Extraordinary Observations

On Tuesday The Printed Blog distributed the first issue of their new newspaper. I give these guys a lot of credit for generating some impressive PR over the past few weeks. Their business model is interesting: a dead-tree newspaper using blogs, Flickr images, and other online content to fill the pages. Locally supported advertisements provide the monetary support to keep the operation running. Right now, the paper is distributed in Chicago (and possibly San Fransisco?) with expansion plans contingent on the success of the prototype. Frankly, I'm extremely skeptical that the business model makes any sense; but deep down I'm rooting for these guys, because at least they've got fresh ideas about the future of the newspaper.

If they succeed, and even if they don't, the role of journalism could be at the brink of a fundamental change. Historically, journalists have made their careers breaking news and writing stories - it might not have been a glamorous or luxurious career, but it paid the bills and could be incredibly rewarding in non-monetary ways. If the market moves in the direction of The Printed Blog, journalism could go from a full-time career to a part-time hobby. In the same way that some people work as factory workers by day and rock band members by night, or accountants by day and belly dancers by night, these "new journalists" may become the primary source of information. They may work for little, if any money, because the market simply can't support even modest salaries; they may have any variety of day jobs - writing on their lunch hours and during the evening, because it is simply something they enjoy doing.

The key question is how the "new journalists" would stack up against the traditional journalists they are posed to replace. Can they break stories as efficiently? Can they engage in the same hard-hitting investigative reporting? Will they even get the same respect that journalists have traditionally recieved? or will they be cast aside as and stereotyped as "just bloggers"? Perhaps journalism will develop in an entirely different manner? At this point, only time will tell.

Yesterday the Postmaster General told congress that the USPS might have to slash a day of mail delivery to close a large and growing deficit. A lot of explanations for the decline of the Post Office are floating around: The rise of email, decline of letter-writing, and growing competition from private companies are common explanations. On the other hand, the growth of Amazon, Netflix, eBay, and other services that virtually didn't exist more than a decade ago has provided at least decent amount business for the Post Office. In their book, Andres Duany et al describe another theory that typically isn't discussed:

Another organization that has had difficulty coping with sprawl is the U.S. Postal Service. An ex-Postmaster General once explained to us where most of the postage money goes: to those little Jeeps and vans delivering mail on the suburban fringe. These vehicles are the main reason why the post office is perennially hiking its rates, and why aluminum mailboxes at subdivision entries have replaced door-to-door delivery on foot. The main-street post office as a social center has also become an endangered species, as large-scale vehicle-storage requirements lead toward the consolidation of services into regional mega-offices on the suburban fringe.

It's sad to see the Post Office in this dilemma; even worse is that the USPS would only continue to delve into the red if this underlying problem is corrected at the source.

Sullivan links to Patrick Ruffini, who thinks Rush Limbaugh should replace Kristol at the NY Times:

Either we engage the liberal media on our terms or on none at all. The Times needs someone who is as far to the right, in as hard-edged and partisan a way, as Paul Krugman is to the left. The fact that strident left-wing voices one step voice up from Kos appear on the op-ed page is not considered a problem, so why shouldn't the same be true on the right?

I find this to be an incredibly odd comparison. As far as I know, the only thing that Rush Limbaugh and Paul Krugman have in common is that they both sit a recognizable distance from the political center and aren't afraid to express their views. The key difference is that Krugman isn't just ideologically liberal, he is a highly respected intellectual with a record of academic achievements. Limbaugh, on the other hand, is a college drop-out with a history of controversies and blunders.

This leads me to believe that either a) conservatives want to continue embracing the George W. Bush-style underachiever image or b) they simply can't find any academic intellectuals on the right as passionate as Krugman is on the left. Conservatives seem like they would have quite a bit to gain from putting a respectable yet ideologically-driven intellectual in a position to tell other academics that it's OK to think about what the right has to offer. Relying on people like Limbaugh to deliver that message just reinforces the belief that conservatives don't care about the intellectual community any more.

A few of my favorite blogs have posted a new IBM commercial that has been airing during recent NFL playoff games:



After the previous discussion about the need for better toll policy, I was curious as to how the Stockholm congestion system actually works. The idea is relatively simple. Tolls fluctuate based on the day of week and time of day (Saturdays, Sundays, holidays, and nights are free) with peak hours charging the highest price. There are no toll collectors or stopping points, the technology merely records the cars that pass through entry and exit points and bills the owner at the end of the month. Some vehicle types (buses, motorcycles, and a few others) are exempted.

The primary barrier to enacting anything similar in other parts of the world will be political rather than technological. Even in Stockholm, the plan faced decent opposition in referendum votes; and debates over whether to spend state-raised revenue on new road construction or on public transit was a key factor in the eventual creation of the congestion tax. Evidence that shows positive results will be critical to winning support elsewhere, as will good advertising and PR (the IBM commercial is a good start).

Over the past week or so I've noticed a surge in the number of people on Facebook joining groups called "I support George W. Bush" or writing comments like "I sure will miss Dubya". Now, I haven't taken the time to ask each individual person why they decided publicize these thoughts, but given the timing of Obama's inauguration and his overwhelming popularity at the moment, I can't help but suspect that these comments are at least partially being made in protest of a new president who may not have been their favorite pick.

Nevertheless, even if you don't love Obama or you would have preferred to see McCain and Palin in the White House, these are independent of whether or not George Bush did a good job as president. There may be two major parties in American politics, but inside those parties are individual politicians, some better than others, and each with a unique job to carry out. With eight years of evidence that Bush's presidency fell well short of the expectations of even many Republicans, making a statement after the fact that he did a good job seems like a particularly weak protest against the fact that John McCain isn't president.

The debate over whether more people prefer to live in urban areas or suburban places is a deeply emotional topic intensified by the fact that each side typically presents strong case. On one end of the spectrum, in his book, Chris Leinberger argues that relatively high rents in walkable urban neighborhoods are the result of a huge pent-up demand for this type of living. In a comment at Brewed Fresh Daily, John Ettorre suggests that humans have a primordial desire for open space, which is why so many choose to live in suburbs and exurbs. These are only two of hundreds or thousands of possibilities. The problem, as I see it, is that when the debate takes place at an aggregate level, the ability to shed light on this topic becomes blurry.

Brent Larkin's column in last week's Plain Dealer suggests that if Cleveland city employees aren't forced to live inside the city's limits, they will inevitably flee to the suburbs, eliminating the last of the middle class in the city. In response, I attempted to note the irony, because in many cities, there are middle class individuals that would love the opportunity to live in a neighborhood similar to the ones Larkin suggests city workers will abandon but they simply can't afford the rents. In this sense, the urban/suburban dichotomy isn't something that can be studied using averages across metro areas; rather, each metro area has to be studied individually.

Even if there are an equal number of individuals and households that prefer urban and suburban living, they aren't necessarily distributed equally. If I prefer urban living but I live in a metro area that has few walkable neighborhoods, a downtown that shuts down at 6pm, companies moving their offices to the fringe, and little hope that any of that will change, I might throw up my hands and leave for a city that offers better amenities. Those who think people inherently prefer suburbs might argue their case by saying, "look, nobody is living downtown, the rents are dirt cheap, and it proves that nobody wants to." Of course, a few of those who might want to live downtown might grudgingly choose a tolerable inner-ring suburb; but others will leave for another city entirely.

The process reverses in cities that attract prospective urban-dwellers. The influx of people from outside cities looking for a place to live in the best urban cores will push up already inflated rents - causing those who think people inherently prefer cities to say "look, only if peopled place a huge value on city living would they pay this much money to do so." This is presumably the reason why you can have some cities where city employees arguably do no want to live in the same municipality where they work; but other cities where similar city employees would love to live in these types of neighborhoods but don't because they cannot afford it. It is also why you have some cities where you can buy a home in a downtown adjacent neighborhood for less than a few month's rent in another city.

Given this arrangement, the only real winners are those who prefer out-of-favor urban neighborhoods. Those who want to live in vibrant urban areas end up paying a huge rent premium; while those who live in the suburbs of a metro area with a dying core are forced to deal with the consequences as they ripple through their neighborhoods as well.

I'm well aware that this is an incredibly simplified interpretation. Demand for housing can vary wildly block by block. A neighborhood can have sky high rents on one side of a major street and housing that can barely be given away on the other. Entire books could be written on this phenomenon; but the idea that looking at aggregate data to draw conclusions is misleading is at least worth considering.

Anytime someone asks my recommendation for a good introductory economics book, I don't hesitate to suggest Naked Economics by Charles Wheelan. For someone without any training in economics, Wheelan's book is fun and educational; even for those with an education in the subject, his book is both entertaining and hilarious. Now, Wheelan is running for Congress in Illinois's 5th District (currently held by Rahm Emanuel) and I can't hesitate to support him for Congress.

Wheelan is a smart guy, he works at the University of Chicago, and his book demonstrates that he can make economics understandable to anyone. On issues important to this blog, Wheelan is right on the money. He thinks we should use congestion pricing and index the gasoline tax to inflation; he suggests investing stimulus money in infrastructure including high-speed rail links; and he advocates "smart growth" instead of suburban sprawl.

Oh, and Wheelan is running as a Democrat, just in case his stance on various positions didn't convince you, but knowing he'll have a D next to his name if elected will. As of right now, there are over 20 candidates running for the congressional seat, and I can't honestly say I know who is the front runner or who has no prayer of winning.

Monday and Tuesday of this week are now officially the two single busiest days in Washington DC's Metrorail history. Some out-of-towners inevitably took Metro service for granted, barely noticing the role it played in the Inaguration festivities. Others perhaps found the system wonderful and wondered why their own home city doesn't provide such excellent public transit. A few cursed the system, annoyed that trains were packed to capacity with mostly clueless tourists. For thousands, yesterday was their first experience on one of our country’s better transit systems; without it, the ability to hold such a grand ceremony may not have even been possible at all…

After John Kerry lost the presidential election in 2004 I purchased one of these stickers...

Friday night's episode of 20/20 features a segment by John Stossel arguing that because college has gotten so expensive, it simply isn't in the best interest for everyone to attend. Watch:



This is a topic that has been getting a lot of attention in recent months. As I noted in my post about the student debt dilemma, I believe a major problem is that high school students simply aren't in a position to make rational decisions about whether or not to go to college, where to go, and how much to borrow. This is why I think the statistic referenced in the video that says 40% of graduates wouldn't attend to their school again exists.

The reason this issue appears to be getting more attention now than ever is that the costs of dropping out or getting a degree without a high-profile career are higher than ever. If college were more affordable, going for two years, dropping out and deciding to try something else would primarily cost a person their time - but now, it costs both time and the dollar amount (plus interest) that is spent giving college a shot. For that reason, public policy that seeks to make college affordable again (like it was in past decades) is a noble goal that often seems to get overlooked by these "college isn't for everyone" critics.

Earl Blumenauer is quickly becoming my favorite Congressman. I have to admit, a year ago today I had never heard of Blumenauer, but the work he has done and the media attention he has generated over the past few months have been impressive. This week the New York Times published another profile of the Representative from Oregon:

Mr. Blumenauer, a passionate advocate of cycling as a remedy for everything from climate change to obesity, represents most of Portland in Congress, where he is the founder and proprietor of the 180 (plus or minus)-member Congressional Bicycle Caucus. Long regarded in some quarters as quixotic, the caucus has come into its own as hard times, climate concerns, gyrating gas prices and worries about fitness turn people away from their cars and toward their bikes... But Mr. Blumenauer’s goals are larger than putting Americans on two wheels. He seeks to create what he calls a more sustainable society, including wiser use of energy, farming that improves the land rather than degrades it, an end to taxpayer subsidies for unwise development — and a transportation infrastructure that looks beyond the car.

A lot of what Blumenauer's caucus has accomplished so far centers around tax breaks for companies that encourage bicycling and other incentives to make bicycling easier on existing infrastructure. As far as I know, little has been done in terms of building new infrastructure for cyclists. It's not that cities don't have bike trails, but the activity has long been seen as a means of recreation as opposed to transportation. That may be starting to change, but the existing bike trails aren't really in places that "go anywhere". Perhaps I should consult a civil engineer on this question, but I have always wondered how much it would cost to build grade-separated urban bicycle trails (assuming land could be procured ahead of time). I can only imagine the cost to be pennies on the dollar compared to traditional roads.

For one of the best introductions to sprawl in America, spend a few minutes watching David Brancaccio's report that aired on PBS's NOW. If this is a topic that interests you at all, this story is well worth your time.



One thing to add is that this piece was obviously filmed at a time over the summer when media was still obsessed with high gasoline prices. The reality is that it isn't the gasoline prices per se that are the problem, it is the fact that those costs trade-off with other things a family could be doing. In that sense, an economic downturn with falling real wages could have the same theoretical effect on suburbia as a rise in gasoline prices; I suspect that is exactly what we are seeing now.

I saw the movie Doubt over the holidays. I am typically a big Philip Seymour Hoffman fan and think he has appeared in some excellent films recently. Admittedly, when I first walked out of the theater I felt frustrated. Not because the movie wasn't well-acted or well-written, but because the ending is intentionally ambiguous and open to interpretation.

In my best attempt not to spoil the plot, I am perfectly willing to admit that I have absolutely no idea whether or not I think the main character is guilty; there simply is no conclusive evidence either way. Each side can construct a convincing argument using the plethora of circumstantial evidence thrown around throughout the movie. The problem, of course, is that none of this circumstantial evidence is responsive to the opposing arguments; it is, as we used to say in debate-speak, like two ships passing in the night. Two people fighting over the guilt of the main character would be, more or less, unable to refute each other's arguments. The best can do is continue presenting their own case.

Nevertheless, what concerns me most is the level of certainty with which others who have seen the movie seem to believe one side or the other, and the way that they are able to justify it to themselves. I am not sure if society has always demanded that we have an answer to every question, but for many, the phrase "I don't know" is like an admission of failure. I'm not saying we shouldn't strive for answers, but when are we asking for too much?

I used to go to a "good" university. In fact, I used to go to the "best" university in the entire state of Ohio, according to US News & World Report and any other official-sounding source that wanted to throw the university's marketing department a bone. Was it truly a good school? I don't know... it didn't seem like a bad school; and I've only attended two universities, so I don't have much basis for comparison. The question is, what makes a "good" school truly good? And does attending one mean that you leave smarter or better educated than a peer from another school? Or even that the opportunity to do so exists?

I already shared my feelings toward higher education, and my belief that some of my best learning occurred outside of the classroom. Malcolm Gladwell's newest piece in The New Yorker raises more important questions on this topic:

Eric Hanushek, an economist at Stanford, estimates that the students of a very bad teacher will learn, on average, half a year’s worth of material in one school year. The students in the class of a very good teacher will learn a year and a half’s worth of material. That difference amounts to a year’s worth of learning in a single year. Teacher effects dwarf school effects: your child is actually better off in a “bad” school with an excellent teacher than in an excellent school with a bad teacher.

Granted, Hanushek's research does not refer to university-level education, but the point is at least somewhat valid. I'm sure most college students would agree that having a bad professor is frustrating, both because it can be difficult to understand material, but also because at the end of the semester it feels like you invested a lot of time and energy and don't have much to take away from the course. In my six semesters of college, I have had math professors who were math-geniuses but could barely communicate in English; I had a grad student TA who seemed to care only about his tuition reimbursement and at which bar he would spend his stipend check; I have had professors who spent more time attempting to win federal funding grants for research (not even including the time spent on the research itself) than worrying about students; I had a statistics professor that was just so poor at communicating the material that I have little confidence that I could apply most of what I "learned" without retaking the course or learning that material on my own.

Remember, these professors all worked at Ohio's "best" university. Not to dismiss the few excellent professors who were incredibly talented at sharing knowledge with students, but having these professors wasn't guaranteed; sometimes it seemed like a mere gamble. And the major point is, since it is difficult to quantifiably justify whether a professor is good or bad, most surveys that tell you about America's "best" universities barely take that key variable into account at all.

Now, you could argue that by doing your research you can determine the bad professors and avoid their course sections; but it isn't always so simple. As an underclassman, I was always one of the last with the opportunity to register for classes (which makes sense, of course) but in many cases the course sections with the "good" professor was already filled. I could merely enroll in whatever had an availability. After I transferred to my new school, I had to build my schedule around work and around my limited availability on campus (probably eliminating half of all course sections in the process). As a result, I now basically enroll in whatever course sections fit in a given time-slot, with almost no regard for who is teaching them. For a full-time student with no other responsibilities, it might be possible to pick and choose professors as an upperclassman, but not everyone has such a luxury.

The implication is that you could have two students, in the same degree program at the same prestigious university who receive very different educations. Or you could have comparable students from different universities. Is a particular BA from a mediocre school with good professors better than the same BA from a good school with bad professors? Is it fair to hold it against someone that they went to what they thought was a good school but had to deal with a lot of bad professors? Does the entire situation appears slightly more complicated that you may have originally thought? I know it does to me.

McArdle describes her book reading habits:

As a youngish adult, I read about a book a day, maybe a little more. But over the last few years, things have crept up on me. I spend a lot more time on the web, and going to panels and events than I used to of an evening. I don't always commute via train, which is prime reading time. And for the last few months, I've been in constant moving frenzy... The upshot is that since the first of the year, I've actually completed exactly four books... By my count, that means I'm on track to read perhaps a hundred books this year. My New Year's Resolution to become better read already looks like a bust.

At first I felt pretty self-conscious and even a bit inferior. Between school, work and all the time wasted commuting between the two, I'll be lucky to finish 50 or so books this year. Of course, today being the first day of the new semester, I quickly felt a lot better about myself, realizing that most of my peers probably won't read more than 10 books this year; and that even includes the ones assigned for classes. Oh college...

During my sophomore year of college I took one of the most interesting courses in my career as an undergraduate. The course was called Economics of State and Local Governments, but a more appropriate name probably would have been Economics of Education. The professor was Dr. Eric Bettinger, who has authored several respected papers on the topic of education, and if I understand correctly, is now at the Stanford School of Education (though I'm not 100% sure). The class didn't have a textbook but we did read publications and working papers from prominent economists in the education arena; people like Eric Hanushek, Caroline Hoxby, and David Card. We looked at theoretical models of school vouchers and charter schools; we studied teachers unions and other teachers' incentives; we compared the American education system to those in Europe and Asia. After all of that you might think I was able to develop some ideas about how to improve education in America. I did not - I have absolutely no idea. It isn't that there isn't good research on this dilemma, it is that nothing seems conclusive; case studies show wild success in some places and dismal failures in others.

Nevertheless, I do have a lot of ideas about urbanism and rebuilding America's cities; I've talked a lot about Generation Y and their shifting preferences toward a more urban lifestyle. But a point that always gets shoved in my face during debates on this topic is the fact that cities typically have worse public school systems than their suburbs. This is true, I cannot reasonably attempt to debate this point and expect to win. So what is the implication for families with children? Is the typical suburban lifestyle inevitable if you want to send your kids to a decent public school? Let's think about it...

Daniel suggests that the urban/suburban school dichotomy may simply be a myth:

Some would argue that suburban schools are on average better than intercity schools. I think this is an unfair prejudice. In Chicago, at least, there are a number of good private AND public intercity schools as there are a number of bad suburban schools —public or private. Without any statistics in front of me, I have to say that a lot of the suburbs vs. city argument for raising children is based on myth.

Every city will have excellent private schools, but affordability is a major concern. I will admit that there are some very respectable urban public schools in our country; Lane Tech in Chicago, Bronx Science in New York, and Benjamin Franklin in New Orleans all come to mind, and I am sure there are handfuls of others. Arguably, a concerned parent who encourages his or her children and plays a role in their education can really help in getting their kids accepted into these schools.

Even if you're not buying any of it, urbanists don't have to give up entirely. After all, it is the segregated zoning, poor access to transit, and pedestrian-unfriendliness that urbanists hate about the suburbs. In many cases, it just so happens that cities offer the density, mixed-use zoning, access to transit and walkability that urbanists strive for; but there isn't any reason it can't happen in the suburbs. Yglesias explains:

...I’ve been meaning for a while to write a post about separating the idea of “walkable urbanism” from the idea of “living in a city.” A city is, of course, a political concept. But walkable urbanism is a geographical and lifestyle concept. In the DC area, walkable urbanism exists in the parts of Arlington County that lie along the Blue and (especially) Orange line corridors as well as near the Silver Spring and Bethesda Metro stations in Montgomery County even though those places are “in the suburbs.” And parts of the city don’t exhibit the features of walkable urbanism. And by the same token, traditionally a great deal of walkable urbanism took place in small towns rather than in cities, and also in small cities... and “streetcar suburbs” rather than big cities... That will mean, yes, converting existing elements of the build environment rather than simply abandoning everything and trying to get everyone to move willy-nilly into downtown Cleveland.

I think it would be a perfectly acceptable compromise if suburbs like the one described above exist. The reality is that most families will not find America's inner city schools acceptable anytime soon, but not all of them will be perfectly content with the typical suburban lifestyle either. Combining decent schools with walkable urban neighborhoods is not a particularly unrealistic goal. Suburban municipalities with existing access to transit should take a hard look at how it is currently being utilized. If there is a gigantic parking lot surrounding a rail station, the municipality should consider turning it into a walkable development. Where new transit infrastructure is built in suburbs, walkable development should be a major determinant in where alignments and stations are built.

Of course there will be NIMBYs to deal with (there always are) and some suburbs will have to revise their zoning laws to make mixed-use development legal; but in the end a collection of walkable urban developments linked together by rail transit is highly desirable, even if most of the neighborhoods are technically "in the suburbs".

Ned Resnikoff points to an article about the arbitrary nature of college admissions and comments:

The reality, of course, is that there’s really no trick, and college admissions are as cruel and arbitrary as an uncaring god in a Beckett play. So to any high school students who may be reading this: Try not to freak out about admissions too much. You can write the best damn essay in the universe and still get rejected from your reach school because the guy reading your application that day has a bad rash. He doesn’t care about your future, because he has no real reason to. Think of it as school’s way of preparing you for the real world, in which CEOs and government officials will gaze down on you from high, assign you a number, and push you around based on whims that you will never understand.

When I was in high school, I applied to five universities, but was only accepted to three. One of the schools that rejected me was an elite private school, and I've already written about being a mediocre student, so I can understand why I wasn't accepted there; but the other school that rejected me was a huge state school. I always wondered why some of my classmates got into that school and I didn't - we didn't have particularly different grades or recommendations. It looks like the answer all along may have simply been that the application process is arbitrary and some people got lucky, others didn't. I secretly suspected that to be the case, at least now I can sleep better at night knowing the true admissions procedures.

Nevertheless, I still interact with enough high school students and policy debate tournaments to know that many of them still truly believe in the magic bullet. Mix the right GPA with standardized test scores and throw in just the right extracurriculars and you can go to any college you want. I wouldn't be surprised if they read the above referenced article and refused to believe it. I've already described my belief that it simply isn't possible for high schoolers to know which college is the best for them, I think the article reinforces that belief. What are the chances we can get it added to the list of "required reading" for high school seniors and parents? I'm thinking there is probably no chance.

Eric Morris's two-part series over at Freakonomics is an extremely well written piece and a great read on the case for congestion pricing.

Opponents of tolls are certainly not stupid, and their arguments deserve serious consideration. But in the end, their concerns are largely overblown, and the benefits of tolling swamp the potential costs. Unfortunately, it can be hard to convey this because the theory behind tolling is somewhat complex and counterintuitive. This is too bad, because variable tolling is an excellent public policy. Here’s why: the basic economic theory is that when you give out something valuable — in this case, road space — for less than its true value, shortages result.

Without going in-depth on Morris's specific ideas, this quote is the key point. There seems to be a huge confusion over who wins and who loses from toll policy; even the title of Morris's posts help fuel this confusion. Roads have never been free, it is just that the users (read drivers) never paid the full cost. Now, you might even say that drivers have been paying the full cost, because gridlock and congestion are a massive waste of time. Not to mention that congestion means less fuel efficiency, gasoline costs money, etc.

I agree with Morris that shortages have resulted, but here is the crucial point: drivers are currently paying for congestion with their time, and in most places there is no available alternative. This is why Morris's proposal to toll some of the lanes on our highways while leaving the others untolled makes so much sense; it allows drivers whose time is incredibly valuable to fork over the cash and whiz by, while it preserves the perception of "free" roads for those who think their time is less valuable.

Think of it a different way. A few years ago the Nintendo Wii was the hottest selling new toy on the market. Unfortunately, Nintendo couldn't produce the units fast enough to keep up with demand, nor were they willing to increase the retail prices. As a result, people lined up outside stores for days to buy these games. To some people, waiting in line for 24 hours in the freezing cold was worth it; for others, they forked over double the retail price on eBay and got their own unit too. The difference, of course, is that the option to wait or to pay existed; on most of today's congested highways, it does not.

Further irony comes in the fact that commuting has been found to be one of the most miserable activities that humans engage in (presumably some of the blame falls on stress caused by delays and congestion) so we would think that rational drivers would be willing to pay a huge premium for the ability to make the commute even slightly less miserable. And yet when it comes to policy debates on this question, drivers often call attempts to engage in new toll policies an assault on their way-of-life. In reality, of course, they are the ones with the most to gain. Politicians, fearful of backlash from these policies, fight to preserve the status quo; but as morris concludes, "it’s rare that a public policy can produce so many winners with relatively small costs." I agree, if only the costs and benefits could be more easily understood, we might be able to finally do something.

Pedro de la Torre posts a trailer for a new documentary called Default:


I think the current student loan situation is uniquely dangerous for a few reasons.

First, I am fairly convinced that high school seniors are unable to make rational decisions about where to attend college because they suffer the problem of imperfect information. High school counselors push students to attend the most elite schools so that the high schools can market that fact themselves. When students visit different campuses, they go on cheesy guided tours; maybe the attend a freshman lecture or spend the night in a dorm, but the visit is a far cry from spending the next several years on that campus. Most high school seniors simply have no idea what they want to do for a career; I am sure there is a statistic that shows a huge percentage of undergraduates change their major multiple times. Upon graduation, some students will claim to have loved the time they spent at a particular school, others will have hated it, and a few will have transferred elsewhere. High school seniors may think they are making informed decisions, but in many cases it may be no more than a roll of the dice.

Second, high school students have little (if any) understanding of personal finance. Our schools fail to teach students the very basics about money; high school students typically work at minimum wage service jobs, if they work at all; and some see borrowed money as "free money" rather than a serious liability (as additionally evidenced by the excessive use of credit cards by college students).. The ability to understand the consequences of paying back these loans four or five years down the road seems nearly impossible. Plus, a person's career choice significantly impacts their ability to pay back these loans. Before the days of subprime and alt-A mortgages (and hopefully again in the future), whether you were a lawyer or a fire fighter made a significant difference in how much and and what interest rate you could borrow. Of course, since many students don't know whether they will work to become a chemical engineer or a middle school English teacher until well into their undergraduate education, the ability an appropriately assess the risk of borrowing is incredibly difficult.

Third, our parents never learned the hard way. Baby boomers and early Gen-Xers attended college at a time when tuition was cheap and government grants covered much of the rest. It wasn't until after they graduated that taking on significant debt became the norm. But even in the early days of student debt, an undergraduate degree meant the ability to earn more than enough to pay back the loan in a reasonable amount of time, and maybe even enough to take out a home mortgage and an auto loan to boot. Only recently has tuition skyrocketed and real wages remained stagnant to the point where the burden for some has gotten completely out of control. So while those interviewed in the documentary trailer may be able to influence where their own children go to college based on their own experiences with debt; our parents simply never lived it.

A lot of debates over the mortgage and housing crisis and government bail-outs center around the question of whether borrowers were deceived, tricked, or just plain bad at assessing risk. The irony, of course, is that mortgage borrowers should be (theoretically) more mature and more able to understand their ability to pay back borrowed money; but even if they can't, refinancing and bankruptcy at least provide options in a worse case scenario. Student borrowers, on the other hand, many of whom are only 17 or 18 years old at the time of the most important decisions, more or less get to choose their financial fate, and as the documentary trailer shows, some were not particularly good.

Car Less Ohio points to an article describing how code changes in Columbus could provide hope for bicyclists and pedestrians in the future:

The changes to city codes will allow the city to develop policy rules and regulations pertaining to sidewalks and bikeways, said Mary Carran Webster, spokeswoman for the public service department. It establishes a requirement for bikeways when private land is developed and codifies a requirement for developers to provide sidewalks, she said. The legislation also promotes better community health and will improve safety, said Maryellen O'Shaughnessy, who served as chairwoman of City Council's Public Service and Transportation Committee until her resignation became effective Dec. 31...

Jeff Stephens is chairman of the Columbus Transportation and Pedestrian Commission and executive director of Consider Biking. "Bifurcating the issue allowed time to fully vet this," he said. "It is a guarantee from City Council that Columbus will become the best bicycling city in the country."

Some people will laugh at the idea that a sprawled out city like Columbus in a less-than-progressive state like Ohio could ever become the best bicycling city in America. The article is rather vague when it comes to describing how enthusiastic Columbus's elected leadership is on these issues; but if local leaders are serious about improving bicycle access in the city, it could only be a plus for the city, and it could help distinguish it as unique to the region. Plus, who cares if they actually become the best? if more cities even attempted to be the best city for bicyclists, we might be able to think of cities other than Portland when it comes to this topic.

On a related note, Streetsblog reports that zero bicyclists died on Portland's streets in 2008. Considering the sheer number of cyclists in the city and the perception in many other places that street cycling and sharing a road with cars is outright dangerous, Portland once again proves that they must be doing something right...

As a follow-up to last week's post over at Brewed Fresh Daily, take a look at what Edward Glaeser has to say about cities that do a good job of attracting a lot of smart and talented people:

Wall Street is just about to finish the worst year since 1931. American housing markets are finishing their worst year in recorded history. New York’s economy is highly dependent on Wall Street; about 40 percent of Manhattan’s total payroll was in finance and insurance in 2006. These three facts should have created the mother of all price crashes in New York City real estate. Yet New York’s housing prices are doing remarkably well relative to elsewhere in America... the New York area’s unemployment rate, 5.6 percent in the latest figures, is lower than that in many other major cities... New York still has an amazing concentration of talent. That talent is more effective because all those smart people are connected because of the city’s extreme population density levels. Historically, human capital — the education and skills of a work force — predicts which cities are able to reinvent themselves and which ones are not. Those people who are continuing to pay high prices for Manhattan real estate are implicitly betting that New York’s human capital will continue to come up with new ways of reinventing the city.

I think the takeaway is twofold.

First, smart people matter. Just about every major metropolitan region has at least one, if not more, well-respected universities. Theoretically, cities could have a proportion of college graduates equal to the number of students who attend those universities; and thus cities could boost educational attainment by sending more locals to college - but it rarely works out exactly that way. Some cities do an incredible job attracting college graduates; others bring smart people in for only a temporary four year period; a few see locals born and raised in their city pack up and leave after graduation. Cities that have a higher proportion of students to graduates should be seriously concerned about why those individuals are not sticking around.

Second, density matters. College campuses themselves are among the most densely populated places in America. Cities that engage in policies that encourage sprawling development over dense urban development may be doing themselves a disservice by encouraging the best and the brightest to disconnect from each other geographically. In places that are already attracting a lot of talent, the market might be able to take care of this; in cities that aren't, an impetus from local leadership may be in order.

Every year people I know fly down to the poorest areas in Latin America and build houses, rehab churches, or offer their time for some sort of charity. One thing that these people always comment about is how happy everyone down there is, despite having nothing. This is an anomaly that has always bothered me, because I can't figure out what it is that makes them feel so great. Kerry Howly and Richard Rodriguez had an interesting exchange on this topic on a recent episode of Blogginghads.tv. Howly thinks Latin Americans are statistical outliers because wealth and happiness are strongly correlated (a highly debatable point, but we'll let it go for now). Rodriguez thinks it has to do with how the different cultures derive identity. Watch:


In case you missed it, the key point is this: [Mexicans] do not take their identity from their work. They take their identity from their families. They take their identity from leisure. And in a culture in which work is a source of identity, menial work becomes trivializing or it diminishes the human being; so the American working class is under a different burden [than Mexican workers].

And here is the fundamental problem with defining yourself by work: your work is never good enough. No matter what position you hold in your company, you could always be one step higher. No matter what your salary is, it could always be higher. A hamburger flipper could always aspire to a McDonald's shift supervisor; the supervisor might someday because the store manager; and then what? Defining yourself as "McDonald's store manager" isn't enough for society, yet American society says that being a McDonald's store manager makes a person who they are.

I'm not suggesting Rodriguez's point is the answer to the puzzle of why Americans aren't happy - but it makes a lot of sense, and at least provides some clue to the ultimate answer.

I recently came across this McDonald's advertisement from 1987.



Now, I haven't been to a McDonald's in months, and I understand there are plans (if it hasn't already been done) to replace the Double Cheeseburger with a product known as the McDouble (one slice of cheese instead of two); nevertheless, according to the Bureau of Labor Statistics inflation calculator, the cost of a 1987 Double Cheeseburger in today's dollars is roughly $1.85. So a Double Cheeseburger for anything less is still a good deal in real dollars. Of course, given the growing rates of obesity and other health related illnesses in America, maybe it isn't a good deal at all?

When I was a kid, I remember shopping at a place near my home, the Euclid Square Mall. Like other suburban shopping centers, the mall is a single story building that contained typical corporate chain stores, a few fountains where you could toss pennies, and a parking lot that probably measures more square footage than the building itself. That was in the 1990s; nobody visits Euclid Square Mall anymore - it's dead, mostly abandoned, and might be an indication of what is yet to come elsewhere in suburbia.

There are perhaps a few reasons that Euclid Square Mall never made it; cannibalization of the retail market is one, a shrinking population in Euclid is another. But the simple reality behind suburban shopping malls is that they have to contain decent tenants; if the tenants disappear, the fate of the mall is not bright. Thus, anyone who loves the concept of the suburban shopping mall should be concerned with predictions for the coming year.

Already, malls are in a considerable amount of trouble. Shopping centers on the block are selling for 25 percent to 35 percent less than they did just a year ago. Retail vacancies are on the rise; nationally, 6.6 percent of stores were empty in the third quarter of 2008, a 20 percent increase from the same quarter last year and the highest mark since 2002. Much of the pain is interwoven with the retail sector, where analysts estimate 148,000 stores will have been closed in 2008. And it will only get worse. Mall stalwarts like KB Toys, Steve & Barry's, and Linens 'n Things are all closing shop. The recession is expected to rage on through 2009, and retail chains will probably be looking at dismal holiday numbers. A mall's chief purpose these days is to be there come the holidays. Now that we're beyond that season, many stores will need to shutter in the new year.

Granted, retail "analysts" are correct almost as often as they are wrong, and even if an entire mall doesn't close its doors, imagine walking through your favorite suburban shopping mall and seeing a quarter or more of stores shut down and boarded up. Would you be comfortable shopping in a place like this any more? Some malls will be hit harder than others, but I suspect that even those in the wealthiest of suburbs will see their share of board-ups (or at least downgrades to lower-quality stores).

It has been long predicted that high energy prices would be the nail in the coffin for the suburban shopping mall; when it is no longer economically feasible to drive fifteen miles across town to buy a pair of Reeboks, people will quit going. Now it looks our current economic turmoil may expedite the process. The end result could be decay problems in suburbs and serious concerns over the sustainability of those suburbs at all.

Suburbs compete with each other for these shopping malls because they are major sources of tax revenue. Rather than cooperating or working out a revenue sharing agreement, many suburbs allowed new malls to go up at the expense of others. It isn't surprising then, that places like Euclid, whose mall is all but gone, have experienced major public school funding problems and slashed amenities that residents once came to expect. Will residents of other places be willing to directly foot the bill for these services through higher taxes? Or are the schools and services that many suburbanites now take for granted in a vulnerable position?

What better way to begin blogging for the new year than drawing attention to a working paper by Gerald Carlino of the Philadelphia Fed and Albert Saiz of the Wharton School. The key to economic growth in American cities may be as simple as creating beautiful places with high quality amenities:

The City Beautiful movement, which in the early 20th century advocated city beautification as a way to improve the living conditions and civic virtues of the urban dweller, had languished by the Great Depression. Today, new urban economic theorists and policymakers are coming to see the provision of consumer leisure amenities as a way to attract population, especially the highly skilled and their employers... “Beautiful cities” disproportionally attracted highly educated individuals and experienced faster housing price appreciation, especially in supply inelastic markets. Investment by local government in new public recreational areas within [a metro area] was positively associated with higher subsequent city attractiveness. In contrast to the generally declining trends in the American central city, neighborhoods that were close to “central recreational districts” have experienced economic growth, albeit at the cost of minority displacement.

Of course, Carlino and Saiz aren't the first to imply that aesthetics and amenities are critically important. In his new book, Richard Florida suggests that physical beauty is perhaps most important in determining whether people appreciate and would prefer to live in a particular community. Some cities are naturally beautiful (think San Diego or Miami) while others tend to be industrial and gritty (think Detroit or Pittsburgh). Perhaps a good example of urban beautification can be seen in Chicago, where the lakefront development, along with major turnarounds in neighborhoods like the Gold Coast and Lincoln Park have seen economic development accelerate as the places themselves became more aesthetically pleasing.