Archive for the ‘Economics’ Category

Increased blight in Oakland, here we come

Friday, May 15th, 2009

An excerpt from the city’s estimate of how proposed budget cuts would affect the Public Works Department’s ability to provide services (“FTE” stands for “full-time equivalent”):

Key Impacts and Mitigations
• Park Maintenance: No routine maintenance at 212 locations (mini-parks, neighborhood parks, special use parks, parking lots, plazas, medians and streetscapes) Remaining 60.27 FTE will provide routine maintenance at 104 “priority” locations.
Tree Services: Pruning, planting, watering will only be done in emergency situations. Remaining 15.0 FTE will remove hazardous tree conditions.
Litter Enforcement Program: Remaining 3.0 FTE will be assigned to each Police Area. Activities will continue but to a lesser extent.
Street Maintenance: Speed bump installations will be eliminated. Remaining 47.0 FTE will continue activities at reduced levels—base repair, pothole repair, crack sealing, guard rail repair, fending, sidewalk repair.
Traffic Maintenance: Street signs and striping will impacted. Remaining 20.0 FTE will continue activities (street sign repair and replacement, and street and curb striping) at reduced levels.
Designated Downtown Cleaning: Elimination of manual sweeping and hand/power cleaning of sidewalks will increase visibility of litter, dirt and grime. Remaining KOCB crews will continue street sweeping, litter container service, illegal dumping removal and graffiti removal.
City Facilities Custodial and Maintenance: Painting of city facilities will be limited to graffiti abatement. Some minor CIP will be eliminated and remaining function will be centralized with CEDA/Dept of Engineering and Construction. Custodial services at Civic Center will be reduced, including fewer daily cleanings and elimination of office move support.

The picture is pretty similar when you look at the list for the Parks & Rec department, libraries (my local branch is likely to only be open 2 or 3 days a week), etc. A pdf copy of the slides detailing the proposed budget cuts by department, which were shown at a budget town hall on Wednesday evening, is available at the indispensable A Better Oakland.

I’m not necessarily criticizing these proposed cuts—I haven’t yet read and thought enough about the options to know whether they are the best solution to our budget woes—but it does paint a pretty dramatic picture of how screwed Oakland’s government is.

For anyone who has driver a car or ridden a bike down, say, 12th St. near Harrison, reading that street maintenance activities will continue “at a reduced level” will send a shiver up your spine—or more accurately, will knock your spine out of whack and send you hobbling to a chiropractor.

As for “no routine maintenance” at about 2/3 of the 300 neighborhood parks, medians, streetscapes, etc., I have said several times here before before that since we can’t rely on City Hall to keep Oakland looking clean and nice, it’s more important than ever for residents to take matters into their own hands by adopting vacant lots, median strips, local parks, etc. Studies have shown that a little bit of blight removal can yield a lot of benefits.

The Train to Nowhere?

Wednesday, May 13th, 2009

If you’ve ever taken AirBART from the Coliseum BART Station to the Oakland airport, then you know the service is pretty slow and unimpressive, especially considering the $3 fare each way. So you might think that public transit advocates in and around Oakland would be delighted by BART’s proposal to build a faster connection between the BART station and the airport terminals. Under the plan, the AirBART bus service would be replaced by an elevated people mover that would whisk passengers at a rapid clip from the BART station to the airport. Sounds great, right?

Wrong! The fact that local transportation activists and bloggers seem to be unanimous in their condemnation of BART’s proposal for the Oakland Airport Connector is an indication of how problematic the plan is. To start with, BART would have to borrow $150 million to fund the $522 million project. Yes, this is the same BART that is scheduled to raise fares by over 5% next year, and is threatening that it may have to raise them even more to make up for shortfalls in their budget. So while the citizens of the Bay Area who rely on BART to get around day in and day out are being asked to shell out even more for fares, BART’s directors want the system to go deeper into debt to fund their longtime dream of a people mover that will soar above an East Oakland neighborhood. (Gotta protect those air travellers from the Oakland riffraff!)

You might ask: Well, won’t the train at least provide a top-notch service to passengers, taking them from BART to the terminal quickly and easily? No! While the proposed connector will get from the BART station to the airport much more quickly than AirBART, the $522 million budget will only pay for a single stop at the airport, between the two existing terminals, and on the far side of all the car and bus dropoff lanes. So while passengers will get to the airport quickly, they will end up farther away from the terminals than they currently do with AirBART, which stops at each terminal, and which only requires passengers to cross a couple of lanes of traffic to get to the gate. If they build a third terminal at OAK, as there is talk of doing, then passengers will have to walk even farther from the train to reach it.

On top of those issues, what seems worst about BART’s proposal to me is that they expect to charge passengers $6 each way for the airport connection (that’s on top of the BART fare that they have already paid). That high cost might be defensible if there was no better option as a replacement for AirBART, but in this case, there is another option. In a matter of a few weeks, the local transportation advocacy group TransForm put together a Rapid Bus proposal that would cost a tenth of BART’s proposal, would require no new debt, would be quicker to implement, would serve more people, would be almost as speedy, could pick up passengers near the hotels and businesses on Hegenberger Road if desired, could stop directly in front of each terminal, and best of all, could be absolutely free for passengers, because the money saved by not building an elevated people mover would allow BART to fund operational costs into perpetuity.

It’s frankly pretty sad that a group of activists seem to have put together a more appealing plan in a few weeks than BART was able to put together in decades of planning (an airport connector has been in the works forever; in 2000, Alameda County voters passed a measure to fund a $130 million connector, which has morphed into today’s proposal, which provides worse service than the original proposal at $400 million higher cost—and has lower ridership estimates to boot).

I hope the BART directors don’t underestimate the appeal of a free shuttle from BART to the Airport. $6 might not seem like much in comparison to the cost of a plane ticket, but I think the psychological difference between a free shuttle and a $6 people mover is enormous, especially for the price-sensitive people who are presumably likeliest to use BART to get to the airport in the first place.

I’m notoriously frugal, to the point where I once rode my bike 10 miles to the airport in the pre-dawn darkness, and locked it there for several days, all because BART doesn’t run all night and I was too cheap to pay for a cab or a shuttle. Another time, after returning from a trip, I walked from the airport to work in San Leandro because I didn’t want to wait for a bus, then dish out $1.75 for a ride of only a couple of miles (also, I just like to walk). So I might not be a typical case, but when you charge riders $6 for a 3-mile shuttle, on top of the roughly $2-$6 that they have already paid for bus and BART fare to get to Coliseum BART, you are giving people a pretty big incentive to just skip BART altogether and take a cab or a door-to-door shuttle.

At the last meeting of the BART board in late April, they reluctantly agreed to table the airport connector proposal until tomorrow, in order to study other options more closely (imagine that: studying other options closely before going $150 million deeper into debt). That’s when TransForm leapt into action and produced their counterproposal. If BART opts for the $6 elevated tramway instead of the free high-speed shuttle buses, I suspect it will not be on the merits, but rather because they have had their sights set on a sexy high-speed people mover for decades, and are too blinded by that long dream to weigh the pros and cons of the various options.

Like a lot of other people, I prefer trains to buses for vague, possibly irrational reasons (I basically never take the bus; if I’m crossing the bay, I will take BART, and if I’m staying in the East Bay, then I will usually either walk or ride a bike). So I understand the urge to build a train instead of replacing AirBART with an improved rapid bus service. In this case, however, the activists and bloggers have persuaded me that the costs (both to BART and to its passengers) of building the train in the sky are way too high to justify, especially given the limitations of the service that it would provide. I won’t be able to attend tomorrow’s BART board meeting where they will be deciding whether to go ahead with their grandiose plans, but local transit activists promise to be there in force, and I hope the BART directors are able to set aside their longterm fantasies and pursue a less flashy, but more practical, option instead.

Sign of the Times

Wednesday, April 29th, 2009

Letters from my landlord don’t come often, and in the past they have usually indicated one thing: higher rent. So when I saw the envelope in yesterday’s mail, my first thought was, “Damnit! How can they raise my rent when rents are falling in the area?” It turns out I had jumped to conclusions:

Rent Decrease

I have heard stories of tenants successfully bargaining their rents down recently, but I don’t often hear of landlords taking the initiative to lower rents on existing tenants. Not that I’m complaining, and presumably the decision was made for sound business reasons and not pure generosity (a couple of other tenants have left the building recently, and maybe the landlord hopes to prevent further departures). That said, given some of the horrific landlords in the world, I’m glad to be in my building that is managed with decency and competence.

The Ongoing Legacy of the New Deal

Monday, April 27th, 2009

As someone with a casual interest in local history, I was interested to learn from another Oakland blog about the Living New Deal Project at UC Berkeley. In addition to producing a book and collecting testimonials from people who worked on (or witnessed) New Deal projects, the Berkeley scholars are compiling a searchable database of the New Deal’s legacy around California, complete with an interactive map.

Lux et LexOne appealing aspect of the project is that members of the public are encouraged to contribute, by submitting projects that are missing from the database. (The best-known local sites are already included, including the somewhat stumpy Alameda County Courthouse alongside Lake Merritt shown here.)

Given how much the New Deal changed the physical character of cities, towns, rural areas, and parklands in the United States, I was surprised to learn that no one had previously tried to compile a comprehensive online database of New Deal sites. Some other websites have collected information about WPA art, and San Diego State University hosts a database of California WPA murals, but apparently no effort had been made to compile an exhaustive online database of buildings, infrastructure projects, and so on. The scholars at Berkeley are hoping that their California project can eventually be a model for a nationwide database.

Sausal Creek culvertWhile the list of sites is extensive, there are surely still some local New Deal projects which aren’t yet included, so if anyone happens to know of any others, the folks at Berkeley would be grateful for whatever help people can give. I noticed, for example, that the culvert holding a section of Sausal Creek, which bears W.P.A. stamps from 1939 and 1940, was not in the database, so I submitted it to the project and it now appears on their map. I wonder if they would be able to include some of the W.P.A. sidewalk and gutter stamps that have been documented at the Oakland Sidewalk Stamps blog. (Yes, there’s an Oakland Sidewalk Stamps blog—why shouldn’t there be?)

I’ve mused before about whether the current economic downturn will produce a legacy akin to that of the great depression, and one reason the Living New Deal project interests me is the parallel—or lack thereof—between that era and our own. In the 1930′s, many parts of the west, including the East Bay, were just becoming major population centers, and the need for civic buildings, bridges,and other basic infrastructure was pressing. Even if the Federal government were to fund public works projects on a similar scale in coming years, the physical legacy would presumably be very different from that of the New Deal.

There are also some New Deal projects included in the database which don’t have any photographs to accompany them, and the scholars seem to welcome help in that area too. For instance, that there were no photos of the Park Street and High Street bridges between Oakland and Alameda, and since I ride my bike across both bridges on a pretty regular basis, I offered to take a few photos which may end up being added to the website.

Those two bridges are both drawbridges, and although they were built 4 years apart, they have nearly identical designs and were constructed by the same general contractor. The only differences seem to be that the Park Street Bridge is twice as wide (4 car lanes instead of 2), and it is painted green while the High Street Bridge is silver. I created a new set on Flickr as a repository for shots of New Deal projects that I happen to have photographed, and here are photos of the Park Street Bridge (1935) and High Street Bridge (1939), respectively:

Park Street Bridge

High Street Bridge

The general public cannot add information or photographs to the Living New Deal site ourselves, a la wikipedia—we can only submit things for the consideration of the gatekeepers running the site. If anyone happens to know of other New Deal projects around Oakland (or anywhere else in California) which aren’t included in the database, I encourage you to submit them, or to let me know in the comments, because I am eager to know about them myself. The potential for this kind of collaborative project is one of the things I appreciate about the internet, but it only works well if enough people get involved.

Is San Jose’s mayor out of touch, or just a panderer?

Friday, April 17th, 2009

Every so often, newspapers print articles about the struggles of some of the wealthiest people in our country, who are barely scraping by on several hundred thousand dollars a year. The New York Times’s 2007 story on “working class millionaires” in the Bay Area was a classic of the genre. And last year, when the San Francisco Chronicle’s conservative columnist Debra J. Saunders dared to call people making $200,000 to $250,000 a year “rich,” she received so many indignant responses from high-earning readers that she decided to follow up in her next column, answering the objections of people like the lawyer who wrote in to inform her that a $200,000 salary cannot, by definition, make someone rich because “a ‘rich’ person does not need to work.”

The Wall Street Journal had a version of this old chestnut yesterday, in an article about how much people who make $250,000 to $400,000 a year will suffer if their taxes go up during President Obama’s administration. I won’t waste too much time explaining why it nauseates me, particularly in these tough economic times when many people are losing their jobs entirely, to hear people who earn more than 98 percent of Americans talk about how they struggle to pay their bills, but here’s an excerpt that gives you a sense of how hard it is to eke out a living on $260,000 a year:

“I’m not complaining, but the reality is Obama may call me wealthy, but I thought we were just good old middle class,” says Ms. Parnell. “Our needs are being met, but we don’t have a load of cash to cover wants.”

…For the Parnells, their perception of themselves is based on the math. The value of their house is down $60,000. Ms. Parnell says the couple’s gross income last year was about $260,000. Taxes, premiums for medical care and deductions for Social Security and their 401(k) contributions cut the gross to about $12,000 per month. The family tithes $1,300 a month at their church. Their mortgage, second mortgage and payment on land they bought is nearly $4,000 a month. Other expenses, including their family car payment, insurance and college funds, as well as basics like food, utilities and donations to charities, leave them with about $1,200 left over each month.

“I’m not after sympathy. We are blessed. What I want is a reality check on what rich means,” Ms. Parnell says. “I can pay my mortgage and I can buy some clothes. I’m not going without, but I’m not living a life of luxury.”

If anyone needs a reality check, it’s people like Ms. Parnell. (It’s interesting how the word “rich” is often the trigger that provokes such a strong reaction; people such as Ms. Parnell are perfectly willing to admit that they are “blessed,” or “fortunate,” or any number of other euphemisms, but call them “rich” and you will immediately be challenged.) I understand that life is expensive for a family of five, and that even for households who earn a quarter of a million dollars a year, there are a lot of things that they cannot afford, but do the Parnells realize that the $1,200 that they have left over each month—after putting money into their retirement accounts and college funds and tithing to their church and donating to charities—is more than the entire monthly income of about 15% of American households? Another person quoted in the article makes $400,000, but says, “I’m barely getting by.”

Presumably these people know that a lot of people “get by” just fine on much less than they do, so even if they don’t want their taxes raised (who does?), you might think that they would be a bit embarrassed to tell a newspaper that they are “barely getting by” or “don’t have a load of cash to cover wants.” (If the mysterious “land they bought” was not a “want,” then what was it? A need?)

I’ve read so many articles like this before that I am no longer surprised when I see some of our nation’s highest earners explaining to reporters how tough it is for a family to make ends meet on a mere $150,000 a year after taxes. I was surprised, however, to see the mayor of San Jose buying into this blinkered view of the world:

Changes to the tax code don’t generally make adjustments for high costs of living in particular areas of the country.

San Jose, Calif., Mayor Chuck Reed calls a family living in Silicon Valley earning $250,000 “upper working class.” That is about what two engineers working at a technology firm can expect to make, but “a family earning $250,000 a year can’t buy a home in Silicon Valley,” he said.

What on earth is Reed talking about? If he wants to think of Silicon Valley engineers as “upper working class,” then I guess that’s his right, but the notion that a family earning $250,000 a year can’t buy a home in Silicon Valley is absurd. The median single family home price in Reed’s own city of San Jose is now under $500,000, down from about $600,000 a year ago. In nearby Mountain View, the median price is under $1 million. If Reed’s hypothetical household of Silicon Valley engineers bought an above-median home in San Jose or a middle-of-the-road home in Mountain View and took out an $800,000, 30-year mortgage at a 6% rate (that’s higher than current rates), their payments would be a bit less than $4800 per month—less than $60,000 per year. Even if they only brought home $140,000 after taxes, they would still have more than $80,000 left after their mortgage payments.

To put that number in perspective, the census bureau reports that San Jose’s median household income was $76,354 from 2005-2007. Let’s round that up to $80,000. So our hypothetical engineers could buy a decent house in many parts of Silicon Valley, and the money they had left over after taxes and mortgage payments would still be more than the median pre-tax income of all San Jose households. It’s obviously true that $250,000 doesn’t get you as much in Silicon Valley as it would in most other parts of the country, and you might not be able to afford a house in Atherton on that income, or a vacation condo at Lake Tahoe, or private school tuition for 3 school-age children, or any number of other things that you might wish you could afford, but it’s still more than most residents of San Jose earn, and it is certainly enough to buy a home, if that is your goal and if you have any basic ability to manage your other spending.

I don’t follow San Jose politics at all, so I don’t know if that quotation is characteristic of Reed, or if he just said a silly thing this one time, or if he was quoted out of context, or if he just figured that the price to pay for saying something dumb was less than the price he would have paid for offending his well-off constituents by failing to commiserate with their plight. But if I were among the 50% of San Jose households who earn less than $80,000 a year, I would wonder whether Reed is out of touch with the parts of his community that are truly “working class.”

The State of California announced this morning that the official unemployment rate reached 11.2 percent in March. Many Silicon Valley technology companies are laying off workers because of the economic downturn. Even Google, which somehow made a profit in the 1st quarter even though most of its revenue comes from advertising, has laid off some workers for the first time in its history.

Given that context, I would have hoped that a public official like Chuck Reed would add some much-needed perspective to the views of the other people quoted in the article, instead of endorsing their distorted view of reality.

Opportunity Knocks

Tuesday, April 7th, 2009

I said a week or two ago that I was on the lookout for ways that our economic troubles were affecting the look and feel of our cities, but that can be a depressing project, so I’m trying to keep an eye out for hopeful signs too. A surprising number of new bars and restaurants have been opening in Oakland in the last few months, and many of them seem to be doing well despite the lousy economy.

There is one business that I’m most excited about. Ever since I read about the Middle Eastern and African emporium that is scheduled to open on a somewhat desolate stretch of Telegraph, I’ve been monitoring the progress whenever I pass by, and tonight I was happy to see that the interior is looking near completion, and something you don’t see very often these days, a help wanted sign, is posted on the window:

Opportunity Knocks

As the owner told Oakland North, a local news website run by Berkeley J-School students, “I’m from Yemen originally, and here we are missing a lot of stuff. A lot of stuff. Sometimes you have to go to L.A. Here there’s not even a single Middle East bakery that sells Lebanese pastries!”

He told the reporter that he might have to bring in a pastry chef from New York or Michigan, because there might be no one in Oakland who is up to the job. Whether he finds a pastry chef here or brings one in from elsewhere, I hope he finds a good one, because I’d hate to have to go to L.A. for my Lebanese pastries…

The Texture of an Economic Downturn

Wednesday, March 25th, 2009

The evidence of tough economic times is abundant, and most of us could probably cite numerous statistics or events as examples: An official unemployment rate that is over 8 percent (double digits here in California—we’ve always been trendsetters!); enormous companies entering bankruptcy or limping along with subsidies (sorry, make that “capital injections”) from taxpayers; tent cities forming on vacant land; friends or family members who have lost work or been subject to mandatory unpaid days off; commercial districts in cities and exurbs alike becoming ghost towns; irreplaceable local institutions like the Parkway Theater closing forever.

We Love You Too

In addition to those much-noted signs of recession, I’ve been wondering recently how our economic troubles will manifest themselves in less obvious ways: in our public spaces, in our daily habits and routines, in our civic engagement. I’ve long been intrigued by the look and feel of cities, and in the ways that small, seemingly insignificant aspects of the urban fabric can have big consequences, but my specific interest in the visual symptoms of economic collapse was prompted by a discussion in the comments to a previous post.

A commenter wondered what I was seeing with my own eyes that “reflected the country’s current ailments,” and I realized that I didn’t have a very clear notion of what I would expect a deepening recession to look like in a city such as Oakland. I see more empty storefronts around, and more signs in front of foreclosed homes (although I feel as if I see fewer than I did six months or a year ago), and perhaps more people out and about during the traditional working hours.

I realized, however, that in a city which has always had more than its fair share of blight, poverty, and unemployment, the signs of a worsening economic situation are probably less glaringly obvious than they are in, for example, exurban developments in the central valley or the Mojave Desert that have gone from boomtowns to ghosttowns in just a few years. Ever since that discussion, I’ve had the question in the back of my mind, and I’ve been taking note of small local indicators of economic trouble that might not show up in a statistic or a news article.

During Depression Only

Since I’m trying to be attuned to these symptoms as I roam the streets (i.e. walk the dog, bike to work, etc.), and since I still have a very limited mental image of what a deeper, prolonged downturn might look like in the modern world (will we see more “Hoovervilles” and bread lines, or will our age have its own different, less obvious manifestations of hardship?), I would be interested in hearing any other thoughts readers might have about subtle ways that the recession is affecting the look and feel of our cities.

Assuming that things continue to get worse before they get better, might we see a strengthening of neighborhood ties as people becoming increasingly concerned about property crimes? Or will people in fact become more isolated, because they will be more fearful of crime in the streets, and will have less money to spend in local restaurants and the like? Will the physical environment deteriorate dramatically, as public services and private investment continue to dwindle?

I don’t have any well-formed answers to these sorts of questions, and obviously much depends on just how bad things get, and for how long, but I’m curious — and more than a little nervous — about how further economic collapse might show itself in our streets, parks and sidewalks.

“Now Open,” Now Closed

Tuesday, March 17th, 2009

This billboard near my home has outlived the business whose opening it was advertising. (The dealership only lasted for two months and closed a few weeks ago. We’ll see how long the billboad lasts.)

False advertising

Walmart on the March

Wednesday, January 7th, 2009

I feel like I’ve seen this in different form somewhere before, but this is a cool visualization of the uncool spread of Walmart across the United States, from FlowingData. Store count is in upper left, year is in lower right.

I’ve been riding right past Oakland’s very own Walmart this week on my commute. (“Right past” in this case means that I can see it in the distance, across a parking lot, even though I ride up the same street that Walmart is on.)

Opportunity Knocks

Saturday, January 3rd, 2009

The New York Times had an article a few weeks ago with the headline “Bad Times Draw Bigger Crowds to Churches.” Slate’s press critic, Jack Shafer, who has never met a trend story that he didn’t want to debunk, posted a rebuttal a week later, citing Gallup research suggesting that church attendance did not increase as the economic news got worse and worse over the course of 2008.

zionI have no idea who is right, since I don’t think I made it to the end of either article, but they did remind me of some pictures I took in October, during the most tumultuous period of this ongoing crisis (at least so far; let’s see what fun is in store for 2009).

I took the dog for a long walk up toward the hills one day, and passed two churches that were seizing the moment like any savvy investor would: when prices fall, it’s an opportunity to add to your portfolio!

And who can blame them? When you traffic in the eternal, I suppose it’s only natural to remind people who are anxious about something as worldly and material as the stock market that a few hundred points up or down in the S&P 500 don’t even register on the great Bloomberg terminal in the sky.

What to do, what to do And if your reminder happens to draw some worldly, material people to your church to hear more about God’s eternal love, and perhaps to drop a few bills in the plate, then so much the better. Worldly concerns and eternal concerns may be different, but they don’t have to be mutually exclusive, right? Just ask Joel Osteen.

I don’t remember what made me snap photos of these signs, because they don’t seem so remarkable when I look at them now. They do, however, raise a worldly and eternal question: What stocks would Jesus buy?