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Monthly Archives: April 2011

Mixed Messages from Fortune Magazine

By | | News commentary, Regional planning
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On March 29, Colin Barr, a Fortune magazine financial writer, argues in a blog post that “housing prices will keep falling.” Just two weeks later, the cover story of the April 11 Fortune proclaims the “return of real estate” and says “it’s time to buy again.”

They can’t both be right: either Fortune magazine is wrong or Fortune magazine is wrong. As a matter of fact, they are both wrong.

Barr bases his argument on a graph comparing housing prices with the consumer price index. Before 1997, the two lines parallel one another. Then housing shoots upward until 2006. Though housing prices have fallen since then, they haven’t reached the line that would have been parallel to the CPI. Prices will continue falling, Barr argues, until they return to that line.

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Back in the Air Again

By | | Housekeeping
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The Antiplanner is in Washington DC today and tomorrow to participate in various meetings on transportation. Tomorrow (Friday), I’ll speak on Capitol Hill at a Cato forum on America’s transportation future. Alan Pisarski, the author of Commuting in America, will talk about the future of commuting. Clyde Hart of the American Bus Association will talk about the future of intercity buses. Reason behind levitra prescription cost male erectile dysfunctionMED is caused because of phosphodiesterase type5. This ingredient works at a viagra super store physiological level in treating erectile dysfunction is Kamagra Jelly. What Are the Side Effects of Intagra? Prolonged erection resulting to damage to the penile blood vessels is recommended only when there is leakages in the cause of erectile dysfunction. order viagra australia The functioning of buy female viagra s results in thick, full, firm and long-lasting erections after a certain response time. I’ll probably talk about transportation funding and, of course, driverless cars.

On Saturday, I’ll be in Boston (actually, Medford) at the Tufts University Energy Conference. They’ve asked me to speak on a panel about why mass transit is not the way to save energy, a thesis that probably won’t be welcomed by much of the audience. If you are in DC or Medford, I hope to see you there.

High-Speed Rail Is Out of the Budget

By | | News commentary, Transportation
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Early Tuesday morning, Congressional leaders agreed on a 2011 budget package that zeros out funding for high-speed rail and rescinds $400 million in 2010 funding that remains unspent (transportation begins on p. 404). The package has the support of Senate Majority Leader Reid, House Speaker Boehner, and House Appropriations Committee Chair Hal Rogers.

The budget plan, now more than six months overdue, also cuts Amtrak’s budget by $80 million and rescinds 2010 highway funds that remain unspent by the states. But the federal government will continue to spend money on highways, transit, and Amtrak. The real significance is that the budget plan is probably the death knell for Obama’s ambitious plan to spend more than $500 billion extending high-speed rail to most major American cities.

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TriMet Tax Fraud

By | | Transportation, Urban areas
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TriMet, Portland’s transit agency, gets about half its operating funds from a payroll tax. In 2004, this tax was 0.6218 percent, meaning employers had to pay TriMet $62.18 for every $10,000 they paid employees. Employees, other than the self-employed, are largely unaware of this since it is on top of pay, not a deduction from pay.

In 2003, TriMet persuaded the Oregon legislature to allow it to increase the tax by 0.01 percent per year for ten years, starting in 2005. In 2009, TriMet went back and convinced the legislature to allow it to continue increasing the tax by 0.01 percent per year for another 10 years. Thus, the tax now stands at $69.18 per $10,000 in payroll, and will rise to $82.18 per $10,000 in 2025.

At the time, TriMet promised that all of this tax increase would be dedicated to increasing service, and as of 2010, TriMet CFO Beth deHamel claims this is being done. But according to John Charles of the Cascade Policy Institute, that’s not what is happening.

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Mesa Del Dolares

By | | Housekeeping, Regional planning
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Saturday, the Antiplanner spoke in Damascus, Oregon, a rural community on the fringe of the Portland area that Metro planners have targeted to become a dense, New Urban city of 100,000. The residents of the area are none too happy about that and have been fighting it by passing initiatives preventing the city from cooperating with Metro.

Meanwhile, I’ve been intrigued with a similar situation in New Mexico: Mesa Del Sol. This is 12,900 acres of formerly state-owned land adjacent to (and recently annexed into) Albuquerque. The state and city hired Peter Calthorpe to plan a New Urban community, and then picked Forest City, a national developer that specializes in mixed-use projects, to develop the area. Fortunately for Forest City, the area had no previous residents to protest the development.

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BLM’s Investment in Dishonesty

By | | Public lands
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The Bureau of Land Management has always labored in the shadow of its sister agency, the National Park Service, and its cousin, the Forest Service. While the national parks are America’s “crown jewels” and the Forest Service represents the best (and worst) of the Progressive era, the BLM manages the federal lands left over after everyone else took what they wanted. Possibly because it simply isn’t as romantic as those other agencies (and so Congress has less reason to throw money at it), the BLM manages its 245 million acres of land far more efficiently, spending an average of about $5 an acre compared with $37 for the Park Service and $32 for the Forest Service.

To help overcome its “romance” deficit, the BLM recently published a four-page flyer titled, “BLM: A Sound Investment for America.” The BLM, the flyer claims, “raises more money each year for the American taxpayer from the use of these lands than it spends.” It goes on to say that the agency’s “management of public lands contributed more than $112 billion to the national economy in 2010.”

It turns out this isn’t exactly true.

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The Ratings Game

By | | Meltdown
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Lots of groups have been blamed for the recent financial crisis, including the Federal Reserve, banks, and Congress for deregulating financial institutions by repealing the Glass-Steagall Act (which separated banks that accepted deposits from investment banks). One that deserves scrutiny is the ratings agencies–Moody’s, Standard & Poors, and Fitch–that gave AAA ratings to bonds made up of subprime loans.

The ratings agencies definitely have a lot to answer for. Historically, only one in 10,000 AAA bonds defaults in an average year. So banks and other financial institutions confidently invested in AAA mortgage bonds only to see the value of those bonds fall dramatically.

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Dead or Not, States Want High-Speed Rail Money

By | | News commentary, Transportation
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High-speed rail may be dead, but numerous states would be happy to get some of Florida’s $2.4 billion in rejected high-speed rail funds. Yesterday was the deadline for applications for this money, and some of the applicants include:

  • California, of course, would like it all, even though that would still leave it $50 billion or so short in completing the first leg of its high-speed rail dream.

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Portland: Second-Most Miserable City?

By | | News commentary
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The Wall Street Journal has published a “misery index” that ranks Portland as the nation’s second-most miserable city after Phoenix. Or, at least, the second-most miserable of the 20 cities included in the ranking. The newspaper’s index is supposed to be based on changes in unemployment, housing prices, and gas prices in the last year.

As much as the Antiplanner likes to read articles bashing the city I love to hate, I have reservations about any such “indices” of misery or anything else. Here is a conundrum, for example: why is it that higher gas prices (meaning transportation is less affordable) are considered bad, but higher housing prices (meaning housing is less affordable) is considered good?

The Journal‘s answer, no doubt, is that housing is an asset while gasoline is a consumption good. This isn’t really true; housing is a consumable as well. But even if it were true, not everyone bought their home a year ago. Over the last five years, housing prices dropped 15 percent in Boston but rose in Dallas. Yet, because the index is based on an annual change, Boston is considered less miserable than Dallas.

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New Fire Plan: Burn More Money

By | | News commentary, Public lands, Wildfire
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In the late 1990s, the Forest Service spent about $300 million a year on fire and the Department of the Interior spent another $100 million a year. Then came the 2000 Cerro Grande fire, which burned a billion dollars worth of homes in Los Alamos, NM. After that, Congress opened up the checkbook and told the agencies to spend whatever it takes to keep such a fire from happening again.

The agencies have taken full advantage of this. In 2010, the Forest Service budget for fire was $2.1 billion and USDI’s was more than $850 million. That’s just the budget; the agencies had another $500 million or so to draw upon if they ran over their budgets; if they didn’t go over their budgets, they got to keep the surplus for future years.

Here’s an indication of how expensive fire has become: In 2010, for the first time in at least 60 years, if not the entire 105-history of the Forest Service, the agency spent more money on fire than on all other national forest operations, construction, and maintenance combined.

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