August 31, 2007

Gas taxes and earmarks won't solve our transportation needs

In a recent Arizona Republic article, Congressman Jeff Flake (R, Arizona) breaks down why more of the same old/same old is not going to help us solve our transportation infrastructure needs:

While the “Bridge to Nowhere” was certainly the most famous of these earmarks, it at least resembled a transportation project. The most recent transportation authorization was replete with earmarks for bike paths, hiking trails, visitor centers, museums, beautification work, and other suspect projects that seem even more suspect given the events of the past months.

For example, Minnesota received more than 140 earmarks in the highway bill worth nearly half a billion dollars. According to a recent review, these included nearly $1.6 million for bike trails, more than $1.5 million for streetscaping, and more than $1 million for new visitor centers. With the state’s priorities undoubtedly shifting in light of recent events, Minnesota should have the flexibility to use its transportation funds as it needs to rather than on projects such as these.

Obviously, this problem is not limited to Minnesota. Congressional Quarterly recently highlighted that nearly all of the fifty most heavily traveled and structurally deficient bridges are concentrated in Los Angeles and San Francisco. My guess is that California has better uses for transportation dollars than the $5 million dollar earmark for bikeways and trails in the Golden Gate National Recreation Area or the $2.3 million dollar earmark for landscaping enhancements for “aesthetic purposes” along the Ronald Reagan Freeway in Simi Valley. These earmarks are even more egregious when you realize that California, like Arizona, is a “donor state,” meaning it receives less than a dollar worth of federal transportation funding for every dollar it pays in federal gas tax.

We can all agree that the Minnesota bridge collapse should serve as a wake-up call. Congress cannot continue to turn a blind eye to pork barrel politics that all too often reward the districts of powerful Members of Congress and tie the hands of state transportation officials. With this in mind, I plan to introduce legislation that will allow states the flexibility to use their transportation dollars as they see fit.

Both President Bush and Secretary Peters have both wisely dismissed calls for raising the gas tax and have called Congress out for squandering much-needed transportation funding on earmarks. The last thing we need is to raise the gas tax, which will simply give Washington politicians even more money to spend on earmarked projects.

My colleague Bob Poole discussed more of the problems with the current highway funding system in his latest Surface Transportation Newsletter:

I fault the current federal highway funding system on two key points. The first is its long tradition of, and recent major uptrend in, allocating money to congress-members' pet projects--rather than to projects that yield the most bang for the buck in addressing real transportation needs. A system that spends lavishly to build bridges to nowhere, while over 75,000 bridges are in danger of collapse and another 79,000 can't handle today's demand, is a system that cries out for fundamental change.

The other basic problem is that the federal funding system, by design, shifts resources from populous, fast-growing states to low-population, low/no-growth states. You can understand why this was done originally: to make sure that Interstate links got built through rural states where there wasn't enough traffic to generate enough fuel-tax revenue to cover the cost. But that was then, and this is now. Today we have massive needs in specific locations: to expand urban expressways to alleviate congestion and to expand the capacity of key Interstate routes to keep commerce flowing. Yet the federal funding mechanism still takes funds from the states where these needs are greatest and sends them to places like Alaska and North Dakota. We couldn't have designed a more perverse approach to solving our highway investment problem if we tried.

Yet the simplistic answer of simply pumping more money into this flawed federal system is the best many pundits and analysts can do. That's pathetic.

Yes, we do need a major, sustained increase in capital investment in America's highway system. But those investments need to be targeted to critically important goods-movement and congestion-relief projects. The best way to do this is to turn to the capital markets, creating mechanisms to direct eager capital to projects that pencil out as viable investments. To their great credit, that's what DOT Secretary Mary Peters and her team have been trying to do, with their aggressive efforts to explain the merits of tolling, value pricing, and public-private partnerships. Before we rush into new federal crash programs and arbitrary fuel-tax increases, we should make a serious effort to figure out how much of the problem can be addressed with these critically important tools.

I think it's safe to assume that, given recent developments in tolling, we can address more of the problem than previously thought. See Bob's recent comments on this subject here.

Posted by lengilroy at 02:48 PM

Missouri Court Weighs Wireless Tax

A Missouri court reportedly is close to a decision on whether the state is entitled to some $500 million in taxes from wireless phone service providers.

The case pits AT&T against 22 Missouri cities, and is one of a several suits between wireless carriers and Missouri municipalities that form a larger legal dispute dating back to 2001. The cities argue wireless carriers are legally liable for a utilities licensing tax that is paid by the state’s landline telecom companies. The cellular companies claim they are not utilities as defined by Missouri and should be exempt.

At stake is an estimate $500 million in taxes, plus interest and penalties that could add hundreds of millions of dollars to the bill, according to the Wall Street Journal, which referenced the Missouri Municipal League as the source.

But it is questionable whether wireless service, a deregulated, competitive business that relies far less on public easements and right-of-way than landline phone networks, really qualifiy as “utilities.” But far be it from the local tax man to shy away from stretching a definition, especially as more users migrate to wireless.

Here’s a snippet from Chad Garrison writing on the Stlog at the St. Louis Riverfront Times.

Moreover, as consumers have canceled their landline phones for wireless service, many cities have seen their tax base drop dramatically. Mulligan says University City collected nearly $800,000 in telecom taxes in 2000. Last year the city collected less than $500,000. Statewide, Mulligan estimates the amount of disputed or back taxes involving cell phones now reaches more than a half-billion dollars.

A ruling is pending from St. Louis County Circuit Court Judge Bernhardt Drumm Jr. on a motion for summary judgment in the AT&T lawsuit. On Sept. 12 Drumm is scheduled to decide whether the case merits class-action status. If it does, it would automatically include more than 200 other municipalities.

Aren’t wireless customers are already overtaxed as it is?

“Our customers are tired of having state and local governments treating them like ATM machines, so we are fighting on their behalf,” John Taylor, a Sprint spokesman, told the Wall Street Journal. He noted the average Sprint customer pays 17 percent of their bill in taxes.

A May 2007 study of telecom taxes published by the Heartland Institute that surveyed 59 U.S. cities found the average tax rate on wireless services was 11.78 percent. This ranged from 21.35 percent in Omaha, Nebraska to 3.62 percent in Carson City, Nevada. The wireless tax rate in Kansas City, Missouri, the only Show-Me State city examined in the Heartland study, was 10.14 percent.

Posted by steve.titch at 01:07 PM

See you on Tuesday--or whenever you feel like coming back from vacation

I've suggested that one under appreciated reason Americans work so much is that lots of people like working. Unlike days gone by when so many were stuck in fields or factories, more of us have jobs that we find quite fulfilling.

But, come on, vacation is still great, and some American companies offer the unthinkable--unlimited vacation days:

    It’s every worker’s dream: take as much vacation time as you want, on short notice, and don’t worry about your boss calling you on it. Cut out early, make it a long weekend, string two weeks together — as you like. No need to call in sick on a Friday so you can disappear for a fishing trip. Just go; nobody’s keeping track.

    That is essentially what goes on at I.B.M., one of the cornerstones of corporate America, where each of the 355,000 workers is entitled to three or more weeks of vacation. The company does not keep track of who takes how much time or when, does not dole out choice vacation times by seniority and does not let people carry days off from year to year.

    Instead, for the past few years, employees at all levels have made informal arrangements with their direct supervisors, guided mainly by their ability to get their work done on time. Many people post their vacation plans on electronic calendars that colleagues can view online, and they leave word about how they can be reached in a pinch.

    “It’s like when you went to college and you didn’t have high school teachers nagging you anymore,” said Mark L. Hanny, I.B.M.’s vice president of independent software vendor alliances. “Employees like that we put more accountability on them.”

Sure there are plenty of trade-offs (do you really want to be on call during vacation?), but it works for plenty of workers. Two more examples of a kick-back view of vacation:

    Motley Fool, the online investment adviser, has, since its founding 13 years ago, let employees take as many paid vacation or sick days as they need; the company’s director of human resources, Lee Burbage, said that most of its 180 workers take three to four weeks a year. Netflix, the online DVD distributor, no longer allots specific numbers of vacation days to its 400 salaried employees.

    “When you have a work force of fully formed professionals who have been working for much of their life,” Patty McCord, the chief talent officer of Netflix, said, “you have a connection between the work you do and how long it takes to do it, so you don’t need to have the clock-in and clock-out mentality.”

Not surprising that a friendlier attitude toward telecommuting is also common among these companies:

    The hands-off approach to vacation time, which gradually took hold over the past decade, has come amid I.B.M.’s shift from engineering and manufacturing into services like consulting and is part of a broader demise of old notions of eight hours’ pay for eight hours’ work at a fixed location.

    Aided by broadband connections, cellphones and video conferencing software, 40 percent of I.B.M.’s employees have no dedicated offices, working instead at home, at a client’s site, or at one of the company’s hundreds of “e-mobility centers” around the world, where workers drop in to use phones, Internet connections and other resources.

    ...

    “If you look at the organizations that have done more radical things, they tend to be technology companies with salaried people,” where flexibility in job performance “is embedded into the culture of the place,” noted Max Caldwell, a managing principal in the work force effectiveness area at Towers Perrin, a human resources consultant.

    Indeed, I.B.M.’s Mr. Calo said that the flexibility has helped the company compete with the more freewheeling atmosphere at start-up rivals in the technology world that have lured away some of its talent over the years.

    “We have a reputation of not being as hip as a Google or a Netflix,” he said. “You don’t have to be the coolest guy on the block, but you don’t have to be the Big Blue nerd, either.”

NYT article here.

My take on HP falling away from telecommuting here.

Posted by tedb at 11:09 AM

August 29, 2007

Private funds speed up New Orleans recovery

Rebulding has gone a lot smoother and faster in the areas the depend on private money compared to the ones relying on government funds according to an article in today's USA Today. The article, aptly titled "2 years after Katrina, pace of rebuilding depends on who pays," notes:


Two years after the devastating floods that followed Hurricane Katrina, the rebuilding of New Orleans, and much of the Gulf Coast, has largely taken two paths: communities that have rebuilt themselves using private funds, insurance money and sheer will — and publicly funded efforts that have moved much more slowly.

Federal, state and local governments have struggled to speed up the release of funds and restore infrastructure. None of the 115 "critical priority projects" identified by city officials has been completed: For example, New Orleans' police superintendent still works out of a trailer, as do most of the city's firefighters. And analysts at the city's crime lab don't have a laboratory to match DNA samples.

Who pays the biggest burden from government ineptitude?

The delays have affected the poor the most — those dependent on government assistance to rebuild their lives. While middle- and upper-class neighborhoods have rebuilt using private insurance and contacts, residents of low-income areas such as the Lower 9th Ward and Holy Cross — roughly 20,000 of them — for the most part remain scattered throughout the region, their return uncertain.

Of course, that's not a surprise to the regular readers of this blog.


Posted by samstaley at 10:23 AM

African Americans Shun Affordable Housing

Affordable housing programs are often supported because proponents believe they will help minority and low income families. Of course, most minority households are not poor, but even middle-income households can be poor in many cities like San Francisco which rank among the most expensive housing markets in the nation.

USA Today recently had an interesting article on "black flight"--the tendency for African Americans to move away from the central city. San Francisco, it seems, is struggling to retain its ethnic and racial minority families as high housing costs, high crime rates and an inhospitable political environment drive them out.

Interestingly, near the end of the article, the reporter points out that many African American households avoid the city's "progressive" affordable housing programs because rent and mortgage restrictions limit their ability to build equity:

Many blacks here shun buying affordable housing because those homes have "equity restrictions" to keep them affordable, which means they can't be resold at market rates.

"They see homeownership as a chance to gain assets that will grow. So they'll go outside the city," says Ed Donaldson, counseling director for the San Francisco Housing Development Corp.

Hmm, so African Americans actually respond to incentives just like everyone else? As any economist would say: "duh". Fortunately, San Francisco's officlal policy is beginnig to recognize this:

[Mayor Gavin] Newsom says he's focusing on "asset creation" — strategies to help blacks, Latinos and others create wealth by owning homes and businesses. That will be a priority of the task force, he says.

Of course, Reason has published extensive research on the folly of affordable housing and inclusionary zoning. The summary of the general study can be found here. A study on Los Angeles and Orange County can be found here. Market oriented alternatives to government mandates can be found here.


Posted by samstaley at 07:48 AM

August 28, 2007

Chicago Scraps Muni WiFi

Chicago is the latest city to pull the plug on plans to build a citywide municipal wireless system after failing to come to terms with EarthLink, its perspective partner, the Chicago Tribune reports today.

Chicago is the largest city so far to scrap its municipal plans in the face of new demands from commercial partners to act as “anchor tenant” and commit to purchase a certain level of wireless data services each year. Earlier this summer, Anchorage, Alaska, and Corona, California, decided to drop their plans for similar reasons. MetroFi was the commercial partner in both cases.

In addition to the disagreement over the city’s role as anchor tenant, a number of other factors influenced the decision, including the wider availability of affordable wired and wireless Internet connections, some provided by the city itself through other departments. For example, free wireless Internet is available in all 79 city public libraries as well as in large downtown public spaces such as the city’s Millenium Park and Daley Plaza.

Chicago never intended to be a leader in municipal Wi-Fi, said a city official, preferring instead to watch what happened in other cities and learn from that. Some of what's happening isn't pretty.

In San Francisco, bickering among elected officials has stalled progress for months. In Houston, where the city council approved a contract with EarthLink last spring, work on the project has yet to start.

As municipal wireless projects have hit one snag after another, prices for wired Internet have fallen. AT&T charges $20 a month for speeds of 1.5 megabits a second in Chicago and will provide connections half that fast for $10 to new subscribers, although more than 10 percent of residences in the metropolitan area cannot get digital subscriber line service because they are located too far from AT&T's switching centers.

Posted by steve.titch at 06:00 PM

In Order to Solve the Problem, We Need More of the Problem

Infrastructure has been a hot topic lately with transportation getting most of the press. However, many of our nation's water systems have been in service longer than originally designed and the cost to upgrade them is truly staggering. Indeed, the Government Accountability Office pegs the cost between $485 billion and $1.2 trillion over the next two decades.

How did it get this bad? The GAO suggests the problems are because of the following:

Many drinking water and wastewater utilities do not cover the full cost of service—including needed capital investments and operation and maintenance costs—through their user charges.

Many drinking water and wastewater utilities defer maintenance and needed capital improvements because of insufficient funding.

For many utilities, a significant disparity exists between the actual rehabilitation and replacement of their pipelines and the rate at which utility managers believe rehabilitation and replacement should occur.

If you read these carefully they suggest a lack of funding -- but that's only one piece of the equation. What about the spending side? There's a general feeling that government is inefficient and doesn't spend the resources they have well (e.g., building convention centers and baseball stadiums instead of investing in vital infrastructure). Frankly the incentives for long-term care or management don't align well -- public officials are in office for only a few years and what's more exciting (or likely to get you reelected); cutting the ribbon a new monument or replacing pipes under ground?

Perhaps, privatization is a solution? Indeed, the GAO also found that "plans developed by
privately owned drinking water utilities tended to be more comprehensive than those developed by publicly owned utilities." Meaning that private utilities or private companies had different incentives and acted accordingly. Yes, profit (that terrible six letter word) was an incentive - but the realization that the best way to achieve "profit" was to take care of your investment and provide a good service. Indeed, GAO further notes that "public drinking water utilities were more likely than their privately owned counterparts to defer maintenance and major capital projects."

Water privatization and public-private partnerships are not new. Some 15% of the U.S. population is served by a private regulated utility, in addition more than 2,000 communities contract for operations and maintenance of publicaly owned facilities. See Reason's extensive work on the issue here.

For many, including this USA Today editorial argues that profit and privatization have no business in "our water." Instead they turn to a higher power...state and federal governments to bail them out. So let me get this straight - it was years of mismanagement that got us into this mess and what we need is more of that? Seems like in order to fix the problem we need more of the problem.

Sadly for the authors they've let ideology blind them - and their obfuscating the facts to push their agenda - an attack on globalization, "corporations" and profit. The same authors in another editorial point to Stockton (check out a Myths v. Facts) to make their case. Here's some of Reason's work on the issue: here and here.

First, nothing is up for sale and nothing has been sold. Long-term leases are not sales. In the case of Stockton which is heavily critqued in the column, it was a management contract - the city continued to own the assets and indeed, pay the company for providing a service.

Second, the authors fail to mention the numerous problems and challenges that Stockton faced before the contract. Indeed, the city's wastewater plant had numerous chemical spills for years - with little incentive to change (and they didn't).

Third, the contract was mutually ended. Not because of poor performance but rather because the constant litigation didn't allow the partnership to function

Fourth, the process was open and transparent. It took more than three years to complete and numerous study commissions and town meetings took place - indeed, more than 92 hours of public testimony was heard.

Someone once told me, and I can't remember who it was, that "god may have given us the water, but he sure didn't give us the pipes." The truth is those pipes cost money and they need to be maintained. Rather than focus on ideology and process I'd like to focus on results and outcomes. I suspect that most taxpayers feel the same way i.e., they don't care so much who provides a service so long as its done well, and cost efficiently. More of the problem will not solve the problem - we need to drastically rethink how our infrastructure is funded, operated and maintained. There is a role for the private sector to play .

P/S - I've always wondered if the same people get this fired up over government operations? I.e., do they demand more transparency, more reports on staffing and efficiency or effectivness? Or is just because a private company is involved that gets them fired up?

Posted by geoffs at 06:16 AM

August 27, 2007

Our Strange and Counterproductive Immigation Policy

Few policies make less sense than current immigation policy. It simply doesn't make sense to throw out people who are productive members of US society.

Despite promising to address the terrible state of US immigation laws, the Bush Administration has made things even worse. Our own Shikha Dalmia, writing in the LA Business Journal, observes:

It is not like it [the Bush Administration] does not understand that the "problem" of illegal immigration is purely a function of existing immigration laws, not "evil doers." These laws don't exactly roll out the welcome mat for high-skilled immigrants that California's Silicon Valley badly needs. But they are downright hostile toward "unskilled" workers who form the backbone of the agricultural, landscaping and hotel industry in the Golden State and elsewhere.

Everyone knows our economy is desperately short of workers in these occupations, yet official poilcy is to throw them out and not even give them an opportunity to become legal US citizens.

What explains this strange and twisted policy of throwing productive workers out? Unfortunately, Shikha's conclusion is hard to dismiss:

The only plausible reason is that the administration has not just abandoned rational immigration reform, which would be understandable under the circumstances. It has actually made a conscious decision to embrace its opposite to win back its lost base before next year's elections. In short, its immigration policy now is driven neither by conviction, nor the needs of the economy - but naked political calculation, even if that involves targeting "willing employers" and "willing foreign workers," the very victims of that policy.

Shikha's article deserves to be widely read.

Posted by samstaley at 11:47 AM

August 24, 2007

iPhone Code Cracked

It took a few weeks, but someone finally broke the code that locks Apple’s iPhone to the AT&T Network.

MSNBC is reporting that Greg Hotz, a 17-year-old New Jersey resident, working in collaboration with four Russians, used some software and soldering skills to crack the iPhone network locking code. The upshot is that non-AT&T customers who use GSM networks, which would include those in most of Europe and Asia as well as T-Mobile in the U.S., will be able to use the iPhone if they follow Hotz’s directions, now presumably available somewhere on the Internet.

It was only a matter of time before someone managed this, yet that did not stop the hue and cry about the Apple-AT&T exclusivity, which drew fire on the floor of Congress from the likes of Rep. Ed Markey (D-Mass.), who found it appalling that the iPhone only worked with AT&T's network. Oddly enough, he seemed to view this as a symptom of a monopoly mindset, even though the very nature of his complaint, that non-AT&T customers must change wireless service providers to get the iPhone, speaks to the fact of competition.

Hotz, a high school kid, seems to understand the mechanics of competitive market a little better. Asked if his hack may spawn a small industry that may buy U.S. iPhones, unlock them and send them overseas, Hotz replied, “That’s exactly, like, what I don’t want. I don’t want people making money off this.”

Although the it may be difficult to get the genie back in the bottle at this point, unlike Markey, Hotz does seem to grasp that there is value in differentiation, and that commercial freedom to create exclusive marketing agreements is what incents the development of cool products like the iPhone.

Posted by steve.titch at 02:44 PM

August 23, 2007

EarthLink Delays Muni WiFi in Houston

It appears that EarthLink is re-evaluating its municipal wireless plans in Houston, which, at 640 square miles, represents the largest muni system so far contracted.

As part of the deal, the city agreed to pay EarthLink $2.5 million during the next five years to serve as the anchor tenant. That, it turns out, may not be enough to make the project worthwhile. The Houston Chronicle reports that EarthLink has delayed the start of construction and may be having doubts about the ultimate success of the operation.

The Chronicle reports:

But EarthLink officials, who declined to comment for this story, have expressed unease recently about the financial viability of wireless projects, which have yet to prove on a scale as large as Houston's that they will draw enough customers to make a profit.
The project here is expected to require an investment of about $50 million, according to EarthLink and city officials.

EarthLink officials have not publicly discussed Houston's network in particular in recent months. New CEO Rolla Huff said in late July the company is reviewing its business model and will not accept new projects until officials are confident they will get their money's worth.

"The Wi-Fi business that's currently constituted will not provide an acceptable return. We're actively exploring ways to scale this business more economically," Huff said during a conference call with analysts. "You can expect that we'll scale back both new-build capital as well as ongoing operating expense structure."


Posted by steve.titch at 08:37 AM

August 22, 2007

Jerry Brown, planning commissioner

With California Republicans conceding in their attempt to block the state budget over greenhouse gas emissions strategies (guess I was a couple weeks off on my prediction for that) and San Bernardino County settling in the suit brought against it by Attorney General Jerry Brown over the same, it looks like the bulk of local land use authority has now been transfered to the state. California state lawmakers already have substantial control over local planning for affordable housing, water resources, coastal development, and other general plan elements--control over land use with respect to greenhouse gas emissions should cover just about everything else.

At least the settlement between Brown and San Bernardino was honest about one thing. The agreement mandates that the county inventory "all known, or reasonably discoverable, sources of Greenhouse Gases that currently exist in the County," but then goes on to state (four times, actually) that "The Parties recognize and agree that definitive data sources do not exist for creating this inventory." It is a good thing the county saved the expense of having to defend itself in a drawn-out lawsuit, since funding greenhouse gas guestimates from non-existent data sets can get pricey.

Evidently, in this new arrangement, Jerry Brown will be the new planning commissioner for San Bernardino County and the local planning commission will take over the job of the California Air Resources Board.

Posted by skaidra at 03:19 PM

August 21, 2007

States' Rights Attacked... Again

In the text of the Farm Bill - (HR 2419) The Farm, Nutrition and Bioenergy Act of 2007 - the US House of Representatives has called for yet another mandate restricting the use of private sector solutions like competitive sourcing. This time the mandate effects the administration of the Food Stamp Program within state-operated health and human services programs. This blatant attack on the authority and rights of Governors and state legislatures would prohibit access to the latest technologies and most cost-effective manners for administering the program not to mention the fact that it would also put an end to numerous modernization contracts which are already in place.
Will the Senate pass a comparable provision this fall? If so, the existing programs that have utilized non-profit and/or private sector contracts would cease, thus pulling the rug out from under efforts which are crucial to updating technology and increasing the level of service to the program’s recipients. Multiple states have integrated the administration of their Food Stamp Program with their welfare system so there is sure to be a breakdown there as well.

We here at Reason know that competitive sourcing determines the most efficient and effective source for providing services. Not only has it been shown time after time to save money; it also increases accountability on the part of the private bidder and the government employees. The flexibility that the states have been able to engage in by integrating, streamlining and consolidating the wide array of health and human services has benefited taxpayers. Currently, many health and human services structures at the state level allow for resources to be shifted to core areas of the program resulting in a more effective and efficient system overall but, that can all change with this legislation.

Each state has different financial and governmental structures. It is the Governor and state legislatures who have been elected to research, develop, debate and deliver services to the citizens who voted to provide that right to them. It is not the job of Congress to dictate federal unfunded mandates in state administration but they are doing it anyway. If this bill passes in its current form, the flexibility that states currently enjoy will be taken away, health and human services will crumble and fall apart in many states, and taxpayers will be left holding the bill.

For more on Reason's government reform efforts, click here.

Posted by akh at 10:43 AM

August 17, 2007

Traffic congestion? Google to the rescue!

One of the more impressive transportation technologies we saw in Beijing was a consumer friendly approach to traffic routing. The Beijing municipal government had developed a GPS technology that would allow drivers to access the Internet from their PC or cell phone and identify the quickest way to their route using real time data from satellites. We wondered why no one was working on this in the U.S., where reading neon signs over the road telling you your already in congestion passes for state of the art.

Well, it turns out, someone was. But it wasn't the local transit authority, or the local transportation planning agency. They're too busy trying get people out of their cars, not making their trips easier. It was Google. Google has just launched a new technology with its on-line mapping technology that allows users to find the fastest route, add multiple stops, and avoid congestion. Users can "drag and click" new destinations and routes. It's part of google maps' "Draggable Driving Directions". A video demonstrating the technology can be found here.

As traffic congestion gets worse, and iPhone technology becomes more diffuse, the short-term prospects for this technology are pretty strong. Once again, Google shows why its ahead of everyone else in the U.S.

Posted by samstaley at 01:04 PM

Is Your Web Site Eco-Friendly?

For a bit of Friday silliness, check out BusinessWeek Online’s story of how Web designers are joining the eco-correctness fad by designing sites to use dark colors, which they believe prevents global warming because black supposedly requires less power than white to display on a computer monitor.

This started earlier this year when Google, whose home page is largely bright white, came in for a scolding for this reckless contribution to global warming.

The online buzz over “going dark” began in earnest last January after Mark Ontkush, a self-described “green computing evangelist,” wrote a blog post concerning environmentally friendly Web design. Ontkush claimed that if a popular site such as Google switched its home page background color from white to black, it could save hundreds of megawatt hours a year. He based his claim on the fact that certain types of monitors use less energy to display black than white screens. And according to the Environmental Protection Agency, cathode-ray-tube (CRT) monitors and even some flat-panel screens use less energy to display black or dark backgrounds.

BusinessWeek reports Ontkush’s blog triggered the creation of a bunch of search sites using black backgrounds. But with knock-off names such as Blackle and DarkGoogle, many others believed that the whole eco-web site thing was an elaborate April Fool’s joke.

No so. And in today’s highly charged debate about climate change, a major corporation, especially one like Google that strives for liberal cred, can’t take such accusations lying down. And, upon closer examination, as is prone to happen with many so-called “green” claims about energy consumption, much is exaggerated, if not wrong.

Google's green energy czar [?!] Bill Weihl wrote that the flat-panel computer screens most common in the U.S. don't save energy displaying black backgrounds. Weihl referred to a test run by an Australian electronics graduate student comparing the power consumption of Blackle and Google on 27 different monitors. On average, CRT monitors saved 10.8 watts per hour using Blackle.

However, liquid-crystal display (LCD) monitors largely used the same or, in several cases, several watts more energy to display the black background. The results were published Aug. 8 on Australian tech news site Techlogg. "We applaud the spirit of the idea, but our own analysis as well as that of others shows that making the Google home page black will not reduce energy consumption," wrote Weihl.

Posted by steve.titch at 10:36 AM

Universal Preschool Falls in Virginia

Via the Washington Post

Virginia Gov. Timothy M. Kaine on Thursday scrapped his campaign promise to provide universal access to pre-kindergarten, announcing that he will instead push to more than double the number of underprivileged 4-year-olds eligible for early education at the state's expense.

Faced with a looming lean state budget and skeptical Republicans in the General Assembly, Kaine (D) said he can largely accomplish his goal to expand pre-kindergarten by focusing on the state's neediest children -- those eligible for free or reduced-price school lunches.

"We're coming at it a little differently, because the experience of other states has convinced us to work within the existing system we already have," Kaine said in announcing his proposal at a day-long education forum....

Preschool programs that meet certain standards -- public, private or religious -- would be eligible for state funding to serve underprivileged children. Currently, only public schools participate in the Virginia Preschool Initiative.


While still an expansion of government into preschool, this is a win for two significant reasons.

1. He canceled his universal preschool program. While he is still offering more spending on preschool (like Schwarzenegger in Calif.), it is not targeted at middle and upper class families and will not be $300 million a year--to replace the private early education market with public school provision.

2. In a change from the previous program targeted to low-income children, which was provided only in public schools, Kaine is now letting non-profit and for-profit private providers, including religious schools, compete for the money in a more voucher-like system. The fact that he is not choosing the Oklahoma public school model is a significant loss to universal preschool advocates.

This is a huge change for Kaine who in his campaigning for Governor and even his response to President Bush’s State of the Union address touted access to prekindergarten for every family.

“There's a better way. … (than No Child Left Behind)

Many states are working to make high-quality pre-kindergarten accessible to every family.” State of the Union Response,” January 31, 2006.

It still a government expansion, but a slower one…

Posted by Lisa Snell at 09:25 AM

Portland: Case Study on the Need for Performance-Based Planning

As usual, Randal O'Toole continues to do yeoman's work in deconstructing the Portland myth. From TCS Daily:

The mayor of Milwaukee, Wisconsin, and a cadre of other top officials recently flew to Portland, Oregon, my hometown, to learn the wonders of the region's rail transit system. Portland's Mayor Tom Potter no doubt told them light rail was "a cornerstone of the city's success." Potter or former Portland city Commissioner Charles Hales probably bragged that the city's streetcar line "has sparked more than $2 billion in new developments."

Unless they had gone out of their way on their junket, the visiting dignitaries were unlikely to hear the other side of the story: Portland's public transit has done nothing to relieve the region's growing congestion; its high cost has sparked a taxpayer revolt; the developments along the rail lines were themselves heavily subsidized; and those subsidies led a crafty cabal of ex-politicians and developers to milk the system for their own gain.

Read the gory details here. And these are just the high points--be sure to also check out his recent study that explores these issues in depth, debunking the agitprop regarding the city's vaunted land use and transportation planning. He hits the nail on the head when he concludes:

These problems are all the predictable result of a process that gives a few people enormous power over an entire urban area. Portland should dismantle its planning programs, and other cities that want to maintain their livability would do well to study Portland as an example of how not to plan.

The unjustified hype about Portland's planning has even spawned a website, www.debunkingportland.com, with lots of facts and figures.

Looking at the bigger picture, one has to wonder, "why exactly are planners still trying to replicate the Portland model?" When will the planning profession wake up and realize that planning, like any other realm of public policy, needs to be performance-based? Noble intentions aren't going to cut it.

Planning needs to be driven by, and continually adjusted based on, clear goals tied to concrete performance measurables. The achievement of goals--or success--is then determined through a rigorous, regular evaluation of outcomes, not processes or inputs. "Did we have good intentions" or "did we set up a process to do X, Y, or Z" or "how much did we spend on X" are a ridiculous way to measure the effectiveness of programs, but that's business as usual in planning. Imagine if you measured your fitness goals by adding up how much you spent on your annual gym membership, as opposed to the number of times you actually went to the gym or the number of pounds lost. We'd mock someone doing that, but we continue to allow planners to do the same thing, despite the fact that our tax dollars, mobility, economic opportunity, and quality of life are at stake.

Posted by lengilroy at 08:27 AM

More Muni Wireless Revisionism

“But municipal networks aren’t on track to offer consumers a cheaper high-speed alternative to the powerful U.S. phone and cable companies, as some backers once envisioned.”

That statement comes from yesterday’s Wall Street Journal in a Page B1 article (subscription required) about the way cities are revising their priorities now that their grand plans to use municipal wireless systems to provide competitive retail broadband Internet service are crashing down around them.

The Journal goes on sums up the last few years in a mere two paragraphs:

“Initially, cities funded their projects out of their own budgets. That proved controversial, as telecom operators argued that it smacked of the government competing with the private sector. Now many cities are contracting out the work of building and operating the networks to companies like EarthLink and MetroFi, who team up with WiFi equipment providers like Tropos Networks Inc., Motorola Inc. and BelAir Networks. In many cases, the only thing cities are offering the companies in such deals are the rights to hang hundreds or thousands of small Wi-Fi transponders on public property such as lightpoles and traffic lights.

That model isn't holding up. The WiFi companies envisioned being able to offer subscription service to consumers at rates that were significantly cheaper than phone and cable broadband. But the unexpectedly high costs of building Wi-Fi networks -- the price tag can easily run into the tens of millions for a big city -- coupled with lower prices for broadband from some phone companies, has made it tougher for consumer Wi-Fi to be competitive. For example, EarthLink offers Wi-Fi for about $20 a month, a price that is on par with the lower-end Internet services now offered by AT&T Inc. and Verizon Communications Inc.”

My favorite quote, however, comes from muni wireless consultant Esme Vos, who noted that the pressure on cities to use the networks for government services is forcing them “to sit down and think about what they want to do with the networks. They actually have to come up with a business plan.” Of course, implied in that statement is that, up to now, cities haven’t bothered developing WiFi business plans, which, by and large, is true. Instead, blinded by hype, most have rushed headlong into these projects without really comprehending the financial and market risks they were taking on, something I have been saying for several years—and backing up with research—in the face of shrill antagonism and ad hominem attacks from true believers.

I still remember heated debates when muni proponents insisted that cities didn’t need a business plan. Muni broadband systems, went the argument, were a slam dunk because millions of dollars in demand was pent-up from frustrated consumers who were being denied service from disinterested phone and cable companies. According to the doctrine, the incumbents were going to leave large sections of entire cities unserved. Where they did deploy broadband, it would be too pricey for most. Until recently, Vos’s writing reflected these assumptions, but if you want to see these deployment delusions in full flower, just visit Lafayette Pro Fiber and TricityBroadband.com.

I’ve never accepted the idea that, after investing billions of dollars in network upgrades, the incumbents were going to eschew whole sections of geography and populations. As it turns out they did not. And where there are gaps, they are being filled by entrepreneurial and nonprofit operations. That municipalities, even when partnering with private companies like EarthLink and MetroFi, can’t gain traction in the retail broadband market forces reasonable people to conclude that their assumptions about the viability of municipal wireless as low-cost retail competitor were wrong.

Vos, more of a businesswoman than ideologue, is wisely joining the movement away from muni-wireless-as-retail-broadband-competitor thinking and into the muni-wireless-as-mobile-government-IT-network. (Well, whatever works!) In an analysis of the plan by New York’s Nassau and Suffolk counties to cover 750-square miles of Long Island with a WiFi network aimed at universal public access, written yesterday by Joe Panettieri and posted on Vos's site, there are statements I’d never thought I’d see from a muni wireless proponent.

“Why not start small? Big WiFi initiatives focused on public access are struggling. Small initiatives focused on one or two core applications -- like public safety or video surveillance in high-crime areas -- generally are performing well.
- Why lead with public broadband access? Many Long Island residents have the financial means for existing broadband services. Municipal applications that deliver ROI could provide a more reasonable stepping stone to affordable public access.
- Who is actually going to pay to do the infrastructure build-out?
- Will certain departments in Nassau and Suffolk Counties serve as anchor tenants? (we sure hope so)”

Big WiFi initiatives are struggling? Broadband is affordable to most? ROI matters? Who’s going to pay? Cities should embrace anchor tenancy? These very ideas are muni wireless heresy. Before you know it Vos and her colleagues will be sounding just like me.

Posted by steve.titch at 08:03 AM

August 16, 2007

Bashing Corporations Makes Great PR

Last week the University of Washington issued a study that found that (gasp!) allowing infants to spend too much time in front of the TV can be detrimental to their language development. It's not as if this was real news. After all, for years the American Academy of Pediatrics has recommended that children under the age of 2 to not watch any television.

But since parents can find that advice in the most basic of pediatric guidebooks, UW decided to tart up the PR release for the study, published in the Journal of Pediatrics, by taking a gratuitous swipe at Disney’s Baby Einstein brand.

It worked. Media outlets from the Los Angeles Times to NPR, without digging too deep into the actual study, ran the story as if the UW researchers had identified Baby Einstein videos as a specific risk and that parents should avoid buying them.

Disney, in a sharply-worded letter to the university, has demanded a retraction of the press release calling it “grossly unfair, extremely damaging, and, to be blunt, just plain wrong in every conceivable sense.”

Say what you will about the Mouse, but here they have a case. What the press release asserts, and the media is reporting, is not what the study actually says. True, the study concludes that infants who watched a lot of TV were developmentally behind those that did not. But, it turns out, the study did not specifically examine Baby Einstein or any other commercial line of baby videos. In what amounts to an incredibly shoddy piece of work, researchers simply asked 1000 parents in Minnesota and Washington State about the amount of time their infants aged 8 to 16 months spend watching videos, playing, being read to, and so on. These same parents were then asked to evaluate their infant’s language development. Researchers used no control group nor independent standard of measurement.

The episode is an example of two trends. The first is an overt hostility of the academic establishment to commerce. It’s one thing to caution parents about exposing infants to TV, DVDs and passive video images. It’s another for a university's PR department to use that study to state that a specific product from a specific company is harmful to babies, especially when the actual study makes no such assertion. If a newspaper or broadcaster had chosen to make this leap independently, it would have been potentially libelous. All you have to do is look at the flap over the lead paint in Mattel’s toys to see how explosive a charge like this is.

The second trend derives from the first: the mainstream media’s willingness to accept and report spoonfed summaries of university research without question.

My Reason and Heartland colleagues who cover the climate change debate deal with this all the time, but it’s become endemic across subject that connect to political issues, from school choice to network neutrality. The LA Times and NPR, not to mention the dozens of other newspapers that picked up the UW story, got it wrong not because the subject was complex, but because they never bothered to check the findings in the report against the way the university’s flack was spinning them. Editors should be demanding better.

Update: NPR, to its credit, ran a follow-up report that clarified what the study actually said and pointed out flaws in the study.

Posted by steve.titch at 04:59 PM

The LA Grind

Earlier today I was on KCRW's "Which Way, LA?" (SoCal NPR) talking about what LA might do to pull itself out of gridlock.

The show should eventually be achieved here.

And here's to WWLA's ultra-classy host, Warren Olney.

Posted by tedb at 04:43 PM

Is your world shrinking?

From yesterday's LA Daily News:

    WOODLAND HILLS - He can't stand spending one more minute in traffic.

    And after commuting all week to work at Warner Center, Divine Hicklin usually stays home on weekends to take a break from battling the bulging bottlenecks on the roads.

    "When the weekend comes, I want to stay home, in my pajamas, in front of my computer and away from traffic," said the downtown Los Angeles commuter. "I do it all the time."

    Whether behind the wheel or sitting on a bus, Los Angeles commuters spend about 93 hours a year stuck in traffic. And those like Hicklin often end up feeling so wiped out by the gridlock, they're becoming increasingly inclined to stick - whenever they can - to their own little neighborhoods on weekends.

    "I think a lot of us have gotten used to not doing things," said Ted Balaker, policy analyst for the Reason Foundation
    , a Los Angeles-based nonprofit. "It makes this city less of a grand metropolis and more into isolated hamlets."

    As congestion makes it more trying to get around, Balaker said Angelenos are subconsciously paring back their lives in everything from where they choose jobs to visiting friends on another side of town or even eating out in a different area.

    Many don't even realize what they're giving up in life because they're trying to avoid traffic, said Balaker, author of a report released last month that assesses the impact of mobility on personal lives.

    But as congestion grows, people ultimately are becoming less spontaneous and less adventurous.

Read Sue Doyle's interesting piece here; some interesting reader comments below the fold:

    I constantly skip fun things I have done in the past due to traffic. Sharapova vs Dimentieva tennis? Sounds awsome! ... oh wait.... the 405 on a Friday evening? No Thanks.

    Used to attend 10 Dodger games each summer, lately I barely make it to one game per season.

    Family gathering in Marina Del Rey...hmmm.. I'll stay home and watch tv.

    Some weekends I don't even start my car - I've had enuogh driving Mon-Fri from Calabasas to Hollywood. Malibu is really the only place I visit on weekends (15 min down the canyon).
    Posted by: David Stratemeyer


    Alas I am not alone?
    I have to be up at a quarter to five in order to catch a bus which will take me to N. Hollywood from Reseda. I hate the traffic, the crowded streets, and the stop and go ride that agrevates me to no end as I try to be on time for my 8 o'clock job. I stay home on my days off because it is no worth the trouble to try to get to the Malls, theater or any place. In the summer heat the buses break down in the 105 degree weather forces me to stand there suffering from heat exhaustion despite of the water I am carrying. There is no pleasure in having to endure endless commutes under duress. I shop for groceries in my neighborhood, maintain telephone realtionships with friend, avoid LA's amusement spots etc..It's terrible and getting worse to get around LA especially the valley.
    Posted by: Marina Perekrestoff


Posted by tedb at 04:29 PM

August 15, 2007

Bottled Water: The New Cigarette

Chicago Alderman George Cardenas wants to place a new tax of up to 25 cents on the cost of every bottle to help close a $217 million budget gap.

"People enjoy jogging or driving with a bottle of water. There's a cost associated with this behavior. You have to pay for it" said Cardenas. You may be surprised to learn that there's a social cost associated with drinking bottled water -- afterall, it was your choice to buy and consume it. Cardenas argues that city's $40 million shortfall in water and sewer funds is because more taxpayers, I mean residents, are choosing to buy bottled water and not using city's water for a fee. Of course the government's own operations aren't the problem -- I'm sure they run a tight ship.

Perhaps most frustrating is that Mayor Daley has been an avid supporter of privatization -- leasing the Chicago Skyway, some parking lots and pursuing a lease of Midway airport -- all of which have brought billions into city coffers. Unfortunately he's been fast and loose with the proceeds which have largely been diverted into new programs rather than shoring up infrastructure and shoring up city finances. Its inexcusable to have a "deficit" after raising more than $2 billion in privatization/leases in recent years.

Cardenas is also pushing the tax to help the environment by dissuading people from buying the plastic bottles that end up in landfills. Check the links - enough said.

If you're a frequent reader of Out of Control you know this is a pet issue of mine -- some of my colleagues and myself have written about this before -- check the links out if you want some more of the back story.

Posted by geoffs at 06:12 AM

August 14, 2007

Universal Preschool in Chicago, NOT UNIVERSAL

One of the little published but obvious facts about universal preschool is that when you make programs universal, there is less money for poorer more disadvantaged children. And parents and policymakers who represent communities who are not as disadvantaged are more savvy about directing resources to their children first. And even in disadvantaged communities, the most disadvantaged families are the least likely to benefit from these new preschool programs.

Ironic, I know.

Case in point, this radio program from Chicago Public Radio. Title says it all.

"Latino Children Shortchanged on Preschool for All"

When Illinois lawmakers voted last year to increase early education funding, they proudly labeled the plan “Preschool for All.” The extra $45 million last year—with a vow to add $90 million more by 2008—made headlines nationwide, and it’s already opened classrooms to thousands more kids. But a new report says many of Illinois’ poorest children are being shut out of the plan.

Posted by Lisa Snell at 01:46 PM

Now there's four...

A fourth city has followed in Sandy Springs, GA's footsteps and hired a private company to provide virtually all services. Chattahoochee Hill Country, Ga -- a new community of about 2,500 citizens. Under the contract, CH2M Hill OMI will design, implement and operate all of the municipal processes and services that citizens will receive when the city formally opens Dec. 1.

Posted by geoffs at 05:50 AM

August 13, 2007

How green is rail transit?

Each day this week The Antiplanner mulls a different aspect of this question.

Check it out; first day's post is here.

Posted by tedb at 07:34 PM

Party train not rocking so hard

Light rail ground breaking ceremonies often have that pep rally vibe: they're filled with live music, bold proclamations, group hugs, fireworks, cheerleaders, and even free bbq sandwiches.

LA just broke ground on the Expo Line, but the reporters' tone is rather bittersweet:

    Standing amid mounds of dirt at the edge of USC on Friday, political leaders celebrated a milestone for L.A.'s fledgling rail system: the start of major construction for a rail line from downtown to the Westside.

    But like so many mass transit projects in Los Angeles County, the Expo Line was shaped by three decades of political squabbling and compromises that raise questions about whether it can achieve the goal of getting Westsiders out of their cars and onto mass transit.

    The first 8.6-mile leg of the line will run from the 7th Street/Metro Center station in the heart of downtown to Culver City. But it will be nowhere near many of the Westside's most congested destinations, including the Miracle Mile, Grove-Beverly Center areas, Beverly Hills, West Hollywood, Century City and Westwood/UCLA.

    Instead, it will move along an old Southern Pacific rail line through relatively quieter southwest L.A., roughly following Exposition Boulevard. The route avoided heavy opposition from community groups and reduced costs, which will be at least $640 million. The line is supposed to start operations in 2010.

    As a result of that route, officials expect the Expo Line to Culver City to see 43,000 passenger boardings every weekday by 2025. (A boarding is a one-way trip.)

Kudos to the reporters for pointing that out. Might also be nice to mention that most rail riders aren't new transit riders, but merely folks who used to ride buses. One thing I almost never see reporters do is give some big-picture perspective--after all, LA County takes 40 million trips a day.

    The MTA has already been struggling with rail lines that have not quite worked out.

    The Green Line does not hit major destinations such as Los Angeles International Airport and the South Bay Galleria mall near its route, but instead goes from Norwalk to a miniature golf course in north Redondo Beach.

    The Gold Line from downtown to Pasadena has also been a disappointment, largely because it runs close to residential neighborhoods and hits so many street crossings that taking the train is significantly slower than driving.

    For safety reasons, the state Public Utilities Commission restricted the speed of Gold Line trains in parts of South Pasadena and Highland Park. Expo Line trains may suffer some of the same problems as they cross major north-south streets, such as Vermont, Normandie and Western avenues and Crenshaw Boulevard, and may have to slow as they approach intersections, experts said.

And how about that Red Line? It still has still not reached half its projected ridership. (Is that the kind of success that should be extended to the sea?)

Will the Expo Line even beat the bus?

    [A] ride on the Expo Line from downtown to Culver City won't be much faster than a bus trip, said Genevieve Giuliano, director of the National Center for Metropolitan Transportation Research at USC.

    "A surface rail line has to stop at traffic signals and is interfered with by surface traffic. It really doesn't have any advantage over a bus traveling the same route," Giuliano said.

    A ride along the full length of the Expo Line to Culver City is expected to be "under 30 minutes," while a westbound Commuter Express bus on Route 437, which follows a different course between the same two points, takes 25 minutes on a Friday afternoon, according to the bus schedule.

Article here.

Posted by tedb at 06:56 PM

August 10, 2007

Girls Gone Good?

More from the media-creates-horndogs meme--this one focuses on the fear that all those celebritarts are turning young girls into slutty Paris Hilton clones:

    “Role models” like amateur porn star Paris Hilton and her underwear-challenged cohorts Britney Spears and Lindsay Lohan are prompting more and more young girls to “go wild,” but with negative consequences.

    Mental health experts say more and more youngsters are being influenced by the “sexualization of girls,” a term coined in a report released earlier this year by the American Psychological Association.

    The research analyzed the content and effects of virtually every form of media, including television, music videos, music lyrics, magazines, movies, video games and the Internet. It also examined recent advertising campaigns and merchandising of products aimed toward girls.

    What they found was a sort of “Girls Gone Wild” effect in which young girls are succumbing to the pressure of sexualization by posting nude pictures of themselves on the Internet, allowing boyfriends to photograph them in the nude and making their own amateur porn videos.

    “The consequences of the sexualization of girls in media today are very real and are likely to be a negative influence on girls’ healthy development,” said Eileen L. Zurbriggen, PhD, chairwoman of the APA Task Force and associate professor of psychology at the University of California, Santa Cruz, earlier this year in reference to the report.

No doubt the naughty exploits of Brit, LiLo, Paris, Nicole, and company can have a corrupting influence on some girls, but stand back a bit and most seem surprisingly well-adjusted.

Here's Reason's Kerry Howley:

    The Guttmacher Institute, which researches sexual health, reports that the teen pregnancy rate in 2002, the latest year for which data are available, was at its lowest level in three decades. Between 1998 and 2002 the teenage abortion rate dropped 50 percent. In 2002, 13 percent of girls had had sex by age 15, down from 19 percent in 1995. Women are 56 percent of college enrollees. Girls have made such strides that conservatives in search of a cause (and an excuse to target feminists) have dubbed the reverse gender gap the “War on Boys.”

Good news parents--your girls haven't gone wild. And they're less likely to be victimized:

    Rape has plunged since the 1970s. The U.S. Justice Department’s National Crime Victimization Survey estimated that 105,000 women were raped in 1973, compared with 30,000 in the latest survey. All indicators of sexual violence are down, and the decrease is most dramatic among younger women. In the last 12 years, according to the DOJ survey, sexual victimization rates have fallen 78 percent.

Nick Gillespie cites more good news:

    there's no question that over the past decade or so kids have been exposed to far more sexual content than they used to be, whether on the tube, at the movies, in music, or in video games. What's more, everyone will agree that most of this content is presented in a glamorous fashion.

    Yet this social reality has not created a generation of sex-crazed adolescents. The percentage of high schoolers who have engaged in sexual intercourse declined from 54 percent in 1991 to 46 percent in 2001. We know this, incidentally, courtesy of another set of researchers at Kaiser, folks who work in the foundation's suggestively named "Reproductive and Sexual Health" program. Similarly out-of-sync trends also hold for violent TV and youth crime: As the former has increased, the latter has declined.

Posted by tedb at 05:06 PM

How to Prime the Access Charge Pump

Forget Haiti and Guyana, Iowa is fast becoming the capital of dial-a-porn.

Call it another example of the unintended consequences of regulation.

One of the more opaque ways the FCC funds universal service is through an elaborate method of carrier cross-payments for the termination of long-distance calls. That is, AT&T will pay Verizon a certain per-minute rate for the termination of calls that are switched from its network to a Verizon’s to reach a customer. This goes for wireless carriers as well.

The problem is that the FCC sets different access rates for different carriers. Rural incumbent local exchange carriers (ILECs) collect more per minute than those serving urban areas, the rationale being that the higher fees offset the higher cost of providing service in rural areas.

The problem is that rural ILECs are losing customers to competition, so they are turning to access charges as a strategic source of revenues. That means figuring out ways to drive more long distance traffic into their territories. One way, as Billing World reports, is to give out local numbers to adult chat lines.

Sprint Nextel announced this week that it had filed lawsuits against 14 Iowa telcos and their partners in what Sprint refers to as “a wide-ranging scheme to abuse the intercarrier compensation system.” Sprint now joins AT&T and Qwest, which are suing Iowa LECs over what they refer to as a traffic pumping scheme.

The lawsuits stem from the popular use of free calling services. These free services include free conference calls, international calling services and adult chat lines. According to the large telcos, these services are available compliments of high access charges that they must pay to the Iowa telcos. The free calling companies obtain local numbers from Iowa and are able to profit from the “free” prices because they share in the access charges obtained by the LEC.

Over the past year, a number of LECs in Iowa have raised their access charges up to 13 cents per minute. Sprint says that the access fee is about 26 times higher than some of the other access fees in the industry.

Elsewhere, Logan Paul Gage of the Discovery Institute reports:

But recently, some shrewd RLECs granted local numbers to “adult” chat lines. This way they now collect fees from the long-distance providers for all these additional calls. Revealing how out of control all this has gotten, one Senate staffer recently explained: “In July 2005, the rural phone company in Wayland, Iowa showed 40,000 minutes of long-distance calls received; in December 2006, they showed 10 million minutes. Of those calls, half were to the same four phone numbers, all adult chat lines.” AT&T refused payment to the Iowa RLECs for this traffic and filed suit. They allege that some Iowa RLECs charge 13 cents per minute, and last week the FCC suspended these fees pending investigation.

In what seems an increasing rarity these days, this issue is uniting social and fiscal conservatives. Family groups complain about porn lines having local numbers. Parents can block 1-900 numbers automatically; not so these local numbers. And fiscal conservatives see a textbook example of the folly of regulation. When government forces redistribution of wealth, companies adapt in Darwinian fashion to the new environment.

Universal Service has yet another unintended consequence: Because RLECs can sit back and collect fees on existing infrastructure, they have little incentive to innovate. Contrastingly, cable VoIP and wireless companies deployed competitive services without subsidies--though they now want a slice of the pie. If FCC Chairman Kevin Martin’s vision is truly to “remove regulations that inhibit innovation,” he should start here.

Posted by steve.titch at 12:57 PM

August 08, 2007

Reason in the Transportation News

Reason's transportation work is featured prominently in four different newspapers today. First up, our founder and director of transportation studies Bob Poole has an excellent piece in today's Orange County Register highlighting the role the private-sector can play in meeting our national transportation infrastructure needs. Here's an excerpt:

Unfortunately, the predictable, status quo responses to the Minneapolis tragedy have already begun: a new federal spending program to fix roads and much higher federal and state fuel taxes.

Both suggestions are off-target. The 2005 federal transportation bill doled out $286 billion, no small chunk of change. Before the feds hike the gas tax any further, government needs to prioritize spending, to focus on critical infrastructure projects instead of "bridges to nowhere" and thousands of other "earmarked" pet projects. If Congress fails to enact fundamental reforms, taxpayers will be justified in rejecting new gas-tax hikes.

For the major highway investments we need—such as rebuilding Interstates and adding capacity to congestion-choked expressways – there's a better way to pay. Texas, Virginia, and other fast-growing states have demonstrated the new model: highway public-private partnerships funded by direct user payments (tolls). In today's new toll-road model, private companies compete for long-term contracts to design, finance, build, operate, and maintain major highways and bridges. The companies recoup their investments by charging tolls.

. . . .

People are tired of sitting in traffic – and they are willing to buy their way out. Toll roads are more equitable than gasoline taxes because you only pay for the roads you use. And the private sector, unlike the government, builds roads based on where demand is highest – not where a politician or special interest group wants a pork project.

We can rehabilitate our aging infrastructure. We can relieve traffic congestion. And we can transform our roads and bridges into a 21st century network that offers increased mobility for individuals and businesses. But to do so, we are going to have to break free of the old model that relies only on government to pay for, build and maintain our highways.

Second, an LA Times editorial today--aptly titled "Kids aren't carpoolers"--makes the case that we've been making for some time (most recently here and here): HOV lanes don't work:

Research shows that most of the people who use carpool lanes, which typically require two occupants per vehicle, aren't teaming up to get to work. They're usually families going to school, the mall or somewhere else. A mom who is allowed to use the carpool lane because she's got an infant strapped in the back seat is not helping to get cars off the road; that kid wasn't going to be driving even if he weren't sharing a ride.

Meanwhile, many of the state's carpool lanes are at or near capacity; at rush hour they're often as slow as the other lanes. (The Legislature is partly to blame for this. In 2004, it passed a shortsighted law allowing solo drivers of hybrid cars to use carpool lanes. No such incentive was needed to boost the sales of hybrids.) This isn't to say that widening the 5 and 405, as Caltrans proposes, is a bad idea. But with the state investing billions of dollars in new carpool lanes, it makes sense to revisit the rules on their use to make them more efficient.

Some traffic experts, notably the libertarian scholars at the L.A.-based Reason Foundation, propose turning carpool lanes into toll lanes. Buses and registered vanpools could still use them for free, but everybody else would have to pay. It's a notion worthy of study, especially considering the success of the 91 Express toll lanes in the median of the Riverside Freeway.

[one caveat--the Times argues that a better solution than HOT lanes would be to require at least two occupants of vehicles using carpool lanes be licensed drivers, arguing that it would free up HOV lanes for actual carpoolers. In addition to the impracticality of enforcement, you would lose the invaluable benefit of pricing. Pricing is the only known way to maintain free-flowing lanes and ensure sustainable, long-term congestion relief.]

Lastly, Reason's 16th Annual Report on the Performance of State Highway Systems was cited in two editorials today-- one in the Philadelphia Daily News and another in the Providence Journal.

Posted by lengilroy at 10:01 AM

August 07, 2007

SCHIP not destructive enough for LA lawmakers

If you’re worried about the brooding prospect of SCHIP, stay clear of Los Angeles.

This week, lawmakers in the ever-compassionate City of Angels have proposed using government funds to cover “ALL” of the city’s uninsured children.

According to the Children’s Defense Fund, Los Angeles Mayor Antonio Villaraigosa and the Los Angeles Unified School District both endorsed the ALL Healthy Children Act:

This bill would guarantee health coverage to every child and pregnant woman in the U.S. Last week’s passing of SCHIP legislation in both houses will cover roughly 3 to 4 million of the 9 million uninsured children nationally. Though this is a positive step towards covering all 9 million uninsured children nationally, Mayor Villaraigosa sees covering all children now critical to their performance in the classroom. In a letter to Children’s Defense Fund (CDF) President Marian Wright Edelman, Mayor Villaraigosa states: “In California and in Los Angeles, [the ALL Healthy Children Act] is especially important because we have seen first hand that healthy children perform better in school,” states Mayor Villaraigosa. “This proposal offers policy makers the opportunity to implement viable solutions to the healthcare crisis.” According to the UCLA Center for Health Policy Research, about 1.1 million California children were uninsured at some point in 2005 (most recent year for which data is available) and about 307,000 live in Los Angeles.

Check out more from Reason on why this would be a universal disaster.

As for the recently passed SCHIP legislation, let us pray for a veto. Otherwise, what’s this poor guy to do?

Posted by tylerg at 10:14 PM

Muni Wireless's Not So Free Lunch

A doff of the chapeau to Adam Thierer at Progress & Freedom Foundation for citing for the San Jose Mercury’s critical look at “free” municipal wireless in Silicon Valley. The article is only the latest in a series of skeptical reports in papers around the country about what the actual cost commitment these projects are going to require from cities.
Here’s a portion of the report, available in full here (registration may be required).

While initially the project was lauded as a way to give the masses affordable Internet, key organizers have gently shifted the focus of the network from serving residents, for free, to giving businesses and city governments wireless access, for a price.

"The idea that we've always had is that this is not just a WiFi network for people to get their e-mail," said Seth Fearey, project leader for the Joint Venture Wireless Project. "Right from the start we said, `We know the operator has to make money; it's very, very important there be a sustainable business model."'

As system costs rise, there’s a certain degree of retconning going on about these systems—namely that the plan from the start was to serve city agencies first and the public second. Minneapolis wasted no time in getting word out about how its municipal wireless system aided first responders during last week’s bridge disaster. That’s all well and good, but that’s not how most of these projects were sold to taxpayers (the ComputerWorld article cited above mentions but ignores the significance of the fact that on the day of the disaster there were just 1000 people using the system. If it’s really outdoor wireless coverage for emergencies the city wants, it then begs the question if the city actually needs to create exclusive franchised municipal WiFi monopolies for the purpose. Why not open right of way to all would-be players, just like Anaheim did? As business models evolve, it’s simply a false dichotomy to assert it's muni or it's dead air.

Posted by steve.titch at 02:09 PM

Nothing to sneeze at

So many are convinced that our health care system is desperately ill, but perhaps mass myopia helps explain the sour mood.

Turns out we've come very far.

In 1836 Nathan Rothschild died from an infection on what was probably a boil. Historian David Landes notes Rothschild was probably the richest man in the world.

    And so the man who could buy anything died, of a routine infection easily cured today for anyone who could find his way to a doctor or hospital, even a pharmacy.

There's another telling anecdote in Amity Shlaes' fascinating new book book, The Forgotten Man. In 1924 President Coolidge's son got a blister on his toe while playing tennis on White House grounds. Infection developed and he died. Penicillin would have saved his life.

The son of a US president died because he did not have access to something that is not only widely available today, but sometimes even free:

    Publix supermarket chain said today it will make seven common prescription antibiotics available for free, joining other major retailers in trying to lure customers to their stores with cheap medications.

    The oral antibiotics, representing the most commonly filled at the chain's pharmacies, will be available at no cost to anyone with a prescription as often as they need them, Publix CEO Charlie Jenkins Jr. said. Fourteen-day supplies of the seven drugs will be available at all 684 of the chain's pharmacies in five Southern states.

    The prescription antibiotics available under the program are amoxicillin, cephalexin, penicillin VK, erythromycin, ampicillin, sulfamethoxazole/trimethoprim, and ciprofoxacin.

More here.

Related
: We're all supermen now

Posted by tedb at 01:43 PM

Ban Wagon--"bitch" and "ho" edition

    The New York City Council, which drew national headlines when it passed a symbolic citywide ban earlier this year on the use of the so-called n-word, has turned its linguistic (and legislative) lance toward a different slur: bitch.

    The term is hateful and deeply sexist, said Councilwoman Darlene Mealy of Brooklyn, who has introduced a measure against the word, saying it creates “a paradigm of shame and indignity” for all women.

Nineteen of 59 council members have signed onto the law, which would also "ban" the use of "ho." But would this affect dog show aficionados (or those who just like to snicker when refined announcers talk about female dogs)?

    “We’d be grandfathered in, I would think,” said David Frei, who has been a host of the Westminster Kennel Club dog show in New York since 1990. The word is a formal canine label that appears on the competition’s official materials. But Mr. Frei said he worried about the word’s impact on some viewers, especially younger ones.

Much of the article discusses how these naughty words have become quite prevalent, even in some unexpected circles. No surprise to hear them from hip hoppers, but council members?

    And Ms. Mealy admitted that the city’s political ruling class can be guilty of its use. As she circulated her proposal, she said, “even council members are saying that they use it to their wives.

Sort of interesting that that line hangs there in the NYT article, without further exploration.

Could also file this under the ongoing Singaporization of New York. (You know, Councilwoman Mealy, gum-chewing has plenty of antisocial consequences.)

Related
: Ban Wagon--trans fat edition; national pastime edition; royal family edition; distracted driving--and walking--editions; and of course smoking.

Posted by tedb at 12:32 PM

August 06, 2007

Addressing Some Misunderstandings on Toll Road Concessions

My pal Tory Gattis--purveyor of the excellent Houston Strategies blog--had an interesting post last week on long term toll road concessions. Tory has generally been fairly skeptical of concessions up to this point, but in his post he concedes that it might be a good thing if the private sector absorbs the risks of increased telecommuting, higher fuel prices, etc., which could result in future traffic and revenues far below what's projected in today's forecasts.

Though reasonable people may disagree on the likelihood of that actually happening, he certainly points out one of the key benefits of public private partnerships--transferring the risks of traffic and revenue shortfalls (as well as construction cost overruns) to the private sector partner.

Reading through his original post and reader comments, I noticed what seemed to be some misunderstandings regarding some of the details of PPPs that I felt compelled to respond to, and Tory generously offered me the opportunity to discuss them in a guest blog post. It's pretty long, so for brevity's sake, I won't repost it here.

For more details on concessions and transportation PPPs, check out these recent Reason publications:


Posted by lengilroy at 07:03 PM

Another good reason to drink fine wine

We know that a glass of wine in the evening can be good for your health, and even good for your pocketbook. Now Reuters is reminding us that drinking wine is good for the environment, too. That cheap stuff with the plastic stoppers won't do, though. Last year WWF, "the global conservation organization," published a report, catchingly titled Cork Screwed?, on the environmental benefits of the cork industry--which supports some of the "highest levels of biodiversity among forest habitats, including globally endangered species such as the Iberian Lynx, the Iberian Imperial Eagle and the Barbary Deer."

This week brings news of the first attempt within the cork industry to quantify some of their sustainable laurels. At the top of their list is carbon dioxide sequestration. To get the full picture, however, you'd have to compare the greenhouse gas savings to the quantity of greenhouse gases released in the wine fermentation process, among other sources. (So, for the time being, we can stick with the Iberian lynx as our reason to buy quality wine.)

Posted by skaidra at 12:49 PM

August 03, 2007

Anti-Nanny Nanny Laws

Is one of the new fads in bans--banning baby formula in favor of breastfeeding--an anti-nanny nanny law? And is that why nanny law proponents are speaking out against it?

NewsBusters' Geoffrey Dickens investigates:

On this morning's Today show, NBC's Meredith Vieira and Dr. Nancy Snyderman became born-again libertarians in their opposition to New York City's ban on bottle feeding babies. Vieira called the measure "drastic" and Snyderman urged, "not so fast." The ban even inspired "Today" to coin a new series segment called "Nanny State." However, back in 2006, when New York City infringed on another right - the right to eat fatty foods, Snyderman struck a different tone, as she gravely warned about the dangers of trans fats.

Posted by skaidra at 03:45 PM

CNBC: America's Infrastructure

I appeared on CNBC's Kudlow & Company today discussing the role of the private sector in America's infrastructure. If you're familiar with Reason you've read about the Indiana toll road lease and the debate in Pennsylvania. Check out all of Reason's transportation work here, our Annual Privatization Report here, and some commentaries on the subject matter:

Indiana: One Year Later -- and one on Pennsylvania.

Posted by geoffs at 03:34 PM

California's Global Warming Budget Crisis

Curious drama in the California capitol this week, as Republican state senators have refused to approve the proposed budget (already six and a half weeks late)--not because they don't like the budget, but because they don't like Attorney General Jerry Brown's current position that CEQA (California's environmental review process) must now take into consideration the contribution to global warming of all new local plans and developments. While the impasse seems unlikely to last very much longer, it is worth noting. Republican hold-outs are saying they won't approve the budget until global warming impacts are exempted from CEQA review. Also at issue are proposed changes to the method of awarding state transportation funds (e.g. SB 375) that would essentially reward regional plans that decrease vehicle miles traveled (the idea evidently being: the less mobility, the less greenhouse gas emissions). The tactics being employed here are questionable, but the characterization by opponents of the move by state Republicans is even more absurd. Consider:

Republicans in the California Senate continue their outrageous demand for major rollbacks to California's bedrock environmental law as the price of their support for the state budget.
--Bill Allayaud, State Director, Sierra Club California
Republican members of the State Senate (Mr. Maldonado now excepted) are refusing to vote for the budget unless CEQA is gutted, with respect to global warming.
--Gary Patton, Executive Director, Planning and Conservation League


A point of clarification: what senate Republicans are asking for doesn't in any way amount to "eviscerating" CEQA (why CEQA provisions are so consistently compared to entrails is another question...). Global warming has never been an aspect of CEQA review, and there is no indication that adding this provision to CEQA was intended by the passage of California's greenhouse gas emissions law (AB 32) last year.

Republicans are being made to look like the worst of uncompassionate conservatives right now, holding the budget hostage while hospitals and clinics struggle to stay open without needed Medi-Cal funds. But adding global warming to the list of CEQA considerations might be worse: essentially holding hostage all development--including, say, development of new hospitals and clinics--indefinitely, while localities struggle to apply unfamiliar and untested methodologies for reducing greenhouse gas emissions through urban planning.

Finally, various coverage of this debate has cited results of the Public Policy Institute of California's recent survey of Californians' opinions on the environment. The survey found that, for the first time, majority of Californians (54%) say they think global warming "poses a very serious threat to the state’s future economy and quality of life." What is more interesting, and more problematic, is that the survey seemed to indicate that the more Gov. Schwarzenegger raises the profile of climate change as an issue through action at the state level, the more Californians see climate change as a critical issue, and the less they approve of the level of state action on it.

Also important: For the seventh year in a row, Californians across all political parties, all regions of the state, and all racial and ethnic groups rank air pollution, not climate change, as the state’s most important environmental problem. The major variation in how critical of an issue residents consider air pollution to be is, not surprisingly, correlated with how bad air pollution actually is where they live (Inland Empire, Los Angeles area, and Central Valley residents ranking it highest).

So are Republican Senators "dramatically out-of-step with Californians"? Not really. Are they disemboweling CEQA? Only if you think that the only two options are for CEQA to grow or be "gutted."

Here's to the (slim) hope that cooler heads will prevail...

Posted by skaidra at 01:59 PM

Friendlier to fatness, but how about smoking?

All sorts of groups claim to be "the last socially acceptable target of discrimination." How is the social tide turning when it comes to two groups vying for this distinction?

Slate's Michael Saletan sees an erosion in social norms that frown on fatness. Case in point:

    In a 1985 survey by the NPD group, 55 percent of U.S. adults agreed that "[a] person who is not overweight is a lot more attractive." By 2005, only 24 percent agreed. The firm concluded, "Perhaps Americans have found that the easiest way to deal with their weight is to change their attitude."

Meanwhile, Michael Siegel points to a new Gallup survey, which finds that nearly half of smokers (47%) feel unjustly discriminated against as a result of public smoking restrictions. That's up from 32% in 2001. But there's also this wrinkle:

    The majority of Americans (58%) continue to feel sympathetic toward smokers, which represents no change from 2001.

Check out "the rest of the story" from Siegel, which includes some interesting musings on whether anti-smoking groups might be stepping out of line with public sentiment.

Related: LA Bans Puffing in Parks

Related: They would never--wait, they already have

Posted by tedb at 01:40 PM

August 02, 2007

The Politics of Disaster

Following yesterday's horrible tragedy in Minneapolis there has been non-stop coverage of America's infrastructure needs. Our roads, bridges, airports, ports and water infrastructure all need significant investment -- its true. For some, the answer is easy -- a massive federal spending program. Even my colleague at Reason magazine fell for the trap in connecting the two (federal spending and infrastructure) in a recent blog post; suggesting that money currently spent in Iraq could be redirected to funding infrastructure. Problem solved, right?

Wrong. A federal bailout and/or spending program is not the answer and frankly runs counter to more than 30 years of policy research conducted by my colleagues at Reason Foundation. For example, the recently published 21st Annual Privatization Report includes a lengthy sections on transportation, water and airports (to name a few) demonstrate how the private sector can play a significant role in infrastructure development in the US. In just a short time private companies have raised a significant amount of capital and they certainly have the expertise and willingness to invest in our infrastructure -- more efficiently and effectively to boot. While a role for the government will always remain, a massive federal bailout is not the solution -- even Wall Street sees it.

This is part of a larger trend -- a bipartisan one where the doors to private capital and expertise are increasingly being opened. Former Colorado Governor Bill Owens, a Republican, discussed it in our recent Innovators in Action as did Indiana Governor Mitch Daniels in last year's edition. Even Pennsylvania Governor Ed Rendell, a Democrat, acknowledged an increased role for the private sector to play in financing, developing, and managing our nations' infrastructure. Despite recently signing a bill in Pennsylvania that would not privatize the Pennsylvania Turnpike, Rendell admitted on national television that privatization would have generated significantly more money than the plan the general assembly and he ultimately supported. Its true that Rendell also called for a 1% national income tax increase to fund a "Federal Capital Budget" so he's not entirely sold but at least he didn't play politics with the war.

Posted by geoffs at 03:42 PM

Exploring Private Prisons

Frank Smith of the Private Corrections Institute in Kansas wrote a letter to the editor of the Idaho Mountain Express - his letter was in response to an editorial the IME published a few days earlier. Sadly an inmate in a private facility committed suicide because of poor living conditions and Smith used that as an opportunity to attack private prisons.

Without argument no one should be treated poorly or inhumanely. Smith, however, suggests the problem lies in the nature of the facility itself. The inmate who committed suicide was in a private facility (if you were to visit Smith's website you'd think that government run prisons were the Hyatt or Hilton...there's never any problems there) and Smith suggests that the profit motive is what led to poor conditions and ultimately the suicide. He suggests that "doing a bad job increases those profits." Smith fails to understand the nature of incentives. Private companies have stronger incentives to do a good job in order to win more contracts and earn more money. If they continually underperform or produce terrible results governments will be forced to send their business elsewhere or build their own facilities. The profit motive actually acts as a push toward good service, not a pull away from it.

Smith claims to have "examined monitoring and oversight all around the country...billion-dollar corporations such as GEO and its competitor CCA have frustrated the efforts of those attempting to represent the interests of taxpayers and insure humane conditions." While he may have reviewed monitoring programs he's letting ideology and philisophy drive his argument. Private prison operators collectively spend less money lobbying in the entire U.S. than does the public-employee union in California.

Regardless, the government remains responsible for ensuring that prisoners' rights are protected even if they send them to a private prison. Smith fails to note that exploiting or abusing prisoners can occur in both government and private prisons. We hear terrible stories all too frequently: of "gladiator" fights between inmates orchestrated by correctional officers, sexual assaults by correctional officers, and other individual and systematic abu