Twenty years ago I called in sick when I wasn't sick for the first and only time in my life. The reason: Game 7 of the 1991 World Series, which wound up to be a 10-inning classic in what has often been called the "best World Series ever." The Twins were facing elimination going into Game 6 when Kirby Puckett made an amazing catch to rob the Braves of a home run and then Puckett hit a homer in extra innings to force a Game 7. The Twins won Game 7 and, while I have since apologized to the owners of the sub shop for skipping out on them, I don't regret it for a minute. Baseball is magical. Good luck to all our readers in St. Louis and in Dallas-Fort Worth going into Game 7 and congratulations on what has been an amazing World Series.
Enjoy the week's news.
- We need to give a few shout outs to start things off. First, thank you to the Human Transit blog for adding to Monday's discussion on the costs of maintenance. Check out the comments on that site - some good stuff. Our friend Jake Krohn also gave a local example at his site, Basement Office. If anyone can read French, this booklet from an organization apparently in Quebec quotes me and our Ponzi scheme series. (French is another in a long list of languages I can't discern.) Then on the MoveArkansas site, it was reported that the Little Rock mayor has issued a car-free challenge to see how many Little Rockers can go without a car for the week. After reading this, we may need to do a Curbside Chat in Little Rock.
Maybe this will spark some meaningful debate about how to spend some of that extra $500 million in sales tax revenue coming our way over the next 10 years so that we don't repeat the mistakes of the last 20. Complete streets anyone? Maybe some form based codes or Smart Codes instead of old-fashioned, outdated Euclidean zoning? Can we work toward making Little Rock a Strong Town?
- Last Friday, one of our great readers and frequent comment contributors, Jeffrey Jakucyk, politely took issue with my characterization of the engineering profession as "insane" for coming up with the diverging diamond design. A subsequent commenter (Chris) posted a link to the video below, which is a narrated tour of a diverging diamond in operation. I have to be frank and say that it took me a while to realize that the narrator was not being sarcastic but actually thought the design was not only sane, but awesome. My favorite part comes around the 5:00 mark with the Death Star-esque pedestrian trench. If someone can add the Darth Vadar music to that part, it would make my day. Sorry Jeffrey. I respect you and hope you keep speaking up, but it's insane.
- CNBC this week had an article about the unfunded pension liabilities of U.S. states. What was interesting about this article was the reporting on the controversy over the different estimates. One group-- State Budge Solutions, a non-profit -- estimates the gap at $4.2 trillion. Conservative think tank American Enterprise Institute estimates it to be $2.8 trillion. Pew Center on the States says just $700 billion. The difference apparently is the estimate chosen for the investment return, which ranged anywhere from a conservative 4% to an aggressive 8%. Just another dimension to why we are so desperate to keep this growth Ponzi scheme going. It is really scary when you think that if we have another decade where we average just 2% growth -- which is still positive growth, just not very high -- we're totally screwed.
The housing bust, financial crisis and economic recession caused states' tax revenue to plunge, and huge holes have emerged in their budgets over the last few years. Because all states except Vermont must end their fiscal years with balanced budgets, states have scrambled to cut spending, hike taxes, borrow and turn to the federal government for help.
Taxpayers are worried the states' poor fiscal health will persist for a long time and some Republicans in Congress have questioned whether the situation is worse than the states say.
- At Rustwire.com there was a great opinion piece on the futility of "chasing smokestacks" and how the prevailing economic development philosophy has hurt more than it has helped. The column has a bit of personal lament to it, but I thought that added to its authenticity more than it detracted. Lots of insight there.
Somehow I couldn’t get excited about the idea of being an economic development professional in the state of Ohio, though. I guess its because so much of what the economic development community does in Ohio I find to be counterproductive, or worse, morally reprehensible.
In Northeast Ohio, almost every suburb employs an economic development director whose sole job it is to poach jobs from other nearby communities, usually those closer to the central city. A recent report from the organization Good Jobs First found that the Cleveland region has provided tax incentives for businesses to move 14,500 jobs further from the central city.
- And when it comes to chasing smokestacks, the futility is apparently now well documented in Florida. A report in the Orlando Sentinel indicates that, going back to 1995, roughly two thirds of the promised jobs failed to materialize. The most surprising thing -- although, sadly, perhaps not too surprising -- is that there is apparently no recourse or mechanism for a clawback. And we wonder why we have Tea Party and Occupy Wall Street protests.
The state disclosed the efforts Friday, more than two weeks after the Orlando Sentinel requested information on hundreds of tax-incentive contracts that, according to Gov. Rick Scott's new Department of Economic Opportunity, were never fulfilled.
On Friday, the agency released a list of more than 1,500 deals inked with companies since 1995 — an additional 101 awards were not released, with no explanation — and the list showed many that haven't made good on their original job-creation aims.
The deals were cumulatively projected to generate 224,286 new jobs over the past 16 years, but agency officials can confirm that only about one-third of them — 73,669 jobs — were actually created. Some of the contracts are still considered pending and jobs could still be created, officials said, but most are classified as "terminated' or "inactive."
- The Economist posted an interesting "Debt Clock" this week. You can view our public debt situation any number of ways. I found it fascinating, but would also like to see private debt levels (our real American crisis).
- And in the interests of examining a competing viewpoint, here's an argument from Ambrose Evans-Pritchard in the Telegraph that the next century will also be an American one. Part of his argument is a positive spin on a lot of negative stuff (for example, he indicates that we can frack our way to energy self-sufficiency) but some of it falls into the category of "we're not as bad as they are." I'm a firm believer in understanding the best arguments from all sides. In my opinion, this is a good representation of a weak argument.
As Cleveland Fed chief Sandra Pianalto said last week, US manufacturing is "very competitive" at the current dollar exchange rate. Whether intended or not, the Fed's zero rates and $2.3 trillion printing blitz have brought matters to an abrupt head for China.
Fed actions confronted Beijing with a Morton's Fork of ugly choices: revalue the yuan, or hang onto the mercantilist dollar peg and import a US monetary policy that is far too loose for a red-hot economy at the top of the cycle. Either choice erodes China's wage advantage. The Communist Party chose inflation.
- A friend of mine (definitely not a Republican) shared this article with me (historically a Republican voter), which is titled "The GOP Hates Bikes." In an obviously slanted way, the article looks at the national debate over where our federal transportation dollars should be spent. Regardless of where you fall in this debate, what is clear is that much, much more needs to be done at the local level to make our cities more walkable, livable and financially productive than can ever be financed out of D.C. My biggest wish is that our local leaders would stop looking for someone else to solve their problems -- or for someone else to blame -- and instead roll up their sleeves and start building Strong Towns. We have all the tools we need right now.
The federal government spends about $40 billion a year on transportation projects. Of that, about $928 million has been devoted to what's known as a "transportation enhancement" program, which provides funding for projects—including rails-to-trails conversions, bike lanes, and bridges—that make cycling safer, and thus more viable as a commuting option. But as Congress gears up to reauthorize the massive transportation funding bill this year, Republicans are arguing that states shouldn't be forced to use scarce transportation funds to encourage bike commuting when bridges for cars are falling down.
- This week I came across this video of Andres Duany taken during my recent trip to Alabama for the New Urbanism Council. His innate brilliance is made more powerful by the fact that he's one of the few of his generation that seems to understand what is going on. To hear him say that the last three years of ideas have been exhilarating (as opposed to scary as hell, as it has been to most of his peers) simply raises the stratospheric esteem I hold this man in to even greater heights.
- One of the ways local officials can do things more productively for themselves is by walking away from the Wider, Straighter, Faster orthodoxy typically applied on local streets. Project for Public Spaces gives some great reasoning this week for why a different approach can cost less and return more, as well as be a lot safer.
Government officials in the Netherlands were alarmed by the high rate of fatalities on their roadways in the 1970s, but they took a different approach from Americans. Instead of thinking “wider, straighter, faster,” they decided to design streets in “built-up areas” to operate more slowly. The result is a roadway that naturally accommodates a mix of modes and the varied speeds cars travel when entering and exiting the roadway. The success of this strategy has been nothing less than remarkable: the fatality rate has been cut to a quarter of what it was.
- Finally, while I know this video has been passed around a ton on Facebook, I wanted to share it here with because I find it a fascinating, artistic expression from suburban America. Expression of what? As will all good art, you should decide for yourself. Personally, I put this in a Carhenge category.
Enjoy your weekend, everybody.