Category Archives: Uncategorized

What’s With the Swedes?

Navel-gazing is something I try to avoid. With a narcissist in the White House, that is true in the present even more than in the past. But there is something about this blog that is so strange that I just have to ask. WordPress tells me that people from Sweden read it, almost every day. This is a blog that is mostly about public policy in New York City and New York State, with occasional discussions of federal policy and the broader U.S. economy and land use issues.  Almost all of those who read it are from the United States, WordPress tells me. Mostly other policy work types, as far as I can tell. Which makes sense. And then you have the Swedes. The question is – who, and why?

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Puerto Rico Needs a Debt for Equity Swap

If anyone doubts that Puerto Ricans are Americans, just look at the state of island’s economy before Hurricane Maria. You had a bunch of rich people holding bonds exempt from income taxes, and a bunch of public employee pensioners who got their pensions retroactively enriched while traditional pensions were eliminated for those hired after 2000, all expecting to get paid by the poorer generations to follow them. You had an economy based on imports, debts and consumption that would collapse without bailouts from the federal government – at the expense of someone else, someday. You had the executive/financial class, the political/union class, and other members of a better off Generation Greed all seeking to suck money out of younger, poorer generations of serfs. (And those serfs fleeing the island in large numbers.) The Commonwealth of Puerto Rico and its government-owned utility finally went bankrupt. Puerto Rico is like the United States, only more so. I wrote a post titled “The Puerto Rico Disaster” three years ago.

https://larrylittlefield.wordpress.com/2014/11/10/the-puerto-rico-disaster/

And then the hurricane hit.

Puerto Rico has no money, no economic base, and very few assets of any that have value in the short run. If the public employee pensioners and debt holders expect all they have promised themselves, where do they expect it to come from? Confiscating people’s FEMA rations and Social Security checks? How can people expect to suck out more from those who are so much poorer, or others who never benefitted in the past? But the Commonwealth of Puerto Rico is going to end up with a whole lot of abandoned land, urban, rural, seaside, etc, because people will be forced to leave and there will be no income to pay property taxes. That, and a tropical climate in a part of the United States with links to New York, could have value someday. Value someday, perhaps, if they cooperate for the mutual benefit of themselves and the island as a whole, is all that Puerto Rico’s creditors deserve. I propose a debt for equity swap, with that land turned over to three of four new publicly traded Real Estate Investment Trusts (REITs) that would compete to earn money by redeveloping the island. Those who wanted to invest in Puerto Rico for the long-term could buy in. Those who did not could sell, and take what they get.

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Term Limits: Impact On The Operation of New York’s Governing Bodies

During my Don Quixote protest campaign against the state legislature back in 2004, the only member of the media who paid attention to what I was trying to say was Erik Engquist, then of the Courier Life papers, now with Crain’s New York Business.   But he didn’t quite get it right. In one column, he said I was someone who cared deeply about the process of government. I e-mailed him and said that to be honest, like most people I never really cared about or paid attention to the process, I only cared about the results. He wrote back and said while that may be so, unless New York gets a better process, it isn’t going to get any better results.

This is the third and last post in a series on New York City’s double-blind experiment with democracy – a City Council that has term limits, and a state legislature that does not. In the first, I noted that thanks to term limits and public campaign financing there are actual elections for the City Council every eight years, with the would-be members forced to pay attention to the general public, whereas in the state legislature competitive contest elections almost never happen.

https://larrylittlefield.wordpress.com/2017/09/10/term-limits-new-york-citys-double-blind-test-of-democracy/

In the second I examined the personal and professional background of the City Council and state legislature members, and found less difference than I would have supposed, due in part to a surprisingly large amount of recent turnover in the State Assembly, and due in part to the fact that ordinary citizens cannot, or do not, run for office.

https://larrylittlefield.wordpress.com/2017/09/24/term-limits-impact-on-the-characteristics-of-nyc-representatives/

This is post is not about who the members are or how they get there, but what they do when they arrive. With regard to corruption, transparency, and the value they place on the common future, the one interest all of us (other than the most selfish seniors) share.

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What Puerto Rico Does and Does Not Need

New York City officials concerned about the disaster in Puerto Rico are making a big mistake.

https://ny.curbed.com/2017/9/26/16369826/hurricane-maria-puerto-rico-relief-efforts-nyc

“Items that are needed the most are batteries, diapers, first aid supplies, and feminine hygiene products.”

The people may need those items, but the worst thing New Yorkers can do is donate them. Relief agencies have warehouses full of low-value items they cannot afford to transport to far-off destinations. And those that get there have the effect of preventing the local economy from re-starting. While the distribution system may have broken down, relief agencies trying to use expensive airplanes to move low value supplies would have to use those same roads.

What people need is cash, in small denominations, to buy what they in fact need, and get jobs getting them to where they are needed in the most efficient possible way. The problem with cash is it can be siphoned off by the corrupt. That just means people need someone they can trust to hand out tens and twenties. True of Harvey and Houston.

http://www.npr.org/2017/08/29/546866561/responding-to-harvey-will-be-long-term-issue-plan-cash-donations-to-match

True of Puerto Rico.

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Median Household Income: It Takes Five Minutes to See Beyond the Happy Horseshit

American Community Survey data was released for 2016 yesterday, and the news was reportedly good.

https://www.washingtonpost.com/business/economy/us-middle-class-incomes-reached-highest-ever-level-in-2016-census-bureau-says/2017/09/12/7226905e-97de-11e7-b569-3360011663b4_story.html?utm_term=.6b0de01d116e

The incomes of middle-class Americans rose last year to the highest level ever recorded by the Census Bureau, as poverty declined and the scars of the past decade’s Great Recession seemed to finally fade. Median household income rose to $59,039 in 2016, a 3.2 percent increase from the previous year and the second consecutive year of healthy gains, the Census Bureau reported Tuesday.

While it is not a surprise that income is rising in an economic upturn, the claim is that this is more than a cyclical increase in income – even though wages are not rising.

The income increase extended to almost every demographic group, Census Bureau officials said. The figure the agency reported Tuesday was the highest on record. The agency reports that in 1999, median household income, adjusted for inflation, was $58,655.

Really? I immediately went to American Factfinder

https://factfinder.census.gov/faces/nav/jsf/pages/index.xhtml

And downloaded median household income for 2016 and 2006, a year at a similar point in the economic cycle. Adjusting the latter into 2016 dollars for an inflation-adjusted comparison. Downloaded it by age of householder. And found almost exactly what I expected.

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Term Limits: New York City’s Double-Blind Test of Democracy

In 1989 a new New York City Charter, developed by the equivalent of a state constitutional convention in response to a court decision invalidating the old Board of Estimate, gave city voters the power of initiative and referendum. The power to directly enact local laws that their representatives were unwilling to enact for them. That power has been used only once in the 28 years it has been in force – in 1993, to enact term limits for city officeholders. Since term limits are one thing the people are almost all in favor of, and politicians are almost all opposed to.

http://www.nytimes.com/1993/10/20/nyregion/bid-to-limit-terms-can-be-on-ballot-in-new-york-city.html?pagewanted=all&mcubz=0

That initiative and referendum has created a double-blind test of democracy in New York City, an experiment that no one knew they were participating in when term limits were enacted. Because today, New York City residents are represented (or not) by two sets of non-federal legislative representatives.   The 51 members of the New York City Council, who have turned over twice or more due to term limits. And its 91 member of the New York State legislature, with 26 State Senators and 65 members of the State Assembly. As we look toward a constitutionally-mandated November referendum on a possible New York State Constitutional Convention, something the entire New York State political class and its funders is opposed to and which basically seems to be hushed up, it is time to examine the results of this experiment. Because based on history, unless the powers that be manage to control the constitutional convention, term limits for state politicians is one provision that it might very well place before the voters for approval, and that those voters would almost certainly approve.

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Brooklyn’s Business Boom: Industrial Sectors

Suddenly, the hottest type of commercial real estate in the United States isn’t office buildings, or shopping centers, or apartments. It is industrial buildings – simple boxes, preferably as large and high-ceilinged and with as many truck loading docks as possible. And this isn’t because manufacturing is returning from overseas and “making America great again.” It is because distribution and logistics, the business of moving goods from producers to consumers as efficiently as possible, has been one of the two sectors with significant investment, innovation and productivity gains during the past two decades, along with information technology.   (Education and health care have had a high level of investment, but without productivity gains in health care and without either innovation or productivity gains in education).

In the 2000s the innovation was super-efficient mega-warehouses serving large regions, with containers off ships and trains, reorganized into tractor-trailer-sized loads of pallets of goods with electronic and barcode tags, destined for big-box stores. The supply chain is so efficient that I am often amazed that the things I buy can be brought to me so for so cheap, even if the Chinese are producing it for free. For the Northeast, Eastern Pennsylvania and Central and Southern New Jersey has emerged as THE industrial center. This era corresponded with many of the final legacy operations, such was the warehouse serving Key Food, moving out of Brooklyn. The latest shift, just happening now, is being driven by one company, Amazon.com, and its growing legion of imitators. That shift has yet to really reach Brooklyn, but the rest of this post uses ZipBusiness Patterns data to show what the industrial trend was in that borough as of 2015 as compared with 2005.

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