Sunday, November 29, 2009


I often cite Cox and Alm's Myths of the Rich and Poor when getting students to think about the poverty stats and the general hand-wringing over how bad things are. Most people take little time to reflect on the stunning differences between their own material wealth and that of their ancestors. Comparing the time it took the average worker to earn enough to buy a 3-lb chicken 100 years ago and now is a place to start.

Some of this is updated at this post at Carpe Diem.

The post's bottom line is worth repeating.

Bottom Line: As much as we hear about declines in median income, economic stagnation, the disappearance of the middle class, falling real wages, increasing income inequality, the data tell a much different story: The rich are getting richer and the poor are getting richer.

Saturday, November 28, 2009

The first ever?

Cap and trade = carbon tax plus corporate welfare. That's apparently a Greg Mankiw theorem. The corollary is that carbon taxes are the way to go. This morning's WSJ piece on AC Pigou cites the "bipartisan appeal" of Pigouvian taxes.

And these will not be politicized? Why is the U.S. tax code 17,000 pages long? Because clarity is not a useful political posture. It seems that unpoliticized taxes are a rarity. Will carbon taxes be the first?

Thursday, November 26, 2009

Researchers' bias

Dan Klein points me to this essay by Michael Marlow. Bias among researchers is what we prefer not to think about, but it is probably inescapable. Marlow notes "good intentions bias" in his discussion of research on smoking bans.

I tell students that reading widely is the only antidote. Waiting for unbiased findings in this life is fruitless. Read widely for perspective. It's the best use of your time.

There are many findings on climate change and there are many findings on smoking bans. They all compete for our attention.

And, yes, it's all made much more difficult when arm-twisting and other chicanery are involved. Exposing the egregious cases is, of course, essential. But in the end the onus is on each of us to reach conclusions. Sharing any wisdom thereby gained is also a serious responsibility.

Monday, November 23, 2009


Religion gets a bad rap whenever true believer zealots are prompted to use it to violate any or all of the 10 commandments. This is a very old story.

And some have claimed that Green has become the religion of those who cannot abide the old-time religions any longer. To be sure, many of these folks describe themselves as enthusiastically secular.

But now we have this. Quite a lot of nastiness is directed at the climate change heretics. We may have more religious tolerance in the West than ever in our history. But these moderns are trying to play it both ways.

I hope we don't have to worry that IPCC types get caught in an ACORN-type sting next.

Saturday, November 21, 2009

Planning for the future?

Alan Pisarski testified to a House sub-committee hearing on the reauthorization of the omnibus transportation bill. Among other things, he said this:

Design the transportation system of the future that will serve the needs of a population with a value of time double of that of today’s average traveler (say $50 an hour in current dollars) and serving an economy with an average value of goods moved double present average values per ton.

Good idea. But will they hear? Here is what Ron Utt says they are really up to. More backward-looking than forward-looking. And more wishful thinking than analysis or common sense.

Our leaders are running up record deficits and some economists are cheering them on. But aside from the raw deficit numbers, just look at where the money is going. I often hear that there is even more waste in the Department of Defense. That may be true, but the two-wrongs-make-a-right defense is pretty feeble.

Friday, November 20, 2009

Shedding light

Speaking of cool data, everyone has seen the famous satellite shot of lights for North v South Korea. Vernon Henderson and his colleagues have exploited accumulated lights data from outer space and are using them to test stories about development contrasts around the world. And in many places where the official GDP stats are questionable, the lights data are a fine truth test.

A Federal Govt Program You Have to Like

The Census Bureau abandoned its long-form questionnaire from the decennial census, but switched to annual (American Community Survey) surveys that cover the same ground (and more). There will soon be the beginnings of a time series of very rich data. I just heard a presentation by Bureau staff and got a taste of some of this. Next year, there will even be a question in health insurance coverage -- about which there has been some controversy.

Saturday, November 14, 2009

LA story

Friday's LA Times reported "Gold Line links downtown to East LA ... The 6-mile light rail extension, which cost $898 million, will open Sunday with free rides and entertainment." The report also mentioned that MTA expects 13,000 daily riders.

The original 13.7-mile Gold Line link from downtown LA to Pasadena opened six years ago and cost $859-million to build, included 13.7 miles of guideway and served about 18,500 boardings per day.

Both sets of numbers are dismal. I reported some time ago that, all things considered, the original Pasadena line accounts for a net negative $80-million per year of cost-effectiveness, including plausible non-rider ("externality") benefits.

Today's LA Times, however, calls attention to all the public art ("L.A. on track ... Eight new Metro Gold Line stations roll toward an exciting future").

I know, I know. The pyramids of ancient Egypt were also costly. The rulers of their day had slaves; we have compliant taxpayers (and reporters) who never do the math and who buy into the myth that projects like this are "green" and/or "create jobs".


Sunday's (Nov 15) LA Times includes this re the $5-billion extension of LA's Red Line Subway. That is expected to pull in "an estimated 49,000 daily boardings at the new stations and a total of 76,000 new daily boardings throughout the system." Cost-effectiveness is beyond the pale. Yesterday's story was all about what the Eastside gets and todays is about what the Westside gets. Getting this balance right exhausted the energies of everyone involved. Questions of mega-waste are not interesting.

Thursday, November 12, 2009

Who's counting?

Ken Orski reports the following:

In a revealing article that should be required reading for smart growth advocates everywhere, Gerrit-Jan Knaap, executive director of the National Center for Smart Growth Research and Education at the University of Maryland, offers a sobering appraisal of Maryland's smart growth policy. Writing in the current issue of the Journal of the American Planning Association, he concludes that there is little evidence after a full decade, that Maryland's smart growth laws have had any effect on residential development patterns. Ironically, the Smart Growth Center, was founded by the University of Maryland (and supported by former Governor Parris N. Glendening) to advance research and awareness of the very same policy whose effectiveness the Center is now questioning.

And Ed Stevens pointed me to State Exploring Strategy for Detailed Growth, referring to California.

And while we're on the topic, the WSJ notes Pfizer and Kelo's Ghost Town.

The Supreme Court's 2005 decision in Kelo v. City of New London stands as one of the worst in recent years, handing local governments carte blanche to seize private property in the name of economic development. Now, four years after that decision gave Susette Kelo's land to private developers for a project including a hotel and offices intended to enhance Pfizer Inc.'s nearby corporate facility, the pharmaceutical giant has announced it will close its research and development headquarters in New London, Connecticut.

The aftermath of Kelo is the latest example of the futility of using eminent domain as corporate welfare. While Ms. Kelo and her neighbors lost their homes, the city and the state spent some $78 million to bulldoze private property for high-end condos and other "desirable" elements. Instead, the wrecked and condemned neighborhood still stands vacant, without any of the touted tax benefits or job creation.

That's especially galling because the five Supreme Court Justices cited the development plan as a major factor in rationalizing their Kelo decision. Justice Anthony Kennedy called the plan "comprehensive," while Justice John Paul Stevens insisted that "The city has carefully formulated a development plan that it believes will provide appreciable benefits to the community, including, but not limited to, new jobs and increased tax revenue." So much for that.

Kelo's silver lining has been that it transformed eminent domain from an arcane government power into a major concern of voters who suddenly wonder if their own homes are at risk. According to the Institute for Justice, which represented Susette Kelo, 43 states have since passed laws that place limits and safeguards on eminent domain, giving property owners greater security in their homes. State courts have also held local development projects to a higher standard than what prevailed against the condemned neighborhood in New London.

If there is a lesson from Connecticut's misfortune, it is that economic development that relies on the strong arm of government will never be the kind to create sustainable growth.

It's been twenty years since the Berlin Wall fell and, yes, memories fade. If advocates want to argue that Kelo and Smart Growth are a kind of benign central planning that is worthy, the onus is on them.

Sunday, November 08, 2009

Still dull and boring

Richard Florida has had some success helping urban economics and urban geography (and related fields) shed their dull and boring images. Researchers now try to identify the places that the young, cool, hip, creative types prefer. But every so often, Joel Kotkin comes along to show us that it's not all that simple.

But even though the research is potentially trendier than ever, the researchers are still trying to pin labels on areas (counties or metro areas) that are much too big to be so easily characterized. Metro area average population density, for example, can be misleading. In previous blogs, I have noted that I am late-to-the-party in discovering the smaller PUMAs (Public Use Micro Sample Areas).

It's easy to take a leaf out of the playbook of the Creative Class researchers and study the link between "hip" in-migrants and PUMA population density. Occupation code 2600 is “Arts, design, entertainment, sports, and media occupations”. Correlate arrivals of these people with small area (metro PUMAs) population density and do it for the nine Census Divisions. The results are all over the map (sorry!). They range from 0.06 (Mountain States) to 0.41 (Mid-Atlantic). In five of the Divisons, the correlation between all arrivals and PUMA population density is higher than for creative arrivals.

Our field is probably stuck with dull and boring.

Thursday, November 05, 2009

Many densities, many foods

My favorite LA novel is The Tortilla Curtain by TC Boyle. Another great guide to today's LA is "The Scavenger: Pig's ear, octopus, and fish-kidney curry with LA's most adventurous eater" in the Nov 9 New Yorker.

The report follows the adventures of Jonathan Gold, "the high-low priest of the Los Angeles food scene." Gold describes LA as the "anti-melting pot". And "... unlike in New York, where immigrants quickly broaden and assimilate their cooking styles to reflect the city's collective idea of 'Chinese food,' the insular nature of Los Angeles allows imported regional cuisine to remain intact, traceable almost to the restaurant owners' villages of origin. 'The difference is that in New York they're cooking for us ... Here they're cooking for themselves' [Gold tells writer Dana Goodyear]."

Gold could have mentioned that LA also has plenty of the New York-style "they're cooking for us" options.

Urbanists keep writing about density, but neither explain what they mean or fall short with meanignless measures such as metro area or countywide density averages. The real fabric and the real nature is far too complex to capture with such vagaries. Interestingy, LA is melting pot and anti-melting pot. One can find the "cooking for us" dishes one day and the "cooking themselves" dishes the next. Whatever "the density" of LA is, it is, both "insular" and not-so-insular as to make both cuisines possible.

Perhaps urbanists can take the hint. Let a thousand densities bloom.

Tuesday, November 03, 2009

Was Ayn Rand boorish?

The November (2009) Reason includes "Are Property Rights Enough? Should libertarians care about cultural values? A reason debate".

It seems to me that libertarian (or any serious) discussions cannot avoid touching on cultural questions. But libertarian individuals and positions are another matter. All are products of a culture and all have individual interests in many aspects of that culture, but the three debaters do not pursuade me that there is a tight fit or connection between the libertarian approach to property (economics and politics) and all the rest.

We argue for standing up to those who want to tax us (on the left) as well as those who want to arrest us (on the right). And that alone can keep us quite busy. But we are also put off by the boorishness that we encounter every day, much of which is not linked to the agendas of those who want to tax or arrest us.

When my fellow concert or theater goers behave in ways that curtail my enjoyment and if it is the business model of the theater or concert hall owner to allow that kind of behavior, the property rights are clear and that is fine, but I still have a problem. I'll probably enjoy more entertainment at home. "Home theaters" are a growing phenomenon anyway. But I am not sure that any of this can be or should be a part of any "libertarian agenda". Much of life is beyond and independent of that agenda and that's fine.

When people bring their lifestyle priorities to political conventions and meetings, they usually do seek state sanction for their cultural positions (be it anti- or pro-abortion). I thought that libertarians were the ones who left that stuff at home when they do politics.