Track Twenty-Nine draws my attention to this article about South Bend, Indiana's lobbying for a stop along a proposed high speed rail corridor. One thing concerns me, though:
If the federal government approves funding for a high-speed rail line through South Bend, passengers here could travel to Chicago's Union Station in just one hour. Such a project would have a profound effect on life in South Bend, making it easier for residents to commute to jobs in the Windy City, local officials say.
There are a lot of good reasons to invest in high speed rail infrastructure. Extreme commuting isn't one of them. Now, this article doesn't specify that people would use this for their daily commute, but there are reasons to think that's the case.

(from flickr user satosphere)

I've heard this argument applied elsewhere. While recently discussing the 3-C Corridor in Ohio, someone said, "wouldn't it be great if we had high-speed rail here?.. you could live in Cleveland and work in Columbus!" Frankly, I don't think it would be very great.

To start, there seems to be an assumption that high speed rail will be very affordable. There is really no basis for this belief. The Acela line in the Northeast (and the closest thing we have to high speed rail in this country) has very expensive fares. To travel from Philadelphia to New York City (about the same distance as South Bend to Chicago) can cost over $100 each way. Doing that twice a day for a week would run you a thousand bucks. Even if they cut you a big discount for being a frequent rider, the price tag would still be very high.

The reality is that the hour-trip promise is a station-to-station estimate, which doesn't take into account that almost nobody lives or works on top of these stations. At the end of the day, you're still looking at a round trip commute well over two hours. It's hard to see it being a realistic option for many people. It's just too far. We should really stop thinking about distance in terms of time, and start thinking about distance in terms of, well, distance.

24 Hour Cities

This American Life is probably one of the best programs on public radio. Yesterday's new episode is one of my favorite yet - five stories that all take place in the middle of the night. Download it on your iPod, listen to it at work, while you jog or whatever. If you haven't heard the show before, it's worth at least an hour of your time.

(from flickr user CC Chapman)

I get frustrated at times when I'm having a good night of writing, the clock strikes 10:00 and I have to leave my favorite coffee shop. There really aren't many other places to go at that hour in my neighborhood. Once things close for the night, they're closed for the night.

Recently I was in one of the more "happening" parts of downtown on a Tuesday night. The streets were dead. The person I was with commented that I shouldn't expect much and if I came back on Friday or Saturday night the neighborhood would be hopping. Regardless, that isn't what makes for a great 24-hour city.

A great 24-hour city should have a variety of things happening at all hours. It should be a place where you can live, work, shop, eat, see a movie, have a cup of coffee, or get a beer. There should be people out on the streets all the time. It shouldn't be limited to a place where people drive in from the suburbs to party two or three nights per week. Unfortunately, the reality is that there are very few of these places in the United States. What a shame.

Thinking About Transportation

Aaron Naparstek of Streetsblog says it best in this interview with PBS's Blueprint America.



The most interesting point comes at the end, when Naparstek notes that livable streets have become perceived as elitist, which is a actually a big problem. In a sense, they are elitist - they're very expensive. You have to have a lot of money to comfortably live in them. I can relate, because I don't have a career and I don't have much income at the moment. There's nothing I could appreciate more than more affordable urban communities; but with such a small supply, of course the prices are going to get bid up by the people who really want to be there.
I don't have a crazy video this year, as it seems the Black Friday crowds have been behaving a bit less like animals this year than historically (see my posts from 2008, 2007, and 2006 if you're interested in that) but I still have a few comments. Take this article from my local paper that I woke up to this morning:
As it neared 5 a.m. this morning, a line of 100 or more Best Buy shoppers wrapped around the store at Steelyard Commons. Several people had camped out overnight, including Ronnie Bolanos of Cleveland. He said he came out last year, and ended up being too late to take advantage of deals on a limited quantity of items. He wasn't going to let that happen again: This year he showed up at 7 a.m. on Thanksgiving, meaning he spent almost 24 hours outside the store.
It's more than just waiting patiently for 24 hours... it's spending an entire holiday at a big-box shopping plaza. It's spending it out in the cold and in the rain and the snow.

The popularity of these "door-buster" promotions is one thing, but stores seem to open earlier and earlier every year. On a typical day, most of these stores probably open at 9 or 10 in the morning. On Black Friday, some open at 6 or 7 in the morning; some open in the middle of the night; I've heard that a few shopping malls open at midnight. The question is, when will they start the door-busters on Thanksgiving at 9pm? or 6pm? When will the promotions start occurring the day before Thanksgiving, rather than the day after?

Boomerang Kids

The Associated Press is running a story about "boomerang kids" that's been getting some attention around the blogosphere. There's no doubt that more college grads are living with their parents than in the past, but to pin it entirely on the recession misses other important points.

College was a lot less expensive in the early 80s, the last time unemployment was as high as it is today; and college grads carried a lot less debt back then too.

There's also the cultural aspect, which exacerbates the problem. What 18 year old isn't anxious to leave home and go live on their own, no matter the cost? Plenty of teenagers choose to go to a college far away from where they live, others go to school in their hometowns. Almost none of them wants to live with their parents. But living away at college is actually very expensive. In the neighborhood where I go to school, the typical rent is about $400-$500 (depending on the number of roommates and quality of the housing and such) but university-owned dorms and apartments charge what calculates out to about $900 per month, nearly a 100% price premium. And plenty of people pay it.

(from flickr user jeremy.wilburn)

When you have no (or little) income and you're spending a fortune on tuition alone, living on your own just adds to that debt load. And it doesn't matter whether or not you use borrowed money to pay for housing, because it all trades-off in the end. Cash you spend to pay rent is cash not being used to pay tuition. So for many, that's the dilemma, live on your own when you're 18-22, but if you aren't dealt a great hand after graduation, you might pay for that later.

Boycott Happy

The LA Times has an interesting story about the American Family Association being up-in-arms about corporations not using the word "Christmas" in their holiday advertisements. This year, they're calling for a boycott of Gap and its brands on these grounds.



It's a pretty bad commercial, but if you watched it, you'll notice Gap actually does use the word Christmas. It's almost as if the American Family Association has a pile of pre-written forms, they merely fill in the name of the (presumably) offending company and the rest is magic. Sometimes if I wonder if these organizations actually don't want what they're demanding, because, once they get it, what do they have to make noise about anymore?

Taxi Cab Payments

Daniel thinks taxi drivers are missing out on some business by refusing to accept credit and debit cards, even though they are required by law to do so. I think this is an instance in which mandating that all cab drivers accept plastic payments leads to unintended consequences.

(from flickr user sunface13)

I understand why cab drivers don't want to accept credit or debit cards. Cash isn't subject to a "processing fee" - an amount that can be significant, particularly for small fares, like those under $10 or $15. Cash is also better when it comes to tips. People paying with cash often round tips up, especially if they need change. People paying with plastic often calculate an exact percentage tip. Not to mention that cash tips are easy for cabbies to hide from the tax man..

It seems like, if credit and debit fares were truly valuable, some cabbies would willingly exploit that market. They could put big stickers on the side of the car or a sign on top so potential customers know it's an option. If a cabbie typically patrols an area (like universities, as Daniel suggests) where people don't carry cash but like to spend money anyway, it might make good business sense for cabbies to accept plastic payments.

The problem with universal mandates in this case is that the winners are the banks and card processors, and the losers are either the drivers or the customers. In the short-term, non-cash payments will cut into drivers' profits and tips. Over time, cabbies might lobby for higher fares, which would be bad for the customers. Kevin Drum has made some good points on the cash vs. plastic debate. I recommend anyone who wants to learn more to check it out.

Don't Tax College

Hard for cash, Pittsburgh's mayor wants to establish a new 1% tax on gross college tuition paid by students. It's an awful idea for generating revenue; but unfortunately, Pittsburgh might be able to pull it off without immediate negative consequences.

(from flickr user Niemster)

College has already gotten so expensive to the point that a lot of students now simply roll their eyes and accept these things as another cost of the college experience. At the beginning of every semester, universities bill students for tuition, and then they tack on a bunch of seemingly arbitrary fees and surcharges. Many schools ask for a few hundred bucks for a parking space. Textbooks can be a hundred bucks or more each. When it's all over, it's actually not that difficult to ask students to fork over another few hundred bucks, and they'll do it, because the sticker shock will be long gone and they're numb to the fact that these are large amounts of money.

With any tax, the big risk is that the city becomes dependent and unable to roll it back if there are unintended consequences. If the tax can be successfully implemented, other cities will probably try to copy it, and students across the country will get pushed deeper into debt buying a service that almost no one will argue is bad for them or for society. The best hope is that the courts find this type of tax illegal and we won't have to deal with it at all.

Popcorn Subsidies

Consider this for a moment: if you go to see a movie this Saturday night, the ticket will probably cost between $8 and $10; if you want a bucket of popcorn, you'll probably pay at least another $5 for the salty snack. On the other hand, one of my favorite bars has a popcorn machine, just like at the movies, and if you go into there this Saturday night, you can eat as much popcorn as you'd like, and it's free!

(from flickr user Justinsanity)

Popcorn at the movies is the quintessential "pricing puzzle". Everyone wants to know why it costs to much to buy something that they know costs almost nothing to produce. Further, how does the bar get away with passing out free popcorn while the movie theater charges an obviously inflated price?

The answer is that in both cases popcorn is being used as part of a cross-subsidy. In the case of the movie theater, popcorn is subsidizing the ticket cost; but in the case of the bar, popcorn is being subsidized by beer and other drinks.

Think of it this way... the goal of a theater manager is to fill every seat at every show. How can she do this? By changing a low enough price so that enough people will come and fill the theater. Of course, she doesn't want to price the tickets too low, or she won't be able to make any money. The solution is to overcharge for popcorn, candy, soft drinks, and other concessions that she knows some people will inevitably buy anyways. In fact, the more people who buy a ticket to the movie, the more potential concession customers this manager gets.

The bar, on the other hand, is making most of its money by selling high-margin alcoholic drinks. The role of popcorn (or peanuts or pretzels or whatever else) is to encourage people to buy as many drinks as possibly. Filling peoples' stomachs with a cheap food like popcorn is the perfect way for the bar to keep people drinking all night and making the bar owner a rich man.

I almost never buy concessions at the movies, I've often heard people make comments about what 'suckers' the people in line for popcorn are. Maybe so... but I don't mind, if it means I get a cheaper ticket to the same movie, who am I to judge?

Saturday Satire

I don't know what it is about satire that pokes fun of big-shot Washington lobbyists, but it just seems to easy to come up with good material. Thank You For Smoking, for example - hilarious. Now Streetsfilms has this short video featuring Veronica Moss, lobbyist for the Automobile User Trade Organization.



My favorite line: "This is not Italy. This is not... a piazza!"

Dealing with Palin

Andrew Sullivan writes:
This is only the second time in its nearly ten-year history that the Dish has gone silent. The reason now is the same as the reason then. When dealing with a delusional fantasist like Sarah Palin, it takes time to absorb and make sense of the various competing narratives that she tells about her life. There are so many fabrications and delusions in the book, mixed in with facts, that just making sense of it - and comparing it with objective reality as we know it, and the subjective reality she has previously provided - is a bewildering task. She is a deeply disturbed person which makes this work of fiction and fact all the more challenging to read. And the fact that she is now the leader of the Republican party and a potential presidential candidate, makes this process of deconstruction an important civil responsibility. We take this seriously as we always have. We want to be fair to her, and to her family, and to the innocent people she has brought into the spotlight. And we are not reporters. We are merely analysts trying to make sense of evidence already in the public domain, evidence that points in all sorts of directions, only one of which can be true.
Emphasis mine. I understand where the guys at the Dish are coming from. It is, in fact, the reason why this blog has gone silent on many national political topics.

Back in my younger blogging days, I routinely drew attention to the idiocy of George Bush, Fox News and conservative pundits who seemed so obviously delusional that perhaps even they themselves knew it. Then I started wondering if it was all part of the game...

When it comes to Sarah Palin, I honestly question if the liberal blogosphere and the mainstream media wouldn't do the most damage by simply shutting up and talking about something else for a while. Drawing attention to every sentence Palin makes merely rationalizes the idea that she is the leader of the Republican Party, and eventually it will become a self-fulfilling prophesy. Even otherwise rational thinkers on the right could eventually get sucked in to the hype and believe that she is running the show.

I don't often agree with David Brooks, but he makes a somewhat compelling case that guys like Rush Limbaugh and Glen Beck are actually not very influential; but it seems like it because every time they inevitably say something outlandish, the liberal blogosphere flips out and draws undeserved attention to them. I fear the same is happening with Palin too.

Towpath Trail Review

I biked it about a week and a half ago, from Cleveland (about mile marker 5) to Peninsula (about mile marker 24 or 25) and back. My overall impression is that the Towpath a nice resource for recreational purposes, but it's difficult to imagine it evolving into a solid network that bike commuters can realistically use to get around.

(from flickr user jacobgutierrezflores)

The ride itself, along the trail, is very nice; but there are a few things that I thought could be better.

First, it's very challenging to get in and out of the Cuyahoga Valley. This is problematic because there really isn't much down in the valley, and many people come from an area of a significantly higher elevation. I think the elevation change is about 500 feet from the Towpath to many of the surrounding areas. And while this isn't necessarily the most ridiculous hill in the world, it is very challenging for those who aren't in the best of shape (considering I rode over 50 miles on the trip, I like to think I'm in decent shape, but the hill was by far the hardest part).

Second, riding on unpaved paths gets old after a while. I'm not much of a mountain biker, I like riding smooth surfaces like city streets. The northernmost part of the Towpath, from Cleveland south to Valley View (about mile marker 14 or 15) is nicely paved with asphalt. The rest of the trail that I rode, from Valley View to Peninsula, was a gravel-type surface that was noticeably more challenging to pedal across, and occasionally kicked up pieces of dirt and small rocks (I didn't have fenders on for the ride).

There has been a lot of talking about finishing the Towpath and extending the trail into downtown Cleveland. I'm all for it. I just wish the trail was a more realistic option for bicycle commuters; perhaps along the lines as the Lakefront Trail in Chicago, which is utilized by both commuters and recreational users alike and has become on of the city's most valuable assets.

Fast Food Loss Leaders

Marketplace had a pretty interesting story last week about the economics of the McDonald's dollar menu, and how it's squeezing profitability for a lot of store franchisees.



I haven't been into a McDonald's in a long time, so I can't speak from experience, but it seems like one major problem is that it's difficult for McDonald's to effectively utilize loss-leaders if a lot of people are simply buying things off of the dollar menu and nothing else. Back when I was in high school, I recall regularly going into Wendy's and picking items off of the value menu and never buying any of the more expensive items.

This is different than if my favorite bar offers a burger and beer for five bucks on a certain night of the week. In that case, the bar only needs to sell about one regularly priced drink to make up for (and possibly even profit) from the deal. And based on my experience, that's usually not a difficult goal to achieve.

The Parking Free-For-All

I can't get enough of the show Parking Wars on A&E that I blogged about a few months ago. The more I watch, the more I notice a few repeating trends.

(from flickr user lobstar28)

Few parking violators admit to wrongdoing. This might just be selective editing by the folks at A&E, but it seems like everyone who gets busted for a parking violation wants to put up a fight about it. This doesn't surprise me. When I worked the rides at an amusement park, people would routinely violate safety rules. When informed, rather than accepting the error and saying "sorry, I didn't know" many would lash out and refuse to admit any wrongdoing.

Most of the violators who get upset are upset at the wrong person. Blowing up at the person writing the ticket or booting your car really is pretty pointless. It's the lawmakers who should really be the object of hostility; but the blue-collar foot-soldiers often take the heat. This also doesn't surprise me. People at airports get more upset with the TSA people running the metal detectors than the do at Gale Rossides (the bureaucratic head of the agency, in case you didn't know) or Janet Napolitano (our current Homeland Security Secretary).

Few parking violators understand why the rules they violate even exist. Admittedly, it's hard to think about this, because it's counter-factual. A single person with an expired meter might not have much impact on everyone else, but if everyone were able to park and not feed their meters, it would be a hell of a challenge to find an open space in heavily trafficked areas (street parking in Manhattan is actually a pretty good empirical case study of this). Similarly, if one car double parks, it's an inconvenience, but if everyone started to double park without penalty, it would be an all-out traffic disaster.

In fact, because the market for parking is so challenging to appropriately price, letting people park wherever and whenever they wanted would turn it into the ultimate 'free-for-all market'.

When you think about it, if everyone just followed the rule of law, entire bureaucratic agencies dealing with parking wouldn't even exist. The fact that they do, that they employ dozens of people with an endless supply of work, and they turn big profits every year really tells you something about how willing people are to gamble with parking in places where they aren't allowed.

Academics & Wikipedia

I know many academics who detest Wikipedia (not all of them, of course, but a noteworthy number). And I wholeheartedly disagree.


I don't think there is a single greater tool for educating ones self on a wide variety of topics than Wikipedia. It doesn't matter what I want to know about, I can learn about it there. It's really a depth vs. breadth debate... Wikipedia can tell you a little about a lot of topics, but it fails to tell you a lot about any single topic.

To which I think there are two important considerations. First, many Wikipedia entries now feature a pretty comprehensive 'works cited' section where you can go for more in-depth look at the topic in question. Second, the peer-reviewed journal articles that academics treat as the gold-standard of research knowledge are basically useless to anyone who doesn't already have an in-depth understanding of a particular topic. Even if they do, the articles are often locked-up and isolated from the public; available only to those willing to pay or access to university library systems. If I wanted to learn something about how an internal combustion engine works, for example, I could get a pretty decent basic understanding from Wikipedia, or I could read dozens of 40-page journal articles about obscure components of such engines and not learn a single thing.

The whole situation intrigues me because, it would seem, academics should be all about the dissemination of knowledge throughout our society; and yet, because of the minuscule chance of finding factual error somewhere out there, many have become hostile to the very idea of Wikipedia.

Oh Christmas Ale

I've been accused of writing about too many serious topics on this blog, so... here's a fun video from comedians Jim Tews & Mike Polk.



For all the criticizing I do of Cleveland, there are a lot of things to love; and if I ever leave, there will be many things I will miss. Besides the Great Lakes Brewery, I'm not sure what I'll do without a strong Phoenix Coffee to wake me up in the morning, a public library where I can get basically any book whenever I want, or a neighborhood where every night of the week a different bar has an and beer for $5 deal that even a frugal guy like me can afford.

If only some of the macro problems weren't so daunting... if only.
Downtown Cleveland needs 25,000 residents to become a 24-hour urban center.

I don't know where the magic 25,000 number came from, exactly; but it's been tossed around quite a bit, and it seems pretty reasonable. We're only about 40% to that goal, so the harder question is: how is Cleveland going to attract 15,000 more people to come live downtown?

One answer seems so obvious it's amazing more people aren't talking about it. Cleveland and CSU need to work together to get more students to come live on-campus.

(from flickr user Steve Aresman Thomas)

There are about 16,000 students who attend CSU, only about 5% of them live in university-provided housing. There are also another 1500 faculty and staff - some of whom already live in downtown housing.

When I was in high school almost nobody talked about going to Cleveland State. It didn't get much respect, and going there meant you'd probably be a commuter and live with your parents. The inability to move out and live on one's own is undoubtedly a big turnoff for many. But at the same time, CSU wants to become a more respectable university, and its enrollment is up pretty significantly, thanks to its generally affordable price-tag (at least compared to Cleveland's 3 big private universities where you can go and live on-campus and which many of my high school classmates did attend).

And yes, CSU is already on the right path. The university has expansion plans that could provide housing to up to 2500 students, and the recent purchase of the Heritage Suites building could house a few hundred students almost immediately.

It would be nice if more locals started thinking about CSU as a major asset for downtown Cleveland - not just that place where a bunch of suburban kids drive to and from every day to go to class.
My personal website must have pretty decent SEO - because in the past year, I've received about two dozen emails from aspiring Southwest Airlines interns looking to draw on my experience in search of their own dream internship. In the past two weeks alone a few new emails have already started rolling in...

(from flickr user San Diego Shooter)

If you've found your way here, you might be hoping for the silver bullet; a secret tip that will propel you above the competition. Unfortunately, I do not know any inside secrets. I can only share my experience as an internship candidate about two years ago and, rather than responding individually to future emails I anticipate to receive, I hope that potential interns will find the information posted here valuable.

Understand: Southwest Airlines is a very unique company. The corporate culture at Southwest is truly unlike that of nearly every other company. But you probably already knew that, since it now seems mandatory for every management, human resources and marketing textbook to include at least one case study about the quirky airline that became a wild success story. But ask yourself this: how much do I really know about the company I want to spend my summer working for? I think there is a huge advantage to understanding the history of the company and the intricacies of how it operates. There have been dozens of magazine articles and several excellent books written on this topic. I would highly recommend that any potential intern get their hands on as much as they can read. Among my favorites are:

Magazine Articles
Books
Realize: Summer internships are ridiculously competitive. Almost all college students take time off from school in the summer, and almost all of them are looking for something valuable to fill their time. If the numbers that my friends in Dallas tell me are correct, then Southwest will receive several thousand applications for about 75 internship positions. The truth is that I did my internship during the winter/spring semester of 2008 - a sort of "off season" as far as internships go. If you're applying in the summer, it will be competitive, so anything less than your best effort probably won't be enough.

Stand Out: A resume only goes so far. Most of the emails I receive from potential interns ask which careers skills they should highlight on their resumes. My response is typically that it won't matter if they neglect to stand out in other important ways. It's no secret that Southwest hires for attitude and trains for skill. And remember, these are internships, so it makes sense that the company would recruit individuals who are likely to be loyal and willing to stick around for the long-haul. My best advice is to use the application to highlight creative abilities and to do something to really stand out from the crowd. The last thing you want to be is one of thousands of dull black-and-white resumes. Back when I applied, all the applications had to be sent in the mail, which gave me the opportunity to send in some pretty fun stuff (and which, fortunately, the recruiter and hiring managers loved). Now that the applications are online, doing stuff like that won't be so easy, so you'll have to really try to think way outside the box.

Interview Essentials: It's about who you are. Congrats, you got a coveted call-back and you'll be flying to Dallas for an interview. What should you expect? I had three interviews before I was eventually hired as an intern: two group interviews and one interview with a recruiter and several hiring managers. I applied for an internship in the marketing department, but I was never asked a single question about marketing, advertising or sales. The questions were focused on me: what I'd done in the past, how I'd handled myself in certain situations, and why I really wanted to be a Southwest Intern.

Prepare: Living in Dallas can be a culture shock. I think the hardest part of the internship for me was the fact that I'd never lived in the south, didn't know a single person in the entire state of Texas, and had to arrange to pick up and move cross-country on about a month's notice. Southwest's headquarters is right next to Love Field Airport, which makes sense, given the nature of the business; but it can also be a difficult place to get to if (like me) you don't have your own car. When I was an intern, we were on our own to find housing and interns were scattered all over Dallas - some lived with relatives, others were out in far-flung suburbs. The good news is that you will make so many friends that you probably won't ever have to worry about finding something to do on the weekends.

Lastly, keep in mind that Southwest greatly values the opinion of its employees. If you're flying to Dallas for an interview, you'll encounter dozens of them... ticketing agents, gate agents, flight attendants, pilots, etc. Each of those people is a potentially valuable opportunity for you. The interview doesn't have to be limited to the hour session in a small room at the People Department in Dallas, after all.

RTA Ridership Model Update

Last month I built a statistical ridership model for Cleveland's RTA system. One major concession was that I excluded a service-level independent variable because I lacked sufficient data to include it in the model. Unsure how to resolve this issue, I recently received this email from someone at the Maryland Transit Administration:
The service level data not in your model is actually a huge factor driving ridership-if the system isn’t seen as robust due to meager service offerings, fare prices and population don’t matter. I think if you add service levels to your model, you’ll see that it adds a good chunk of explanatory power, and that it may even be collinear with population. As population departs, tax base declines, service has to be cut, and so on. For the share of transit system users that are transit-dependent, poor service means they will find other ways-ride sharing, moving, etc.-to get to where they need to go. Transit use is always optional, and the elasticity is different for different rider segments, but less service will always reduce ridership.
This explanation is actually more intuitive than one that high fares primarily drive ridership. And here is the worst news: next April, RTA will cut service more significantly than in recent memory.

So continues the death spiral of transit service in Cleveland...

Intelligent Urban Thinking

There are a lot of books out there about urbanism, city-living, sprawl and other such topics. Some are excellent, others have put me to sleep. Michael Sorkin's Twenty Minutes in Manhattan is one of my new favorites. Although the description on the inside flap describes the book as a story of the walk from the author's apartment in Greenwhich Village to his architecture studio in Tribeca, the book is so much more; from a history of zoning and tenant laws in New York to an analysis of street grids and the subway to the many parks that blanket the urban landscape. The book can be dense in parts and some topics seem very long-winded and without organization. Overall, it's a nice read for someone interested in New York City and the urban realm that encompasses it.

In particular, there are three topics that Sorkin got me thinking more about; things which I hadn't really paid much attention to before.

Rent Control - there are few topics that get as much bad press in economics circles as New York's rent control laws. Most economists argue that rent control creates an artificial shortage of residential space, and those paying low rents are cross-subsidized by new residents who wind up paying exorbitantly high rents or who can't find an apartment at all. Along these lines, they say everyone would be better off if we just let the market dictate rental prices. Sorkin suggests, on the other hand, that many with rent controlled residences make up the difference in cost by becoming more civically engaged, which ultimately benefits everyone in the community. A completely market-driven system could unintentionally alter those dynamics, leading to something like the suburban subdivision effect, where people don't even know their own neighbors and only care about the community to the extent that it benefits them personally.

Lessons from Disney World - much has been said about Disney World as a fantasy urban place. Between the density, the walkability, and the car-free midways, there are a lot of things to like. And every day, thousands of people pay top dollar to get into these places, but when it comes to the public places we use every day, the perception can be quite different.

The Birth of Cities - most of America's cities have histories going back at least a hundred years. A few have risen over the past few decades, but one interesting question is whether any new cities can emerge in the future? When we look at the sprawled out metro areas with very weak urban cores, it's easy to wonder if we can ultimately fix them? Or can we start from scratch? Sorkin thinks military bases can be easy converted into high-density cities. It's a valid theory, but it's challenging to wonder if we will ever come to something like that.
Now that the cool new thing in state politics is for voters to rewrite state constitutions and promote casino construction in their backyards, one question to think about is the impact the all of these new brick-and-mortar casinos will have on internet gambling. The answer, I think, is: virtually none; and the reasons are both political and economic.

(from flickr user .mw)

It's easy to understand why people think there will be a trade-off. We use the ambiguous term "gambling" and assume that casino games are interchangeable; but internet gambling is focused heavily on two games: poker and sports-betting. Brick-and-mortar casinos, on the other hand, dedicate more floor space to slot machines than anything else. This equation is unlikely to change anytime soon.

As far as sports-betting goes, federal law makes it effectively illegal in every state outside of Nevada. That's great for the bookmakers in Vegas and Reno, but it's annoying as hell for anyone who wants to make a bet on a game and who doesn't live in the desert. It's extremely difficult to imagine Congress ever changing this law. Professional sports leagues will lobby hard to keep sports-betting out of the mainstream; and internet gambling will fill in the void.

The key to understanding why poker doesn't get much attention at brick-and-mortar casinos is to consider the marginal costs of running a poker room. Online, the marginal cost is effectively zero. As long as the host company has surplus computing power, they can run as many poker games as people are willing to play. In a casino, the marginal cost is considerably higher - there is the opportunity cost of floor space where the tables go and the salary of the dealers and the supervisors who run the poker rooms. From the players' perspective, casinos typically take a higher rake (commission) per hand than do online poker sites, so the cost of playing is higher. Plus, the pace of play is slower and players can only play a single table at once. These all line up to give online poker a big advantage over casino poker.

And the numbers back up the theory. The poker room at the MGM Grand in Detroit, for example, has a capacity of around 100 players. At the moment I'm writing this post, Full Tilt Poker alone has tens of thousands playing online. Online, there are tournaments running non-stop around the clock online; brick-and-mortar casinos, if they offer tournaments at all, typically relegate them to the slowest times of the week, like weekday mornings, or Sundays at 3pm.

This dichotomy is actually one of the things that annoys me about all the hype surrounding new casinos. When it comes to gambling, I enjoy three games: tournament-style poker, craps (at low limits, since I don't have much disposable income), and sports-betting. There isn't a single casino outside of Nevada where I can find all three of those under one roof; and going to a casino where 90% of the floor space is covered with slot machines is definitely not my idea of fun.

Dear Sirius-XM, I Quit

After being a loyal customer for 2.5 years, I called and canceled my Sirius-XM subscription this week. It wasn't a spur of the moment decision, Sirus-XM has been getting on my nerves for a while and the ultimate result is that they lost my business. I went from thinking that Sirius Satellite Radio was one of the best purchases I've ever made to deciding it wasn't worth it anymore. How? The story begins in the spring of 2007...

The Honeymoon Period
I had just finished my second year of college and was on track to start my summer job. Back then, I naively believed that spending over an hour a day driving back and forth from work in a car was "completely normal" and that I might be able to make my drive pleasant. So I bought new car speakers from a friend and a Sirius car unit from Newegg.com. In May 2007 I activated my subscription.

The price tag was $12.99 per month and I was instantly hooked. The number of music channels was awesome and the fact that there were no commercials was pure gold. Plus, I occasionally enjoyed listening to the news and entertainment stations. It was a nice change of pace from the truly awful programming that AM/FM radio had to offer.

The Programming Starts to Go Downhill
I first started getting irritated with the programming on some of the "commercial free" music channels in the summer of 2008. See, Sirius-XM is true to their word that these stations don't play obnoxious commercials, but unfortunately, they hire the same type of arrogant DJs that I would expect to hear on any run-of-the-mill Clear Channel station.

My favorite Sirius station was Alt Nation, which plays a decent mix of new alternative music and some popular older stuff. Unfortunately, whoever Sirius hired to run the station in the afternoon, typically during the time I was coming from from school, was absolutely terrible. It almost seemed like this DJ browsed Google News looking for stories to make really ignorant and offensive comments about and proudly state his twisted political opinions in-between songs. It was exactly the thing that makes FM radio so terrible and the sort of thing I was willing to pay money to avoid hearing. After all, if I wanted to hear mindless political banter I would have tuned to one of the Sirius-XM stations dedicated to that, like Patriot Radio or Sirius Left.

Goodbye Online Access
My original subscription gave me access to most of the Sirius music stations through my online account. I didn't utilize it very often, since I typically listen to public radio on my PC if anything, but occasionally it was nice to tune into some music at work, if I was in the mood. At some point in the past year that little perk was canceled, and I wasn't willing to pay more money to get it back.

The Pricing Bait and Switch
The straw that broke the camel's back occurred right around the time of the Sirius and XM merger. I (like many) believed the merger would be great for customers because one of the terms set by the government meant that Sirius-XM had to open its service up to "a la carte" packages, meaning I could pick only the stations I wanted to receive and pay a reduced monthly rate for them. After the merger occurred and the new packages became available, I logged into my account to change my plan. Unfortunately, I discovered that I could not, because my Sirius equipment was "not compatible" with a la carte programming. If I wanted any package besides the one I was already paying $12.99 for, I would have to buy all new equipment. This was unacceptable, as the new hardware would take years to pay for itself with the money I would save every month. I grudgingly accepted defeat and kept my package.

Then in August 2009, I noticed that the charge to my credit card was noticeably higher than what I had previously been paying. Since I pay by the quarter, my new rate amounted to more than $16 per month. I didn't see it coming. I did a bit of Google research and discovered that Sirius-XM had sent a letter to its subscribers (I probably shredded it since it looked like junk) that blamed the rate hike on the US Congress and the greedy music industry:
Music royalty rights were established by the U.S. Congress as part of the Copyright Act. This Act requires payment of copyright music royalties to recording artists, musicians and recording companies who hold copyrights in sound recordings. These royalties have recently increased dramatically, principally as a result of a decision made by the Copyright Royalty Board, which is designated by the Library of Congress to set royalty rates for sound recordings.
Was I supposed to sympathize with Sirius-XM? Certainly they don't want to pay more for programming, neither did I. They could have opted to eat the cost, but they decided to pass on the cost to me, and I wasn't willing to pay.

Is Satellite Radio Doomed?
Sirius-XM has a serious customer service problem: they turned a customer who used to think they offered one of the greatest subscription services into a non-customer. I have to imagine there are many others who feel the same way as me. I understand that Sirius-XM isn't a profitable corporation and that investors can be pretty impatient people, but I really don't care as a customer. It's hard to pay more money for a worse service than what I used to receive.

What will I listen to if not Sirius? Well, I drive a lot less than I used to when I first subscribed, so I don't need the same amount of stimulation while wasting time in the car. There are tons of good podcasts that I can download to my iPod. Now that just about everyone else seems to have an iPhone, I imagine the availability of decent content will only continue growing. Sirius-XM really needs to figure out what it's doing if it doesn't want to continue dying a slow, painful death.

The customer service rep I talked to made me several offers I "couldn't refuse" - I refused them all; because the damage was already done, and I knew if I took one of their offers, I would just be calling back to cancel again in a few months.

The Danish Way

Last week's episode of NOW was pretty great.



I think the whole 'electric cars can save the world' attitude can be easily misinterpreted, because the reality is that in a city like Copenhagen, there will still be a sizable number of people who never own one. It's a unique city in the sense that it's both very expensive to drive and very reasonable to get by without ever driving. That's not true of most American cities.

So you could replace every SUV in America with an electric vehicle; for that matter you could replace every internal combustion engine vehicle with an electric one, and we'll still have a plethora of problems. Electric vehicles won't solve traffic or congestion, they won't slow sprawl, they'll still cause tens of thousands of deaths every year and they'll still need a place to be parked for 95% of their lives. Even this completely unrealistic "best case scenario" isn't really very progressive in the scheme of things.

Lastly, I've been skeptical of Shai Agassi in the past, and his interview with David Brancaccio doesn't inspire any new confidence. For instance, he makes this argument in defense of his electric vehicle business idea:
The thought process of ‘we need money for health care, so let them drive the cars that emit the gases that cause health care costs’ is the same as telling people, ‘force them to smoke, so we can collect the taxes on cigarettes so we can pay for the hospital afterwards’. That logic is convoluted in it’s design.
But it's Agassi's logic that is actually flawed. Who actually thinks that an excise tax on cigarettes amounts to the government forcing people to smoke so the state can collect revenue? If the state spends the money they collect from cigarette taxes on programs to help people quit smoking, that's a socially responsible action. Similarly, if government uses excise taxes on cars and gasoline to provide alternative means of transportation, that's not backward thinking, that's what makes a city like Copenhagen such a progressive city.
Occasionally Chipotle has promotions where they give away a free burrito to anyone who shows up. Apparently Halloween is one of these occasions, which I discovered last Saturday night when I showed up craving a burrito and found a line wrapping all the way around the store.

(from flickr user LSykora)

I took my business elsewhere.

Most highways in the United States suffer from the "free burrito problem". When I go to Chipotle, I expect to pay $5.50 for a burrito. I expect the line to be anywhere from no wait to a ten minute wait; but nothing like the line I saw on Saturday, which I suspect might have taken a little over an hour to maneuver.

Every morning people take their cars and curse the congestion on the "free highways" they use to get to wherever they're going, even though it's pretty much exactly what they expect. And there are strong political constituencies to keep things this way.

Of course, there are plenty of alternatives to Chipotle, so even though I would have preferred a burrito, I wasn't going to go hungry. But in some of the American cities with the worst congestion, there aren't many alternatives. The Chipotle with the insane line is the way of life.
Last Sunday's 60 Minutes took a look into the world of movie piracy. Take a look.



I have a really difficult time understanding how there is such a huge market for this kind of thing in the United States. I can understand why there might be a market for a product like music, even textbooks, because theoretically you can make a near-perfect copy of the original and the bootleg would be only marginally different (if at all).

Movies are a different beast. People listen to music on their ipods and in their cars; but they go to a concert to experience that music live. People go to the movies for an experience they can't get at home - watching a movie on a giant screen. The reason I wouldn never want to watch a bootleg DVD of a new movie is the quality gap. The 60 Minutes story describes bootleg movies being made by people sitting in the back row of the theater recording on tiny spy cameras . There's no way that the bootleg can even come close to the quality of the original.

I always thought the point of going to movies was to enjoy films, not to see them merely for the sake of it. I know there are a lot of people with more disposable income than me and it probably would be good for my budget if I quit going to movies, but there's no way I would substitute a bootleg instead. Watching a bootleg movie like that would be like listening to a live concert recorded by someone standing in the audience. What's the point?

Reverse "Crowding Out"

Daniel has a few interesting things to say about the plans for Chicago's North/Clybourn L station. First let me say that I think any transit improvement is worthwhile. But I also think we have to consider the potential risk that this could pose in the long term - a sort of reverse "crowding out" of public investment in transit infrastructure.

(from flickr user konomike)

Here's the concern: Apple might spend a few million bucks renovating the North/Clybourn station, but Apple itself might never see a direct financial return on its income statement. The net beneficiaries of the improvement will be the public, who will use the station, and other businesses in the area, who will free ride off of Apple's investment. For Apple, it will primarily be an act of corporate goodwill.

The risk is that transit systems become reliant on these acts of corporate goodwill, which are never guaranteed. A more reliable idea for transit improvement would be some sort of public and private collaboration. The private side would be administered by a business improvement district, to avoid some firms free riding off of others. This might not work so well for brand new transit systems whose goal is to drive development; but for older systems that already have development around stations or for potential in-fill stations, it could be the most efficient way to make improvements to crumbling transit infrastructure.