to come up with programs that only benefit non-whites, but at the same time, it's totally unconstitutional for the government to treat everyone equally without giving any special benefits to any particular skin color. That'd be racist. This is the magical reasoning of the civil rights movement. And we see the effects all over the place, strictly on world star. This is what malls look like today. Notice in the first clip, the woman leaves her child behind in the stroller so that she can kick someone during the bra. Yeah, you gotta have your priority straight. Watch. Oh, yeah, yeah, yeah, yeah, yeah, yeah, yeah, yeah, yeah, yeah. So keep footage like this in mind when you're told that online shopping explains entirely the death of malls in the country. Actually, that's not true. Online shopping is part of the picture, but the main problem really is that when you import criminals to places, those places become less desirable. It's one of the reason housing prices are so high. If the cities were safe and livable, we'd have a lot more available housing. As it stands, you need to pay a premium to avoid places like this. Now, part of the reason we can't blame online shopping is that this decline was underway long before the arrival of Amazon, certainly before Amazon became what it is now, which, and that didn't really happen until late 90s, early 2000s. The other reason is that we can look at other countries like China. So this is footage from the Shenzhen Wanda Mall, which I'm reliably informed is located in the Longgang district, specifically in the Pingu sub-district near the South China city. Of course, I knew all that already without even looking it up, but we'll put it up on the screen now. You'll notice immediately that it's extremely clean, high budget, packed full of people, offers plenty of activities in addition to shopping. The There's an indoor glass suspension bridge and indoor arena for team-based first-person shooter style games, an indoor surfing pool, a rock climbing facility, a go-cart track, in a question area for horseback riding. There's also a huge bookstore, a culinary museum, an escalator that goes to the sixth floor. It's a major landmark to the same degree or more as American malls in 1950s. And I'm not cherry picking here, by the way, China overall has many more malls than we do, and they're much nicer. Again, we only have around 1200 malls now. China has something like 7,000, by most estimates. They've doubled the number of malls they have since 2013, while we've closed most of ours. And as for the Shenzhen one, the mall in particular, it's also important to point out that based on my extensive research into the Chinese suburbs, the mall isn't even located in a rich area. It's a working class, and it's frequented by people from a wide array of professions and income brackets. People are almost exclusively Chinese. Now, you won't notice too many Somalis in that mall. Nor do they typically host any unlicensed team takeovers. It's just a normal working class, historically industrial part of town. Everyone there is Chinese. On the other hand, to the extent that we have functioning malls, nice malls anymore in the United States, they're all in wealthy areas with overwhelmingly white homogenous populations. So take the Ross Park Mall in North Pittsburgh, for example. Now local news reports will tell you that it's doing very well. But I'm gonna tell you the truth though, about why it's doing well, watch. Across the region you see the empty promenades, the clothes gated stores, the leaky roofs, and the cracking facades. Century three has gone under. The Pittsburgh Mills is teetering. The mall at Robinson is shedding tenants and shoppers alike. By some accounts, the whole idea of a shopping mall is dead. But others say reports of its demise have been greatly exaggerated. We are evidence that malls are doing well. They're surviving, they're thriving. People are coming here and droves. Ross Park Mall is the region's biggest exception to the dying mall. While other malls have suffered from online shopping and disinvestment, its parent company Simon has aggressively reinvested in its properties, managing to stay ahead of the curve, assembling cutting-edge stores. We have stores like Eritzia just made their grand debut here in Pittsburgh, Allo Yoga, they were brand new. We have Rowan where they have nurses that actually do all of the piercings. It's important that you know your market, you know what stores are going to really resonate with that shopper that's in that area, and give them what they want. And the mall continues to evolve, aspiring to be more than a shopping destination, but an experience. Dick's House of Sport offers hands-on tee shots and a climbing wall. The mall currently updated and expanded its food court and added new restaurants like Plaza as Tekka for lunch and dinner. They've got the right location, and they've done very well on bringing in some of those additional amenities to make it a place for people to have experiences and not just shopping. And that seems to be some of the secret sauce for the malls that are doing well. Yeah, give the customers what they want. Now at the Ross Park Mall, you can hire nurses to do all your piercings when you're done with the yoga studio, the rock climbing wall, top golf. Then you can sit down for a nice steak dinner. Why didn't any other mall think of that? Well, Ross Township, where this mall's located is one of the richest enclaves in North Pittsburgh. It's much wealthier than that Chinese province that I mentioned earlier, where the space-age mall is located. To the extent that any malls are doing well in the United States, this is the secret sauce. They're selling high-end products and services to rich white people in an environment where they won't come across any Somalis living in an affordable housing complex. Not exactly a revolutionary discovery. Any place that caters to upper-class white people is gonna be nice. It's gonna be the sort of place where you can spend the day without having to worry about getting robbed or stabbed or shot in the parking lot or anywhere else. Southdale Center in Minnesota, the first enclosed mall in the country is doing the same thing as Ross Park Mall, which isn't surprising. Since it's owned by the same company, the Simon Property Group watch. - I'm gonna throw a number at you here. 94 billion. That's a billion with a B. That is how much money is expected to be spent on luxury retail items in the United States this year alone. - That's insane. And malls in the Twin City are responding. Any Dina, Southdale Center, the nation's first enclosed mall is in the midst of a $400 million upgrade, including a luxury wing that opened in June. - Some of the businesses going in there at Southdale actually moved over from the Galleria, which if you know the area, you know the Galleria is right across the street. So what does this mean for what was once considered the ultimate mall for luxury in the Twin Cities? We bring in Beth Perro Jarvis and Mary Van Note from Ginger Consulting. Thank you both for being here. I live in Dina, there's so much activity going on at these malls, Southdale was very quiet for a long time, and now you're seeing this big push to bring in luxury. Talk a little bit about that, because the mall has such history that it almost couldn't fail, so they're kind of revamping the whole thing. - Yeah, so Simon Property's own Southdale, and they own almost every great mall across the country, and they have tons and tons of money. So they're pouring $400 million into the first enclosed mall in the US, we're very proud of. And it's mostly about luxury. So they're taking, they have Kowalski's, they have the lifetime fitness sale, and then they are putting in 50 new high-end stores, 50 over the next year. - Now even outside of Simon Property Group, this is a strategy that pretty much every successful mall is now adopting what few were made. This is from a local news report about Lake Sight Mall in the New Orleans area, for example, which is one of the only malls in the country that is growing, quote, "The mall's management has done a good job attracting trendy new tenants from outside the market." Like Aloe Yoga, it Beverly Hills brand. It opened its first Louisiana location on Lakeside last year, and Aratizia, a fashionable Canadian label opening this spring. The mall also has been effective in attracting retail tenants away from other shopping centers in the local market. Our house, say high-end furniture store, left the South Market District for Lakeside in 2023. Anthropology vacated its two-story location in Canal Place, where it was an anchor tenant for Lakeside in 2025. So if a mall's gonna survive and remain economically viable, this is apparently the only route that's available. And as a result, what you end up with are these high-end retail places for upper-class people, and then you have low-end garbage dumps like Dollar Tree on the other end of the spectrum. But what you don't have, and there's basically no equivalent to what Sears was in the '80s and '90s, which is a nice, clean, family-friendly retail location that sells relatively high-quality products affordably. That sort of thing basically doesn't exist in the country anymore. And by the way, since we're on the subject of Sears, it's important to acknowledge that there are several other factors that led to the decline of malls. The Civil Rights Act and related policies were a main contributor and online shopping obviously didn't help, but when you're talking about a complicated development like this, there's always multiple factors at play. And one of those factors, which is relevant to what happened with Sears, relates to the involvement of hedge funds and private equity-style leadership. Now, to conclude about this, Sears was in financial trouble for many years before any hedge fund got involved. I'm not claiming that without private equity Sears would somehow be thriving today. I'm not gonna blame private equity for the death of shopping malls, you know, on their own, but at the same time, it's obviously true that when the hedge fund took over Sears, they had some very mixed incentives. So to give just one example, they had Sears sell off their real estate and pay rent to a separate firm, which the same hedge fund owned. They could also collect interest on their loans to Sears. In other words, the hedge fund made as much money as possible from Sears' failing business before it shut down for good. This was beneficial for the hedge fund, and arguably it was the faith that Sears was going to meet anyway. You can make the case that this outcome was economically efficient, but it's also true that when malls existed back in the 50s and 60s, this kind of thinking simply didn't exist at any meaningful scale. Massive hedge funds had not perfected the playbook of strip mining failing companies and then erasing them from existence. And as a result, someone who hypothetically might have purchased Sears on the cheap back in, say, 1950, would have had every incentive to make the company work. They'd re-tool the brand. They'd start stocking different kinds of products, run different kinds of advertisements. They make a good faith effort to save the company. That doesn't happen anymore. Like ten years near the same degree at least. Instead, our overlords are maximizing every available dollar they can possibly earn to a degree that's demoralizing over the top and frankly, strange. For instance, some empty mall storefronts are now being converted into makeshift housing, complete with tiny 250 square foot units. Developers realize that people are too poor to afford rent, much less the products that they're selling in these malls. So their solution is to repurpose the stores into these dystopian pods, watch. (upbeat music) - So welcome to the teeny tiny shoebox apartment inside the arcade. There are lots of others in here. building just like this. So mine is about 250 square feet. There is a walkway right in front of the facade because this used to be a shop front and so people had to access all of the shops in the building. While malls across the US are facing store closures and empty parking lots, some are finding a new life from an unlikely source. We are here at the Arcade Mall and Providence Road Island, the oldest indoor shopping mall in the country. The Arcade had a long been a center point in Providence's bustling downtown, but like other malls, it fell on hard times and was completely vacant. But rather than letting this historic building fall into ruin, developers came in and decided to build 48 micro-loss here on the second floor and up here on the third floor. Another obstacle is design. Most malls have limited windows, which are essential for residential spaces because they need natural light, making it difficult to convert certain parts of the mall. Usually, only the exterior facing retail spaces are suitable for housing. Well, at least you get a window. So they won't stick you in an old abandoned foot locker store, something like that, where the big metal security grill is your front door. Give it a few more years, I'm sure that will change. In the meantime, your kitchen is a bombed out, you know, auntie Anne's pretzel store, the mannequins will be your only company. Enjoy owning nothing and being happy. The same malls that used to be a symbol of American progress, ingenuity and growth are now massive empty husks, where human beings are jammed into shoe boxes because they can't afford anything else. Now, if you're measuring the success of our economy by traditional metrics, none of this really shows up. You'll hear that we're a much more efficient country now, we're wealthier than ever, and so on. But even if you can see all that data, and even if you're generally happy with the way things are going, if you are, there's no denying that monuments to American greatness have now become evidence of our decline. They are no longer inspiring or interesting or desirable. They serve the opposite purpose. They're demoralizing and demeaning and even dangerous. They're totally defunct. And in their place, we have Amazon.com, Walmart with 24-hour delivery, Dollar Tree. This is a trade that, according to every economic textbook, is a worthwhile one. We have to wonder, as you think of those pod dwellers going back to their depressing little bedrooms, otherwise known as the storage closet of a JC Penny, and as people continue getting stabbed and shot during teen takeovers in the parking lots of once great American institutions, after all, they're wonder whether any of the official data is actually capturing the full extent of what we've lost. That will do for the show today, and this week, have a great weekend. We'll talk to you on Monday, Godspeed. I have never profited from public service. I welcome this kind of examination, because people have got to know whether or not they're prisoners to crook. Well, I'm not a crook. For more than five decades from Iran, Contra, to Monica Lewinsky, to Russian Gate, every political scandal has been measured against one, the Watergate affair. But what if Richard Nixon was telling the truth? What if Watergate isn't what it seems? What if hundreds of thousands of pages of sworn testimony, memoirs, and newly released government documents tell a different story than the one you learned in school? I know America. In 1972, Nixon won the biggest electoral landslide in modern American history with grand plans to remake the federal government. Two years later, he was out of office. You were taught that Nixon's men broke into the Democratic National Committee Headquarters to spy on his political opponents. You were taught that when he found out, Nixon covered it up, and if the cover-up was worse than the crime. You were taught that two heroic Washington Post reporters, guided by a righteous FBI whistleblower, brought the most powerful man in the world to justice. But you were never told what really happened. I shall resign to the presidency, effective at noon tomorrow. Real history of the Watergate scandal is available now.