Platters II

There’s another aspect to the platter system which deserves a little thought. The rules put into play at the higher, overarching levels need to be the most useful to the most people. If they are too specific, they set the lower platters, or ecosystems of exchange, a kilter, setting up rules to counter act the rules.

Take a subway system as an example. The governance and maintenance of the infrastructure is managed as a system for a large population. The NY subway handles over 3 million rides a day. So in terms of setting user fees, the calculation is done with inclusivity in mind, pricing so as to be accessible to the most people, in this case of upwards of 20 million residents

User fees work well in carrying the cost of water delivery, but come up short in paying for sewer line replacement. User fees in subway systems are also insufficient in maintaining the physical structure. In sewer lines it is easy to assign the replacement cost to each dwelling. In metro stops it is less clear who should pay.

As different locations benefit to different degrees from their proximity to the subway stop and the line, who benefits the most from a particular piece of the system is more difficult to identify. But those who enjoy its use the most, are also those who are most likely to be agreeable to paying a surcharge in order to preserve its use.

Similar to the example of waste water removal, the daily patrons at any metro stop are the most likely to realize a tangible benefit. Another way to put it is the people who use the property, apartment towers, businesses, shoppers, office complexes, realized a benefit and hence receive an increased value in rents, level of employee employee satisfaction, and so on. Wouldn’t it be great is there were price signals to tell us how much they would be willing to pay?

Being able to price out the maintenance expense would realize another mid-level platter efficiency. The building owners who do not value the proximity to the subway, and hence would find the maintenance assessment a burden, would be incentivized to leave the property. There maybe ten other desirable aspects to their building keeping them in place. Hence they stay put neglecting the benefits of mass transit.

But if the market value expense of subway maintenance were great enough, the building owner may move five blocks away from the subway line where some combination of the ten other features would maximize their needs. By not have to pay for the line, which they don’t value, they voluntarily relinquish that space to others who value it more.

When new construction goes in, the cost of putting in sewer lines, roads, curbs, and so on are built into the price of the purchase. Developers are only able to go forward with a project if there are buyers who would pay for the package– including infrastructure costs. Last time I checked, these ran around $25-30K per household in Minnesota.

If all the decision making is done at the largest, most encompassing level of cooperative agreements, then then there is a glossing over of the pockets where the benefits are compounded. Infrastructure is an amenity to an entire city, and those who travel to see it. But to afford such a significant amenity, the details of all the various levels of users and daily riders could be better understood.

Spring sports

It was a beautiful evening to enjoy this first game of spring sports over at the high school. I wasn’t raised in a sports family so for many years American’s obsession with football and baseball and basketball was a mystery to me, and even a little amusing.

As a young loan officer I worked mostly with men who each fancied their favorite sport. A very young Shaq O’Neil was scheduled to be at the Metrodome in the early ’90’s and the bunch of guys I worked with in downtown Minneapolis were excited to watch him practice. Their hearts’ pulsed visibly beneath their grey suit jackets.

Slowly I came to understand that many of them knew the histories of the final four teams; they knew statistics and coachs; they had a long term relationship with the sport. Watching the game is just one of many facets of being a sport’s fan.

In the spring, when the warmer temps are just barely taking the edge off still dormant ground, I can’t wait to climb up the metal bleachers to take in a game. It took a lot of youth sports to teach me the rules, and to understand the plays, but I have gradually grown into fan stature. Actually both my husband and I have.

Come to find out, sports are more fun to consume with someone else. When the Twins won the World Series in ’86 it was easy to jump on board as a fair weather fan and bask in the ticker tape parade through Minneapolis. But sitting on a couch comparing memories of past plays or relishing the last 90 minutes of a toe-to-toe basketball game, is also more enjoyable with a buddy.

A sport’s audience is bound in a communal relationship. People from all parts of a city can strike up a conversation with a simple, “How about them T-Wolves?” There aren’t many ways strangers can break through the social dampeners that keep people on their platter. Sports provides that venue.

The beauty of Math

The best thing about math is that it is reliable. Numbers don’t change, they don’t have nuance or inflated expectations. You can’t disappoint them. They make you think of Horton the Elephant with a little redirect, “they say what they mean and they mean what they say, numbers are faithful 100%.”

Some people find them inconvenient for that reason. They want to tell their own story and numbers get in the way. So there are all sorts of tricks to distort the numbers. Graphs that don’t start at zero, or graphics where the bars are enlarged, to imply an unsubstantiated claim. The number sits on its axis, seemingly blushing under its inflated image.

All the more reason to keep people thinking about math. I was just reviewing the statewide scores by public school district and the math scores have the greatest spread between neighborhoods. Yet I don’t think math talent divides out that way. God given gifts ignore social-economic concerns. We just don’t know how to tap that talent-yet.

But we do know a lot about mathematical relationships. There are theorems and proofs as ancient as the Greeks. Some of us who desire some concreteness in the world, find this comforting. And even if it is not your thing, the applications of their relationships have been leveraged to give us a life enhanced by science and technology.

This alone should garner respect from even those with aversions to numbers. And even when the numbers aren’t giving us the feedback we want, they will most likely represent the reality we need to hear.

Platters

A few days ago I wrote an interpretation of a notion using an analogy to juggling plates. On the cover of Raghuran Rajan’s book, The Third Pillar, a disc is supported by three pillars. Think of these platters as holding political/economic ecosystems. The people on the plates are there voluntarily. But the more layers of plates, the easier it is to jump between them. If there is one plate up in the clouds and a bunch of plates jiggling away down by the parkay flooring, then people can only jump sideways, not upward.

On the cover of Raghuran Rajan’s book, The Third Pillar, a disc is supported by three pillars. Think of these platters as holding a political/economic ecosystem. The people on the plates are there voluntarily. But the more layers of plates, the easier it is to jump between them.

With this structure in mind, it is easier to see how societal systems require competent political figures at all levels, in turn providing greater freedom of movement between the platters. (And if you should imply from this mental drawing that those closer to the ground are somehow simpletons, you are not in my portrait, yet. Many people choose a simple rural life, for instance, regardless of their intellectual makeup)

There is, however, a natural nesting of authority, as all the plates are spinning in the same environment. So when decisions are made of an overarching nature, they come from the upper platters. A neighborhood does fine sorting out it’s dog park and garbage collection, but needs a city to set up sewers and water service. Then the county takes over with the county roads and the state with the freeways. What if there were no levels of government between caring for your own driveway and the interstate?

Here’s an example given by Raghuram Rajan in The Third Pillar.

Therefore, for example, they want him to procure a birth certificate for their child, who was delivered in their shack in a village far away from any medical clinic. The birth certificate is essential for the child to be admitted to the free government school, and no government officer will provide it with out suitable gratification, because he has no official document to rely on. The poor do not have the money to bribe so they plead for a call from the MP’s office, which will set the wheels of bureaucracy rolling. Once the child is in the local school, the child becomes the MP’s responsibility. When she gradu ates from high school, the MP has to find a college that will admit the student if her grades are modest, and when she gets a degree, he has to persuade some government office to give her a respectable secure job. And when she gets married, he will be invited to the wedding and be expected to give a suit able gift.

In a society where the typical government civil servant is neither civil nor a servant to the poor, the MP is the intermediary who will help the poor navigate the treacherous world. While the poor do not have the money to “purchase” public services that are their right, they have a vote that the politician wants. The politician does what he can to make life a little more tolerable for his poor constituents-a land right enforced here, subsidized medical services honored there. For this, he gets the gratitude of his voters, and more important, their vote. Tied to their MP via patronage, they do not really care about how the MP will vote on the bigger issues of the day, whether he supports tax-evading liquor barons, illegal miners, or industrial polluters, so long as these do not intrude directly in their already-hard lives.

The missing plates between the poor in this story and the MP causes a couple of errors in the system. Those who should be receiving support through a combination of reciprocal work and engagement have nothing to offer the person in authority but an unconditional vote. The vote contains no value in evaluating the higher level issues which do not effect their lives.

If the vote was going to an intermediary plate authority, one who could actually trade in meaningful services for the poor, social exchanges would be tested and evaluated and remediated through the system. A successful local politician, say at the city council level could become a candidate for state or county level responsibility. The omission of mid-tier ecosystems eliminates that possibility, allowing for private actors to step in and capture the needs at those levels, in fraudulent manners.

The winds, they are a-changing

The mayor of Brooklyn Center has navigated a superb response to the on-going crisis. His feed is specific, situational and gives clear direction.

This approach appears to have general pubic support. As you read through the comments, an expression of outrage is followed by an explanation. Other voices are spelling out the agenda.

Mayor Mike Elliott on Twitter: “Daunte Wright’s death will not be exploited. Some outside elements may be planning to show up to infiltrate peaceful protesters and cause mayhem, we will not allow that. We ask folks to protest peacefully then please go home before the curfew goes into effect this evening.” / Twitter

So far the extensive military force present around the city seems to be deemed appropriate to the level of potential threat. A far cry from last years repeated bolstering of the protestors, allowing the grievers “express” themselves. The sweet naivete has been swept away on winds of change.

From the Inferno

Our metropolitan area is being tested by dark forces. To have a senseless tragedy occur midway through the legal proceedings of former police officer Chauvin feels like the doings of evil seeping up from a subterranean inferno.

Events are unfolding differently from last May. The top political figures are out front and center. The mayor of Brooklyn Center, Mike Elliot, posted a video statement in the middle of the night and today held a press conference. (We didn’t see the Mayor of Minneapolis last year until five days after the event.) The Governor also has made public statements along with John Harrington Minnesota’s commissioner of public safety.

The looting started last night so there is a four county curfew tonight from 7pm until 6am. The top politician voiced stern rhetoric against violators of the curfew and stated in no uncertain terms that they would be arrested. The national guard has been activated. So much for woke empathy.

We all received several alerts, like amber alerts, on our phones to remind us to stay home. Since it is rainy and 40 degrees outside, this won’t be much of a sacrifice. The news did show clips of businesses back out putting plywood over their windows. Someone Twitter quipped, “where’s the closest Target?”

Throughout the day newspapers and citizen journalists were out capturing bits of information and promptly posting them to social media, but it feels different. Less surprised outrage when a journalist gets hit by a rubber bullet. More disbelief that a firearm could be confused with a taser. Maybe because the officer is female, the “militarization of the police” image doesn’t quite materialize.

Lastly, this incident is different because the victim’s mother and older brother are very much of Caucasian descent. And so far the brother has acted as the family spokesperson. Whereas the TV news has found young African American talent to be the lead reporters from the streets. It’s nice to see their fresh faces report on an important issue.

There are similarities too. Both men had cause to be apprehended. Both struggled or resisted arrest. Both ended up dead at the hands of our law enforcement officers.

Now how are we going to solve this problem?

San Francisco comes to its senses

San Francisco schools have decided not to spend the time and money to rename 44 schools.

The San Francisco Board of Education will ultimately keep the names of dozens of public schools in a case of high-stakes second thoughts.

It seems we are seeing a turning point in the ridiculous posturing against ghostly foes of yore. And the objections came from a wide selection of practical folks from both sides of the aisle.

The reversal was met with relief and enthusiasm by disparate critics united in their opposition to the project. Conservatives characterized the effort as cancel culture run amok, while liberals decried the woefully poor research conducted by the blue-ribbon panel that led to the lengthy list of school names to be changed.

San Francisco School Board Rescinds Controversial School Renaming Plan : NPR

Here in Minnesota, we are experiencing an attendance problem. Now that buildings are opening up again, it’s time to try to lure the 17,000 Minnesota kids, who left public school, to get back on the yellow busses. Some may have settled into parochial schools, but the vast majority, according to reports, are being home schooled. Or at least are at home.

Let’s hope these families return to valuing our teachers, the socialization benefits of in-class learning, as well as the extra curricular activities. At an approximate revenue of $14K a pupil, there’s a $238 million dollar missing entry in the public school income ledger.

Sorting

The national conversation around inequality is grounded in measuring an individual’s income or wealth. I question if this is really the way we want to sort the players in order to get down to the nuts and bolts of our concerns.

Many of those in the one percent are recent superstars: ball players, rock stars, blockbuster actors. None of the ones who come to mind are set to receive an inheritance. Derek Jeters of NY Yankees fame, qualifies as a one percenter with a reported $5 mil/year salary. His parents are not from the super rich stratosphere, nor are quarterback Russell Wilson’s (35 mil/yr), nor Serena Williams’ (78 mil/yr).

The purpose of a free and open society is for folks to be able to move between social and financial groups. If the majority of the one percenters are the first in their families to enter this income bracket, that is a win for the country not a loss.

There are plenty of examples outside of sports franchises and Hollywood too. Many of the tech giants don’t come from substantial wealth. Bill Gates, Mark Zuckerberg, Elon Musk all come from professional parents, but seemingly not one percenters. And Oprah (315 mil/yr) isn’t the only self-made woman that came from a modest background. There are plenty of self-made rich women in the US.

It is true that the wealthiest women in the US are beneficiaries of family fortunes. “Eight out of the 10 richest women in America are descendants or widows of the founders of some of the biggest companies in the country – from Walmart to Apple to Mars candy.” And I’m sure there are one percenters of the male persuasion who have lived a life of financial opulence.

It seems to me, however, that it is uncommon for family wealth to make it much past the second generation. Entrenched wealth is what we find objectional. Movement of people between the income brackets is desirable. It is the way connectors can move between groups and link resources to talent.

So I suggest we talk in terms of coupling parents and children. The greater difference between their life’s circumstance the healthier the environment. Taken together, as a grouping, and then ranked, will give a better snapshot of how income is stacking up across the country.

I realize there are already inter-generational studies of income, but these focus on upward mobility. These are concerned with lifting people out of poverty. While this is one aspect to consider, moving people up from low income to higher income bracket, I consider the reverse to be of equal importance.

Children of parents with financial means are best able to be entrepreneurs as there is greater financial security in their backgrounds. Friends and family usually fund the first round of investment in a start-up. Children of parents with means can afford to tinker in a garage, be creative, invent something new.

So as important as it is to couple generations for upward mobility, it is also important to see whether those with means are helping the next generation invest their work in progress and the arts. For all these reasons I thinking sorting bi-generationally reveals more insights into the financial status of our communities.

Building a case

Watching a trial is interesting as you follow the threads left as the attorneys build their case. The witnesses are called to tell their part of the story to the jury, or contribute their expert opinion. Yet it is the attorney’s precision in introducing information to the jury that can be the difference between clarity and confusion.

Questioning the witnesses is a fine-tuned skill. There is timing and emphasis. A dance of words swirl around the courtroom, meant to land in the right order, with the right emotion. When the witness’ response chimes in agreement with the argument, the defense attorney looks down as if to review his notes. But he’s not. He’s waiting. Waiting for the sounds to resonate in the chambers a little bit longer. He wants the words to settle in each of the juror’s ears.

We all resist seeing, hearing, knowing things, especially when they tug our brains to venture down a yet unexplored path. “Stay on the rutted course” it directs us, “it’s easier, safer.”

The trial is a slow version of what happened. The process requires a review of what led up to the event. Persons from a sobbing passerby, to the off duty firefighter, to the boxer, tell what they saw, what they heard, what emotion was left on the pavement. The store clerk who called out the forged bill is shown at the curb holding his hands to his head

But just when the evidence seems irrefutable, that there is only one verdict to be had, the video footage from five other cameras is cut, reviewed, spliced into side-by-side viewings. The viral clip hides the activity behind the squad car. The body cams tell that story. The police officials discuss policy; the trainers discuss procedures; the famous pulmonologist discusses breathing.

There are diagrams, charts and examples. But caution! An exaggerated comparison might be rewarded by a nervous chuckle from the witness. The clearing of tension from the room might be appreciated, temporarily. On the redirect, facts may lay it out, hollow, a dud, a bridge too far. One point gained, two points lost, net score is negative one.

What the jurors are asked to judge is intangible. There was no decisive gun shot or stab wound through the heart. There were no marks or bruising from strangulation or force. A man’s heart and lungs stopped. An enlarged heart serviced by obstructed arteries, was supporting life to a body which had recently experienced Covid and was harboring a concealed tumor and some level of meth.

The jurors, who are thankfully out of the scrutiny of TV cameras, are responsible for the verdict. A tremendous responsibility! At least the members of the court are doing their utmost to present every possible angle of this case, thoroughly examined, through a variety of framings.

A rigged system?

I’m finding all sorts of little mindless projects to do so I can justify listening to the Chauvin trial. My latest is sorting miscellaneous hardware left over from blind installs or picture frame mountings. Yes–I have that work ethic problem where one still needs to keep busy doing something.

In some ways it feels like Minnesota is on trial. All we’ve heard about since May 25th is the ongoing degradation of our neighbors at the hands of systematic racism and white priveledge. This truly does not seem reflective of our state. And I think the trial is vindicating that notion, regardless of the jury’s decision regarding Mr. Chauvin.

The Star Tribune offers a comprehensive list of all the witnesses to date. It is far from a clubby group of white men who hang out at the firehouse slamming women and minorities. In fact the firefighter personnel involved in the incident were evenly divided by gender. We’ve also heard from both women and minorities at various levels of seniority within the Minneapolis Police Department.

Similarly, the Bureau of Apprehension and the crime scene workers are all non-white male. But maybe more importantly I can’t help but note how consistently well spoken, careful to respond and even mannered the witnesses have been. These Minnesotans are under the glare of worldwide scrutiny and they are showing themselves to be well spoken, conscientious workers.

It’s hard to build a case of systemic oppression, imposed by from above, by a mixed group of the oppressed.

Infrastructure

There’s a lot of chat going on about what all is included in President Biden’s infrastructure bill. Those on the right are making accusations of bad intentions as funds for social programs have been feathered into the expenditures. The left quips back that they are simply not thinking creatively enough with what it is that is necessary for a successful society.

So what is infrastructure? According to the dictionary(.com):

Well this leaves us with a lot of leeway for interpretation. But traditionalists would claim that you need to look at what has historically been considered infrastructure, like roads and bridges, water delivery systems and even mass transit.

I would humbly point out that what I refer to as public goods, those things we prefer to provide as public products to the most people within a defined grouped, is an excellent way to stack and separate infrastructure from private goods.

We choose to provide public goods when 1. It is simply more practical to pool resources and have roads available to everyone than have everyone pulling over to throw a few quarters in toll booths 2. When there are questions of safety involved, particularly personal safety. Can’t let people drink foul water–then we’d have to rescue them! 3. When the benefit of mass production provides strong upsides, like preservation of our environment. Why else would there be doggie bags on the public trails?

Biden’s bill provides several provisions for housing. “Specifically, the plan calls for the construction and rehabilitation of over 500,000 homes in low- and middle-income areas. According to Biden, two million affordable homes and commercial buildings would be built and renovated over the next decade as part of the initiative.”

This money will be pushed down to the local level through a grant making system. Typically, the final tally of actual structures touched following these types of political statements are far fewer than the aspirations. But the question perhaps is whether housing should be a public good, or infrastructure, in the first place.

The answer is no. Public housing projects, like Kabrini Green, have a long history of failure in America. The construction and maintenance of structures is best handled in the private (quasi-private) market. While the determination of which segments of society need help in the spread between their capabilities and the cost of housing should be left to the public arena.

Framing

Framing offers multiple perspectives.

Wouldn’t it be great if you could put a frame around a conversation so when voice(s) try get a hold of the markers and run straight off the canvas on some doodle, they’d hit the edge of it and come ricocheting back to finish the project at hand?

The ability to reframe an image quickly has taken a lot of uncertainty out of successful modern photography. Whereas one once spent time manually capturing the image through the lens, now one worries mostly about high resolution. Unhappy with tipping or cropping? A few clicks and it’s done! Take one photo and clip it four ways to tell four stories.

Framing topics of discussion is not so simple. There can be lack of guidance as to what information is admissible, as to the boundaries of the topic. And that’s just the subject matter, data, facts. Then there is the obscurity of the wealth, or limitations, of your interlocutor’s personal experiences.

Roya Hakakian, an Iranian-American poet, has a new book out: A Beginner’s Guide to America for the Immigrant & the Curious. In an interview today she explained that her writing is a way of showing the American people what is like to be an immigrant in a foreign land. And through this process help people to reframe issues.

But what if the audience in question has very few points of reference?

For instance, when I returned to the US in the early 80’s to attend a small liberal arts college, I befriended woman who had never been allowed to venture to downtown Minneapolis. The 8 mile trek from her affluent first tier suburb was considered to risky. To entertain a meaningful discussion about safety when the granular degrees of life’s experience are so excessively narrow in one instance, and so comprehensively broad (so as to include a childhood immersed in revolution and an eventual flight from one’s homeland) seems improbable.

And what is challenging in public conversation, is that more times than not, you do not know your interlocutor’s framing. Are they looking at the river in the upper left photo, concerned primarily about water quality? Are they focusing at what is going on beneath Hennepin Avenue Bridge? Do they just have the bridge in focus as a source of river crossing and transport? Or are they in those tall condos valuing the view of the river and the Minneapolis skyline beyond?

When two people fail to find common ground for the basis of a discussion, the outcome is frustration and a few slurs on Twitter. Irritating yes, but there are worse things. Here is a case where lack of framing leads to detrimental rule making.

Say a city was weathering a period of fast rising rents. Maybe this inflation was even due to a catch-up period as real estate prices had been atypically low in preceding years. But the acceleration scares people. Especially young people with short time horizons. So they rally and want action. They point to the recent data to convince the public that markets must be constrained. If not the 4%, 5% increases will continue to 6%,7%,8%!

The data over a long term, however, shows a modest increase in annual rents of, let’s say, 2%. The city council members prefer to keep their framing on the short term as this is most effective. It seems there maybe a role here for the Federal Government. If rescue funds were made available (like Covid funds are now) to the truly needy after a sharp increase in rent, then the gut reaction to impose rules would be muted. The demand for action satisfied.

Having a rescuer of last resort whose view isn’t immediate, whose view expands to a longer timeline framing, who steps in to ease the burden of those disproportionately effected, this could deter four year politicians from rewriting rules with over a century of good standing.

Whereas less rules keep us nimble in our special combination of an open economy and liberal democracy, erroneous rules take time to undo, reek havoc and prevent progress. Every tier of government can use its framing to ease demand for bad policy.

Author essays

I really enjoy late-in-life reflective essays written by authors whose work is too large and too challenging to tackle head on. For example Bertrand Russell wrote Portraits from Memory and other essays, which places him in his time and space as an observer of his contemporaries. And recently I’ve been enjoying Essays on Political Economy by James M. Buchanan.

Taken in small bites, it’s easier to chew on some of the ideas they left for the world.

Consider the fourth essay in the book: The Relatively Absolute Absolutes. Buchanan tells the story of how he was invited to give a talk on the same old hum drum economic stuff when he negotiated their accord to a presentation with this somewhat Suessian title. Keep in mind this is after he won the noble prize in 1986. With celebrity prizes earned, he was free to expend some creative thought.

He explains the commitment to the talk was meant to keep him on track with the good intentions of writing a small book, to bear the same title. Yet it doesn’t appear to have been enough of a push. So we must turn to this essay to learn what this great mind was trying to impart about relativity and absolutes.

I’m sure I am going to fall short of his intentions, but here is goes. The term implies that for purposes of analysis one can pull out a segmented situation and look at interactions at that level for the absolutes that are applicable, even if those absolutes are only relative once the segment is shoved back into the extended deck of playing cards for life.

If all settings of economic activity could be held on plates swirling on sticks, like the jugglers are able to manage, then to do the analysis of just one plate of activity, you are able to temporarily ignore the other relevant factors of being part of a larger group of plates (one being that they will come crashing to the ground once the stick stop jiggling).

In his first example he considers the work of Alfred Marshall who “imposed a temporal order environment within which firms act.” As we all know there are short term decisions which can garner immediate profits, but short change long term goals. Using the relatively absolute absolutes argues that it is OK to consider the short term ignoring the overarching ‘absolutes’ or givens of long term decisions. It’s OK to analyze long tern decisions under similar circumstance. Then pull the analysis together.

The short-period and the long-period planning process may occur simultaneously. The differentiation lies, instead, in the number of variables that are allowed within the relevant choice-set relative to the number of variables that are regulated to the set of constraints.

The next example releases the individual from commitments to institutions. “The individual must reckon on the the temporal ability of the potential choice variables, and norms for rational choice required that some variables be treated analogously to fixed inputs in the Marshallian model, that is, as relatively absolute absolutes for the purpose of making short-period choices.”

He says that this is all pretty straight forward on the surface but it gets more complicated when you consider how many plates everyone is trying to spin without any falling to the ground. Things get a little more interesting when one interest has constraints placed upon it by a higher level interest. For instance the “higher” level interest of loosing weight is biased constraint against the initial impulse to select a second chocolate Easter egg.

The practical part of what he is offering with the relatively absolute absolutes is that analysis and measures can be done on just one plate. “We may, on occasion, walk on ice as if it were solid ground, even if we recognize that to do so requires that certain conditions of temperature, time and place be met.”

I think this is a very useful point of view.

Union Market

Even back twenty years a go when the death kneel sounded for the end of paper books, I was skeptical. I never tried the Nook or downloaded books from the library. The feel of the printed page in my hands is part of the reading experience.

In those in between years, when national bookstore chains were shutting down, I made a point to visit Birchbark Books which is one of a handful of independent bookstores to weathered the competition from technological alternatives. It’s a sweet brick storefront with a large glass paned window, owned and run by writer Louise Erdrich.

Her shop, which is in an old money neighborhood of Minneapolis, has an eclectic inventory on its shelves with brief commentary on handwritten cards taped up so as to give you a preview of what is to be found between the pages. Quite a few shelves are devoted to her books as well as the work of other Native American writers, as this is a venue for their display.

Last week while out in DC we visited Union Market, an old grocery marketplace now being rehabilitated after a long period of decline. Politics and Prose has a cozy presence in a slim shop settled in a long row of what appears to have been food distributers. The area has that cool vibe of a place artists would like.

The redevelopment, however, is coming fast and furious. The contrast is visible as the four to seven story apartment or building space surround the street level shops.

Politics and Prose is the pale green store front center left.

Housing as Infrastructure

Biden’s 2.5 trillion infrastructure plan has supply side incentives for getting additional housing up and running. The push is provided by grants to those who will eliminate restrictive zoning laws.

The fact sheet goes on to describe this zoning plan in two sentences, as follows:

CNS News

Eliminate exclusionary zoning and harmful land use policies. For decades, exclusionary zoning laws — like minimum lot sizes, mandatory parking requirements, and prohibitions on multifamily housing — have inflated housing and construction costs and locked families out of areas with more opportunities.

President Biden is calling on Congress to enact an innovative, new competitive grant program that awards flexible and attractive funding to jurisdictions that take concrete steps to eliminate such needless barriers to producing affordable housing.

The City of Minneapolis rezoned the entire city in 2019 to allow for multi-family dwellings across the city. What was discovered however, is that there are still many additional rules in place that restrict developers from completing the task. Things like height restrictions and underground parking. As most of the requests thus far have been in the high demand neighborhoods, the planners seem disinterested in working out the kinks.

The persistent thought that development for the wealthy is a negative, not a positive, continues to restrain people in power from acting.

The city gets full credit, however, for bringing back some old school methods of diversifying the composition of household formation. In November of 2019 a change in zoning was approved to allow for intentional housing clusters. This is a similar set-up to a rooming house where residents share a kitchen and one or more bathrooms.

The intentional community cluster development ordinance allows nonprofit organizations, government agencies or healthcare agencies to create collections of small housing units (tiny homes) and a common house or rooming houses with shared facilities on a city lot that is at least 10,000 square feet. The developments are allowed in any part of the city with the exception of industrial zoning districts.

Most recently, the county in conjunction with Avivo, a local non-profit, created “Avivo Village, an indoor community of 100 secure, private dwellings or “tiny houses” created to provide shelter to individuals experiencing unsheltered homelessness, has opened in Minneapolis’ North Loop Neighborhood.”

And the council continues to push through additional changes.

A few days ago “the Minneapolis Council Business, Inspections, Housing and Zoning Committee approved a provision that would remove language from the city’s Housing Code regarding occupancy requirements. Currently, the city’s Housing Code limits occupancy by restricting dwellings “to one family that must be related by blood, marriage or domestic partnership.”

All this undoing of how housing is built and used in the city is a start to allowing more people move into more space. More units leads to lower costs. But it is also necessary to keep the history of such restrictions close at hand. The reasons constituents blocked rooming houses were because they became problem spaces. So what’s the plan to prevent this from happening?

To revive old systems and proclaim them to be new solutions without any consideration of their history seems shortsighted. They do provide lesser expensive housing. But there needs to be an active and on-going companion piece to keep the public from turning on these ‘new’ solutions again, down the road.

Trials in an age of body cams

The Derek Chauvin trial has been very distracting! There are several outlets for the live stream including the NYT and Court TV. What makes it so engaging is all the high quality video footage from multiple street cameras and police body cams.

With witnesses filling in context, there seems to be little room for Perry Mason like attorney tricks trying to sway whether someone could really see what they saw, whether someone said the menacing words, whether a bystander was really belligerent. Maybe for this reason the unfolding of events as told by the witnesses over the past few days has been relatively uncontested between the two legal teams.

At one point today the prosecutor was leading Chauvin’s supervisor to proclaim a judgement call on the event prior to having fully investigated all the evidence. Upon objection by the defense, the jury was asked to vacate the chambers so the judge could be convinced of his reasoning. Judge Cahill then allowed the prosecutor one question in this regard. The defense responded with a thorough and methodical cross examination.

The paramedics were on the stand in the afternoon along with a captain of the Minneapolis Fire Department. If you thought firefighters only put out flames, you would be as wrong as I. About 80 percent of their calls, it was testified, are support calls for EMT’s. The speed with which they responded, in minutes, has to be recognized as well above average.

Since a police officer entered the ambulance, the court was shown several still photographs from his body cam. It was all very real TV to see the photographs and then hear the paramedic’s testimony of the attempts to revive the victim who appeared to be in cardiac arrest. Only minutes later, Chauvin’s supervisor, who also activated his body cam, gave the court a look at the halls of Hennepin County Medical Center.

This trial must contain more video footage of any other yet to be presented to a jury. It’s fascinating. I’m sure I’ll get sucked into more viewing hours in the coming days.

Supply-side shelter

The conversation around housing always seems to be one of demand. We need more affordable housing! There are homeless people who need a safe place to live! There aren’t enough rental units!

What if, instead of demand, we thought in terms of the supply. Not even necessarily in terms of the supply of the physical structures as much as the physical structures in conjunction with the neighborhood attributes.

For instances, there are several examples in Rochester and Perham MN where businesses have banned together get involved in the process of suppling workforce housing. It came about because they had jobs to fill and potential employees could not afford to live within a reasonable driving distance of the workplaces.

There is a history of missionary types of people hosting new immigrants to our country, of supplying them with housing until they get on their feet.

Maybe if more thought was put into supply-side housing, instead of incessantly pounding the drum of demand, we could see our way to more solutions. Or maybe if we could see the constraints that are holding back the natural inclinations of supply, we could ease them to allow for more forms of shelter.

Affordable housing is not a product line

Some politicians don’t buy the idea that an additional supply of housing units, at any price point, will lead to more units of affordable housing. They do not accept that increasing the number of units overall, or greater supply, reduces costs.

What they see are swanky high end homes being built and swanky high income people moving in and absolutely nothing happening to the other end of society. So who’s to blame them?

In order to assist in smoothing out some of these misconceptions, it’s necessary to beg people to accept that housing is not an ordinary commodity, like clothing. Everyone needs housing and clothing, but that’s where the similarities ends.

Poli-types and activists talk about affordable housing as if it were one line of housing, like an evening gown is one line of a designer’s seasonal collection. If you only make evening gowns there’s nothing for the average Joleen to wear. We must sew up some practical shirtdresses! It’s that simple: Build affordable housing.

There are two conceptual problems with treating housing like clothing (just pick the right line for goodness sakes!) Housing is a good that is used and reused as opposed to being disposable. And secondly, in part due to this, over time (time is important) depending on how much maintenance it receives (maintenance is important) a home’s usefulness and hence value fluctuates.

When left unattended for too long, the structure depreciates and the land it sits on becomes disproportionately valuable.

Whereas a community doesn’t want too much time to pass with too little maintenance (which creates slums), this is often the scenario playing out for NOAH (naturally occurring affordable housing). A long time landlord may get to the point of not being energized by upgrades and flashy renovations. He or she may be riding out the property’s usefulness as long as the tenants are amicable.

But time never stops. And mechanicals get old. So these situations are only sustainable for so long. When left unattended for too long, the structure depreciates and the land it sits on becomes disproportionately valuable. Down comes the structure to make way for a swanky new one.

Since new is expensive, expensive people move-in. But as long as the new construction is adding units to the pool of housing, and not just being filled with newcomers, then homes are freed up for folks to stair step up through more choices.

Deals to be had

The condo market continues to have growing inventory in this fast hectic market. (Or maybe part of the market is hectic because condos are being ignored.)

Either way, this won’t last forever folks! The extra inventory allows for better selection and better pricing. But in that funny way markets work, this opportunity will be taken for granted until it’s gone. Then there will be regrets.

Catallactics

I came across a new word today in James M Buchanan’s Essays on the Political Economy. In his second essay, The Public Choice Perspective, he says:

I shall refer in the following discussion to two separate and distinct aspects of elements in the public-choice perspective. The first aspect is the generalized “catallactics” approach to economics. The second is the more familiar homo economicus postulate concerning individual behavior. These two elements, as I shall try to demonstrate, enter with differing weights in the several strands of public-choice theory, inclusively defined.

He goes on to explain what the catallactic part of the economy means as used in his POV.

The approach to economics that I have long urged and am urging here was called by some nineteenth-century proponents “catallactics,” the science of exchanges. More recently, Professor Hayek has suggested the term “catallaxy,” which he claims is more in keeping with the proper Greek origins of the word. This approach to economics, as the subject matter for inquiry, draws our attention directly to the process of exchange, trade, or agreement to contract.

Then he elaborates to distinguish traditional economics as the exchange between two individuals, versus the catallactic form as an exchange between groups of people.

If we take the catallactics approach seriously, we then quite naturally bring into the analysis complex as well as simple exchange, with complex exchange being defined as that contractual agreement process that goes beyond the economist’s magic number “2,” beyond the simple two-person, two-commodity barter setting. The emphasis shifts, directly and immediately, to all processes of voluntary agreement among persons.

This seems like more than a point of view. This is the foundational understanding of the comprehensive economic apparatus.

Equality at odds with Progress?

There’s a new paper, Lessons from Denmark about Inequality and Social Mobility, by James J Heckman and Rasmus Landerso. Here’s the abstract:

Many American policy analysts point to Denmark as a model welfare state with low levels of
income inequality and high levels of income mobility across generations. It has in place many
social policies now advocated for adoption in the U.S. Despite generous Danish social policies,
family influence on important child outcomes in Denmark is about as strong as it is in the United
States. More advantaged families are better able to access, utilize, and influence universally
available programs. Purposive sorting by levels of family advantage create neighborhood effects.
Powerful forces not easily mitigated by Danish-style welfare state programs operate in both
countries

What I find interesting is the framing of their analysis around neighborhoods. They find that even though teachers in Denmark are paid the same salaries, there are still different outcomes for children which appear to be a result of families sorting themselves by neighborhood.

One good example of this phenomenon is the quality of schoolteachers by clusters of parental
characteristics. In Denmark, teacher salaries by neighborhood are mandated to be equal. That is
a force for uniform quality of schools across neighborhoods. However, uniform quality is not the
actual outcome in Denmark.

The sorting continues down through to the teachers.

There is a strong positive association between the characteristics of parents, on the one hand, and the characteristics of teachers on the other, despite equality in wages.

Even with an equalization of monetary compensation to the educators, the more established families gain the preferred access to education. And thus equal opportunity to education is not being realized.

But is this one of those everything-should-be-equal that makes sense or is counter productive? Are the measures and classifications and groupings done in a way that divvies up into a state of balance?

I don’t think it is a controversial notion that those on the lower rung of academic performance are more likely to be motivated by seeing themselves in their teachers and mentors. And until those teachers and mentors are brought along into this higher level of academic delivery, the system that looks for those mentors will have unbalanced delivery systems. By choice. And this may very well be the best delivery for that moment in time.

Here is a scenario where fine tuning and focusing in on what is thought to be an issue of equality maybe sabotaging the path for greatest progress. By drilling down to the tier of the individual, one dismisses the group. To bring along the child can only be done by bringing along their larger group, including their parents and teachers.

Revolt?

It might be my imagination, but I sense a subsurface tension in the teaching community around the issue of the extended Covid school closings. It lurks like other things you can’t quite detect: a high pitched dog whistle or the floor beneath your feet right before a quake. Or even more material things like the moisture on your brow and that earthy smell in the hour or so before thundershowers roll in.

As long as the virus is still taking lives, the topic is off the table. But soon everyone will be vaccinated. Soon the teachers will be taking account of where exactly their students are at in the curriculum. Some who normally enjoy the challenge of working with the most in need, may find their charges have have slid in arrears, past due even for assignments pre-Covid.

Without the structure of school, without the routine, without the expectation of someone waiting for them, recognizing them, without the the fun as well as the drudgery of the school environment, they simply stopped paying any attention to their education.

As an outsider looking in, it seems the teacher’s union towed a tough line. The virus put teachers’ lives at risk. The end. Apparently their work is not essential to the functioning of society. Decades of negotiating wages and benefits right down to each and every minute of their instructional day has made it easy to disregard any intent of the job and only see their work from a pecuniary point of view.

How the teachers who carry an old school sense of service to the community feel about this very privatized manner of handling their chosen profession is yet to be seen. Unions deserve credit for elevating teachers’ wages, and after all, spirit or no spirit, one has to pay the bills. Still–in years gone by, teaching was more of an employment of the heart, it involved a sense of duty, and was regarded as such.

So this cocooning of teachers away from the public while grocery workers and nurses became celebrated frontline workers, this buffering of their duties to educate seven, eight and nine year olds through Zoom screens can’t possibly fulfill the desire to be in good standing within the community. Some might feel the dignity of their work has been stolen out from under them.

Maybe when they were young pups trying to figure out their career choices, they absorbed the fact that teaching would pay less than other professions in business or law, but as a counter balance, they valued the sense of contributing to a greater cause. Teachers are trusted. Teachers are a source of advice. Teachers have the ability to play the role of a connector. At least for now.

For every minute of labor, the union has monetized their job. Perhaps the process has squeezed out any compensatory allocation to good will, to the noble cause. The power of the union is to talk in one voice. Then there is little hope of those within, who oppose its direction, being heard in any way.

This is all speculation on my part, of course! Classes are resuming, and by next fall all the soldiers will be marching to the old familiar cadence. Everything will be chalked up to the unprecedented and unanticipeted year of the plague. No matter. A little inkling persists. If you strip all the community value out of a labor force who is inspired by it, has worked for it, defends it; if you monetize every last moment of their day, at some point workers will revolt.


Vintage Stonehenge and the passing of time

Stonehenge summer of 1976

In honor of the alignment of the rising sun on the spring solstice between the ancient stones of Stonehenge, here is picture from my visit in the mid 1970’s. I do remember the now UNESCO World Heritage site as being well attended. And from the lack of grass around the ancient stones, it seems that everyone was allowed full access to the area.

To write or not to write

“Get it in writing!’ is the advise offered when entering into a contract. Too true. In particular when the parties have no relationship. If you want the law to back up your claim in an agreement, then it is a lot simpler if the terms are written out and both parties have signed in acknowledgement.

However, things aren’t always spelled out in a contract. A while back, in small claims court, I listened to a judge pull the rental agreement between a duplex owner and a tenant, one question at a time. It was clear he had some experience ferreting out these types of arrangements, to help settle who owed what to whom. He didn’t seem aghast that the plan at hand was verbal not written.

And before you judge, how many times have you clicked through the ‘I accept’ box without taking a moment to read what it is you are accepting? Written out yet neglected. We rush around our lives assuming the best.

Sometimes no one is clear what that ‘is’ is in particular. Technology has generated some truly stunning options, options unanticipated. When facebook provided that opportunity to reconnect with childhood friends around the world, it was intoxicating. Did I click right through the user disclosures agreeing to let their algorithms stalk my life and sell the information to advertisers? Yep. (or wait–were their any concerns of data privacy at the start?)

Written or not written. It’s not practical to put every moment of our lives into a written contract. Say you wanted to ride share with another family. You divvy up the chore, one takes the girls to girl scouts, the other to lacrosse practice. Stuff happens. Things get cancelled, rearranged, people have to be flexible.

Maybe one family does bare an larger burden. There’s no official settling of accounts, but for the relationship to sustain further commitments of work towards the children’s on-going experiences, more than likely there is some sort of make-up. Interaction continues. And this pattern can be seen in workplace groups, covering for each other or coordinating on projects. Work, exchange, work.

And when this pattern continues over a long period of time, people trust it. They rely on it. Home buyers, except for rare exceptions, diligently sign the stack of documents as indicated by the manicured finger of their closing agent. There’s no flinching at the part where the bank can foreclose for non-payment. Buyers rely on the knowledge that banks are competitive, consistent and regulated.

Consumers rely on a business climate. That many thorny issues have already been washed through mediation or courts by objectors who took their time to point out injustices. How can that be? It’s certainly not true everywhere in the world. The answer might be something like, “In the US we have institutions which allow consumers to trust the mortgage financing system.”

So in effect, institutions are the culmination of work which goes to enforce unwritten contracts on how to behave in (this case) the mortgage business. We have written contracts too, of course. But the trust in the system, the cart blanche, ‘I don’t need to have an attorney review this’ part is a trust based on social behavior and outcomes. Based on the knowledge that others have gone to bat and secured enforcement or change. That people were consistently able to work toward an outcome secured in the spirit of the transaction.

People often refer to institutions as a set of rules. I see institutions as the structure which allows work to occur and be captured in a non-fungible manner within a community. The greater the repetition, the greater the trust, the stronger the institution. We may even discover the value of unwritten contracts to far exceed the value of ones spelled out in ink on paper.

Example of ADU (accessory dwelling unit)

If you’ve been curious about accessory dwelling units–just a fancy name for an apartment on top of the garage- there’s a home for sale in Minneapolis that has one. The market has been hesitating a little bit with it as it has been on the market a week already, which is uncharacteristically long for a home in this condition.

As posted on NorthStar MLS

The listing is offered by Lake Sotheby’s Realty and a full set of photos is found here.

Truth-in-Regulation

A few days ago I suggested that home buyers and sellers, at least while in the process of a transaction, do not place monetary value on a city’s truth-in-housing process (TISH). Whether the city mandated point-of-sale ordinance contributes to the transfer of property is not a new discussion. It’s not even controversial in the sense that the handful of cities which require the inspections are steadfast in the process and very few new cities have ventured down the road of its implementation. You can read the Minneapolis Realtor Association position statement on the matter here.

Let’s consider the expense of the regulation in a modest suburb of 23,000 households which experiences a ten percent turnover in any one year. The city collects a fee of $250 x 2300 or $575K to cover the costs of TISH. By design this fee pays inspectors on staff and the administrative burden of processing the certificates. Financially it is a wash through the city coffers.

What exactly do the residents get for the $575K? The idea, of course, is that the condition of the housing stock is elevated to some degree. As you can read in the position statement this reasoning is flawed, at least in a relative sense. The properties that come to market have been prepped and prettied up. Buyers often require sellers to do repairs before closing based on their own private inspections. Furthermore new owners, in their excitement, invest further in mechanical and cosmetic improvements. Just ask Home Depot.

The truth-in-housing process does double duty to the private process of a more comprehensive inspection. The city is perhaps better prepared to catch failures to pull or complete permits, but that is also covered in the disclosure process required my Minnesota law.

Regulations are needed. They are desired. Let’s just be as efficient with them as possible. If the objective is to elevate housing stock, I would argue that constituents may choose something other than TISH. They may choose for the $500K to be shoveled back into clearing up permits for the least advantaged households in their community. They may choose for the city to carry out TISH on properties that have not pulled a permit in the last fifteen years.

Many mechanicals have an average 15 year lifespan: appliances, hot water heaters, even furnaces. In a fifteen year window roofs might be replaced, window and doors. There’s a good chance that these households are not pulling permits because they either suffer from lack of money or the ability to tackle large projects. Wouldn’t this be a good use of half a million? To aid those who are not able to help themselves with their housing maintenance?

I don’t claim to know how a city’s population would respond. But I know the present system doesn’t even allow the conversation to happen. (And those with the most expertise in the process are quite deliberately left out on the permis they are only capable of self-interest.) Establishing a periodic rethink of regulations refreshes the figures, and the costs, the possible alternatives, and the goals.

Wouldn’t it be great if truth-in-regulations were right there, printed on glossy paper, with all the other summary reports of a city’s performance?

Unicorns and Magic Dust

One of the good things that has come out of the pandemic is the speedy development of vaccines. Nothing like a threat to all of humanity to bring people together and achieve medical milestones! But short of alien invasions or another plague, what are more temperate ways to promote progress? This, it turns out, is a hard question.

I find it much easier to point out what stops progress than what ignites it. Three culprits come to mind: desire for power, inability to curb jealousy and gatekeeping (which I guess is the result of the first two human conditions). It’s no wonder successful start-ups are dubbed unicorns as the circumstances which spin out to swirl them into explosive growth are rare and magical. Any one of many fateful decisions could lead the whole project down the wrong road.

Some time ago I heard a story about one such decision made at the infancy of a present day multinational. The founder needed a place to build stuff. This was up in northern Minnesota where the land bares little more than hay and potatoes. The founder approached a local guy who had a bunch of large sheds sitting empty. He had no money, but he went to the owner and asked is he could lease the space and pay with stock certificates from his soon-to-be company.

The local guy didn’t know what to think of such a proposition. How was he to evaluate this guy from the cities and whatever it was that he would be putting together in his buildings? It wasn’t like people were banging down his door to pay him rent, but he didn’t want to play the fool (nobody wants to play the fool) either. He knew a successful real estate guy from the cities. He had done some work for him planting a nice row of Colorado Blue Spruces as a border along the drive into his lake home.

So here’s the connector part. A connector person is one who can bridge various otherwise isolated communities. The relationship is strong enough that the parties at hand trust each other and value the information being shared. Up north guy knew enough about the real estate guy: he was a college athlete, his business was successful, he was reliable. He had interacted with him enough to know he was on the up and up.

So when real estate guy leaned in and said, “Really, what do you have to loose?” Up north guy unlocked the sheds and widgets started to tumble out.

Real estate people tend to be optimistic, but what if up north guy had turn to a pessimist for advice. Instead of a ‘what have you got to loose’ response, he got a ‘those city folks are always out to take us for a ride’ response. What if there had been no one to turn to to figure out if this was a con or the real deal? What if there was a person nearby, but he was all caught up in social stature making him unapproachable?

The solution that won’t necessarily ignite progress, but would certainly set up an environment of greater potential, is the advancement of activities which encourage the mixing of people from different backgrounds, skills, and social groups.

As you probably predicted, the stock made up north guy far wealthier than the majority of other residents in the county. More than half a century later his descendants are still flush from a decision to rent or not to rent. All because he trusted sound advice and didn’t get caught up in a power play.

Jury selection- Chauvin trial con’t

I didn’t know jury trials were an American thing. According to Jury | Britannica 90 percent of jury trials occur in the US. A defendant who faces a penalty in excess of a six month imprisonment has a constitutional right to have their case judged by a jury of their peers.

It seems when their are tough decisions to make, we prefer to defer to a group. A jury is interesting as their deliberations are done privately, no outside judging, no transparency. There’s an anonymity to a group. The group has to come together behind a decision and stand by it in front of the court.

This is a service done without compensation, a civic duty. Granted, many will sabotage their opportunity to sit in the jury box. Reading through this coverage of jury selection in the Derek Chauvin case provides plenty of examples. And then there are those like #52 who is compelled to participate in an historic court case.

It takes all types of people with all types of talents to round out a group.


Reporting from the Hennepin County Court house:

Entire thread

Chauvin’s attorney says the Court should consider: giving the defense extra strikes, delaying the trial, moving the trial outside Hennepin County, bringing back the seated jurors to ask them what they’ve heard, or immediately sequestering all the jurors.

“We’ve got a mayor who is a lawyer by trade, he should know better,” defense says of Jacob Frey. Judge Cahill: “I wish City officials would stop talking about this case.” May bring back seated jurors to inquire, motion to delay trial taken under advisement—nothing decided yet.

The first prospective juror of the day right away discloses she heard about the $27m George Floyd family civil lawsuit settlement on the radio. “When I heard it I almost gasped at the amount,” she says. She doesn’t think she can be impartial, and has been excused.

Prospective juror #52 says he doesn’t think Chauvin intended to harm anyone, but he wonders why the other officers didn’t intervene and stop him. Supports BLM. “This is the most historic case of my lifetime and I would love to be a part of it,” he says. He’s on the jury.

Prospective juror #54 in the #ChauvinTrial is 75 years old and describes being “appalled” by the video. “To exert that kind of force for that long just seemed out of line to me,” he says. After expressing doubt over whether he can be impartial, the judge excuses him.

Originally tweeted by Tony Webster (@webster) on March 15, 2021.

Market Value of City Inspection : $0

The housing market is marching to pomp and circumstance as apartment dwellers and condo owners are graduating to detach single family living. As this Star and Tribune weekend article announces, “In risky move, buyers waive inspections in red hot Twin Cities home market.”

Everyone benefits from an inspection. Buyers learn what it is they are buying, and sellers are far less likely to hear about conditions issues after the fact. The average home owner has somewhat limited knowledge of all the mechanicals in a house, and first time buyers are truly limited in their understanding of not only how it all works, but more importantly which items are costly.

It is risky for the average buyer to accept a home without an inspector’s professional opinion. The fear is that hidden behind some panel is a terrible crack in the foundation or behind an electrical panel cover is a box about to be set alight by over-fused breakers. So wouldn’t you think there would be some value placed on a city’s truth-in-housing process? This is a process where the city requires the soon to be seller to have a city inspector come to the property and do a less thorough review, yet still a systematic evaluation of the structural features of the home.

The city collects a permit fee somewhere in the $200-250 range, produces a report, and sometimes request repairs. Yet never once in over twenty-five years have I heard a buyer say, “I don’t need to get this home inspected because I know xyz city has done one already.” Even in these fiercely competitive times when buyers are bidding on three, four, five houses before securing a purchase, they hang onto the inspection contingency.

If the actors in the market do not value the city inspections, who is receiving a benefit from the $250 being spent on the housing market? The seller is simply complying with the rules. The buyers, even the ones who only want assurance that the home won’t collapse around them on the day of move-in, don’t value it. Anyone not involved in the transfer of property, pay no attention to it.

City officials when considering a truth-in-housing ordinance say things like, ‘preserve the housing stock,’ and, ‘get in there and look around,’ and, ‘make sure they are keeping things up.’ I doubt the money is a profit to the city, maybe a breakeven. It seems that the $250 times thousands of transactions per year is the expense to feel like something is being done.

It wouldn’t be that hard to investigate the subject, especially in this market. There is an advantage for a buyer to waive the inspection as the seller will consider the offer more favorably over another; the sellers will not have to wait a handful of days to know the transaction is finalized. Simply tracking transactions between two cities, one with a truth-in-housing and one without would determine if there is any consideration given to the report.

In the reports that city’s send out to constituents pie charting out how they spend their tax dollars, it might be beneficial if city’s also had to justify the benefits of their permitting expenses. Instead of a truth-in-housing, a truth-in-regulation.

Talk of Short Sales- How can that be?

After a steady stream of buyers came through my new listing today, it’s hard to believe some people are out preparing for what is being presented as an inevitable wave of short sales.

When I sold this mid-century modern home to my clients in 2010 the listing sheet bragged that it was not a short sale, that the folks on title as owners did not have to beg permission from a lender to sell their home. A little over a decade ago buyers in the marketplace had become weary of dealing with corporate interests who had to forego of some profits in order to allow a sale to proceed. What we call a traditional seller was a valued party to the transaction.

With demand for single family homes peaking as inventory shrinks, the days of bank owned properties are part of a foggy past. But maybe it makes sense that the reason for the inventory shortage is in part due to the protections in place for all those distressed sellers who would have had to jump in the game and let their homes go to market. Once a past due seller realizes they can live rent and payment free, why not coast it out.

If the incentives are there, that is exactly what should be anticipated.

One fellow realtor went to a class recently offered on the topic, and said the presenter had some pretty astounding numbers. They are predicting a tsunami of distressed property once Covid protections are lifted. Time will tell how demand absorbs it all.

Presidential Addresses

I hadn’t given presidential addresses a lot of thought over the years. They provided so little new information over and above what was already known. I honestly didn’t appreciate being addressed by a leader until the last days of May 2020 when our city on fire.

The leaders of the largest city in this state and the state itself were eerily absent. As protestors burnt buildings and commandeered a police precinct, crickets. On Friday evening, the 4th night of the protests and the second attempt at an evening curfew there may have one tweet, something like, pleeeese stay home tonight for your own safety. So Minnesotan to be polite to folks hiding tinder in alleys to set structures ablaze.

Tonight when Joe Biden took to the TV I kept thinking–there it is. That’s how it’s done. It might be repeating old news. It might be reassuring old fears. But he’s there, concerned and unwavering, optimistic and speaking to the future. Leadership 101: don’t run and hide in times of crisis.

To err in commission or ommision- and how to know?

There’s an excellent bakery in a little strip mall down the interstate from where I live. The jumbo donut holes melt in your mouth. I’m not sure if it is the glaze on the golden globes, but the texture and flavor and softness is memorable. The store front is small. A twelve foot display counter full of long johns, and bear claws and jelly donuts (my husbands favorite) reveals the day’s offering as you walk through the door.

A middle aged guy runs the place and when he plans the baking for the next day, I’ll bet he’s trying for that ultimate mix of filling the expectations of the steady stream of regulars who filter in, yet not having any pastries left at 11 am when he flips the ‘closed’ sign on the glass door and locks up.

The point is that nothing really bad happens if he doesn’t get it quite right. He might have to take a dozen treats home or give them to the food shelf. Or he may have lost out on some sales if he was too conservative and didn’t bake enough. A few dollars either way, but no one dies because he miscounted his jumbo cinnamon rolls.

That’s why bakery goods are an ideal private good. Their production and consumption are individualized. Everyone can have their favorite. Products that tend to be well suited to public good, by contrast, usually involve groups, either because they service groups, like infrastructure, or because they require a group consensus on their production, like education standards.

To further complicate things, group opinions vary by region and demographic. In order to accommodate these features, the fine tuning of say the reopening of schools, is pushed all the way down to the school district level. The standard for how a community agrees to educate their K12 population during a pandemic is placed into, let’s call it, a first tier group. Not the county, or the state, or the region, or the country.

Unlike the provision of apple strudels, errors involving health and safety can result in physical harm. There’s more at stake than a few bills in a till. And there is often no unique measure to dictate exactly how to proceed—which is exactly why it’s been delegated to a public good. How safe is safe enough; how much school is school enough; how much protection is protection enough? And as a group we are both anonymous and participatory in the decision process.

And as this is a big messy political endeavor, it is much more difficult to ascertain whether errors of commissions, or errors of omissions occur in taking a run at the most efficient social outcome.

Suess Addendum

Whether intended or not, whether considered or not, the copyrights holders of Suess’ life work have realized a windfall. We can’t look into the hearts of men to know if they strategized for the money. Since Ted Geisel had no children of his own, we do know that these people are not his blood relatives.

I don’t think they expected the cash. They probably were horrified by the thought that they could be earning money off of anything of a systemic nature, and more than likely move in circles who feel the same way. Removing the books was a public service, a response, a tangible action.

Buyers thought otherwise. Some might say the buyers who pushed up the prices are part of ‘the problem.’ But I think most realize this is a group of people who feel this judgement-from-on-high of a beloved author is a miscarriage of cultural perspicacity. It follows a long list of similar actions that have yet to prove useful in tempering or solving this High-Stakes-Social-Issue (HSSI).

The fact remains that by withdrawing the product from the market, demand rose, and a pot of gold was found at the end of the rainbow. Indeed– signaling occurred. A signal to others who understand the social component of price and will now look for other opportunities to leverage and create their own pot of gold. It’s happened before. People were steered, profits were realized. Others found their nest egg fleeced.

First Laura now Seuss

Parents beware- Watch out for children’s books! First Laura Ingles Wilder’s memoires of life on the prairies of Minnesota and Wisconsin were warping young minds with an inaccurate portrayal of a free and self-reliant frontier. Now the linguistically entertaining word-strings penned by Ted Geisel are riddled with caustic racism.

Today’s price on Amazon for a copy of On Beyond Zebra is $650. What accounts for the 38 fold price increase? (Barnes and Noble still has the ‘out of stock’ hardcover listed at 16.99.) Cutting off supply seems like the traditional way to look at it. Stopping the presses from printing such offensive material indicates a future scarcity. This isn’t the first book to become dated so as to be dismissed by the publishers. Most of these tomes are simply forgotten, found for a few dollars on a table at a church sale.

In this case, the books are being withdrawn them from the market by those who hold their copyrights. On Beyond Zebra, however, is a relatively unknown Dr. Suess book. There are other discontinued books for sale by famous authors. Zane Grey’s The Vanishing America can be had for $3.79. Cass Timberlaine by Sinclair Lewis is posted at $5.39. And Pebble in the Sky by Isaac Asimov is $3 even. (So much to read–so little time)

The extra $633 dollars is the result of a social or community change. The premium for this copy, on this day in March, is a social component arrived at through the market pricing system we know as Amazon.

Reframing first jobs

I’ve taken photos since I was a kid. Framing in your subject matter back then was more important. Whatever was captured on the 35 mm negative frame, was what you got back printed on glossy paper. Now you can be as lazy as you want. You can crop a photo on your phone, reposition it, tilt it. Decades ago reframing was a luxury enjoyed by those with access to a darkroom.

Sometimes you can’t see how to frame something until you’ve given it a go. Once you’ve clip out all the surrounding noise, it’s easier to see how the subject at hand can be better positioned. Or redressed, or simplified. Most of you have probably seen before and after framing with portraiture, or with a home remodel. The first shot is flat and cluttered. The second gives the room depth, a room which is now smartened up with clean lines. Reframing makes you see things clearer.


In ninth grade my brother and I attended a boarding school in the Normandy region of France. It was just how you would imagine from portrayals of British schools: strict teachers, old manor homes for dorms, and a short distance from a quaint country village.

The student body, however, was very eclectic. Insurgencies in countries like Lebanon, Iran, Algeria and Nicaragua sent wealthy kids to safer regions of the world. Many had ties to France or relatives who lived in Paris. So a school an hour west of the capital city was a perfect refuge.

There were a few Europeans as well. One classmate was the daughter of a businessman from Milan, call her M. Her typical mode of transit to and from her northern Italian home was by personal chauffer. Where as my brother and I melded in with the general population on a flight into Charles de Gaulle, then bus transit to central Paris–if I remember right to Place des Invalides– where several greyhound style busses waited to drive students out to the country. She went executive class, while we were riding in coach.

One late Saturday afternoon I found myself going through math exercises with M in the salon of the country house that served as our dormitory. What she had in riches she lacked in scholastic aptitude. As I had already been identified by teachers as the student to pair-up with other kids who needed help in the classroom, it seems natural that I was there. The other girls were upstairs giggling and gorging on purchases from a visit to the town that afternoon.

Perhaps she said thank you. Or perhaps she made a self-deprecating remark. In response I said something I had heard throughout my childhood. That when something needs to get done, you dig in and get it done. Everyone has something to bring to the potluck so to speak. I may have listed the treats our roommates were sharing as examples. I may not have. The idea was that there was no need for thanks as tutoring was one thing I could contribute.

She froze momentarily, thinking, and looked at me with a steady gaze as we sat there at the wooden tables where we took our afternoon goute of French bread and chocolate (a most excellent tradition which unfortunately cannot be replicated without crusty baguettes from French ovens). Her first language was Italian and mine English, but it was very clear that whatever it was we were doing that damp rainy afternoon, it had no relation to material things. Nothing I was doing in that space had that type of value.

This was hardly the first time a cultural clash had caught me up short. Cultural clashes were part of my upbringing. I tutored all through high school and college. I taught French University students English during an abroad program in Avignon. But at age fourteen my classmate from Milan reframed my concept of work, clarifying the distinction between cooperative reciprocal work and that done for money.

I Care a Lot – Movie Review

My husband and I finally stumbled onto a movie last night that didn’t have me flicking the exit button after fifteen minutes. Netflix’s I Care a Lot twisted and turned enough to hold our attention.

It’s a battle between a nouveau riche con-woman and an established class con-man. But the story is kept au current by setting it in the middle of the how-to-care-for-aging-boomers dilemma. The portrayal of a nursing home as a lockdown facility is terrifyingly real, especially in times of covid when there has been strict control over who enters and exits through the magnetically locking entrance doors.

The protagonist is a bad ass feminist. She’s driven to out smart and out bully anyone in her path to success. She’s out to demonstrate how the work which usually falls to the domestic in a household, can instead be externalized into a lucrative business. Get the right doctor to assess memory loss and the right judge to legitimise her stewardship, and poof! She builds a portfolio of guardianships. Bend the rules a bit more, and it’s a cash cow bonanza.

The plot riffs off the ever too real issues simmering through many families. As mom and dad age, when do they become too forgetful (because being a little forgetful reaches well down into middle age)? Who gets to decide when an adult, a person of authority for decades, must forego their independence and turn everyday decisions over to another. An error of commission causes unhappy holiday gatherings. An error of omission invites scammers of all sorts to prey on the elderly.

Grappling with incentives

Many free market economists are criticized for placing excessive weight on incentives. A couple of examples come to mind. If an actor finds a wallet with $1000, do they keep the money or try to return the wallet? The utility maximizing objective suggests keeping the money. Perhaps true if the actor is an individual devoid of human contact. The keeping the money answer omits that the actor is part of a community, and has an interest in promoting and participating in a group which returns lost items. Some people would call this morality. I see it as practical. The group incentive encourages action which retains capital within the community in the form of future gestures of similar goodwill.

Another example given is the story of the drowning child. Saving the child would result in the loss of an expensive suit. Does utility maximization deter the actor from saving the child? The answer that the actor bypasses the impulse to save his suit, and saves the child in order to be a better, or noble, person is an individualistic way to look at it. But what about the practicality of being the one in the group who is available for a just-in-time activity, who sets a precedent for the next person to carry out similar duties when the need arises. An insurance towards future savings of life. This seems like a a reasonable justification for the behavior. One that is also in sync with responding to incentives, group incentives that is.

But where do we see the $1000 or the reimbursement for the expensive suit? Where do we see the money? Where do we see the returns for the work of stay at home moms or senior volunteers? Where are the lifetime earnings of (est) $1mil-$2mil that a family foregoes when one partner works in the community? Are they suckers? Is it just fairy dust? I think not. But it will take me a bit to prove it to you.

Post Covid, what will be different?

Working from home will be just one of the inevitable changes that springs from the pandemic lockdown of 2020. At home, there will be a better understanding of domestic life. The demands of combining to work for pay with work for children has put in contrast two different types of work. The new perspective should facilitate tackling busy family life. But how about some others? What else will change?

Family formation appears to be on the rise amongst Millennials. Pre-pandemic Pew reports that only three in ten lived with family (a spouse and children), lagging behind other generations. But the recent mortgage application rates indicate an uptick in this cohort financing new home purchases. An extended stay with mom and dad may have hit a limit during the lockdown.

While some households are combining, others are coming apart. The New York Times ran an article in January providing testimonial of such things as the official statistics for divorce rates from last year are still unavailable. Lawyers, counselors, social workers, private judges all report an increase in activity. Perhaps the bright spot here is that 90 percent of the cases settled though mediation as a court time, in times of covid, is in short supply.

While the pandemic may extinguished the last flicker of love light for some couples, I have to think that all age groups are reflecting on the disadvantages of living alone. In Minnesota just under 30% of households are single person occupancy. Perhaps the stoic pride of self-sufficiency will take a back seat to the flat out desire for companionship. Zoom can make connections but nothing replaces the warmth of the human touch.

Human interaction plays into mental health, but I think an overall awareness of self-health will hover in everyone’s consciousness. After experiencing so much loss of life, loss aggravated by health risk factors, it seems like people will place greater value on looking after themselves. The most basic means of achieving this end is through food and diet and exercise.

An abundant use of parks and trails has opened up this avenue to fitness on several fronts. Due to all the walkers out and about, people don’t feel odd to go for a walk. People have discovered all the great trails nearby. People meet up and chat with neighbors on a walk, sometimes even cluster in driveways for that Thank God it’s Friday happy hour. It’s becoming a routine, a part of your day, a way to socialize. As well as exercise and a clearing of one’s head.

I also predict that the authority of science will no longer be given cart blanche in regulatory discussions. Whereas a loss of life used to trump all conversations, policy decisions during covid have forced the issue that there are trade-offs. It is time to unhinge the bolt across the gate which kept regulators in control of the conversations about health and welfare outcomes based on science. Many voices, particularly those in the industry at hand, deserve equal time to make a case in order for the system work properly.

It’s hard to believe we are coming up on the one year anniversary of being secluded from social life. A year, three hundred and sixty-five days, and we’re not done yet.

More on Millenials

A recent report by LendingTree analyzed mortgage requests and offers in 2020 for borrowers across the 50 largest metros. The report ranked the metros by the percentage of total purchase mortgage requests received. The report found that millennials made up at least 50% of purchase mortgage requests in most metros.

The top 5 metros ranked by millennial homebuying popularity 

#1: San Jose
Share of mortgage requests: 61.8%
Average down payment: $158,040
Average requested loan amount: $704,318

#2: Boston
Share of mortgage requests: 59.1%
Average down payment: $78,062
Average requested loan amount: $416,267

#3: Denver
Share of mortgage requests: 59.1%
Average down payment: $56,937
Average requested loan amount: $354,433

#4: Minneapolis
Share of mortgage requests: 58.8%
Average down payment: $38,833
Average requested loan amount: $252,163

Yikes! No homes to sell

Northstar MLS

As you can see from the graph, the inventory of homes for sale in the Twin Cities had been fairly consistent until people emerged from the Covid lockdown and started buying last June. Now we are down 31.4% over last year. Buyers are buying but not enough sellers are bringing their homes to the market.

I speculate that some sellers are waiting until herd immunity as they are not comfortable interacting with the public. Some are being sold off market to Millennial children who are just now starting family formation. And some are being protected by stays which keep people in homes until after the crisis.

A hike, a lake, a monastery.

A hike up to the crater lake at Mount Zuqualla is a day trip from Addis Ababa. The drive out of the capital city and off the Ethiopian high plateau, down through the valley to the base of the extinct volcano can be done in less than a couple of hours. It is a bit of a climb up to the lake, and the road is rough. The verdure is thick right after the rainy season, and yellow flowers, similar to our tickseed, bloom throughout the countryside. Silhouetted on the ridge of the hill are oversized eucalyptus trees. They grow everywhere in the highlands and their fragrance is unmistakable.

The crater lake is not much to look at but the views back over the valley are spectacular. A 14th century monastery is visible off to the west, but we did not venture in its direction. I came across this post on twitter telling the story about how it was settled.

Taken from the Asian African studies blog at the British Museum

The British Museum has an extensive collection of Ethiopian manuscripts which are beautifully inscribed and illustrated. If you ever hear people complain that Christian art does not depict the stories of the bible in their image, send them to this resource. Ethiopians trace their Christian heritage back to King Solomon and the Queen of Sheba.

Choose your work location

Yesterday was the day for work-from-home articles, as Bloomberg also posted this excellent article by Sarah Holder, The True Costs of Working From Home. It’s full of great information and statistics. This, for example:

Between 2013 and 2017, households with at least one adult who worked from home spent more money on housing, on average, than ones that all worked outside of the house, the study found: Remote renters spent between 6.5 % and 7.4% more of their income a month, and homeowners who worked remotely had mortgage and property taxes that were 8.4% to 9.8% greater than non-remote households.

I didn’t appreciate that, pre-pandemic, remote workers were already spending almost ten percent more on housing. That’s quite a bit. On the other hand I’m surprised the percentage of people working from home in times of Covid isn’t higher.

The study is a snapshot of the pre-coronavirus world, when only about 3% of U.S. employees did their jobs from home. By February 2020, that number had swelled by some estimates to 8%. And by May, that share had exploded, with about 35% of U.S. workers who once commuted going remote. 

Still– that is about a third of the workforce. And it appears that staying in the neighborhood is popular amongst employees.

According to a Pew Research Center survey, more than half of workers who can do their jobs remotely say they will want to continue doing so after the pandemic ends. A December survey from Upwork predicted that 27% of workers in the U.S. would still be largely remote by the end of 2021.

The freedom of WFH allows people to move to new communities if they so choose. Perhaps drawn by less expensive housing, or a host of other possible benefits. A U-Haul study shows that coastal people tend to move to other states near the coasts. This article offers another view.

But sticking closer to home may be the favored path for many, especially if companies ask for some face-time each month. A San Francisco Chronicle analysis of USPS moving data showed that the majority of San Franciscans who left the city during the pandemic moved not to Florida or Texas, but to another Northern California county; a Zumper report that analyzed national rent shifts found a similar story, with “cheaper, neighboring cities” appearing to be the 2020 destinations. 

I think it’s too soon to tell how household priorities will all shake out. There are options out there that people have yet to consider. If moving half way across the country is possible, why not another continent? Croatia is just one country trying to leverage the remote work concept by offering a Digital Nomad Visa.

There are many costs and benefits to living in various communities, and the reshuffling of tradeoffs will be different for each household. Businesses also may find the transition to remote work a cost savings at first, but then an expense as it is more difficult to recruit and train a corporate culture from afar. Though as a general rule, more choices for both employers and employees are a good thing.

Work in the neighborhood

The pandemic will reshape our lives for years to come. One lesson learned is that company centric office space is not essential to many forms of employment. This creates inroads to the reality of paid work from home. And the benefits for families to staying in the neighborhood, close to daycare and schools and extra-curricular activities, will make it a convenient option for many employees.

When people started to re-emerge from their homes last spring, at the beginning of what ended as a boom year in real estate, we heard a lot of buyers expressing the desire for home offices. Once children return to a traditional schedule in daycare or school, the home environment will be even more ideal.

There are other options for remote work. WeWork, a US real estate company, has provided office space with shared amenities since 2010. It’s success has been muddied by an outrageous leader and a lack of market confidence in its business model. Recently its co-founder has been embroiled in a law suit with SoftBank. Sensing blood in the water, an international competitor, IWG (International Workplace Group), has made moves on WeWork’s holdings in Hong Kong.

For the third time in less than a year, IWG has opened flexible offices under the Signature brand in a Hong Kong space formerly occupied by embattled rival WeWork.

IWG is based out of Switzerland and provides space in 120 countries. Their focus is on catering to a particular environment with supportive services, access to networks while connecting companies to locations at close proximity to their clients.

Perhaps this flexible model office space is an even better fit in densely populated cities like Hong Kong. Here the average home is 484 sqft limiting space for home offices. The average American lives in a 2164 sqft. dwelling which, in comparison, sounds generous with ample room for work. Yet everything is relative. City dwellers will settle for a 1800 sqft craftsman bungalow while suburban buyers desire a full two story with double the footage and a three car garage.

Whether through a work-from-home setup, or a flexible workspace nearby, households with children will benefit by having at least one adult in the neighborhood. Being available on-demand for children is part of the deal: when daycare calls to pick-up a toddler running a fever, or there’s the school science fair to attend, or little league practice starts at 4pm. Since juggling those demands around commute times is stressful, being close to home is a social benefit employers can provide at no pecuniary cost.

Standards

I recently listened in on a presentation which was given by a respected academic to a political body. The topic is one that I know well and over decades have heard many arguments hugging all sides of the issue. I was dumbstruck by how fluidly the professor’s language navigated between academically supported information and his own opinions. Isn’t there a standard of disclosure for such things?

For instance, he would start with results from a study but then list projections which his team conjectured– as if lives could be lived twice and records kept accordingly. One politician asked specially about these projections, and there was an apology for the omission of the model, yet his dialogue kept flowing as if these figures were generated with the same standards as the peer reviewed papers.

For the average listener, including the folks who will make policy for tens of thousands of people, the distinction between actual data and estimates was muted if not eliminated. The professor’s tone, consistency, and manner of referring to the material did not distinguish between research and conjecture.

The inference of receiving information from an academic, particularly those who have cultivated a long CRV and a number of titles, is that they are communicating academically supported material. Anyone with limited knowledge of the topic will not be able to detect when the information is in fact a subjective opinion. Instead of aiding the pubic conversation around a topic professors become arms dealers for divisive public discourse.

Lessons from airports

To say I grew up in airports is a bit of an exaggeration, but only slightly. International travel in the 60’s was still rather new and exotic and susceptible to schedule changes. Long layovers to coordinate connections were common, and delays due to weather or mechanical issues were even more common. My parents were adventuresome and thought nothing of towing three young children around with them. In the photo, my brothers and I are cooperating dutifully on the luggage cart at the Colombo airport having arrived from Dhaka for a little R&R.

The vintage “where in the world” posts are from trips we took while stationed overseas with the US Diplomatic Corps. Even by foreign service standards we moved a lot, fulfilling only one DC assignment which lasted less than three years. The school years spent on Chesapeake Street between Reno Road and Connecticut were idyllic, only blocks from Murch Elementary.

On the weekends we would go for hikes off the scenic Skyline Drive or ride our Shetland ponies on an acreage in West Virginia. But this tame American experience couldn’t match hiking the terraced tea gardens of Malaysia or climbing up to the crater lake at Mount Zuqualla or even the rather urban stroll up to Victoria Peak in Hong Kong. The whole family was eager to take back to the skies. I didn’t return to live in the US until college.

With so much time on our hands at Heathrow or Narita or Charles de Gaulle my brothers and I would play games eavesdropping and then betting on the nationalities of our chosen observation subjects. Of course there was language to give us some guidance, but also mannerisms and apparel. If we were lucky they would pull out their passports to allow us to settle our bets.

Fifty years ago, as pre-covid, airports were busy places with passengers rushing anxiously to catch flights. Perhaps forgotten now, is that by 1972 a total of 150 US planes had been hijacked. Commandeering aircraft was in a golden age. Airport security was considerable. I remember the Rome airport in particular crawling with camo clad soldiers, each carrying an assault rifle. The true power, however, was held by the typically slender uniform behind the passport control counter. He (usually, but sometimes she) could question or detain you. Have your luggage searched.

The approach was straightforward. Only answer the questions when asked. Don’t offer additional information. Do nothing that could antagonize the one person who could delay your travel. I still think of these very prompts when I travel abroad.

Chauvin Trial Update

The Derek Chauvin trial starts two weeks from today, and from all the prep that is going on, it appears that folks are nervous. Concrete dividers, fencing and barb wire have joined plywood at the entrance doors of the Hennepin County Government Center building in downtown Minneapolis.

For those readers who were busy in a blow pipe making class in PNG last summer, Derek Chauvin is the former Minneapolis police officer who held his knee on George Floyd’s neck for eight minutes. With his face inches from the pavement, Floyd expressed concerns about not being able to breath before he died in police custody. This happened on a Tuesday. Protests were in full gear by Wednesday evening. Riots led to the burning of a police precinct Thursday. It wasn’t until Saturday evening that the National Guard, in full combat gear, patrolled the streets with pellets guns to keep them clear for the curfew. Black smoke from Batteries Plus and other commercial spaces hung over the Lake Street section of South Minneapolis through Sunday morning. Protestors burned or damaged upwards of 700 buildings, housing many minority owned businesses as well as national chains.

Estimates are that the Minneapolis Police Department has lost 200 of its 600 police officers to disability claims and early retirements since last year. The city council continues to hammer on the department, denying funding requests while attempting to shift responsibilities from the police department to social workers. This strategy is not garnering a lot of support outside the city limits.

In an unusual move, the speaker of the Minnesota house, Melissa Hortman (D-Brooklyn Park), brought a bill to the floor of the (DFL majority) house which, apparently, had not been vetted for votes. The governor’s proposal to create a statewide fund intended to pay for security during the trial failed as a handful of democrats voted with the GOP. It appears there is a shuffling up of groups, as who do or do not support Minneapolis’ move to reimagine public safety, and they are not all falling along party lines.

The Minnesota House rejected a bill Thursday that seeks to create a state fund to reimburse police departments from outside Minneapolis if they’re called in to help prevent civil unrest around the upcoming trial of Derek Chauvin.

Security funding plan for Chauvin trial fails in Minnesota House | MPR News

One comment that was made was that outstate Minnesotans aren’t necessarily as supportive of the MPD, as they are appalled at how the police have been treated. There is a difference. The media, however, is cradling protestors sympathetically, as in this recent headline in the Minneapolis Star and Tribune. (Hollywood ready little girl in his arms et all)

The trial will be televised, but it seems like the drama already has its verdict. Just in case, there will be a lot of manpower on the ground to keep the peace.

Suburban sprawl in the time of Jesus of Nazareth

The majority of the Greek Jews lived in the new section of the city which had sprung up on Mount Scopus outside the ancient walls, opposite the Sheep Gate. Accustomed to spacious houses, with gardens and colonnades, they could not find room in the old, crowded sections. The house of Miriam, sister of bar Naba, built in the Cypriot style, resembled a Greek temple; behind it was a garden, enclosed in a peristyle, and here she arranged frequent banquets for the leaders of the Greek-Jewish community of Jerusalem.

The Apostle by Sholem Asch

Try something new

The drum beating earlier in the week about cancelling student loan debt was abruptly muffled by the president. In response to Chuck Schumer (D-N.Y.) and Elizabeth Warren’s (D-Mass) proposal to forgive up to $50,000 in student loans:

“I will not make that happen,” Biden said when asked at a Milwaukee town hall hosted by CNN Tuesday night if he would take executive action on loan forgiveness beyond the $10,000 his administration has already proposed.

Biden Balks At $50,000 Student Loan Debt Forgiveness Proposal | HuffPost

Some people think student loan forgiveness falls into a moral category. Society has an obligation to advance citizens through education; that college is an extension of the k-12 necessity to set a youth up for a productive life. The debt should be waived on principle. Of course this gets a little messy post grade twelve, as vocational choices, and the education they require, vary tremendously. And for this reason I think free college will always be a non-starter.

But why waste good numbers when they are out there for consumption? The debt figures can be, and should be, put to good use. When aggregated up to the federal level they loose some nuance. But at the local level it maybe possible pull some levers and leverage a few social objectives at a time. The results maybe more interesting than a simple money transfer.

Case 1. Say there were two objectives on the table: student loan debt and career advancement. One would look for organizations at this intersection. There are hundreds of business associations in Minnesota. Local Chambers of Commerce might be first to mind, but there is the Iron Mining Association or the Minnesota’s Corn Growers Association or even local PTA’s. Say an association was given access to a pool of federal funds marked for student debt relief, with a catch. There is a trade involved. Once the Mining association, or corn growers, show proof of employment of a new-to-the-profession worker (for at least x-amount of time), then they can allocate relief to the student they deem eligible.

It’s a community grant (given to an individual) in exchange for making an effort to lift a worker up and into a new stage of professional development. Many of these associations have a history of giving out scholarships, and a process in place for evaluation. They are well regarded in their communities and have a reputation to protect in the administration of debt forgiveness.

The relief recipient advances economically from the removal of the debt. The business community can justify the extra work or training necessary to bring an inexperienced employee into their field. The new employee hopefully evolves to see the rewards of elevated employment and not just feel the demands of the additional expectations in a challenging position. All those who step outside their norms to make this happen find comradery with others not like themselves.

Case 2. Here’s another example. Say an elementary school attendance area is experiencing a sharp downward trend in enrollment–and the demographics confirm the trend to be long term. The risk of school closure is high. Closing a building is not only expensive for a school district, but the loss to a neighborhood can be devastating. Short term it brings angst to the families who now send their young children to a building out of the neighborhood. Long-term it can be difficult to reverse the negative impact from the closure.

Say the federal government allocated a pool of student debt relief money to the elementary school’s attendance area. Now imagine that there is a household with young children who would qualify to purchase a home in the area if a portion of student loan debt was forgiven. The local PTA in conjunction with a local mortgage bankers’ association could be in charge of distribution. This scenario leverages three objectives: debt relief, school support and housing.

Local control over distribution of funds could refine distribution in a way which engages incentives to accomplish other objectives within communities.

NFT’s at Christie’s

The NFT’s (non-fungible tokens) are making news in the art world as auction house “Christie’s Will Become the First Auction House to Offer Non-Fungible Token Art.”

Last December, an artist who goes by the name “Beeple” made headlines when he set a new record for the most valuable artwork auctioned off Nifty Gateway, a marketplace for limited-edition digital items. Beeple sold 20 artworks for a total of over $3.5 million, catching the attention of those who might not previously have known about the existence of NFTs, or Non-Fungible Tokens. While just a few years ago blockchain-based art might have been considered niche, a recent development proves this is no longer the case: on Tuesday, Christie’s announced an upcoming auction featuring thousands of images created by Beeple that have been compiled into a single composition.

The actual art looks very much like regular art. And are trading amongst buyers and sellers at a nice clip. Bitcoin.com reports that in a week last August there were 14,654 sales and $1.2 million in weekly trade volume. This piece by Trevor Jones commanded a nice price.

So what about the NFT- or the non-fungible token notation.

Crypto art relies on non-fungible tokens, or NFTs, which are usually issued with an Ethereum token, ERC-721. This ensures verifiable digital scarcity; each artwork is a uniquely distinguishable digital asset—no two are the same. 

Crypto Art Sales on Ethereum Reach a Record $80 Million – Decrypt

At first glance it seems to be a certification of sorts, a blockchain version of an identifier to keep track of the art work’s provenance. An authentication certificate more than anything else. In the artworld the story of where a piece was produced and who has owned it since, is an integral part of preserving its authenticity. The token is attached to the piece and hence is non-fungible.

But something is missing from this conceptualization. Fungible has the quality of being able to be exchanged with other goods. The auction activity indicates a product that is very tradeable. Since these NFT’s are bought and sold freely, there seems to be a contradiction. Zoup at non-fungible.com tackles some of the issues.

zoup: I had several passionate debates during Meetups around the definition of non-fungibility. And I must confess… most of these debates turned out to be sterile but, they helped me understand something important: the definition of non-fungibility is everything but obvious.

Zoup explains that bitcoins are fungible in the same way that nickels, dimes, quarters are easily exchanged. A precious coin, however, is something different. To a collector a nickel that was mistruck during production can have significant value. To a collector the deformed nickel is non-fungible. And it is in this way the non-fungible tokens make digit art unique. Hence zoup comes to this conclusion:

It is therefore the use value that defines the fungible or non-fungible character of the asset. And not its technical characteristics. The main use of an asset and the perception that one can have of it define fundamentally if the asset is fungible or not.

Why most definitions of “non-fungible” are incorrect. – NonFungible.com

It is here that I propose a clarification needs to be made. The quality of being fungible, by definition, indicates an attachment to a group, as it is the group which determines its use.

Let’s try to disprove the idea and see what happens. The mistruck nickel is non-fungible when held within the collector group, it is precious, it has a unique story. To a kid who wants a coke on a hot day, the nickel is simply five pennies towards his purchase. He pops the coins into the slot on the side of the machine without another thought. He is using the coin as a fungible asset.

The quality of non-fungibility is attached to transactions that exist within groups. NFT’s find value in the crypt-investors sphere, but I doubt you would find much interest at the local VFW. Outside of this very specific group of people who understand the crypto space, the value goes to zero. I’ve written about fungible versus non-fungible transactions. I claim that when non-fungible assets are held within a group, they are a public good. All investors share equally in the assurance that the tokens represent a unique asset.

When a group assigns a use to an object- a park bench, for example, is open to the public in a park- then the bench is a non-fungible asset (it can’t be rented out or traded by any one individual) that is held by the group. When the crypto people decide to use tokens as identifiers, they’ve created a certification process that legitimizes an artwork by the community. And that is non-fungible.

I’ve said it before. It’s all about the group.

Numbers, pictures, and what they tell you.

I’m a sucker for images, and these new graphic representations at the intersection of maps and data are lovely.

A consulting firm out of North Carolina, Urban3, has a new measure for assessing the productivity of land in an urban environment. It’s an interesting new twist.

Urban3 makes maps that show the value of city buildings on a per-acre basis. That last detail is the kicker.

“We make the models to provide information equity,” explained Joe Minicozzi when I asked him about his approach. “We show a financial picture of what’s going on with the cash flow. You see where the holes are, what’s doing well, what’s not doing well. You can’t see where you’re leaking your money if you don’t know what’s going on.”

Per-acre analysis: a unique way of looking at urban economics | MinnPost

The general process is to take the tax revenue on the section of land and divide it by a spatial measure. Under this calculation, downtown buildings are more ‘efficient’ than suburban malls with lots of surrounding acreage of asphalt parking spaces. And in this way the analysis has flaws. Consumer (pre-covid) enjoyed the ease of mall access. Downtowns discourage shopping traffic. So if the objective is to encourage downtown visits, an understanding of transit and traffic and parking would be more valuable.

Reframing a means of analysis is exciting, but there are many more features of the built environment than simply tax collection and land space.

Aesthetics and Solar Roofs

Elon Musk has stated that 2021 will be a key year for the Solar Roof, with the CEO noting that its potential would be evident this year. Considering the company’s ongoing rollout of the integrated PV system and the development of better Solar Roof designs, it may only be a matter of time before more customers of Tesla’s flagship residential solar product would have more design options available. 

https://www.teslarati.com/tesla-solar-roof-colored-textured-tiles-patent/

Aesthetics is one stumbling block in consumers’ embrace of solar energy. A look that blends into the standard architectural asphalt shingles, or clay roof tiles, would be more consumer friendly than panels.

NorthStar MLS

Attractive shingles will undoubtedly command greater appeal than shiny 24 x 24 inch panels set into a large framework.

Tesla’s Solarglass Roof tiles are already among the most aesthetically-pleasing PV systems in the market. A Solar Roof installation involves the setup of both PV and non-PV roof tiles, and according to Tesla, this could present some issues. Since some tiles do not have solar cells in them, there will be some angles or times when it is possible to distinguish which tiles have solar cells and which do not. 

credit: Patentscope

Tesla also produces a lithium home battery, called a powerwall, which can store energy from the panels to be used after dark, during peak pricing hours.

The Tesla Powerwall pairs well with solar panel systems, especially if your utility has reduced or removed net metering, introduced time-of-use rates, or instituted demand charges. Installing a storage solution like the Tesla Powerwall with a solar energy system allows you to maintain a sustained power supply during the day or night, as long as you store enough power from your panels when the sun is shining.

https://news.energysage.com/tesla-powerwall-battery-complete-review/

With cost for the battery alone running around $8-9K, installation of an entire solar system is upwards of $20K. For comparison, a forest air furnace runs around $4-5K. That said, people pay extra for all sorts of social reasons. They use their son-in-law for their mortgage despite higher fees, they buy Girl Scout Cookies (OK, they are delicious too) and bid triple the value of a vacation package at a charity auction. There is an additional expense in buying organic vegetables and sometimes loyalty to one’s barber requires a drive across town. There are many circumstances where one pays above the going rate so that a portion of the price supports a social objective. Still- the premium has its limits. And solar power isn’t quite affordable enough to reach the mainstream concerned, yet.

In the end it is all about the payback and reliability, especially in a harsh climate. Natural gas is very affordable, but its infrastructure is not available throughout the state. Homes that rely on electric baseboard heat will most likely be the first to tackle the significant upfront investment and convert to solar.

State capacity MN style: Stay off the roads!

Around 4pm this afternoon the temp in the Twin Cities creeped above zero ending a 95 hour streak of negative highs and lows. As far as I know there have been no deaths during this polar vortex. But down I35 W, past Iowa, Missouri, Kansas and Oklahoma, a tragic 133 vehicle pile up left 65 hospitalized and 6 dead in Texas. The winter weather conditions coated the interstate with glare ice jackknifing semis across the thoroughfare. Approaching cars helplessly collided into each other as they skated into the metal mangled mess.

Around the same time last week, in Minnesota, a “bridge appeared to be ice-covered when the driver crashed and nearly went over the edge…”Take a look at the video where bystanders stopped a pickup from teetering over a bridge rail into the Minnesota River. When it comes to winter weather, Minnesotans have high state capacity. As a group we have the extra skills and initiative to respond to unexpected winter weather challenges.

It’s not that the people down in the Lone Star State are hick, uneducated or inept. It’s not that they’re too poor to be responsible nor too rich so as think they’re above it all. It’s not that they are too stupid or too smart. Capacity is a combination of knowing what to do, and being able to engage when the need arises. It’s an identification process, a communication process and a step-up-if-you-are-there-and-available process.

The group has to have the expertise to distinguish the glean on the pavement as black ice, and not innocent damp asphalt. A network has strength to communicate the concern when it is reliable and trusted. Parents put in the extra ‘no’ with persistent teenagers who want to go meet their friends, errands are put off. Stories of cars sliding into holding ponds and drivers waiting through the night, half submerged, until someone comes to the rescue, are retold to confirm the nature of the situation. All these activities enforce behavioral sacrifices which lead to successful outcomes.

Our cities are well rehearsed to handle the weather, whereas the Texas Department of Transportation lacks the physical equipment to plow off the half a foot of snow from the roadways. Formal government and its preparedness are just one feature of the ability of a community to identify, communicate and respond to the challenges, or ambitions, at hand. But it’s really the coordination abilities of the whole group which delineates its capacity.

Valentine, Will you be true?

Despite all the shortfalls in American culture in the 50’s, one grossly overlooked foundational strength was community support for marital bounds. Sure– a lot of the outrage in the 60’s stemmed from strength of the marriage contract. Women were disproportionately dependent on their partners, due to male control of traditional economics within the family structure and the workplace. Cross-gender issues were squelched and hidden, leading to psychological detriments.

But as is still true today, activists needed to inflate the issues in order to have them recognized, filling the 60’s 70’s and 80’s with fervor for the dissollution of marriage.

Marriage and divorce in the US: What do the numbers say? (sas.com)

It’s wonderful to see the rates inch down in more recent decades. But I think there is a lot more work to do. The celebration of Valentine’s Day is about new love. A celebration of anniversaries and dedication to sharing the stages of family life with one partner is not only romantic, but provides vision to navigate family life with all its stresses and demands. Here’s to the Valentiniversary!

Ice Fishing

We’re hitting a record cold spell as a polar vortex nestles in over the bold north state. So what do people do when the temps don’t climb above zero and hit lows in the -30 range? Go fishing on the ice of course! (see Grumpy Old Men for the Walter Matthau, Jack Lemmon and Ann-Margaret portrayal) For those of you who never get to experience cold climate living– this is for you.

Folks with false intentions

Ezra Klein: San Francisco is about 48 percent white, but that falls to 15 percent for children enrolled in its public schools. For all the city’s vaunted progressivism, it has some of the highest private school enrollment numbers in the country — and many of those private schools have remained open. It looks, finally, like a deal with the teachers’ union is near that could bring kids back to the classroom, contingent on coronavirus cases continuing to fall citywide, but much damage has been done. 

Eighty percent of my motivation to write commentary was due to folks like the ones described above. There was one in particular, who loved to call everyone a racist. But where did he send his kids to school?

So I guess I’m indebted to them.

Growing in place

I remember posting my first public comment. I was nervous. I must have read through it a dozen times, and felt so exposed once I pressed enter–no edit back then. The article, Met Council: More focus on growing in place, was an opinion piece by local journalist and urban design consultant Steve Berg, writing here in MinnPost

Ten years have gone by, but the gist of what I was saying remains the same. People trade with an understanding of both a collective benefit, as well as one of self interest. At least that it what I am here to convince you of.

I loved commenting on Steve Berg’s articles because there was so much substance to target. Things have changed a bit since then. He was a classic anti-car guy, which has been toned down since Elon Musk came along. And you don’t hear people harping on sprawl as you once did. Nor market failure for that matter.

Maybe people are listening.

Trades work is non-internet

I think most people would agree that the agility with which high paid workers were able to transition to remote work with the aid of the internet was nothing short of astounding. Had it been tried without Covid, I’m sure it would have been as difficult as getting teachers back in the classrooms.

Tradespeople have also been able to keep working as their work is most often socially distanced and out of doors. Road crews, roofers, delivery workers are all busy. None of these jobs rely on a quiet space with a lap top.

It seems a natural fit to connect the low wage workers into this workforce.

Can it be more than just about coin?

Biden’s 1.9 trillion relief plan is a little too enormous for me to get my head around. The magnitude of federal numbers just makes my eyes blur over the page. There is no anchoring the size of these things to my everyday life.

But if I can’t talk about magnitude, I can talk about structure. The goal of the bill is to engage the US economy as well as shore up people’s unexpected and uncontrolled loss of income; to keep their lives right side instead of upside down (which subsequently causes an economic drag on their greater groups). And then to get them back to employment where income can be feathered back in to the economic apparatus.

I’m all in favor of transfers for the first part. They work efficiently.

But I think there is a missed opportunity in the second part. Engaging idle labor from folks who are not destitute nor in need of transfers is low hanging fruit. As explained in this post about The Crafter The Contributor and The Covid Tracker, there are high skilled individuals available to donate labor if they are enticed by the objective at hand.

There are successful national service programs like AmeriCorps and the National Guard. Would it be so hard to have a property repair civil service? Ask any builder about the shortage of construction workers. What about a write-off for plumbers and sheet-rockers and electricians who’d be willing to have an apprentice tag along to fix a faucet at the local homeless shelter, sheetrock in a storage room at the food shelf, or replace all the gym lights with LED fixtures at the community gym?

A money transfer won’t teach a trade, nor will it make a connection between a potential employer and up-coming employee.

Below surface

Pioneer Press North Dakota had adopted a law, proposed by the state’s Industrial Commission that oversees oil, gas and mineral removal, that gave energy companies broad power to continue injecting salt water, an unwanted byproduct of their drilling, and added rights to pump carbon dioxide deep underground and leave it there for eternity. This is becoming important as the cheapest method of “carbon sequestration,” which is deemed vital to reducing greenhouse gas emissions.

The law was very favorable to companies wanting to inject. It stiffed owners of land overlying the areas that might be filled. This created strong opposition, and a landowners association challenged it.

North Dakota had made an environmental claim on the subterranean space, but the landowners, who felt shafted by the fracking boom, said not so fast. They wanted in on the deal that seemed to pad everyone else’s pockets. So who owns the ‘pore space’ and who gets to benefit from it economically?

In mid-January, a state judge amped up the controversy in a broad decision favoring the landowners. He struck down the whole law as violating both the North Dakota and U.S. constitutions. He ruled it was a “taking” of private property as banned by our Fifth Amendment.

One can speculate on the line of thinking the legislators in North Dakota may have been following. Since everyone would benefit from the purging of by-products into the depths of the earth, than the assignment of the use of pore space to the energy companies is fulfilling a traditional public good.

As I’ve said here many times before, I do not believe in natural public goods. And this is just another example. Although the act of burying the carbon dioxide has a positive environmental outcome for the citizens of North Dakota, it is the land and the rights attached to the land that are under discussion. The land is privately owned by the landowners.

My view is that what is pubic and what is private comes about through tradition and legislation and cultural norms. In this case the courts decided. As the author says, there will be more to follow regarding “pore space.”

Legal scholars will write scholarly papers and economists will construct mathematical models. There are precedents in water and oil laws going back decades, but compressed gases that should stay there for millenia differ enough to open new controversy and give topics to hundreds of grad students who need thesis topics. And the outcomes will affect all of us.

Yesterday, a birdwatcher saved a life

A little after two, yesterday afternoon, my phone made that intentionally obnoxious noise to signal an Amber Alert in our area. A grandma of nine had also gotten the notice. She happened to be watching a Jeep, through her front picture window, idling across the street. Grabbing her birding binoculars, she verified that the license plate number matched the one on her Amber Alert notice. She then called her daughter to confer, then the police.

Only 35 minutes elapsed between the alert going out and the one year old being found in an abandoned vehicle on a brutally cold day. Here’s a timeline of the events. A local journalist was in the area and was able to catch this senior on the move for an impromptu interview. (so sweet)

One might label this a one-off call to action, being in the right place at the right time sort of activity. Shrug it off as happenstance instead of recognizing it as work. But you’d be wrong.

A community, a group of people who share a public safety interest, need these types of eyes-on-the-street workers. Not everyone. Just enough to have capacity around to engage as needed. As annoying as they can be to those young first-time homeowners, the older retired types, just like our grandma here, make excellent neighborhood watchers.

Note that this work didn’t require a valedictorian or a particular muscular prowess or any technical expertise; this work is done by being present and caring enough to act. There can be misunderstandings and errors in interpretations, hence it is good to check with your direct sphere, which she did when calling her daughter.

Note that the motivation here is not political or monetary or for glory. Often it is done because we would want someone to do the same for us. And we become part of groups for this reciprocal reinsurance.

The Amber Alert counts on it. Sending a message out to everyone who owns a device spreads the word, looks to reach the ears of those who are in the right place and circumstance to engage these sentiments. The system doesn’t expect any one person, just someone in the group.

If the Amber Alert hadn’t gone out with the vehicle’s description. If the birdwatcher hadn’t grabbed her field glasses to verify the license plates. If her advisor hadn’t reinforced the proper course of action in calling the police. What would have happened to a twelve month old child in the back of a white Jeep in weather where exposed skin freezes in a matter of minutes?

It just takes one out of the group. But you can only help if you are close enough to touch. This isn’t a federal public good, nor a state public good, it telescopes in further than that. But this public good, the provision of public safety, relies on eyes-on-the-street workers.

More measures that don’t add up

Cost burdened is the catchphrase of the day in housing. Over the last couple of years it has popped up everywhere. Articles posted on all sorts of sites use the phrase without specifics on how they came up with all their charts and graphs. Smart Asset was good enough to describe its methodology.

Data and Methodology

SmartAsset used Census Bureau data to determine the most and least severely housing cost-burdened cities. This data, which we found for 126 cities, breaks down residents into the following brackets based on the percentage of the total household income they are spending on housing: less than 20%, 20% to 24.9%, 25% to 29.9%, 30% to 34.9%, 35% to 39.9%, 40% to 49.9% and 50%. The data also lists the total number of households.

We took the number of households in each city paying more than 50% of their income on housing and divided it by the total number of households in that city in order to come up with the percentage of households that are severely housing cost-burdened. We then ranked each city based on this percentage. We also calculated the percentage of households in each city paying between 30% and 50% of their income on housing, but this did not impact the ranking.

Data comes from the U.S. Census Bureau 2017 1-year American Community Survey

Most and Least Severely Housing Cost-Burdened Cities (smartasset.com)

You can find more about the American Community Survey here. But I’m pretty sure the information about housing expenses is self-reported by the three and half million who receive the request.

As you do with ranking lists, I checked out my own community (childhood home of Senator Klobuchar no less) to see how we stacked up in the cost burdened arena. According to an extremely well regarded source of data and information to politicians and local officials, half of all residents of Plymouth, Minnesota are cost burdened. Seriously?

I’m not sure how this could be true for one of the more affluent parts of the western suburban Minneapolis-St. Paul metro area. So I checked another affluent area on the St. Paul side, Mendota Heights. Here it is reported that 75.4% of homeowners are cost burdened. Clearly there is an implementation problem with use of the data meant to determine those in need. More alarmingly, there it sits in bold bar graphs given to lawmakers and policy people.

But even if folks choose to pay thirty or even forty percent of their monthly cashflow for housing, who is the Census Bureau or the American Survey or HUD to say that it is too much? Consider these three scenarios.

  1. I choose to live within blocks of my parents, even though their neighborhood is a little expensive. My parents are able to provide fulltime daycare for my toddler as well as before and after school care for my two elementary school children. Living in their neighborhood saves our family upwards of $2500/month.
  2. I choose to live in the city which is noticeably more expensive than some first ring suburbs. This location allows me to take mass transit to work, shop and recreate. It’s easy and cheap and I don’t need a car. Between insurance, a loan payment and gas, I save $400-$500 a month.
  3. I chose to live near my congregation despite the monthly rent being high in relation to my fixed retirement income. My apartment, however, is near my church and the fellowship is such a big part of my life. I am able to share transit to and from my doctor’s office which is close-by. Plus I feel safe.

(For some back of the napkin, points of reference, average rent in Plymouth is $1300. An income that is considered non-burdened (28%) is 4643$/mo. An individual is considered cost burdened (30%) at 4333/mo in income. A difference of $310. )

Evaluating housing based solely on monetary income and rent is grossly insufficient. Consumer housing choices are influenced -think back to your own choices- by all the services found in various neighborhoods. Each of these scenarios show how access to family help, transit infrastructure, and religious communities contribute people’s home economics.

Not only is the present methodology, (which is being projected in stereo as if on a national housing agenda of some sort) yielding reports declaring the poor rich as burdened, I argue the use of pecuniary measures, as the sole means of evaluating quality of housing, is starkly erroneous. If a ratio of rent to income is used (as it has been) as the primary driver in decision making, than less advantaged people will always be pushed into the least expensive rental markets. Surprising to no one is the market reality that these neighborhoods are lacking in support structures.

Flyways in spring

It’s a frosty negative one degree Fahrenheit in the north country with a flag snapping wind. A lovely four mile walk from earlier this week, captured above, is a distant memory. It appears we’re in for a week or so of highs around zero.

There are people out walking still, mostly walking their dogs. A few are bundled from head to toe, buffering their skin from the bitter bite of the cold air. The Dutch have a word for it. Uitwaaien is the practice of jogging or walking into the wind, especially in the winter. It is invigorating, and I’m all for clearing one’s head. But if your eyelashes start to frost up into some avant-guard model look, it might be time to stay in doors.

Instead I let my thoughts flock to the bird migrations coming up next month in March. The Mississippi flyway brings a steady flow of avian creatures up from the Gulf of Mexico as they venture up to Canada and past the Hudson Bay. They seem to like our state with all our water features, including the headwaters of the famous flowing river.

Perhaps you think the whole binoculars and birdwatching thing is a little silly, but you are wrong. It’s delightful. While on a walk in the spring slush with tree branches bare of foliage, you learn the orange flash is an oriole, and a fleeting bright blue is usually a tanager. A brighter yellow-green with a bandits mask and pompous crest is a cedar waxwing, one of my favorites.

Perhaps you think that it would be frustrating to spot some small brown poof of feathers only to be bewildered in finding its identification. By the time you pulled out the green covered field guide from your back pocket, turned to the sparrow section, the details of what you saw become fuzzy. And you can’t choose from the oh so similar options.

Well there’s a new technology for that. It’s called Google Lens. Quickly capture a cell phone photo of the titmouse, chickadee or vireo, use the lens image at the base of the photo, and presto! The app identifies the bird and tells you all sorts of information about it.

Eventually you learn the difference from a yellow warbler and a goldfinch even if they both hop around in the grass looking for dinner. And you no longer confuse the black headed grosbeak with a robin as the beak (name implied) is thicker and its build a bit buffer. A swan and a Canadian goose are more than large waterfowl honking as they skim the lake’s surface.

But I digress. There’s a 20 below wind chill just outside my window, and the thought of a spring thaw luring wildlife back north is a pleasant distraction.

Peace

Years ago I called my stock broker all in a flutter as I had noticed one stock in my portfolio had taken a tumble. In a steady and calm voice he asked me to hold on, so he could bring up my account. Then he proceeded to run through the statistics which verified that, although the recent downturn in value was a setback, overall my purchase was fairing quite well.

The uniformity in his voice, one acquired from handling calls like mine a hundred of times before, undoubtedly contributed to bringing me around. But the numbers took a moment-in-time piece of information and stretched it over a larger framework. They provided some concrete reference points to mollify an emotional response.

A plunge in the value of an investment can raise one’s blood pressure, but does not compare in anyway to the response following the loss of a human life. Still– looking at loss of life as a statistic spread out over other scenarios and situations is a worthwhile endeavor when trying to subjectively evaluate a variety of circumstances.

The department of Labor and Statistics keeps track of how many workers suffer a loss of life while on the job.

Frobes: In 2018, 5,250 people sustained fatal injuries at work. To put that into perspective, an estimated 609,640 Americans died of cancer in 2018, 116 times as many as who died as a result of a workplace accident. Of those 5,250, 40% were killed as the result of a transportation accident, most of which involved roadway collisions. The second-largest category of fatal injury in 2018 was “Violence and other injuries by persons or animals” with 828 deaths, displacing 2017’s No. 2, “Fall, slip, trip.” The increase in workplace violence was driven by workplace suicides rising from 275 in 2017 to 304 in 2018. In 2011, there were 250 workplace suicides.

People also die when receiving services. The statistics for how many patients die while being treated by the medical profession are all over the place. A study by a John’s Hopkins’ team from 2016 claims the number is a quarter of a million a year, but other estimates put the number closer to ninety thousand. Given the cost and concern around malpractice insurance, the number of fatalities in the public health sector must be significant.

Now lets look at fatalities in the public safety sector. According to the Washington Post, 41 unarmed people died at the hands of the police in 2020. Not 250,000 in the care of physicians. Not 5,250 in work related accidents. 41. And let’s keep that in mind in the coming months when evaluating the service the police provide to our communities everyday.

Noah is building an ark

A handful of years ago a new term showed up in housing forums and real estate continuing ed classes. NOAH. The acronym stands for naturally occurring affordable housing. The Greater Minnesota Housing Fund explains:

The majority of affordable rental housing in the United States can be found in modest apartment buildings in every city and suburb.

These units are home to every stripe of renter and receive no federal or state subsidy at all. These Class B and Class C rental units comprise the bulk of affordable housing in the country today, but there is nothing to guarantee that they will stay that way.

Nationwide, this affordable rental housing is at risk. In prime real estate markets, this “naturally occurring affordable housing’ (NOAH) is often operated under poor management or in disrepair. Speculators are eager to snap up these developments, upgrade a few amenities, and convert these once-affordable homes to higher-market rents. This loss of affordability threatens the stability of individuals and families who are displaced, and even entire communities.

It was like a frosty burst of January air through an open front door. A much needed break from endless harping on ‘building’ more affordable housing. New construction is the most expensive form of housing and how it is in a community’s best interest pay top dollar for very few units is anxiety rising for any spendthrift.

It is equally refreshing to read that a real estate investor in Charlotte, Mark Ethridge, is building on the concept of NOAH. Here’s how he got started:

Ethridge had watched for years as properties like this were snatched up by big money investors who’d quickly renovate them, jack up the rents and then sell them off for a quick profit. With an estimated 120 people moving to the city every day and an economy on the rise, growth in Charlotte had put these kinds of apartment complexes in the sights of housing investors who saw them not as affordably priced homes for lower income residents but as undervalued assets.

Ethridge has attracted a bunch of like minded people to run up a $58 million fund for the purpose of providing housing at below market rates. The difference here is that his investors will receive annual returns on their investments, just at a reduced rate.

Bowles insists this is not philanthropy, and giving the fund a for-profit structure was a way to bring the discipline needed to ensure it would work for the long run. “We are capitalists,” he says. “We believe in capitalism. But if it’s going to survive, we have to make it work for more people. A lot more people.”

The city is still involved with help on the financing end of things and in return there is a twenty year deed restriction placed on the title of the property to ensure 80-100 percent of the units are rented to residents at the low end of the income scale.

Ethridge calls the effort “social impact capital,” and he says the Housing Impact Fund’s investors recognize that their investment can be both beneficial to society and profitable. “The nice thing about buying existing properties, unlike new construction, they cash flow the day you buy them,” Ethridge says. “So we will pay quarterly returns to our investors and we expect that cash flow to be relatively consistent.”

Labor Wedge

Some words or phrases latch onto you like thistles while walking through blooming prairie grasses. They tag onto your pant leg until you notice them and pluck them off for a closer look. Labor wedge has such a nice visual, a separation between what a model is predicting and the empirical data, I think that’s how it wedged its way into my thoughts.

It seems to be a fairly new macroeconomic term, defined at the start of a paper by Loukas Karabarbounis, University of Chicago, as:

Do fluctuations of the labor wedge, defined as the gap between the firm’s marginal product of labor (MPN) and the household’s marginal rate of substitution (MRS), reflect fluctuations of the gap between the MPN and the real wage or fluctuations of the gap between the real wage and the MRS? For many countries and most forcefully for the United States, fluctuations of the labor wedge predominantly reflect fluctuations of the gap between the real wage and the MRS.

https://www.nber.org/system/files/working_papers/w19015/w19015.pdf

At different time periods, American households have found it advantageous to substitute out paid work for something else. They preferred to spend their time, perhaps at home, performing valued activities for their families. Or perhaps the value was found in associational life of another nature. De Tocqueville said years ago that Americans are apt at associational life.

More interesting are the measuring questions. How do we categorize where people have the opportunity to perform duties which build capital for themselves and, most probably, their communities? Where are they exerting energies in lieu of showing up for a paycheck?

Sorting by their economic benefit seems sensible. If the ambitions fall under health related activities (staying out of the workforce to care for an aging parent) then the credit goes to pubic health. If education (during these Covid times people are staying out the workforce to supervise their children’s education) is the goal then shuffle those hours to the public education column of the ledger. If governance (people are choosing to spend their time on park boards or citizen commissions instead of working) is where the hours are spent, then register the tally under civics, and so on.

A better understanding of these motives and ventures will smooth out the prickly problem of labor wedges.

Arguments about work

“And what did you do all day?” He would ask as he came through the front door at about 6 o’clock. An inquiring look searched out his wife, while the follow-up phrase, “while I was out earning a paycheck to pay for this house, the food we are about to eat and the clothing for the kids,” was left hanging in the air, unsaid. Having returned to his home, he had not yet transitioned from the private nature of the workplace.

Through the 70’s and 80’s the notion of unpaid labor in the home was adjudicated many times over as marriages came apart. Terms like like spousal support, child support, alimony, pension obligations, all forced the issue that what she did all day could not be classified as leisure time. And carved out what we all knew: a worker in a home environment is a valuable component to the economic outcomes of the family.

By 1989 a formal accounting was given to the work done by homemakers, caregivers to the elderly and to children, and all those who exist in the realm of domesticity. Dale W. Jorgenson of Harvard and Barbara W Fraumeni wrote a paper that led to a measure of unpaid labor in the form of human capital, where it took up a spot in the national income accounting system. Jorgenson explains.

Barbara Fraumeni and I (1989) have proposed a measure of the output of education and training, namely, the increment to lifetime labor incomes. This accrues as current income to individuals who receive the education and training. Our approach has the important advantage of providing separate measures of output and input. The value of input into investment in education is equal to expenditures on education and the incomes of students in school. The value of output is equal to additions to lifetime labor incomes.

Human Capital and the National Accounts (bea.gov)

(Hang on, I’m getting to the good part)

In more current times Michael Christian has maintained the accounting of human capital in the US. Our very own Ellen McGrattan, with the Federal Reserve Bank of Minneapolis, collected her comments on Michael Christian’s 2010 paper on human capital accounting. From the abstract:

Michael Christian’s paper presents a human capital account for the United States for the period 1994 to 2006. The main findings are twofold. First, the total human capital stock is about three-quarters of a quadrillion dollars in 2006. This estimate is roughly 55 times gross domestic product (GDP) and 16 times the net stock of fixed assets plus consumer durables. His second finding is that the measures of gross investment in human capital are sensitive to alternative assumptions about enrollment patterns. In my comments, I emphasize the need for greater interaction between human capital accountants and applied economists. To date, there remains a disconnect between those measuring human wealth and those investigating its economic impact.

McGrattan isn’t satisfied with summing up a present value for the life-time work that could be performed by ‘non-market’ individuals, she would like more specifics on what actual economic outcomes will evolve from their work performance.

Perhaps what is needed is more focus on economic questions and less focus on the magnitudes of the human capital wealth estimates. Whether these estimates are based on current costs or on lifetime earnings, economists can construct the same statistics in their model economies as satellite accountants construct for actual data. Unfortunately, there still remains a great divide between those measuring human wealth and those investigating its economic impact.

I don’t want to put words in her mouth, but it seems like she would like the evaluation of this type of work to be centered around an economic objective. She goes onto reference a paper that she co-author with Edward Preston, Unmeasured Investment and the Puzzling US Boom in the 1990s. Although reading such a thing is more than a little intimidating, I was able to pickup that they measured a decrease in household labor and an increase in unpaid business labor which then lined up nicely to justify the business boom of the 90’s.

What are the common threads between business people who dig in and amp up their unpaid work into R&D which results in a business boom, and a homemaker who stays home to care for children? Both are doing work for a long term return, they are building capital for themselves, but also a larger group. Both are only able to perform because they are in a situation of opportunity. If they were to offer those work hours to someone else, it would be work for pay, and not at all the same thing.

I believe this is the type of framing Ellen McGrattan is requesting. She would like to see the study of unpaid work categorized, as we do here at home-economic.com by objective, and measured in that way. Rather than assume a measure based on a summation of remaining years of work life in concert with educational attainment.

Lean into the slope

Matthew Yglesias writes in his newsletter yesterday:

Defunding the police is a bad idea that, wisely, the voters and political system have rejected.

But it was so thoroughly successful as a slogan that a situation has emerged online in which a willingness to embrace it is widely seen as the key sign of one’s commitment to taking complaints about police misconduct seriously.

The reality is just the opposite.

True statement: the reality is just the opposite. As crime has increased this year, the need for resources devoted to public safety has increased, not decreased. The Minneapolis City Council didn’t get the memo. They are working off another economic model as they continue to entertain agendas which weaken the ability of the mayor, the police chief (who is now on a short list for a job in California) as well as the police force to do their job. MPR reports on January 15th.

The Minneapolis City Council on Friday took steps — again — toward trying to get a proposal on the ballot this year that would allow the city to replace its Police Department with a new public safety agency.

Their model appears to motivated by the need to subdue an ever present and ever impounding anger. The anger at the memory of, for example, the sound of thick soled heavily polished black shoes across the high gloss middle school floors, the glint off the handcuffs, the roughness of the shove as the uniform twists a best friend’s arm around and behind his back, before the jangle down the halls as the officer and youth depart through the heavy wood doors, to the back seat of the squad car.

Anger still simmering some three decades on. Like a clip on auto replay. A disturbing removal of a 12-13-14 year old from their place of learning. I have no doubt that every activist who seeks to dismantle the police, relives (and perhaps fosters) a simmering wrath against an established societal structure or symbol thereof.

Regardless of whether the activist’s personal case-by-case experience has merit, the model they pursue and the action it initiates will not result in productive outcomes. It is a model that seeks to break apart established norms, as opposed to working with them.


Yglesias seems confident that the greater group (it’s all about the group) does not follow the logic of diverting police funding to social workers, despite the catchy slogan. And as the cost of not being able to travel freely around the city without concern of being car jacked, or jumped to make a Venmo transfer, the public’s sympathy for those wronged by past interactions with the police appears to be waning.

Yet there is still a concern about errant police, as there should be. The inability of police chiefs to dismiss the truly bad apples, as Ygelsias calls them, the acceptance by the profession to let them back in, to reinstate them, has outsiders thinking outside intervention is necessary. We are right to step in when the police can’t police themselves!

Perhaps it’s time to step back, (further back) to take in a new view, to change-up the framing. Let’s start with some basics. 1. Police officers are no more good, or bad, than the general population. 2. Nor are they any more good or bad at evaluating themselves and their performance. Good. We’ve established that we are dealing with basically a decent group of people who show up for work with the intentions of doing their jobs. Since the pay isn’t great, we have to assume there is also some sort of personal sense of honor in the position.

The dicey work police officers do is risky not only because the threat of physical violence is undoubtedly present, but also because they are stepping into some social interaction gone awry. When they are called to a domestic dispute, they have to assess the conditions which led to an escalation in a marriage. When they are called to a corner drug deal, their survival can depend on assessing the players on the street. The police are called into restore safety to a highly charged marketplace of social interaction.

So is it surprising that this basically decent group of people will always choose the perspective of one of their own in that assessment? Or that they band in support of each other to the bitter end? They endure criticism and penalties at the hands of their black sheep members, yet on the whole they hold fast. That is how untrusting they are of an outside world assessment of their workplace situations.

And I wouldn’t assume a lack of methods to get the bad apples out of the barrel. Sometimes opportunities present themselves, and as a group, they find a way. Certainly that is true in other groups. Could more opportunities be made available for the black sheep of the group to be pushed out? Most probably. But that is an internal matter.

To be honest, I’ve read a lot of lists of horrible things the police have done, but you rarely hear of these as a percentage over the whole group. Or as a percentage of all the work tasks they perform. The only way to gauge the group is to take their numbers in that identity. Pulling out the one completely unacceptable incident as a representation of the profession is measuring oranges to apples.

When you start with the assumption that the group as a whole is as decent as the rest of us, it’s hard to get to “they are all inhumane idiots who are abusive beyond control.”

Years ago someone gave me some advice when I was learning to downhill ski. “Fear,” he said, “makes you want to sit back on your heals. But this is exactly what you don’t want to do. Lean down the hill, keeping your weight centered over your feet. That’s the way to tackle the slope.” The police need to lean into policing where most of the violent crime has been occurring. Despite resistance and lack of cooperation, they need to get those cases solved. To make believers and reliable partners out of a population who needs their support.

Common Currency

Humans have been sorting, measuring and trading for over 5000 years.

Standardized by shape and weight: 5,000 years ago, people used rings, bangles and axe blades as an early form of money.

The concept of fair or equal trade shows up 2500 years before ancient Greeks lean-in to put words to the consistencies of human existence. It was important enough for folks to hone skills to gauge the weight of a trading token.

The Dutch researchers examined more than 5,000 bars, axe blades, and rings from the period of 2150-1700 BC. The examined objects came from different archaeological sites, including in what is today South Germany, Austria, the Czech Republic, as well as North Germany and southern Scandinavia. They found not only single objects, but whole collections (hoards) of several hundred pieces.

It appears that in addition to having found the benefits of doux commerce, man of the Bronze Age was familiar with greed and hoarding. There are some constants in the world.

More on Moving

It’s old news that folks having been abandoning New York and San Francisco. Not surprisingly many of these coastal creatures are staying in the east or the west.

LEAVING NEW YORK CITY

Top destination cities for U-Haul customers leaving New York City during the pandemic include Bridgeport, Poughkeepsie and New Haven. Outside the Northeast, the top destination is Chicago in the Midwest and Atlanta in the South.

The top 10 states DIY movers from New York City are migrating to are: New York (outside NYC); New Jersey; Pennsylvania; Connecticut; Massachusetts; Virginia; Maryland; Florida; Rhode Island; and North Carolina.

LEAVING THE BAY AREA

Top destination cities for U-Haul customers leaving the Bay Area during the pandemic include the Sacramento/Roseville corridor, San Diego and Stockton. Outside of California, the top destinations are Reno, Las Vegas, Portland, Phoenix and Seattle.

The top 10 states DIY movers from the Bay Area customers are migrating to are: California (outside the Bay Area); Nevada; Arizona; Oregon; Washington; Colorado; Texas; Utah; Idaho; and New Mexico.

What’s nice to see is the middle of the country states filling out many of the spots in the top 20. A bunch have also moved up significantly in their standings.

4.Ohio (7)
7.Missouri (13)
11.Arkansas (23)
12.Indiana (9)
13.Wisconsin (41)
14.Oklahoma (14)
18.Kentucky (37)
20.Minnesota (15)
https://www.uhaul.com/Articles/About/22746/2020-Migration-Trends-U-Haul-Ranks-50-States-By-Migration-Growth/

First jobs

I wonder sometimes if the people who want to raise the minimum wage actually go on site and meet some of these workers and employers. They might be surprised to find situations other than the poor and the destitute. They might find new to the workforce people, and people who need a lot of flexibility, and people that drift in and out of jobs because that’s what they want to do. They might find people who are accepting the wage because they get something for it.

In each of these situations the employer is giving something in return. If you are new to the trade, you will need a lot of extra coaching and assistance. Your boss is ‘working’ extra hours in training or staying late or forgoing other responsibilities. A new to the workforce employees may need more understanding and leeway on other issues like sticking to a schedule and what to do when your car doesn’t start and how to handle notice for time away.

Flexible and short-term employment also causes a churn for employers who have the responsibility of maintaining all the HR administrative work. Yet many people I’ve know over the years, that do not qualify as destitute, have been willing to work those jobs because they are a temporary distraction, jobs they don’t have to think about, that can be ditched in a heartbeat.

I was hired for one of my first jobs due to family connections. Some might object to that, but a connection is a control string on the employee. Anything the dependent does reflects on the career officer, which puts in play strong incentives for adequate performance. When a connection is not available for that first job, employers may have to work a little harder at supervising until they are confident of the reliability of their new worker.

I could go on with examples, even if some are now taboo to talk about. I’m sure someone would frown if I pointed out that the language barriers create more work for employers. And certainly I’d be accused of the ‘r’ word if I pointed out that getting to know other folks’ culture whether about language, or sick time, or parental leave, would certainly be an adjustment versus hiring the neighbor’s kid whose father works for you.

We have to admit that this type of ‘social’ work exists, call it something, give it value, so we can enumerate it, and use it in fruitful discussions. But since there is a lack of accounting, there is no science to the discussion around minimum wage–there are just opinions. Predictions.

Until we call it out, and give a name to the work that must be done to shore up cultural and social issues; until we count the number of hours of work that goes into it, we won’t have the sophistication to deal with getting low wage workers up the economic ladder.

Pardon me, Yes? or No?

Have you ever noticed that there are yes jobs and no jobs? Attorneys are likely to say, “No, that’s too risky.” What would we do if all entrepreneurs listened to their accountants when they called up to say, “No, we can’t afford that!” Then there are processing types of jobs who like to say, “No, that’s not included in your policy.” Luckily there are visionaries that say, “Yes, let’s build a skyscraper!” And keep saying yes to all the naysayers as they wade through setbacks and plan approvals. And there are journalists that say, “Yes, we can meet the deadline for that story!” Then there are the killjoys, “No, no, no drag racing is not allowed, even if everyone is home on Covid lockdown.” But seriously, do you think Elon Musk says yes or no?

When you read something like this:

Online registration launched at noon but was disrupted within an hour as the website was overwhelmed with a peak of 10,000 hits per second. The site closed to new registrants at 2 p.m. in order to serve people stuck in a waiting queue, but in the end connected more than 5,000 people with vaccine appointments this Thursday through Saturday.

Seniors surge to Minnesota site to register for COVID vaccine – StarTribune.com

It feels like the vaccine distribution got assigned to the risk monitor, process types instead of the we-can-meet-that-deadline types. Give the right job to the right people.

Efficient to the X degree

In a Bloomberg article yesterday, Laura Millan Lombrana encouraged governments attending the United Nations climate talks to push oil and gas companies to fix methane leaks. Due to new satellite technology, which helps identify the location of the seepage, there is an economic efficiency argument to such action.

Methane emissions need to fall 70% over the next decade, a decline equivalent to eliminating CO₂ emissions from all cars and trucks across Asia, according to the report. Fixing methane leaks would be cost-effective for energy companies because the captured methane can be sold as natural gas. The cost of repairs and maintenance needed to capture methane can often be paid for by the value of the additional gas brought to the market. 

The new information (as to where the pipes are leaking) is one driver for action, but there is also the notion that the low emissions benchmark, set in the Covid year, offers up a new goal. This combination of information and technology coupled with motivation, made me think of Harvey Lieberman’s concept of “X”-Efficiency. He was a professor at Harvard and is best known for coining this concept. Here’s how he describes it in Allocative Efficiency vs. “X”-Efficiency.

Our primary concern is with the broader issue of allocative efficiency versus an initially undefined type of efficiency that we shall refer to as “X-efficiency.” The magnitude and nature of this type of efficiency is examined in Sections II and III. Although a major element of “X- efficiency” is motivation, it is not the only element, and hence the terms “motivation efficiency” or “incentive efficiency” have not been employed.

He identifies the possibility of meeting a higher efficiency with new motivations, usually in combination with other factors. In the Bloomberg article, the sense of urgency around climate change motivates the fixing of methane leaks.

The level of unit cost depends in some measure on the degree of X-efficiency, which in turn depends on the degree of competitive pressure, as well as on other motivational factors. The responses to such pressures, whether in the nature of effort, search, the utilization of new information, is a significant part of the residual in economic growth.

It’s hard to know for sure, but it sure seems like Leibenstein’s “X”-Efficiency refers to the efficiency attained in the blending of the public and private spheres.

In Dubious Battle- Steinbeck (1936)

After the first of the year, I wrapped up the novels I was reading and made a promiss to myself to be a little more selective. To only read high caliber writing. That’s how I came upon In Dubious Battle. I wasn’t aware of the buildup to an apple pickers’ strike until I was bending back the binding so the pages eased open in my hands. And strikes are turning out to be very good scenarios for expressions of the social economic side of the economy.

Take what Mac says here to Dr. Burton, who has been brought in to be on hand to mend any of the strikers who get caught up in a tussle. Mac’s trying to figure out why Burton keeps showing up when he doesn’t get paid, nor does he seem interested in the cause. In other words Mac can’t figure out the ambitions for what he refers to as ‘work’ when it falls neither in the private or public sphere.

“Yes, you. You’re not a Party man, but you work with all the time; you never get anything for it. I don’t know whether you believe in what we’re doing or not, you never say, you just work. I’ve been out with you be fore, and I’m not sure you believe in the cause at all.”

Dr. Burton laughed softly. “It would be hard to say. I could tell you some of the things I think; you might not like them. I’m pretty sure you wouldn’t like them.”

“Well, let’s hear them, anyway.”

“Well, you say I don’t believe in the cause. That’s like not believing in the moon. There ‘ve been communes be fore, and there will be again. But you people have an idea that if you can establish the thing, the job’ll be done. Nothing stops, Mac. If you were able to put an idea into effect tomorrow, it would start changing right away. Establish a commune, and the same gradual flux will continue.”

“Then you don’t think the cause is good?”

Burton sighed. “You see? We’re going to pile up on that old rock again. That’s why I don’t like to talk very often. Listen to me, Mac. My senses aren’t above reproach, but they’re all I have. I want to see the whole picture as nearly as I can. I don’t want to put on the blinders of ‘good’ and ‘bad,’ and limit my vision. If I used the term ‘good’ on a thing I’d lose my license to inspect it, because there might be bad in it. Don’t you see? I want to be able to look at the whole thing.”

Burton turns out to be a bit of a philosopher. He’s there putting in the work so he can understand the why of it all. He and I agree the flux will continue. That the whole pricing mechanism is always in motion, and for that reason time must be understood. He also is indifferent to the ‘good’ of it. He isn’t going to shuffle through the risks versus the rewards, he is there trying to understand the beams that turn the wheel and the flow of the water that pushes on the buckets.

In the following few pages Dr. Burton talks about group-men. “I watch these group-men, for they seem to me to be a new individual, not at all like a single man. A man in a group isn’t himself at all: he’s a cell in an organism that isn’t like him any more than the cells in your body are like you. I want to watch the group, and see what it’s like.”

I’m looking forward to reading what else Burton observes.

Home is your castle

A home is consider a private good–one that owned for one’s use and enjoyment. Its says so in the county recorders after all. It would follow that one could do whatever one wants with their home. Well almost.

That sidewalk, that runs along the street, you can’t block it. You have to let the neighbors walk their dogs and the kids to ride their bikes along it. And don’t be digging near any of the utilities that have easements across your lot to bring water, electric power and natural gas onto you property. If you wake up one morning (as in the photo) and there is a huge hole in your front yard, the city can do that too. The workers can dig down and see if your water connection to the street is leaking.

Ok- fine. The front yard has restrictions placed on it, but the backyard is all privately owed, to dig up and do what you wish with it. Not so fast. If you unearth an artifact from a native American tribe, it is not yours to keep. Despite being on your soil you maybe obliged to relinquish it for the public to enjoy and appreciate as part of their heritage.

But inside the house is all mine. Well, kind of. If you live in the state of MN than your spouse has rights to the home no matter if their name in on the title or not. Which isn’t a conflict, usually, as most couples jointly enjoy the fixtures attached to the land. It’s not like there is a penny slot to fill every time you toast a slice of bread, or the washer dryer is coin operated to divvy up the cost of its use. Couples and families use the features of a home in a public fashion, for all to enjoy.

So yes the home is primarily private to the person on the title. But there are all sorts of public interests that take a little nip out of ownership.

Some, like the utility companies, provide valuable, essential services. In fact the reliability of services, like high speed internet, can make an area more desirable. The reliability of a city to be responsive to snow removal and road maintenance can create increased interest in the neighborhoods they serve. Public utilities and city services are daily necessities, hence exhibit high impact. Whereas the likelihood of a pre-historic relic being dug up on a property is rare, and so, although the public has an interest, any practical impact is low.

These are just a few of the public interests in the very private investment of a home. There are many more besides the utility commissions, and the city utilities. There are a bunch of other public entities that make an appearance on your property tax bill. There are fees for police and firefighters, fees for school districts, fees for county services.

Your home is your castle. But your castle shares many commonplace interests with lots of other castles.

Inciting Violence?

MINNEAPOLIS (AP) — Some Minneapolis City Council members are preparing a new plan that seeks to replace the city’s police department in the wake of George Floyd’s death.

Phillipe Cunningham, Steve Fletcher and Jeremy Schroeder are working on a proposal to create a new public safety department that removes the police department as a standalone department from the city charter.

The three are still working on their plan and expect to release it by the end of January, the Star Tribune reported. It would require voter approval.

Cunningham told the newspaper that the proposal might place oversight of the new department on par with many other city departments, giving the council legislative authority while the mayor would retain executive authority.

Minneapolis council to try again with plan to replace police (apnews.com)

Quilting

My great-grandma stitched this quilt before I was born. My grandma said they would save up old coats, then cut them into squares, piece them, back them with flannel and pull the yarn ties through.

This all took place through long winters out on a farm in southwestern Minnesota, not far from St. James. One house to every 80 acres or so. There was more time than money (more cold and snow back then too) so this was how people passed the time.

What explains the continued popularity of quilting is harder to figure out. This site will connect you with 49 quilter guilds in the area, and I’m sure that accounts for only a fraction of the women (mostly women) who gather in homes or church basements to sew up their creations.

The financial incentives were shipped off to Asia long ago. So it makes you wonder whether some folks simply have to tinker and make stuff. If they don’t do it for money, they’ll do it for distraction as it brings them joy.

You have to have space for such things like workshops and studios. And if your tinkering is on metal and wood you’ll require a garage with a heater mounted from the ceiling in the corner. Did all those spaces where people bend metal and pound on things get shipped off too, eliminating a creative environment? Have we stop creating new better things for lack of workshops?

Radon Be Gone

The EPA has designated January as National Radon Awareness Month. “Test. Fix. Save a life.” is their tag line.

Those of us in the business of helping folks buy and sell homes, have been hearing about the health concerns emanating from radon seeping into homes for the past twenty years. In the first part of the 2000’s, health department officials encouraged buyers to test for radon at time of purchase. Radon was listed alongside a variety of other environmental concerns on the state of Minnesota mandatory seller’s disclosure.

Consumer response to radon did not match the government’s concern, and in 2014 the MN Radon Awareness Act went into effect. The variation in apprehension is best represented by the amount of space now dedicated to the topic in the seller’s disclosure. Lines 279-309 (2020 version) of the body of the disclosure speaks to radon alone–more lines than wells, septics, or any other topic. And two pages of information regarding the detection and harm of radon gas were tacked onto the end. Out of a twelve page disclosure virtually three pages, or one quarter of the document, is now devoted to radon (as opposed to foundations, or water penetration, or roofs).

The new disclosure established an industry standard which dictates the seller is obligated to mitigate a home which tests above the 4 cPi/L established by the EPA. It’s unclear if buyers request the install due to fear for their health, or because they don’t want to be the sucker-who-got-stuck-with-the-bill at a later date, when they go to sell.

Over the course of implementing tests and installations there have been some inconsistencies which have resulted in the need for a final arbitrator. For instance, a few years ago an inspector turned off the air exchange system that a seller had installed in his 1920’s home to enhance the heating and cooling functions. The EPA guidelines state that HVAC systems should be running as normal during the test. However, since this air exchanger was located in the attic (not in the basement) the inspector felt it was an extraneous appliance and turned it off.

The reading came in slightly over the benchmark of 4 cPi/L. As it had already been a contentious negotiation the seller refused any additional compensation. The buyer choose to use $1200 (compensation negotiated for a cracked clay chimney flu) on a radon mitigation system that would not be necessary had the exchanger been left running. They chose between fire safety and radon safety.

By early 2019 licensing of inspectors who perform radon testing was implemented to handle the inevitable variations in the use of the testing apparatus, including decisions regarding air exchangers. Since the MN Radon Awareness Act went into effect, a whole industry of inspectors (tests range from $180-$240) and mitigation installers (system installation ranging from $1000-$1800) as well as a bureaucracy to monitor and deal with complaints, has been established.

Background

The story the Minnesota Health Department has been stressing is that cancer is the leading cause of death in the state. But the leader is all cancers. Mortality rates for cancer vary within demographic groups, but generally, lung cancer makes up around 25% of cancer fatalities. Radon is called out as the second leading cause of lung cancer after cigarette smoking. What they don’t say is that radon is lumped in with second hand smoke and accounts for just 12% of the cases of lung cancer.

MN Leading Causes of Death, 2017DeathsRate***State Rank*U.S. Rate**
1. Cancer9,896146.836th152.5
2. Heart Disease8,230119.150th165.0
3. Accidents2,78844.638th49.4
4.  Alzheimer’s disease2,47434.923rd31.0
5. Chronic Lower Respiratory Disease2,46436.339th40.9
6. Stroke2,25032.640th37.6
7. Diabetes1,31219.336th (tie)21.5
8. Suicide78313.838th14.0
9. Flu/Pneumonia6979.948th14.3
10. Parkinson’s Disease67510.23rd8.4
Taken from the CDC’s website

Feel free to chime in if I’m doing my math wrong, but a quarter of all cancer cases is around 2500 (lung). Then twelve percent of that number is 2500 x .12 = 300. In other words, death due to radon isn’t even on this top ten chart. It accounts 38% of the souls that commit suicide.

From the keys on my calculator, I have death from radon registering in at no more than 5 per 100,000. Below this grouping of accidental deaths which make up 6% of all deaths (from MN Department of Health):

  • Falls (2.7%): 21.1 per 100,000 population
  • Accidental poisoning: (1.6%) 12.8 per 100,000 population
  • Motor vehicle (1.0%): 8.1 per 100,000 population

The average Minnesotan is four times more likely to die from a fall, twice as likely to be accidentally poisoned and slightly more likely to die in a car crash. The claim that more than 40% of homes in Minnesota are contaminating people’s lungs with radon gas and killing them is not jiving with consumers’ personal experiences.

Nationwide Agenda from the EPA

One has to assume that the MN Health Department is following a directive for radon procedures from the EPA’s national agenda. However the EPA offers not one article newer than 2003 on its website to validate research tying lung cancer to levels of radon in homes.

A paper from Korea, which looks at the topic using measures of radon in homes, was published in March of 2016 and is the most recent academic paper I could find. It too references almost exclusively research papers written prior to 2000. Ji Young Yoon et all (Department of Humanities and Social Medicine, Ajou University School of Medicine, Suwon, Korea) wrote “Indoor radon exposure and lung cancer: a review of ecological studies” which was published in The Annals of Occupation and Environmental Medicine. There had been no studies to date in their country. They found:

For Korea, we observed tremendous differences in indoor radon concentrations according to region and year of study, even within the same region. In correlation analysis, lung cancer incidence was not found to be higher in areas with high indoor radon concentrations in Korea.

Scanning the bio’s of the faculty at the College of Design at the UMN, not one cites an interest or expertise in radon. There seems to be a lack of interest in funding or pursuing this topic.

How can we be following guidance that doesn’t appear to have been updated or even reviewed in the last ten years?

That was then this is now

Furthermore there has been a dramatic decrease in lung cancer’s claim on lives.

The death rate from cancer in the US declined by 29% from 1991 to 2017, including a 2.2% drop from 2016 to 2017, the largest single-year drop ever recorded, according to annual statistics reporting from the American Cancer Society. The decline in deaths from lung cancer drove the record drop. Deaths fell from about 3% per year from 2008 – 2013 to 5% from 2013 – 2017 in men and from 2% to almost 4% in women. However, lung cancer is still the leading cause of cancer death.

American Cancer Society

The American Cancer Society estimates deaths from all lung cancer in MN in 2021 will come in at 1950. Twelve percent of this is 234.

Time has changed the circumstances but there has been no release, or at least, re-evaluation, of the protocol. It’s like everyone moved-on and no one told the bureaucrats. So they keep RADON at the top of their checklist of ‘to-do’s. Meanwhile a whole industry of inspectors, installers and licensing and compliance people are settling into a new market.

It’s that mindset that if, ‘We can save one life!’ Then it is all justified. Yet–if 2020 has taught any lessons it is, that even in lives, there are trade-offs.

Costs

In 2019 closed home sales in the 16 county greater metro area (Minneapolis Area Association of Realtors) came to just shy of 60,000 transactions. Take out new construction (10%) and townhomes (25%), and take out a few for opting out of radon testing assuming 36,000 test were performed. A radon test performed by a now licensed inspector averages $200. The (conservative) amount spent on radon testing in 2019 totals $7,200,000.

The MN Department of Health estimates that 40% of homes in MN will test over the benchmark set by the EPA as hazardous to one’s health, or 4 pCi/L. That would lead us to expect that 40% of the homes tested high and negotiated the installation of a radon mitigation system into their purchase. At an approximate average cost of $1200, that comes to a total expenditure for the state of MN to (36000 sales x .4 x $1200) $17,280,000.

Based on these numbers, Minnesotans spent nearly $24,480,000 on mitigating radon in 2019. The tag line from the ‘EPA Test. Fix. Save a life’ promotes an image of each install resulting in fewer deaths to cancer. But is that true?

The amount of money our metro community spent on radon is a flash in the pan compared to a state budget or even a (metro) county budget. But $24,480,000 for community associational groups, who are on the ground interfacing with those struggling with mental health and substance abuse, it is a pot of gold. And that’s where the money should be going. When a 70+ year old passes, it folds into the course of life. The impact of a father OD’ing, leaving young children behind, or the death if a youth, high on the latest street drug, will galvanize community effects that reverberate, even to the point of burning down a mile stretch of buildings.

Wouldn’t our communities be better off by spending that $24,480,000 on mental health to deter suicide? Wouldn’t this, for instance, help with community policing? I say yes.

Motivations and Spheres

The difficulty, of course, is that we can’t transfer the $24 mil from the radon pocket to the mental health pocket. Government used their ability to pressure a commercial endeavor to set up the radon industry. In fact, with the death rate for lung cancer dropping, it almost feels like the health officials are spurred onto be more aggressive. “We’re doing so well making widgets, lets make more!”

Unfortunately this is a business mindset, for work in the private sphere, one that seeks to expand and grow. The public good mindset is quite the opposite. Since the work in the public sphere is often performed to prevent something from happening–as in this case, to prevent lung cancer. Once that is accomplished, activities should cease, and resources reallocated to other demands of the public that now climb up to a higher priority.

In the meantime, the industry standard for radon testing, at time of a house purchase, has created paying jobs for inspectors and bureaucrats. Quite naturally, their motivation will be to support this new structure from a private point of view. It is not part of their employment to evaluate whether this the best use of societal funds. The inspectors and installers and continuing ed teachers and state licensures and public health workers will support the process because it pays the bills that support their families.

What happened to the feedback loop? Where in the system should there be a check to see if programs are on the right track? Feedback has been stifled because to criticize the noble cause of saving life has not tolerated.

What I am and what I’m not saying

I am not saying I have the expertise to validate or deny the tie of radon in homes to lung cancer.

I am pointing out that public health officials have struggled to get this issue to take traction in the public mind. I am saying that no research in the last fifteen years has validated our present path to safety (and one study has countered it). I am saying that an industry, in the private sphere, has sprung from these government actions, draining over $24,480,000/year from community funds for this issue. I am saying death rates from lung cancer have plummeted in the last ten years. I am saying there is no feedback loop to public officials to demand a review. I am saying it is no longer good enough to make one agenda and then push it through for a decade without any consideration that time alters all things.

For a generation there has been the activist approach in government. Select a cause; implement it nationwide; get the talking points out to all the communication outlets so it is heard in stereo; then never relent. I am saying that this is no longer good enough.

Back to tenements for the poor?

While the government will need to employ short-term measures to avoid a wave of displaced households, one major step toward resolving the underlying problems in the housing market would be repealing an obscure 22-year-old addition to the Housing Act of 1937, the Faircloth Amendment. Passed in an era when the reputation of housing projects was at a low, the amendment prohibits any net increase in public-housing units.

Opinion | Alexandria Ocasio-Cortez Knows How to Fix Housing – The New York Times (nytimes.com)

Ugh. When politicians are too young to remember the mistakes of the past.

MN comes in at #2 to raise a family

According to research by Wallet Hub, here are the top five states in order:

RankStateScore ‘Family Fun’ ‘Health & Safety’‘Education & Child Care’ ‘Affordability’ 
1Massachusetts60.889103621
2Minnesota60.571458115
3North Dakota60.103372141
4New York59.802216547
5Vermont59.164015274

Raising a healthy, stable family sometimes requires moving to a new state. And the reasons for moving are often similar: career transitions, better schools, financial challenges or a general desire to change settings. Wants and needs don’t always align in a particular state, though. For instance, a state might offer a low income-tax rate but have a subpar education system. However, families do not need to make these kinds of tradeoffs. They can avoid such problems by knowing which states offer the best combination of qualities that matter most to parents and their kids.

The column on the far right is title ‘Social Economics.’ The full report is here.

The Iron Lady- movie review

I’ve been a big fan of Meryl Streep ever since Sophie’s Choice (1982), but for some reason hadn’t gotten around to watching her portrayal of Prime Minister Margaret Thatcher in The Iron Lady (2012, directed by Phyllida Lloyd, a British film director and producer). It seemed like the perfect match-up for a Saturday night: the story of the first women to rise to the highest political office in the UK brought to life by a favorite actress.

Yet-I found this movie perplexing. The film opens with a batty old lady stumbling around a shop, buying a pint of milk. I could barely make out Meryl and was confused how this could be Thatcher, who putters anonymously along the streets of London. Getting wise to the technique of starting a story at the end of a life, and then filling in the important stuff in a retrospective, I sit back and wait.

And wait. Nearly half the film is about an elderly lady hallucinating about her kind and beloved husband. It’s a touching story, but not exactly what the most powerful woman of the western world in the twentieth century is known for. The message seemed to be that this woman had a supportive father as well as a devoted husband- lucky girl! That’s how she managed to enter the halls of power.

Even when the film gets around to her accomplishments, they leave out interesting details, like that she was a chemistry major. No information or encounters in her subsequent academic pursuits, or early years. We do discover her husband was a businessman and also a family man, but isn’t the story about her?

More often than not the portrayal of her career lands on the tragic- such as the scene where she is writing letters to the families of the servicemen who died in the Falklands War. No mention that the conflict was provoked by an Argentinian invasion on April 2nd, 1982, and was wrapped up with a decisive victory by June 17th. What does a girl have to do to get a little recognition?

An overt concentration on the loosing side of her political career continues through the whole film, from the riots following her proposal of a “community charge,” to the waning of political judgement after so many years in office, to the tears that spring to her eyes when she resigns. Yet the voice of her husband pipes in, “Chin up old girl.” There’s Denis with his unfaltering support.

This representation of Prime Minister Maggie Thatcher, the longest serving prime minister of her generation, blessed as a dementia patient so she doesn’t have to relive a faltering political career, is more than a little odd. Any female who started in a grocery store and rose to lead men, not listen to them, must have been– spellbinding.

It’s not even difficult to find her admirers. Check out the level of reverence in William F Buckley Jr’s voice as he introduces her in this clip from Firing Line. Meanwhile, she sits in her chair composed and alert, neither aloof nor nervous. Just present. This was 1977. Two years into being the leader of her party, and two years away from being elected to the top job.

It would have been far more interesting to tell the tale of how she discovered and cultivated her ability to captivate her male (and female) counterparts. Instead of showing how two men coach her into a new hair do and enhance her elocution skills (ho hum), how about the moments she went from awkward to confident, from nervous to calm, from hesitant to determined? How did she come to realize her je-ne-sais-quoi?

Meryl Streep took home the best actress Oscar for her performance. I just don’t think she was playing Maggie Thatcher.

Can we see some numbers, please?

Say an individual, Bob, is concerned about a public good, like the environment. He decides to make a new year’s resolution to do something about it. Over a two to three year period, he activates others in his industry to legislate a testing requirement that costs the consumers, say, $200 on average per transaction. Note that this organizing and petitioning and writing communications and attending meetings was all done outside of the pay-check sphere of life.

One of the objectors to the added commission-for-the-public-good points out that, other than providing information, the testing will not give rise to any tangible reductions in green house emissions. Bob and his cohorts respond that doing something is better than doing nothing. Is he right?

Now let’s say that instead of doing the testing one could give the $200 to the client to not use their personal vehicle for a month, or to not take an airplane trip. In both scenarios there would be a measurable and immediate impact on green house emissions. Given these choices, it’s fair to say that there are other ways to spend $200 which would result in a greater impact on the goal to reduce global warming.

Numbers must be run so the public has a means of comparison. While everyone is working on (lobbying for, debating in favor of) one idea, other more valuable ideas are neglected, omitted from the realm of public consideration. Even though no one received payment for their time, the capacity of a community to engage and respond was tapped. So despite Bob’s sincere interest in climate change, doing nothing is, in fact, better than advocating for an unsubstantiated claim.

Now let’s say Bob was particularly talented at organizing and galvanizing folks around a cause. And due to this success he continued to seek approval and status through this type of work. The impetus for action transforms to status seeking, increasing Bob’s private persona, versus the stated tangible impact to any group concern. Now, in an error of commission, a form of corruption, starts to germinate.

The answer is not to stop the Bobs of the world. Hardly. The intent of this blog is to encourage the meaningful enumeration of choices; to clarify the resources used as inputs and record the increases in public capacity and capital; the intent is to provide the information necessary to steer Bob’s ambitions to the most productive choices.

Dual Sphere Commerce

For as long as I can remember, my mom tackled an extensive Christmas mailing with mimeographed updates of our family’s progress printed on colored paper. My job was to fold and insert these single-spaced typed communications into elegant cards purchased from UNICEF.

The greeting cards provided a means for people to support the United Nations International Children’s Emergency Fund while purchasing a commodity. Girl Scout cookies blend this genre of multi-function purchase. And some large retailers, like Target, will donate a percent of the purchases to the school of the customers’ choice, distributing funds to public good providers in much the same way.

When a UNICEF ad appeared as I scrolled through my Facebook feed, I clicked to see what they were up to. Holiday cards are still a mainstay with 18 categories to filter through and hundreds of choices from there. But that’s not all. The site has an extensive offering gifts, jewelry, and so on.

They’ve stepped up their offerings but also their accounting of how much the purchaser will contribute towards the benefit of desperate children. For just shy of a hundred dollars the buyer receives a hand crafted ring, and prevents 54 children from contracting measles. In addition to laying out the the tally of how many lives will receive a health benefit, the site allows the buyer to meet the artist. These brief bio’s can further connect buyer and seller through other shared interests.

UNICEF is creating an Amazon of dual sphere commerce.

The Art of Mianzi

Americans might benefit from a greater understanding of the Chinese custom of saving face, or Mianzi.

The Chinese concept of “face” (aka 面子 or miànzi) refers to a cultural understanding of respect, honor and social standing. Actions or words that are disrespectful may cause somebody to “lose face” while gifts, awards and other respect-giving actions may “give face”.

For good or for bad, Americans’ preoccupation with being right and transparency, seems to have folks battling-it-out on every single issue. Calling people out in public. Pursuing them until they are fired. Demanding video to confirm or deny what did, or did not, happen.

There is more at risk than your own embarrassment when you act to loose face, those near you are affected as well. So they act accordingly.

Raising your voice with someone in public is strictly frowned upon. Causing a scene makes bystanders lose face through embarrassment suffered on your behalf. They may actually scurry away from the scene to save face! Even if you win whatever argument, you’ll lose as a whole.

Don’t misunderstand my allegiance to the individualism and pursuit of the truth facilitated by our democratic system. It’s just with a public health crisis impacting our economic activity, I’m wondering if there is something to learn from those who start all solutions from the communal vantage point. If, by allowing some people, or groups of people, a little slack in making the wrong decisions, we will move more quickly to plan B, C or D? By letting people save face we skip that time delay of digging-in to hold onto poorly conceived territory.

I sure don’t grasp the fine tuned logistics of Manzi. But the Chinese have a whole social capital structure in Guanxi-based corporate social capital tied into their business dealings. There is an understanding and acceptance that social transactions are a component of economic outcomes.

Allowing people to be wrong at times without a public airing seems to be a way to keep the whole machine purring gently. Can’t we just let some arguments die without an investigation? After all that’s how we live our lives. You’ll strike out as a parent if you berate your kid when he’s up to bat, and your marriage will be stinkier than the garbage that your husband forgot to pull to the curb if you make a scene out in front of the neighbors. We evaluate which battles to fight all the time.

Maybe saving face has a place on this side of the Pacific.

Probability title deed

In South Africa a start-up called Bitprop is helping with affordable housing by building and securing tenants for backyard rental units (in return for a percentage of the income stream from the rentals for a set number of years).

Our duties include locating investors, drawing up professional building plans, sourcing reliable local builders, and enforcing good environmental practices. Furthermore, we work with the homeowner to develop landlord, financial and entrepreneurial skills. 

How micro property development could transform townships in a big way | OUR FUTURE CITIES

It is estimated that 30 million people in South Africa do not have formal property titles to their homes. So a significant outcome of the process is securing a recordable claim to the property for the owner.

Bitprop works to “Enable micro property development at a macro scale”. We want to prove that previously ‘invisible’ property assets, which are not recognised by normative legal or financial institutions, can be developed into valuable investment opportunities. We do this by taking each homeowner that we work with through the process of securing their title deed.

How micro property development could transform townships in a big way | OUR FUTURE CITIES

The focus is on generating income from the renters. But property ownership does more for homeowners including incentivizing repairs and improvements. Perhaps, more importantly, the titling process enables people to buy and sell their property more freely should their circumstances warrant a change. If Bitprop is as successful as they wish to be, they will create a valuable public good.

Our dream is that we do this so well—because we have the commercial incentives to do it well because if we do, the risk in our property investment goes down—that we, on a voluntary, private basis, start mapping land, step by step, and then we get the council to acknowledge this as a low-cost, digital- and- technology-based title deed.

20 Minutes With: Carl Sammeli, C0-Founder of Bitprop | Barron’s

This is a story to follow.

WWF, Neocolonial?

The World Wildlife Fund is the largest conservation organization in the world. Born of the passions of the 60’s, it established a foothold in Kenya when the organization purchased 37,000 acres adjacent to Lake Nakuru in 1973.

Eco-tourism is a big player in Kenya’s GDP, coming in at close to 10%. Despite this economic success, decades of outside influence on the care and preservation of wildlife has some expressing tension around land use.

The conservancy, portrayed in this BBC clip, celebrates the initiatives of local ownership.

Nashulai Maasai Conservancy , is the first ever community led and managed Conservancy which has been created to on the borders of the Maasai Mara National Reserve . The conservancy has been established for wildlife conservation but the local community would also live within the area and share it with both wildlife and livestock . It is a mixed model Conservancy the first of its kind in Mara

The point to be made here is that what was an agreeable arrangement 47 years ago, two generations or so, may no longer have the same feel to it. At that time perhaps there was insufficient home-grown ability to manage the parks, and as the shared objective of wildlife preservation still appealed to all, it was advantageous to have outsiders come in and put everything in place.

What was appealing and profitable in a social, ecological and financial sense, a half a century ago, is showing some wear. Now that the outsiders are no longer needed, they are pirates. They are taking instead of giving. Time has changed the circumstances.

Hospitality

I have been a fan of Walter Russell Mead’s Yule Tide Blog since back when he wrote at The American Interest (now the American Purpose). His annual recap of the Christmas Story has something to offer both steadfast Christians as well as those simply curious about the faith and what it entails. Today’s entry starts:

The Christmas story suggests that we can somehow try to be loyal members of our nations, our families, our tribes—and to reach out to the broader human community of which we are also a part.

Just because we all belong to groups, doesn’t preclude us from reaching out to others. In fact there is a desire to do so. Yet a tension arises.

It’s a puzzle. Human beings need roots in a particular culture and family, and those roots shape them; at the same time, human beings have values (like freedom and democracy) and ideas (like the Pythagorean theorem and the laws of thermodynamics) that demand to be recognized as universal. We seem perpetually torn between “cosmopolitan” and “local” values: universal ideas and the customs of the country.

Importantly, within the faith there an obligation to welcome and help strangers.

We think of the trade-off between local identities and universal values as a modern problem, but it is deeply rooted in human experience. In the ancient world, where tribal and family affiliations were very strong, many cultures shared a strong belief in the moral duty of hospitality to strangers, whatever their tribe. Day-to-day life revolved around your own group of close associates, but the duty of hospitality required a willingness to look beyond these limits to recognize the common humanity and worth of all people.

And this is hardly unique to Christianity. The tradition of hospitality runs throughout Islam. Read adventurer Dervla Murphy‘s account of her solo bicycle trip from Ireland to India in 1963, as detailed in Full Tilt.

Her dedication reads: “To the peoples of Afghanistan and Pakistan with gratitude for their hospitality for their principles and with affection for those who befriended me.”

You can be true to your tribe, true to your group within your group, and still reach outside that structure for all sorts of interactions. Not only can this be true, it is the best form of social commerce. And not everyone has to play. This show-stopper-outrage that has controlled our dialogue, the one that holds up the one offending example, sidesteps the reality that a few bad apples (racists, sexists or otherwise horrible people) don’t monopolize the ability for the rest of us to extend a hand where they won’t.

One doesn’t have to practice in a faith community to believe in the goodness of human nature.

2020 is a Wrap!

This afternoon, as a lingering glow alights the World Trade Center and the lights go on at the Empire State Building, as the glimmers extinguish off the Hudson River, and the sun’s rays slide down New Jersey, Pennsylvania, Ohio, across the prairies, and silhouette the mountains of the West until finally slipping off the coast of California, Oregon and Washington, as the rays sink past Hawaii and into the Pacific, we say goodbye to 2020 with a wave. And a wish that we could give it a good kick in the petuti.

But this year allowed me to start this blog and I am very thankful for that. Readers have shown up in the hundreds, well over my expectations. I have relished every like and comment. Thanks so much for visiting.

The most popular article hands down was Is it so simple? A response to Nathaniel Rachman’s article in Persuasion allowed me to unabashedly promote the view that drives me to write this blog. These last three months have been devoted to laying some ground rules to how things work. There’s really no point to continue, if folks don’t see the definitions clearly of the economic nature of public and private transactions.

Since this is an economic philosophy I need to get around to tying it to material values, and I will get to such an accounting in due course. I could bring in the numbers, and show how they are assigned to forms of capital. But should people not accept the actors and the types of activity they do, all will be explained away, talked over. There will be references to cloaking and embedding and behavior.

For people to see the hard cash, they will have to see that private individuals employ time and resources to public endeavors everyday throughout; that governments are riddled with private transactions everyday throughout; that businesses develop goodwill on their balance sheets and accommodate labor demands everyday throughout; that associations are motivated by private ambitions while supporting the group’s goals everyday throughout. Until there is an acknowledgment of this type of dual structure–there is no point to assigning slices of material wealth to each and every activity.

Economics is not just represented with dollars. There are two natures to transactions. The value does show up in capital and dollars, most obviously when being externalized or internalize. Although-that moment is but a snapshot in time, a frozen price point, that could be simultaneously the result of the in-hand trade as well as the tapped capacity accumulated over generations. Hence the necessity to understand time.

For a generation, those who control the public purse have developed a party line, with nationwide control of talking points. They’ve developed an activist type of one issue dominance, with the devastating inability to see subtle trade-offs. They’ve basically obliterated the concept of varying degrees of importance. Covid has made this glaringly obvious.

So happily ring in the New Year! And ring out the old ways, while keeping an open mind to the new.

Cool gadgets for the home

There were a handful of gadgets clients talked about this year that are worth mentioning. (note: I don’t mean to endorse any one model–there are several choices in all cases.)

Garage Door Sensors: Ever leave on a road trip and worry that you left your garage door gapping ajar? Now your smart garage door opener will notify you, and allow you to close it en route.

Control, secure and monitor your garage door from anywhere and receive real-time notifications when your garage door is opening or closing.

You can also have it on a timer to always close by a certain hour of the evening. Super handy especially if you can’t see your garage door from a window view in your home.

Security Cameras: Little nubby camera heads have been around for a number of years but either the price point has dropped or folks are more comfortable with the technology, as they’ve become much more prevalent. They sit inconspicuously on the fireplace mantle with the thick candles or amongst the books on the wall of bookcases. Many have both audio and video capabilities.

Thermostats: Most homeowners don’t replace their thermostat until their furnace dies, which on average is every 15-17 years, so you might not know of the progress made in their construction. Wi-fi enabled thermostats allow you to track your homes temperature from afar, warming it back up as you arrive at the airport, for instance, after a long trip to the beach. One agent told me that when her in-laws visit they always crank up the heat. With her new thermostat, she just hops on her phone and resets the temp (so much for being nice to the baby sitters!). The monthly reports of energy tracking and usage are also very popular.

Lighting: You no longer have to stumble around in that back storage room or wish you had undermount lights in your kitchen. There are many LED lighting options which are bright and convenient to install. No more florescent glass tubes, no more undermount lights heating up your cabinets. One variety comes on a rope with an adhesive backing for easy installation. Ceiling mount LED’s are flat as there is no additional casing. You can light up your place or tone it down.

Keeping your garage door closed and lights on is the best way to promote safety in your neighborhood. Maintaining low temperatures in your home when you are away will save energy. Each of these gadgets are small steps towards better use of natural resources, and a more safe and secure home.

Primer Podcast for Affordable Housing

Lots of great topics covered in this Econ Talk podcast with Katherine Levine Einstein. Russ Roberts and the assistant professor of Political Science at Boston University tackle the obstacles developers face in building higher density homes, as well as affordable housing units.

Katherine explains that the title of her new book, Neighborhood Defenders, comes from the notion that people who show up at city council meetings feel they are speaking on behalf of their neighborhood; they view themselves as representatives of that public.

So, first on the motivation side, the term NIMBY implies sort of a selfish motivation. It implies, Not In My Backyard, a very individually motivated view. And, in our research, we actually find that the folks who show up to oppose the construction of new housing often view themselves as representing their community’s interests and are motivated by protecting their neighborhood, their surroundings. Right? So, their motivations are not so individualistic.

The conversation flushes out the reality that people who have time to devote to the work of public affairs do not necessarily reflect the width and breath of the constituency. In fact there are noticeable groups missing from these planning and approval meetings. As Russ says:

So, talk about that tension between the idea behind saying ‘a public hearing.’ Wouldn’t you want a public–I mean: Let the public be heard. And yet it’s not really the public.

Groups are further delineated in the failure of the California legislature to approve SB 50 which would have streamlined the approval process for developers. It seems that the environmental folks found common ground with NIMBY’s.

So, one set of interests, which doesn’t surprise anyone, would be opposed to something like this is communities like Beverly Hills. Like, very privileged places with lots of white homeowners who are strongly opposed to the construction of new housing. So, those folks were like, ‘No, we do not want to have fourplexes all over the place here.’ So, they were a natural oppositional constituency.

But, other groups also came out in opposition. So, Sierra Club and a few other environmental groups were strongly opposed because they thought this would lead to the degredation of sort of existing green spaces.

And, that I think, and this is the oppositional group that was to me most interesting, is sort of left-leaning tenants’ rights organizations and some of the socialists organizations in California that are quite powerful, especially in Los Angeles and San Francisco.

Those groups worried that this up-zoning would actually lead to gentrification. If we think about areas in Los Angeles that are near transit stops, that many of those are less -privileged areas with larger Latin X or black populations. And, that those were places that might face development pressures, and, you know, the construction of new luxury housing, should zoning codes be relaxed.

And, so those really diverse constituencies all came together. Both times they killed SB-27 and they essentially killed SB-50 as well.

As they pull apart the thorny issues around community support for affordable housing, they not only talk groups, interests and work, but also how the public’s impact on timeframes have economic consequences.

Usually it would take like three to six months, I assume, to build a grocery store–I don’t know, maybe. But, for some reason it takes forever. And, of course the answer is, ‘They didn’t get the permit yet. They’re working on it.’ But, talk about–these things, some of them are ten years. And, after the 10 years, they get a building of four units down to three. But these are often 90 units of affordable housing were planned and they end up with, like, 40, ten years later.

In addition to these public sphere definitions and mechanics, they talk externalities and corruption. Well worth a listen!

Ski Trip-Park City-Review

The overall rating for our Christmas trip to Park City was five out of five stars.

Travel and logistics: There are multiple daily flights from MSP to SLC, accommodating early risers or those who want to tick out the very last minutes of the day. The front desk at the Marriot recommended Four Seasons Concierge Service (approx $75/person round trip including stop time at Wal-Mart) to haul the four of us, and all the equipment, the 40 min drive up to Park City. We no longer have any desire to drive on icy, unfamiliar roads and use whatever bus or car service is available. This one was excellent.

Lodging and Food: Marriott Mountainside offers villas which are two bedroom suites with a kitchen and living area. So we cooked-in most all meals. Our driver pulled into Walmart parking (conveniently right on the way), where an employee loaded a week’s worth of groceries into the back of the suburban. By ordering on-line the day before departure, our groceries were ready to be picked up, all confirmed by text message. Definitely a Covid lesson I will repeat. There was only one additional stop for groceries the whole week.

Marriott Mountainside is right on the hill. You walk past the pool and hot tub with your gear, pop into your skis and slide down into the lift line. This frees up the time normally spent stomping out to an early morning bus ride up to the ski area. Park City Mountain is the largest resort in the US, but more importantly for us were the number and quality of blue runs. Skiing on a 4-out-of-5-day pass ($415/adult) we had plenty of terrain to keep us busy. Lift lines were a little long, but thanks to Covid, a reservation system kept the numbers in check.

Since we had such easy access to the room, we took a break for lunch every day. We did go into town for a nice steak dinner one evening. Prime Steak and Piano Bar lived up to its on-line accolades both for food and ambiance. You wouldn’t be able to get out of there without spending $300 (us more) for four. We felt it was well worth the money. The live vocals and piano music were particularly welcome this year.

The Town: Silver mines brought people and wealth to the area starting as early as 1868. So there are a fair number of preserved historic buildings. Main street is filled with what you would expect in a resort town: restaurants (said to have over 200), galleries, merch shops, snow wear and gear.


Weather: Average temps in December and January are between 13-32 degrees. This year the snow cover was sparse–for guaranteed depth it is best to arrive mid-January. The climate is dry which allows the snow to remain powdery despite the warmer temps. It was sunny four out of the six days.

Gifts and Gratitude

Credit due to an unknown source

There are a lot of exhausted moms out there on Christmas day. What accounts for the value they find in gift giving? To bring joy and a little material well being to your kids is within the realm of comprehension. But what about all those other gifts?

Business people see something in the cards with lots of scrolls that go out to clients, thanking them this time of year. Showing gratitude is over and above any monetary payment, even if there is a business angle to the effort to nurture their contacts.

Figuring out who makes the list is an accounting of sorts. Your very best customers may get a holiday wreath along with the message of good cheer. Teachers may receive gift cards to Caribou Coffee, whereas uncles and aunts step up to Pendleton socks and scented candles, but your secret santa pick warrants an outright custom purchase.

A gift is, by definition, something that is given with no expectation of return. Yet thankfulness is often a notion in the gift giving tradition. It’s a recognition that there is somebody out there thinking about you. Being thankful affords you a moment of recognition for all those loose and untimed interactions that structure a more pleasant life, including perhaps the $15-and-under gift put before you.

Instead of rolling your eyes when you pull back the tissue paper hiding the token of appreciation in the little gift bag, consider what type of gratitude is wrapped up in it. The gesture asks you to take the time to think and remember when that cousin picked you up after hours from the bars, or Aunt Bee was at home on that below zero day when you were locked out of your home, or how the mailman put your package in a shelter spot on the front porch.

Appreciation allows you to gauge different levels of merit. A fine tuning of need, something that seems to be sorely lacking in some of our large institutions. Gratitude is an important player in the ballgame of human interactions, right up there with empathy or greed. It is one to cultivate.

For Christians today is a day of thankfulness for the birth of Christ, the Savior. The lessons of gratitude and thankfulness are carried out through gift giving. All the others who are simply setting up a tree with presents all around are still listing out their sets of priorities. In this way they benefit from this lesson, believer or non-believer. That’s something to be thankful for.

To all of you–Merry Christmas and good night!

Book Club

One of the benefits of raising a child is that you get to follow them through their interests and endeavors. My college sophomore was required to tackle two novels for his class on colonialism: The Poor Man’s Son and God’s Bits of Wood. Feraoun is the product of French Algeria and Ousame is from Senegal, part of Afrique Occidental Francaise (AOF) until 1958. Both tell stories of the struggles of their countrymen and women during the era of New Imperialism.

Unlike the conversation of today, both authors describe many more groups than the simple division of colonial power and the colonized, of oppressor and oppressed, or of those who take what is not theirs and those who are left without. How exactly the goods, services and resources are shared and divided between all the players is a preoccupation for both men.

Details such as, 180 francs– the amount of Feraoun’s scholarship to Ecole Primere Superieure, and 100 francs–the amount he turns around and sends back to his family in Kabylia. Then there is 25 francs and a container of barley–the amount that shows his family’s extreme financial distress. And 600 francs–the amount the headmaster hands over to allow him to continue his education.

Both authors detail workplace struggles. Feraoun’s father leaves for a time to be a laborer in Paris. When a workplace accident lands him in the hospital he is able, after two attempts, to secure a settlement of $3000 francs along with a quarterly stipend. Ousame describes the 1947 railroad worker strike with specifics on pensions and wage scales and family benefits.

There is a counting amongst the women as well in the home life of the railroad workers. There is the rice that the local grocer is forbidden to sell them, and a fight with the french soldiers over a leg of mutton. Feraoun finds his financial obligations to his northern Algerian family growing as his sisters’ husbands leave them for greener pastures. He counts thirteen dependents on his teacher’s salary.

There are many groupings in these stories; there are the workers, and the women, and the missionary, and the soldiers, and the french educators, and the French who show up to help with the strike, and the elders who feel disregarded–all pulling in many different directions for people’s time, talent, and assets.

It’s as if these authors are trying to sort through two spheres of economic activity, particularly set in contrast by private affairs and public affairs, by looking after the individual and being obliged to the family, as well as by outsiders and insiders. And the good and the bad make an appearance in every cluster.

Without a doubt, the richness of these detailed accounts of choices is far more interesting than the conversations of today.

Book danger!

Some think Little House on the Prairie should be off school shelves. Yes, the toothy girl in braids bounding across the prairie and runny amuck with Nellie is surreptitiously misguiding your child’s thoughts about life in the Midwest 150 years go. Thoughts of self-reliance and hard work will only have a negative influence on your child. Although fiction, the books are used as education–and they are not accurate!!!

Seriously TPT?

Doing Laundry–Real Estate Edition

The November 2020 tally of Realtor members of the National Association of Realtors totaled 1,460,397, making it the largest trade association in the U.S. There are just shy of 21,500 Realtors in Minnesota alone. The group is nonpartisan with a stated “mission … to empower REALTORS® as they preserve, protect and advance the right to real property for all.”

Maintaining property rights, so that their clients can buy and sell homes and investments, is an unwavering shared value amongst this group. Not only because it facilitates their clients’ and in turn their own private interests, but also because stagnant unproductive real estate becomes a drain on public interests in the form of crime, blight, and inefficient use of public infrastructure.

The good and the bad of it is that once you build an open and reliable system, everyone wants to use it–including the criminals.

Globally, real estate is one of the “laundromats” of choice for criminals seeking to legitimize their ill-gotten funds. Using shell companies and other shady venues, they annually funnel more than $1.6 trillion into real estate investments around the world. Despite federal efforts to crack down on the illegal transactions in the United States, money launderers continue paying top-dollar for purchases, driving up real estate prices in many cities. 

NAR and other housing groups are urging Congress to stem the tide of dirty money by passing effective anti-money-laundering legislation. The organization is also launching an education campaign to help Realtors® identify the risks to their businesses and use best practices to protect themselves against liability.

MN Realtor

More dollars chasing real estate means higher prices. Since a pricing system is dynamic and interdependent throughout an entire network, it means higher prices across the market, not just in apartment buildings or the venue of choice for foreign or domestic racketeers. So we could say that money launders are externalizing unaffordability to lower income homeowners, while internalizing the benefits of our property rights institution–including the work done by NAR and its members.

Wouldn’t it be interesting to know the tranche of the value that illegal activity adds to the price of a home, apartment or investment property? Even if it were only an estimate. Across a metropolitan area this maybe a small amount say half a percent, or around $1500 on the Twin Cities’ median priced home. Barely perceptible with all the other costs and expenses involved in a home.

But if the criminals did their business primarily in one neighborhood, (a neighborhood where people don’t have time to wonder why a property is left vacant, nor know where to file a complaint for snow covered sidewalks) their stake could have an outsized impact. It is in these locations that a large number of REIT’s and creatively named groups tend to appear, especially since the recession of 2009. If a large sell-off of their position swung pricing, say ten percent, it would have a destabilizing effect, especially if that neighborhood was already experiencing a variety of negative externalities.

Note the groups. There is the overall housing group of buyers and sellers (personal or investors) who are buying real estate to be used as places to live. The pricing system is a reflection of the value property commands as places of residence. The criminals are not participating in that market. They bring money into the market because it is reliable environment to launder their funds. While the criminals internalize this as profits, first time buyers in the large group can no longer afford to buy a home.

The presence of washermen (and women) in the marketplace also necessitates an increase in the stream of funding used to subsidize those of the larger group who are unable to provide for their own housing. It would be useful to know some of these numbers. Knowing the financial drain of the money launderers on our real estate market tells us how much the Justice Department can spend to pursue and capture these ne’re-do-wells. This is the housing justice we need to see happen.

Photo of the day: Minneapolis City Hall

Home to the Minneapolis City Council

The building, located at 350 South Fifth Street, is an example of Richardsonian Romanesque architecture. The design is based upon Henry Hobson Richardson‘s Allegheny County Courthouse in Pittsburgh, Pennsylvania. Washington School, the first schoolhouse in Minneapolis west of the Mississippi River, was demolished to make way for the new building. Groundbreaking took place in 1889, and the cornerstone was laid (a story off the ground) in 1891. Construction did not officially end until 1906, although the structural exterior was essentially complete by the end of 1895. The county began moving in to its side (4th Ave.) in November 1895, while the city (3rd Ave.) side was not occupied until December 1902. Cost was about $3,554,000, which works out to 28¢ per cubic foot ($10/m³).

Minneapolis City Hall – Wikipedia

Home after Covid

Lots of folks are speculating about what the world will look like once people emerge from the Covid induced hibernation. Zoom, Teams and other internet mediums have shown how it is possible to run companies and services remotely. But will people use this flexible employment opportunity and choose to live elsewhere?

One way to consider this is to look at why people moved before Covid-19. Porch.com is a home remodeling site and tracks this information. On average people relocate every seven years, and people don’t take it lightly. As Porch explains:

Moving is a hassle. From boxing up one home to finding another, facing a move can feel like scaling Mount Everest. It’s no wonder Americans have been moving at decreasing rates since the 1980s. In fact, the moving rate in America reached its lowest in 2018 since 1948, when the U.S. Census Bureau began tracking moving rates.

Buyers diligently write out a list of wants and needs when they start their home search. Some of these criteria change of the course of evaluating all the amenities that different areas have to offer. One in four (on Porch’s sample of 1000) said that more space was the greatest driver for a move. Realtor Magazine broke the other reasons down by percentages:

  • Desire for a larger home: 26%
  • Desire to own, not rent: 19%
  • Downsizing: 12%
  • New job or job transfer: 11%
  • Desire for a better neighborhood: 9%
  • Separating from a significant other: 6%
  • Establishing own household (e.g. moved out of parents’ house): 6%
  • Desire to be closer to family: 5%
  • Desire for a shorter commute: 5%

Only 5 percent (said) they made a decision based on commute times. A job relocation prompts a greater response. Still–few buyers consider distance from employment as a significant determinant. Perhaps we should consider how many types of jobs are really affected by the ability to dial-in from a home office?

Anyone involved in the construction or maintenance of built structures (plumbers, sheet-rocker, bull doze drivers, HVAC contractors) will always drive to job sites. Then you have all the service providers who interact face-to-face and hence are tied to location such as k-12 school teachers and administrators, nurses and hospital staff, lab workers. People who build stuff like workers in a production plant are also anchored by their workplace location.

That leaves white collar jobs such as attorneys, accountants, mortgage underwriters, IT workers, architects, engineers and actuaries. Many of these jobs have already provided opportunities for their workers to work remotely. And as some of these jobs grow to include management and partnership opportunities, it is less clear that the full-time remote option would be available. A transition to more of a business ownership role would require better proximity to clients and/or employees.

I speculate that remote work won’t send homeowners off to new locations as much as their home’s floor plan. With more time spent at home, the functionality of their living space comes sharply into focus. Many will decide they need more space. Or it maybe the issue of how the space is distributed. An accountant might be fine with spending one day a week wedged in a cinder block space in the basement laundry room of a 50’s rambler, but becoming a full-time home office worker will demand a more comfortable office with appropriate buffers from family life.

This should make We Work types of built-place solutions more popular, especially in neighborhoods with smaller homes which are more difficult to expand due to limited lot sizes. Suburban neighborhoods may have more elbow room, but residents here may feel overwhelmed with the increased together-time. Whereas suburbanites used to enjoy their anonymity, perhaps this will diminish when a bunch of them no longer depart to their other lives across town. Those who seek the old sense of distance and privacy may shift out to the third tier suburbs and beyond.

Maybe the post-Covid environment won’t be about people moving away from their present communities as much as employers reaching across the country into a larger pool of talent. There will be community upsides to more folks working from home as well. Keeping people out of cars and airplanes will give back more time for family work, free up roads from congestion, and reduce pollution. Overall the great work-from-home experiment of 2020 will contribute to increased productivity in both the private and public spheres.