Thursday, November 20th, 2014
My latest column is now available in the November issue of Governing magazine. It’s called “Lessons from Kokomo on How to Spend Responsibly” and takes another look, obviously, at Kokomo. But my focus here is the intersection of fiscal responsibility and investment. I highlight not just Kokomo, where getting a handle on the budget enabled investment, but also Los Angeles, where losing control of it has resulted in serious infrastructure problems. Here’s an excerpt:
Kokomo can spend money on these items because it took care of fiscal business. Not all debt is bad, but in this case, by mostly resisting the urge to borrow, Kokomo will retain the ability to invest well into the future by not encumbering future cash flow. As a small industrial city, Kokomo still has challenges to be sure, but it appears to be on the right track.
Other cities are in different stages of this process. Consider Los Angeles, which is also making national news, this time for its crumbling infrastructure. The New York Times reported that it faces more than $8 billion in needed repairs just to bring its worst roads, sidewalks and water lines up to par.
Why can’t Los Angeles afford to invest in infrastructure? Because it allowed its budget to get out of control. Some blame this on the city’s fear of raising taxes, but L.A. is hardly a low-tax haven. Instead, as a report issued earlier by City Administrative Officer Miguel Santana notes, while revenues are anticipated to grow 4.4 percent — faster than national GDP — expenditures have been growing at an even faster rate.
Read the whole thing.
Wednesday, November 19th, 2014
The NYT’s Upshot program features a lot of data visualizations and infographics. Here’s one they recently wrote about based on Facebook “Likes” of college football. This isn’t a map of specific teams like (though they link to one of those if you click through). Rather, it’s just overall interest in college football.
Why put this up? Because once again it shows how state borders matter. There are cultural items, commonalities, etc. that follow state boundary lines even when there isn’t an obvious reason for them to in the larger frame. Though we live in a global era of metro-centric economies, geographies like states still exert power not just legally, but also culturally.
Wednesday, November 19th, 2014
I’ve written a few pieces on corruption lately. I’ll continue in that theme with this 30 minute video, part of series called “Straight Up” from Brooklyn Independent Media, about how journalists should think about covering corruption. As important topic as obviously the media plays a huge role in breaking corruption stories. If the video doesn’t display, click over to Vimeo. h/t City Limits
Tuesday, November 18th, 2014
[ Here’s another nice piece of analysis about Chicago from Pete Saunders. He originally did this earlier this year – Aaron. ]
Chicago skyline. Source: wikipedia.org
Fast forward twenty years. Chicago’s transition from Rust Belt Capital to Global City has been unparalleled. Where there once had been large swaths of middle-class, working-class and impoverished neighborhoods, with high-income enclaves, there are now nearly as many high-income neighborhoods as there are of the other three. Perhaps someone who moved to Chicago post-1995 and lives in one of the up-and-coming areas is vaguely aware of this, but anyone who was here before then is quite right to be astounded.
Despite Chicago’s transformation, it’s been pretty well-documented that not all parts of the city have benefited. The battle over the closing of nearly 50 schools, mostly located in the city’s poorer South and West side neighborhoods, brought this to light, as did Chicago’s high-profile murder and violent crime rates through 2013 (which, to date in 2014, have gone down dramatically). Inequalities and disparities became evident in both areas; University of Chicago graduate student and blogger Daniel Kay Hertz brought the disparities to light with his analysis of violent crime in Chicago. As he said in his piece:
Over the last twenty years, at the same time as overall crime has declined, the inequality of violence in Chicago has skyrocketed. There have always been safer and more dangerous areas here, as there are everywhere; but the gap between them is way, way bigger now than it used to be.
Over the last two decades a new but undefined paradigm has emerged, the one of “Two Chicagos”. This is probably best explained once again by Dan Hertz, who recounted an overheard conversation on the L:
I was on the train earlier this week, and two white men got on and asked their neighbors, who were two black women, how to get to a hotel. The women told them. And then began a sort of stock conversation that Chicagoans have with tourists: How do you like the weather, ha ha? The men, who were from Atlanta, did not like it. Have you been on a subway before? Yes, but not often. Would you come back? Oh, yes. We love Chicago, the men said.
The men reached their station, and left.
One woman said to the other: I hate it when people say that – I love Chicago. No, you don’t. You love downtown and the North Side. The other woman said, Uh huh.
That is a frequent sentiment of those who live on the other side of the invisible divide in Chicago. But what, exactly, is that divide? Where are the boundaries? Exactly how deep are the difference?
I took a stab at trying to figure this out.
I compared some socio-economic statistics for the 56 zip codes in Chicago against medians and averages for the entire Chicago metro area (Indiana and Wisconsin excluded). The differences are stark.
Let’s start by looking at maps of the areas of examination. Here is the seven-county Illinois portion of Chicago’s metro area, with Chicago etched in:
I gathered data for all suburban municipalities and all City of Chicago zip codes within this area, for five variables — population, non-white population percentage, median household income, and median home value, and bachelor’s degree or more for persons 25+. The data comes from the 2011 U.S. Census American Community Survey. After collecting that data, I established an “average of medians” or “average of averages” to get a baseline for the metro area, and an understanding of how jurisdictions or zip codes would compare to one another. One fairly big caveat — an average of medians or average of averages weighs all jurisdictions equally, skewing the numbers higher due to the number of small but well-to-do suburban municipalities. So while the 2011 actual median household income for the seven-county area overall was $61,491, the average of medians was $74,731. But since all data is expressed this way, differences are negated.
Next, I looked for Chicago zip codes that were above the metro area average in at least one of three categories — median household income, median home value, and bachelor’s degree or more for persons 25+. These are the higher income neighborhoods that can be called “Global Chicago”. Within the city, they look like this, in yellow:
Most Chicagoans would recognize this as the wealthier parts of the city. It stretches from the far Northwest Side eastward to the lake, south to downtown and continuing south before ending in the Hyde Park neighborhood on the South Side. Again, I included all zip codes that were above the metro average for at least one of the three categories I examined, so not all communities are the same. Hyde Park, for example, is here because it has high educational attainment, but is below the average for income and home value. The same applies to Rogers Park and Edgewater on the city’s northern border with Evanston. Jefferson Park, Norwood Park and Sauganash, on the other hand, located on the Northwest Side, rank highly in home value but lower for income and educational attainment.
Taken together, you can see how “Global Chicago” compares with the Illinois portion of the metro area, the metro area excluding Chicago to give you Suburban Chicago, and the balance of the city beyond “Global Chicago” that I’ve called “Rust Belt Chicago”:
The differences are indeed stark. “Global Chicago” is on par with the Chicago suburbs and the metro area overall in terms of income, and has a lower percentage of minority residents compared to the metro area. Interestingly, “Global Chicago” has a much higher home value and educational attainment when compared to the metro area overall or the ‘burbs. Meanwhile, “Rust Belt Chicago” lags far behind. “Rust Belt Chicago” has a large majority-minority population, has an income nearly one-half as much as the suburban households, and has only one-third as many college graduates as “Global Chicago”.
I decided to take this analysis a little further and determine if there is a core to “Global Chicago”, and how it would compare to the rest of the city. I collected data for zip codes that exceeded the metro average in two or more of the three categories. That produced this map:
And this table:
Here, a “Super Global Chicago” compares favorably with the ‘burbs in terms of income, but far exceeds it in terms of home value and educational attainment. Including some of the peripheral areas of the previous “Global Chicago” with the previous “Rust Belt Chicago” to produce an “Average Chicago” leads to some gains, but it still lags far behind the other slices of the metro area.
Right now, the CNN series “Chicagoland” is doing its best to illustrate the “Two Chicagos” meme, highlighting blues festivals and Stanley Cup championship celebrations on one end of town and school closures and endless crime on another. However, these maps and tables may do a far better job of demonstrating the impact of past and current practices and policies on the city’s landscape. In fact, I think Chicago’s example is one that will serve as a model, for better or worse, for other cities across the nation.
In reality I see the “Two Chicagos” meme as overplayed. Chicago may be better understood in thirds — one-third San Francisco, two-thirds Detroit.
This post originally appeared at Corner Side Yard on March 18, 2014.
Sunday, November 16th, 2014
A couple of incidents recently highlight how many communities have taken a sharply negative turn when it comes to privatization. A look at the cases in question however, shows that the objections to it appear to be as much ideological as performance based.
In Indiana, a group of seven counties through which the Indiana Toll Road passes want to buy it themselves from the bankrupt operator and its bankers.
The Indiana Toll Road lease was an unambiguous win for the state of Indiana. Was it perfect? Of course not. But those seeking to portray it as a bad decision always have to cite some peripheral defect. They can’t talk about core matters like the roadway condition, which is in better shape than ever and now with electronic toll collection, nor its operations, which are solid. Nor have I ever seen a critical financial analysis that was remotely credible. (One study in an academic journal that got a lot of airplay used ridiculous discount rates in their analysis, including literally 0% in one of their primary scenarios. This is what they are reduced to in trying to undermine the deal’s logic).
The bid by these counties seems motivated more hostility than logic. La Porte County Commissioner David Decker says, “The nonprofit would not be beholden to shareholders who siphon all the money off. We want to put money back into the road.”
Let’s analyze this a bit. The road is bankrupt, so the shareholders aren’t “siphoning” anything off at this point. I suspect that Cintra and Macquarie (the original lessees) protected themselves well in this deal, however. I’m not crying for them. But the concessionaire did go belly up.
Then there’s the idea of putting the money back into the road. Where were these counties when the state was running the road and letting it deteriorate so badly? There were some truly decrepit stretches of highway, especially in Lake County. Where were all these counties back then? If the public sector is so much more responsive and attentive to public needs, why didn’t the state ever fix this when it owned it? Why didn’t the state ever install electronic toll collection? I started telling INDOT they should install this as far back as the O’Bannon administration, but nothing ever happened. It wasn’t until the privatization deal that money did indeed start getting invested back into improving the road.
Then there’s the counties’ proposed financial structure. The private company paid $3.9 billion and went broke. These counties think that they can pay $3.7-4.1 billion for it, and make a profit of $38-50 million per year even after they – get this – pay a private company to operate the road anyway. How is that supposed to work? Yes, they can issue tax exempt bonds at a lower interest rate. But they want to limit repayment only to the toll road revenues, so that will limit their rate savings. Also, they won’t be able to take advantage of the huge tax write-offs from depreciation and such that the private company had available. I’d have to see the details on this, but it’s quite a financial claim they are making. They are basically saying that they can buy the road back from the bankers and run it at a profit of $50M higher than the bankers could. (Remember, any profits the banks might actually make would surely factor into their sale price). That seems a bit dubious. If it’s really true, every county in American ought to think about turning themselves into a private equity fund to invest in infrastructure assets.
Then there was an article in the Guardian talking about Hamburg voters approving a measure to buy back their electric and gas utilities that were privatized a few years back, or reclaim them when the contracts end.
Again, let’s ask what the problem is. Has the private operator breached its covenants? Have they provided poor service? Have the prices been at issue? No, no, and no. The article talks about pricing as a factor in some “remunicipalizations” of utility service, but not here. Instead what we see is that the real driver is political:
In Hamburg, activists launched the Unser Hamburg, Unser Netz (Our Hamburg, Our Networks) campaign in 2010 after noticing that the city’s existing contracts with Vattenfall and E.On were set to expire. The campaign brought out a wide range of supporters: environmental groups said buying back the grids would give Hamburg more control over its energy systems, and make it possible to really drive the city’s Energiewende transition away from coal and nuclear power and towards renewable energy.
The motorways running in and out of Hamburg are lined with giant windmills, slowly churning the air, constant reminders of the country’s ambitious green goals. Shifting the city’s energy transition into higher gear was one of the key promises of remunicipalisation.
The referendum ballot proposed not only to take back the city’s energy grids, but to institute as a binding target “a socially just, democratically controlled and climate-friendly energy supply from renewable sources”.
It seems pretty obvious that the drive to buy back the utility was driven by greens, who hope to use political control to implement their preferred energy generation schemes. In short, it’s about ideology. The article quotes a professor saying that privatization itself is promoted for ideological reasons, but here we see de-privatization happening in the same way. A touch of the increasingly anti-infrastructure bias of the German electorate comes through as another ideological factor.
Lest you say “it’s about climate change, not ideology,” the policy response to climate change very much falls within the political and ideological sphere. The German greens are, as the article notes, anti-nuclear. The Green Party driven, legally mandated decommissioning of Germany’s zero emissions nuclear infrastructure is a big reason why the country is still constructing coal plants in the first place. That doesn’t seem very green to me.
I’ve not hesitated to rake bad privatization deals like the various parking meter leases over the coals as bad public policy. But in these cases we see moves to cancel privatization deals coming from a root of ideological bias, not the public interest.
Friday, November 14th, 2014
Here’s another episode of Carol Coletta’s Knight Cities podcast. This is an interview with Chicago Community Trust President Terry Mazany with interesting thoughts on Chicago’s culture. My commentary is below the audio player. If the audio doesn’t display for you, click over to Soundcloud.
The bulk of the show is taken up with a discussion of a community dinners event the CCT (Chicago’s community foundation) put on to celebrate their 99th anniversary. This may or may not be of interest to you. But the beginning is Mazany’s take on Chicago’s culture.
I’ve always struggled a bit with the classic consulting SWOT framework (Strengths, Weaknesses, Opportunities, Threats). That’s because I have trouble classifying things. So often to me internal factors can be strengths or weaknesses depending on the context. For example, the same personal qualities that are our strengths are generally also weaknesses in other ways.
So it is with culture. Chicago has a very powerful civic culture. I won’t claim to have it fully defined. But like everyplace it has its own way of doing business. As Mazany notes, this culture involves a very powerful and engaged corporate sector, including at the CEO level. This is something I’ve noted has long disappeared in so many other cities.
Obviously things like a corporate orientation have their downsides, as I and others have written about elsewhere. Also obviously Mazany is going to present Chicago’s culture as a positive. Since this is his show, let’s stick with that for today.
I think it’s pretty clear that Chicago’s strong corporate and philanthropic leadership played a key role in preserving Loop as the region’s commercial heart, especially during the nadir of downtowns in the 70s and early 80s. Chicago did lose HQs to the suburbs, but even suburban based CEOs have played a big role in backing downtown Chicago. The corporate sector also has raised a lot of funds for civic projects like Millennium Park. One can certainly complain about the cost overruns and corporate logos, but a lot of private money went into this and many other things. Business leaders, notably Lester Crown, were the big promoters of the O’Hare Modernization Program.
Without a doubt, the corporate culture of Chicago is a big part of what had made the city work. That’s part of why simply copying the projects and techniques of other cities doesn’t necessarily translate to success. It’s the values and culture and other attributes of the city that lies beneath the projects, etc. that are often the real differentiators.
Thursday, November 13th, 2014
Image via OC Mini Market
Earlier this year a trend called “normcore” got a lot of press. Normcore is a fashion idea based on wearing boring, undistinguished clothing such as that from the Gap. Jerry Seinfeld is a normcore fashion icon.
While normcore was at least in part a joke, I think it illustrates why trend chasing by uncool cities will never make them cool. So you live in some place which isn’t on everyone’s list of the coolest cities. You read all about what’s happening in places like Brooklyn with micro-roasters, micro-breweries, cupcake shops, and artisanal pickles, and you’re like wow, my city has all that now, too. We’ve arrived.
No you haven’t. Do you think for a minute that the cool kids are going to let you just catch up and join the club? It doesn’t work that way. By the time you get to where they were, they’ve moved on to something else. You’ll never catch up doing it that way.
The idea of normcore, though probably just ephemera, shows how quickly the script could be flipped on you. Just as you finally master pretentious esoterica, the cool kids suddenly revert back to ordinary.
I wouldn’t be totally surprised to see something like that happen, actually. While I shouldn’t underestimate the ability of creative people to continue playing leapfrog to new levels of local, bespoke, exclusive, etc., at some point that trend will be played out. Then were do you go? Back to the comfort of ordinary.
Just when your Rust Belt burg finally has seven different artisanal pickle purveyors, don’t be surprised when the New York Times does an article talking about how the latest trend in Brooklyn is Vlasic kosher dill spears. (In an era in which Millennials are under huge financial pressure, this, like the sharing economy, would also be conveniently a matter of self-interest). Heck, maybe they already have and I just missed it.
Again, it’s like the way that these industrial towns abandoned their local culture to pursue cool city culture, only to have those cool cities re-appropriate working class culture – Pabst, workwear brands, etc – for themselves. Now these Rust Belt cities are re-importing their own culture back as supplicants. Remember, back in the 90s, the cool cities list used to frequently include the number of Starbucks locations as an indicator. Things change fast.
I like being able to get a good cup of coffee in these industrial towns now. I think it’s great for cities to have nicer stuff. But don’t ever make the mistake of thinking that by itself will change your relative standing in the marketplace.
Wednesday, November 12th, 2014
This week’s video is a timelapse of the Netherlands by Pengcheng He. I hope you enjoy. If the video doesn’t display for you, click over to You Tube. h/t Likecool
Tuesday, November 11th, 2014
Bandwidth is a late machine age term that helps illuminate the millennia of technology and culture that preceded its coinage. The definitions of bandwidth vary, but its most basic meaning is a channel’s capacity to carry information. Smoke signals and telegraphs are low-bandwidth media, transmitting one bit at a time in slow succession, while human vision transmits information to the brain at a much faster rate. The past century has yielded tools for measuring bandwidth and quantifying information (see Claude Shannon) as the channels for carrying that information have advanced rapidly.
In any era, but never more so than now, the landscape of existing technology is a palimpsest in which the cutting-edge, the obsolete, and the old-but-durable all coexist as layers of varying intensity and visibility. New, unprecedented means of information exchange and communication are invented constantly, while their older equivalents live on long after they’ve stopped being state of the art. Information reaches each of us—and often assaults us—through a multitude of high-bandwidth and low-bandwidth channels, some of which we permit to speak to us, and some of which do so uninvited. Sitting down to watch TV, checking one’s iPhone during dinner with a friend, or finding a quiet place to read a book all represent conscious choices to block certain channels and pay attention to others. Marshall McLuhan recognized that technologies in our environment have a rebalancing effect on our senses, writing that each medium is an “intensification, an amplification of an organ, sense or function, and whenever it takes place, the central nervous system appears to institute a self-protective numbing of the affected area, insulating and anesthetizing it from conscious awareness of what’s happening to it.”
Human attention, then, is a finite resource. A variety of criteria inform everyone’s small, constant choices about which media to focus on and which to tune out, and those choices often have little to do with their bandwidth, but today one thing is certain: Our own brains, not anything manmade, are the bottlenecks that limit how much information we can receive at once. The contemporary world offers as much space for storing information as we’ll ever need, and we can instantly send any amount of it to the other side of the planet. Well before either were the case, however, humans learned to ignore the features of our environments that we deemed irrelevant—the noise surrounding the valuable signals we actually wanted or needed to receive.
Claude Shannon’s quote above, from his Mathematical Theory of Communication, introduces a qualitative layer to the question of human bandwidth and the environments we seek: People move continuously through information-rich and information-poor environments and are affected differently by each. Basic English is “redundant,” meaning it’s a language that requires many words to convey even simple messages—and is therefore a language that few would choose to use for anything but utilitarian purposes. Finnegans Wake, at the opposite extreme, could not be richer in information or content, to the point that it can barely be compressed or summarized. In Shannon’s example, the rich, information-dense content of Joyce’s novel represents a higher quality of communication, and Basic English a lower quality, although the latter fulfills plenty of functional roles.
Low-information, redundant content has a flatness to it. It’s less interesting. The Residents expressed this a different way on their Commercial Album, which comprises 40 one-minute-long pop songs. The liner notes explain:
“Point one: Pop music is mostly a repetition of two types of musical and lyrical phrases, the verse and the chorus. Point two: These elements usually repeat three times in a three-minute song, the type usually found on top-40 radio. Point three: Cut out the fat and a pop song is only one minute long.”
Plenty of pop music, in other words, is redundant and can be compressed without losing anything. This might be too harsh and cynical a judgment, but it’s valuable as a polemic. Modern environments, from top-40 radio to architecture to fiction, are full of redundancy and thus thin on information. The ease of digital information storage and transmission help explain why we can afford to be less economical with information than we were in the past, but getting used to redundancy, like getting used to a diet full of salt and sugar, reinforces our appetite for it and actually influences the types of information we produce. If the manmade world seems like a flatter place in the Information Age (not in the Thomas Friedman sense), this might be part of the reason.
As communication technology improves, the argument periodically surfaces that face-to-face interaction and cities in general will become obsolete. Joel Garreau rebutted this argument a few years ago in his article “Santa Fe-ing of the World,” in which he praises the high bandwidth that physical proximity and direct experience afford. He writes, “Humans always default to the highest available bandwidth that does the job, and face-to-face is the gold standard. Some tasks require maximum connection to all senses. When you’re trying to build trust, or engage in high-stress, high-value negotiation, or determine intent, or fall in love, or even have fun, face-to-face is hard to beat.” Even the most advanced digital media, in other words, are limited compared to full sensory engagement with one’s environment—the digital, closer to Basic English than Finnegans Wake, is still a utilitarian solution to problems like distance more than it’s an ideal theater for the highest levels of human contact. As our reality becomes more automated and algorithmic, our truly complex, nuanced, information-rich activities will continue to justify their existence, while the flat and redundant will increasingly disappear into the digital. By recognizing this condition, we can learn to preserve the depth of the former instead of simplifying our reality for easier absorption into lower-bandwidth channels.
This post originally appeared in Kneeling Bus on October 5, 2014.
Sunday, November 9th, 2014
This post originally ran on April 28, 2013.
I had an interesting conversation about Washington, DC with Richard Layman a few months back. One of his observations, rooted in Charles Landry’s, was that great global cities don’t just take, they give. To the extent that Washington wants to be a truly great city, it needs to contribute things to the world, not just rake in prosperity from it.
Affecting the world, often for good but unfortunately sometimes for bad, is a unique capability that global cities have because they are the culture shaping hubs of nations and world. When an ordinary city does something, it can have an effect to be sure. But things that happen in the global city are much more likely to launch movements.
For example, Chicago did not invent the idea of doing a public art exhibit out of painted cow statues. I believe they copied it from a town in Switzerland. But when Chicago did it, it inspired other cities in a way that Swiss town did not. In effect, ordinary cities influence the world usually by influencing a global city, which then influences the world. Often it is the global city that gets the credit although the actual idea originated elsewhere. Thus the role of the global city is critical. But we shouldn’t assume that all ideas originate there or that other cities can’t profoundly influence the world.
We might also think of bicycle sharing, which was around in various forms for quite a while. But it was the launch of the massive Paris Vélib’ system in 2007 (which according to Wikipedia was inspired by a system in Lyon) that made bicycle sharing a must have urban item the world over.
Similarly it was the High Line in New York that has every city wanting to convert elevated rail lines into showcase trails. New York is really the city that made protected bike lanes the new standard in the United States as well.
Beyond simple urban amenity type items, global cities can also launch profound cultural and social transformations. A few examples.
The first is from Seattle, a sort of semi-global city. It was in such a depressed state in the 1970s that someone put up a billboard that’s still pretty famous: “Will the last one leaving Seattle please turn out the lights?” Yet in Seattle there was a coffeehouse culture that spawned a movement out of which came Starbucks which literally revolutionized coffee drinking in America and event pioneered the entirely new concept of the “third place.”
A lot of people like to attribute the emergence of Seattle as a player to Microsoft moving there from Albuquerque in the late 1970s. However, I think the coffee example shows that there were interesting things already happening in Seattle long before that. It was a proto-global city waiting for a catalyst.
Another example would be the emergence of rap music out of New York City. Or house music from Chicago.
Or consider the 1963 demolition of Penn Station in New York in 1963. The wanton destruction of this signature structure horrified the city and led to the adoption of its historic preservation ordinance. This was not the birthplace of historic preservation in the United States, but this demolition played a key role in bringing historic preservation to the fore, not just locally but nationally.
Lastly, the Stonewall Riots in 1969 clearly played a signature role in the gay rights movement in America. Many pride parades today are scheduled to fall on the anniversary of the event.
Who knows what might have happened with coffee in America without Seattle. But I think it’s clear that both the historic preservation and gay rights movements would have emerged at some point anyway regardless of what happened in New York. However, the events in New York clearly provided a sort of ignition and acceleration.
How many historic buildings in America were saved because Penn Station was lost? (Think about how many might have been destroyed had the historic preservation movement emerged later).
Think about a state like Iowa where gay marriage is legal. How many people in Iowa 40+ years ago had any idea that an obscure incident in New York City would ultimately transform the social conventions of the rural heartland?
I think this shows the power of the global city. I’m sure that there are things happening underground in New York and elsewhere that right now that we don’t know anything about yet that will ultimately transform our world 10, 20, or 30 years down the road. It’s crazy to think about.