Ezra takes a crack at explaining why Seattle and Portland are hipster heaven:

Sounds like Portland is a rather nice place to live -- a fact backed up by everybody I know who has ever lived there, despite what Cato says. This has actually puzzled me since I went to Seattle and noticed all the awesome coffee shops and bookstores and generally nice features. Why can't DC have all that. There are, after all, lots of young, computer savvy white people in Mt. Pleasant, but nary a coffee shop to serve them. It's barbaric!

But it actually makes sense: Cities like Portland and Seattle are trying to create a livable city to retain and attract a certain type of resident. Namely, educated, young, white people. Portland's 78% white, Seattle's a bit under 70%. So you structure the city thus that there's lots of educated white people bait, including cafes, bookstores, wireless internet spots, bike trails, etc.

DC, by contrast, has a lot of white people working in it, but is actually only 39% white, and has a city government that does not derive primary political support from transient white voters. So the character of the city actually does more to represent its inhabitants. Which seems rational. Moreover, the white people there basically have to be there. You don't move to DC because it's awesome, you move because it's where your work is. So there's little need to construct an affirmative agenda to attract residents

Here's the primary difference between liberals and libertarians in a nutshell: it would never have occurred to me to assign the city government a dominant role, except perhaps for Portland's greenbelt, which seems like the result of a pretty conventional coalition of environmentalists and property owners whose home values were driven up by the artificial supply restriction.

The DC area, in fact, has a large number of bike trails; I seriously considered biking out to Fairfax for lunch today. (I'm going to bike partway then take the train instead.) It has bike lanes on many of the major streets in Northwest, which I have been greatly enjoying as I tooled around on my new (used) machine. Nor does the government in Seattle operate coffee shops, wireless hotspots, or bookstores that I am aware of. Those things are operated by private actors trying to make a profit--no government intervention required, or as far as I know, offered.

The market supplies those things because the demographic profile of the area demands it. And DC is supplying more and more of those things as the relatively poor black population of Northwest and the areas surrounding Capitol Hill is pushed out to Prince Georges County by rental competition from young white people who like bookstores, cafes, and wireless hotspots. In just six years, between 2000 and 2006, the white population of DC rose from 30.8% of the population to 34.5%, a massive demographic shift. Meanwhile, the black population dropped from 60% to 55.4%.

Services require a certain minimum market to make them viable; there may be a lot of upper-middle class twenty-somethings in Mount Pleasant, but they may not be densely crowded enough to make a viable business yet. (Or they may simply be waiting for some clever entrepreneur to spot the hole and fill it.) But if current trends continue--and as far as I can see, they are only accelerating--the market will eventually fill the niche without any intervention at all from the government.