New Geography

Author: Tory Gattis

  • Houston’s Not Resilient? Really?

    Alert reader Jessie sent me this article about Houston ranking "very low" on a "resilience capacity index".  For real.  I was dumbfounded too. And now I’m going to post out-of-character and get a little snippy…

    Let’s skip right past the parade of articles and data showing Houston and Texas weathering the great recession better than just about everywhere else in the country.  It’s so strong Rick Perry might win the Republican presidential nomination based on it.  That alone should make them question their entire methodology.  Go back to the dot-com and Enron crashes, and you’ll find the same minimal impact.  Sounds like we’re pretty resilient to me.

    Then there’s their explicit declaration that it represents the ability of a city to weather the shock of a major storm or flood.  I’ll point to both Tropical Storm Allison and Hurricane Ike.  Both were devastating – yet we bounced back relatively quickly from each one.  You might note on their map that New Orleans ranks higher than Houston, yet Hurricane Katrina knocked New Orleans on its back for years.  Maybe they need to add a "levees upkeep" variable to the index?

    Let’s look at some of the problematic variables that make up the index:

    • Economic diversification: I’ll admit there’s some value here, but it’s also worth noting that some of the wealthiest and most successful cities in the country built that success around one strong, dominant industry: NYC and finance, DC and govt, SF/SV and tech, Houston and energy, etc.
    • Income equality: also a proxy for "we don’t have any high-paying industries" – nor the corresponding tax base.  How is this helpful for resilience? (more on the value of income disparity here)
    • Educational attainment, being out of poverty, and home ownership: a proxy for using tight zoning and land-use regulation to keep out apartments, new and affordable housing, and immigrants.
    • Metropolitan Stability: aka "stagnation".  Cities that aren’t growing have amazingly stable populations because nobody wants to move there and none of the residents can sell their houses.

    My cynical side thinks that, since the University of Buffalo put this out, they intentionally chose variables that made Buffalo look good, even though it’s one of the most stagnant metro economies in the country.

    All in all one of the worst designed indexes I’ve ever seen – and there are some doozies out there.

    OK, I feel better.  End venting (and snippyness).

    Read more from Tory at HoustonStrategies.com.

  • Attracting National and Global Tourists to Houston

    PWC ranked Houston #11 *in the world* for business, life, and innovation – a really amazingly high ranking when you think about it.  Here’s what they said:

    Best : #2 in cost of owning business space, entrepreneurial environment and life satisfaction, #3 in commute time and cost of living  

    Worst : Last in foreign job-creating investment and international tourists  

    Details: Houstonians love Houston. So do US business owners. The rest of the world … not so much. With lax zoning laws and plentiful space, Houston’s low cost of living and doing business is a dream for American businesses and middle class workers, but the rest of the world pretends as though the city doesn’t exist. The city has fewer international tourists than any other comparable global city.

    That sparked an interesting debate started over at HAIF on how to improve Houston’s tourism, especially for foreign visitors.  This has always been a tough issue for Houston.  We just don’t get tourism proportionate to our global economic standing, and out-of-sight is out-of-mind.  But what would a realistic strategy possibly be?

    • Out family-fun Orlando?
    • Out weather California?
    • Out beach Florida or Hawaii?
    • Out culture New York?
    • Out museum DC or New York?
    • Out gamble/adult-fun Las Vegas? (or South Beach?)
    • Out ski Denver or Salt Lake City?
    • Out history New Orleans, Boston, Savannah or Charleston? (or even San Antonio)

    See what I mean?  People choose vacation locations for specific reasons, and the winners are pretty damn dominant.  We’re stuck as a local/regional “big city” tourism destination like Chicago is for the midwest and Atlanta is for the southeast, with our share of great museums, restaurants, shopping, and a few attractions – but not enough to pull people from across the country – much less the world – to vacation here.  Our one niche exception – something with some global pull – has been NASA JSC and Space Center Houston, but who knows what the future is there.
    Here’s a long-shot proposal I made a few years ago on my blog, one that would build on the NASA niche:

    Finally, Houston needs to upgrade its tourism experience. All great, world-class cities offer a compelling tourism experience, even if only for a short trip. Even with NASA, the Galleria, and solid museum and theater districts, this has been one of Houston’s most glaring weaknesses, and one that has kept us off the radar for educated, well-traveled professionals. Again, the light rail network and some vibrant pedestrian districts will help greatly, but we really need one powerful, anchor “mega-attraction” that will actually draw people to Houston for at least a long weekend. One niche where I think Houston could be distinctive would be the world’s largest engineering and technology museum – something along the lines of DC’s National Air & Space Museum, Munich’s Deutsches Museum, and Chicago’s Museum of Science and Industry. It could even be one of the Smithsonian’s network of National Museums, which have started to move out beyond Washington DC (Design in NYC, Industrial History planned for Pittsburgh). Think of it as Houston’s version of Paris’ Louvre or London’s British Museum. The combination with Space Center Houston could create a national draw, not to mention a wonderful source of educational and career inspiration for our youth. As far as sites, 109 acres just became available at the end of the light rail line with the closing of Astroworld – not to mention the old Astrodome – both easily accessible to downtown and Reliant Park conventioneers. Any well-heeled philanthropists out there?

    Done on a large enough scale, I could see it attracting not just the usual tourists, but multi-day student group field trips from all over like Space Camp does in Huntsville or the Smithsonian complex in DC – inspiring a new generation of scientists and engineers.  It should not just focus on history, but articulate the great engineering and technology challenges we face going forward.  It would be a big, bold, expensive gamble – but could be just the ticket to move us up to the next level in tourism and international recognition.

  • Giving the “New Houston Metro” Credit Where it’s Due

    Tuesday, the Houston Metropolitan Transit Authority (Metro) held a blogger luncheon with senior Metro people (Chairman, CEO, board members, managers) at the Rail Operations Center south of Reliant.  It was an informative event with a lot of good two-way Q&A.  And it included an impressive tour of the facility, which, btw, is not air conditioned in the main maintenance bay.  Let’s just say it was the right time of year for a tour and I’m really glad I don’t work there in the summer.  The facility is doing its job though: Metro claims to have the highest operational uptime for rail cars in the country.

    Sometimes in my push for increasing commuter bus services and cutting back rail, I fail to give credit to a lot of good work that is going on at the “New Metro”:
    a few issues for our collective consideration:

    • They really are a lot more open and transparent, and are really trying to do the right things.  
    • There’s been a lot to clean-up, and they’ve done a good job (although CEO Grenias says it will take another 2-3 years to completely turn around the organization).  
    • They’ve also done a good job continuing to reach out and create collaborative agreements to provide commuter bus services outside of their service area (like Baytown and Pearland).
    • They’ve fixed the poorly performing Airport Direct service, price and route-wise.
    • They shifted to a cash basis for the General Mobility Program instead of increasing debt.
    • They fixed their broken relationship with the FTA.

    There was a lot of good talk about improving express commuter bus services to TMC, Greenway, and, most importantly, Uptown.  I pitched them on expanded HOV/HOT lanes (like the 610 Loop) and laptop trays and wifi on the commuter buses, which are under consideration.  They have a very high percentage of downtown commuters – 30-40% – and claim a pretty high number for TMC – 20-30% – but that includes people who park in Smithlands and ride the rail, which I don’t consider a true commuter solution (it’s not doing anything to reduce freeway congestion).

    Ultimately, they’re trapped by the voter referendum and the federal money process to keep pursuing a rail plan (and line prioritization) that really doesn’t make a lot of sense given the new fiscal reality since the referendum was passed.  It will make even less sense if the Republican House guts rail funding.  But at least they’re taking steps to “firewall” the rail plan financially so it doesn’t end up stealing from critical local and commuter bus operations.  I may not agree with the overall strategic direction of the agency, but they do have good people doing good work within the constraints of the game they’re forced to play.

    This post originally appeared at houstonstrategies.com

  • The Real Answer to Houston’s Traffic Congestion

    The Houston Chronicle editorial board recently argued that light rail is key to combating Houston’s traffic congestion problems. But if you look at the three cities with worse traffic congestion than Houston – DC, Chicago, and LA – they have much more transit, including tons of light rail in LA. Transit clearly hasn’t solved the problem in these cities. These people aren’t stuck in that traffic because they like it – it’s because the transit doesn’t go where they need to go or isn’t timely. This is especially true with the rise of dispersed job centers in those cities where the trains don’t go or don’t provide good connectivity to the suburbs where people live.  Let’s see, in Houston we have downtown (<7% of jobs), uptown/Galleria, the med center, Greenway, Greenspoint, the Energy Corridor, Ship Channel, and NASA – among others.  If that’s not a dispersed set of job centers poorly suited to rail connectivity, then I don’t know what is.

    It’s absurd to argue a light rail network focused inside the 610 Loop is going to do anything to relieve congestion or provide relief to commuters from the vast suburbs outside the loop.  The solution is not doubling down on our multi-billion dollar LRT network, but instead scaling it back (University line only, IMHO) and instead spending the funds on a radical increase in express bus commuter services connecting all suburbs to all job centers with frequent nonstop 60+ mph transit using high-speed HOV/HOT lanes.  Imagine driving to your local suburban transit center (which might just be a mall parking lot) and finding regular, frequent express buses (of all sizes) serving every major job center in Houston.  These buses could have amenities like wifi and laptop trays.  They might even be run by private operators (with subsidized fares) competing on routes, schedule, reliability, service, and amenities.  And after they get to the job center, they can circulate to get you right to your building – no long walks in heat, cold, or rain.  Finally, all of this is a single-seat service without annoying and time-consuming transfers from bus-to-rail or rail-to-bus (or even rail-to-rail).

    It’s a much more practical solution for a city like Houston, but one that requires innovating ‘outside the box’ as a transit agency rather than parroting the “more rail” mantra that every other transit agency in the country repeats endlessly.

    For more details, see these two previous posts:

    This post originally appeared at Houston Strategies.

  • Krugman’s Muddled Argument Against Texas

    Last week NYT columnist and economist Paul Krugman wrote a very popular column pointing to Texas’ revenue shortfall and declaring it an example of the failure of conservative government.  I found the whole piece a muddled mess and dismissed it, but you can’t believe the notes I’ve gotten from people requesting a response.

    The thing is, I don’t really get his point. The bad national economy was going to cut state revenues no matter what. Is he saying we’d be better off if we had a fat government with easy cuts, instead of a lean government with tough cuts?  How much sense does that make?

    The nice thing about delaying my response is that others have already made great cases against the column (saving me the work).  Kevin Williams at the National Review is a bit sarcastic for my tastes, but makes several great points – the main ones being:

    • there’s no such thing as a shortfall in Texas, since we use zero-based budgeting (i.e. we start from nothing building every budget with no assumptions from prior years), and
    • our unemployment rate, which is better than the national average, is even more impressive when you consider our huge population gains and the jobs we’ve had to provide just to keep up with it.

    Bill Watkins here at New Geography also lays into Krugman’s fuzzy thinking:

    “People are not as stupid as many Nobel Prize winners might think; they move for opportunity, not just for cheap houses or low-paid work.”

    Then he comes up with a great new acronym:

    “A business moves to or expands in a region based on a whole host of reasons. These include available infrastructure, resource availability, market size and location, labor supply and costs, worker productivity, facilities costs, transportation costs, and other costs. Those other costs include what I call DURT (Delay, Uncertainty, Regulation, and Taxes).”

    Conveniently, the Wall Street Journal made the case for Texas’ growth and opportunity the next day:

    WSJ.com – Opinion: The Great Lone Star Migration

    Today one out of 12 Americans lives in Texas—the same proportion that lived in New York City in 1930.

    …Finally there is Texas. In 1930 there were (rounded off) six million people in the Lone Star State versus 13 million in New York. In 1970 there were 11 million in Texas and 18 million in New York: Each had grown by about five million. But in 2010 there were 25 million in Texas and 19 million in New York.

    Back in the 1930-70 period, liberal political scientists hoped and expected that America would become less like Texas and more like New York, with bigger government, higher taxes and more unions. In one important respect—the abolition of legally enforced racial segregation—that has happened. But otherwise Americans have been voting with their feet for the Texas model, with its low tax rates, light regulation and openness to new businesses and enterprises.

    Today one out of 12 Americans lives in Texas—the same proportion that lived in New York City in 1930. Metropolitan Dallas and metropolitan Houston, with about six million people each, threaten to overtake our fourth largest metro area, San Francisco Bay (population about seven million), in the next decade.

    That doesn’t seem to be much of an indictment of Texas’ approach to governance…

    That’s not to say the next budget is going to be easy.  A lot of hard tradeoffs will have to be made.  But it’s pretty clear Texas is a very far cry from being a failed state.

  • Drew Carey and John Stossel Tell Cleveland to Learn From Houston

    What started as a humble video segment for Reason TV has mushroomed into a lot of positive PR for Houston (and less than positive for Cleveland).  It started with famous actor and comedian Drew Carey working with the libertarian Reason Foundation on a video series about saving Cleveland, his hometown.  Houston is held up as a “best practice” example for land use regulation.  There are lots of suggestions and positive comparisons to Houston on red tape (minutes 29:20 thru 32), zoning (37:30), and opportunity (47:50). Yours truly has a short cameo at 38:55. (If you want to be able to jump around, the trick is to start playing it, then hit Pause. You’ll see the grey loading indicator continue to download the video. Come back later after it’s fully loaded and you’ll be able to jump to any point you like.)
    After the series was released to the internet and Forbes declared Cleveland the Most Miserable City in America, John Stossel at FOX Business News picked it up.  A friend of mine loaned me a DVD of the 45 minute show (thanks Nolte), but I haven’t been able to find it online.  There are shorter segments about it here and here.  The first one jumps right into talking about Houston 16 seconds in, and the second one jumps into Houston around 40 seconds and 58 seconds in.  The Cleveland newspaper writes about the show here.
    Unfortunately, one of the professors he has on the show to present the other side brings up another one of those Houston myths that just won’t die: that you can build anything next to anything, including a strip club next to a day care center or school.  No, we have narrow nuisance and SOB regulations to prevent that.   We also have private deed restrictions. You don’t have to prescriptively control everything to prevent the worst-case scenarios.
    Then Bill O’Reilly picks up the story in an interview with Stossel (hat tip to Jessie):

    STOSSEL: People go to where the weather is good. We already have…

    O’REILLY: Well, you can’t blame the city for the weather. I mean, look at Chicago. Great city, bad weather. Boston, come on. You can’t blame the city for the weather.
    STOSSEL: You can rank them for that. And you can blame the politicians for saying we’re going to raise taxes to build our wonderful projects, and that’s going to make things better. The cities that prosper like Houston are the cities that have fewer rules and lower taxes.
    O’REILLY: But remember Houston used to be the crime capital? They cleaned that place up pretty well.
    STOSSEL: But Cleveland has 22 zoning categories. Houston has none.
    O’REILLY: Twenty-two zoning categories? Very hard.
    STOSSEL: In Cleveland, to start a business, a politician bragged, “We could get you in there in just 18 months.” In Houston, one day.
    O’REILLY: One day? The problem with no zoning is you can have, you know, the No-Tell Motel right next to you. And…
    STOSSEL: You could. But that rarely happens. And it’s not an ugly city, Houston.
    O’REILLY: No, I didn’t say it was ugly. Who said it was ugly?
    STOSSEL: Lots of people. No zoning. The city planner said it will be ugly. You will have…
    O’REILLY: We have a lot of Houstonians watching “The Factor,” and I love going to Houston. All right. There you are, the Forbes magazine list, and Stossel laying it down.

    We’ve come a long way.  Five or ten years ago, you couldn’t find many people – including libertarians – that were willing to hold Houston up as a land-use model in public because our reputation was so bad.  But now they do, and it’s (slowly) changing our national reputation for the better.

    This post originally appeared at HoustonStrategies.com

  • What Houston can learn from the Israeli model to boost entrepreneurship

    While Houston is not a Silicon Valley, or even an Austin, it has come a long way in cultivating a small but vibrant entrepreneurial scene in the last decade. But there’s always room for improvement, and we might be able to learn some lessons from Israel, of all places. First, there is this conclusion from an Economist article on the mostly-sad story of government strategies for cultivating entrepreneurship:

    The country that has led the world in promoting entrepreneurship has also done the most to plug itself into global markets. The Israeli government’s venture-capital fund, which was founded in 1992 with $100m of public money, was designed to attract foreign venture capital and, just as importantly, expertise. The government let foreigners decide what to invest in, and then stumped up a hefty share of the money required. Foreign venture capital poured into the country, high-tech companies boomed, domestic venture capitalists learned from their foreign counterparts and the government felt able to sell off the fund after just five years.

    Last year Israel, a country of just over 7m people, attracted as much venture capital as France and Germany combined. Israel has more start-ups per head than any other country (a total of 3,850, or one for every 1,844 Israelis), and more companies listed on the NASDAQ exchange, a hub for fledgling technology firms, than China and India combined. It may not have the same comforting ring as “the Swedish model” or “the polder model”, but when it comes to promoting entrepreneurship, “the Israeli model” is the one to emulate.

    What’s Israel’s ‘secret sauce’? This book review from Newsweek lays it out:

    How does Israel—with fewer people than the state of New Jersey, no natural resources, and hostile nations all around—produce more tech companies listed on the NASDAQ than all of Europe, Japan, South Korea, India, and China combined? How does Israel attract, per person, 30 times as much venture capital as Europe and more than twice the flow to American companies? How does it produce, for its size, the most cutting-edge technology startups in the world?

    There are many components to the answer, but one of the most central and surprising is the Israeli military’s role in breaking down hierarchies and—serendipitously—becoming a boot camp for new tech entrepreneurs.

    While students in other countries are preoccupied with deciding which college to attend, Israeli high-school seniors are readying themselves for military service—three years for men, two for women—and jockeying to be chosen by elite units in the Israeli military, known as the Israel Defense Forces, or IDF.

    I goes on to detail the elements of the military culture there that carry over into the entrepreneurial world: innovation, improvisation, flat, anti-hierarchical, informal, flexible, multi-disciplinary, diversity, challenging, meritocratic, and intense ‘crucible leadership experiences’ to forge deep social bonds and networks that are later leveraged to create startups.

    Now obviously Houston (or Texas or the U.S.) won’t be instituting mandatory military service anytime soon. But could we form a local civilian corps of high school and pre-college youth to create a similar environment, focused on tough social problems and charitable work. If we modeled the corps on Israel’s military culture, and made sure to craft the experience to be very attractive to college admissions departments, there’s a lot of potential here to attract youth, work on some of the city’s toughest problems, and cultivate a generation of entrepreneurs to add economic vibrancy to our city for decades to come. Oh, and we could match them up with older philanthropists and retirees to provide both funding and mentorship.

    Combine that with new sources of local venture capital, and we could really turbocharge the local startup scene. I’d love to hear your thoughts on how we might structure such a corps and the problems it might work on in the comments.

  • How the new Apple iPad (and other mobile tech) changes the commuting equation

    Apple’s much anticipated iPad tablet computer was announced today, albeit to some mixed reviews. While the iPad itself may or may not succeed, the overall technology trend line is clear: increasingly rich mobile access to the Internet and email. Oddly, this Business Week columnist thinks the iPad may lead to more telecommuting, when what it really favors is tipping the balance for commuters from driving to transit, where the usually “dead” commuting time can become really productive. Most people are already spending more than two hours a day on email and the Internet – why not put those hours at the beginning and end of the day while commuting so you can spend less time in the office and more time with your family?

    A decade ago, the workplace was much more call and voice-mail driven, which matched up just fine with long driving commutes and cell phones. But the shift has moved strongly towards email and other data-driven communications (texting, Twitter, Facebook, collaboration applications, etc.). Most messages have multiple recipients and can expect to have a string of replies – something voice mail simply can’t handle. People are trying to do this data-driven communication while driving, with very bad effects that are leading rapidly to a comprehensive legal ban.

    As more people realize the productivity advantage of a transit commute, I think there could be a substantial shift. But it might not be quite what you’d expect. Mobile productivity favors one long ride in a comfortable seat – no transfers, no standing ‘strap-hanging’ (like on a subway or full light rail or local bus), and minimal walking (which is not only incompatible with mobile productivity, but also has weather risk and is especially hard on women in heels). That argues for express buses over trains. I recently met with a friend that lives in Manhattan but works in Connecticut. Does he take the subway and then ride the train? Nope – a luxury shuttle bus with wi-fi picks him (and the other Manhattan employees) up right near his apartment and drops him at the front door of work. Point-to-point express buses are the future of commuting. All you need are a couple dozen people that need to get from the same neighborhood to the same job cluster on roughly a similar schedule to justify a daily round trip – and they can all be productive the whole way, whether through individual 3G data connections on their devices or wi-fi on the bus (by far the cheapest option).

    While the climate-concerned may cheer increased transit use, an ironic side effect may actually be increased sprawl. When commuting is truly unproductive time, as driving is, people really hesitate for it to be more than an hour a day, which puts a pretty hard limit on how far home can be from work. But if you can be productive on a bus doing work you’d have to do anyway, you might consider two or more hours a day commuting (as my Manhattan friend does) and look at exurban communities you wouldn’t have even considered before, especially if they have more affordable or newer houses with better amenities and public schools.

    This is the commute of the future, and cities that offer it conveniently, affordably, and comprehensively (all neighborhoods to all job centers) through some combination of public transit, private buses, and HOT lanes will continue to grow and thrive in the coming decades, while those that don’t, won’t.

    This piece is a cross-post from HoustonStrategies.com

  • The Essence and Future of Texas vs. California

    I know there have been a lot of articles and references to Texas vs. California recently in this blog, but, well, there’s a new one with some genuinely new contributions to the argument ("America’s Future: California vs. Texas", Trends magazine, hat tip to Jeff). And it says some nice things about Houston too, so how can I pass on it? The beginning of the article is here – including an overview of both states’ situations – but here are some key additional excerpts:

    …Both the Brookings Institution and Forbes Magazine studied America’s cities and rated them for how well they create new jobs. All of America’s top five job-creating cities were in Texas. It’s more than purely economics and regulation can explain, though. Texas – and Houston in particular – has a broad mix of Hispanics, whites, Asians, and blacks with virtually no racial problems. Texas welcomes new people and exemplifies genuine tolerance. When Hurricane Katrina hit, Houston took in 100,000 people. Not surprisingly, Houston has more foreign consulates than any American city other than New York and Los Angeles.
    …
    But, how did this happen? What’s wrong with California, and what’s right with Texas? It really comes down to four fundamental differences in the value systems embodied in these states:

    First, Texans on average believe in laissez-faire markets with an emphasis on individual responsibility. Since the ’80s, California’s policy-makers have favored central planning solutions and a reliance on a government social safety net. This unrelenting commitment to big government has led to a huge tax burden and triggered a mass exodus of jobs. The Trends Editors examined the resulting migration in “Voting with Our Feet,” in the April 2008 issue of Trends.

    Second, Californians have largely treated environmentalism as a “religious sacrament” rather than as one component among many in maximizing people’s quality of life. As we explained in “The Road Ahead for Housing,” in the June 2009 issue of Trends, environmentally-based land-use restriction centered in California played a huge role in inflating the recent housing bubble. Similarly, an unwillingness to manage ecology proactively for man’s benefit has been behind the recent epidemic of wildfires.

    Third, California has placed “ethnic diversity” above “assimilation,” while Texas has done the opposite. “Identity politics” has created psychological ghettos that have prevented many of California’s diverse ethnic groups and subcultures from integrating fully into the mainstream. Texas, on the other hand, has proactively encouraged all the state’s residents to join the mainstream.

    Fourth, beyond taxes, diversity, and the environment, Texas has focused on streamlining the regulatory and litigation burden on its residents. Meanwhile, California’s government has attempted to use regulation and litigation to transfer wealth from its creators to various special-interest constituencies.

    They go on to make six forecasts:

    1. …expect to see California’s loss of jobs to Nevada accelerate…
    2. …expect to see a backlash in California and across the country against regulations, especially green initiatives that can’t clearly demonstrate a positive ROI…
    3. Watch for the smart money, including venture capital, to begin migrating to Texas for start-ups in many areas, including energy, info-tech, manufacturing, and biotech. Just as Delaware’s tax laws once encouraged numerous businesses to incorporate there, even when they had no connection to the state, Texas will become a magnet for new businesses by offering cheap land, a favorable regulatory environment, a business-friendly culture, and a large supply of skilled labor. Unless California revamps dramatically, expect to see its economy languish, even as the recovery takes off.
    4. To make its business climate even more business-friendly, Texas will invest heavily in secondary education and work hard to attract the best talent to its research universities (note the recent Tier 1 proposition and funding). Keep an eye especially on the University of Texas, which already has a first-rate campus and faculty. Within 10 years, UT, as the locals call it, may well rival Stanford or Berkeley.
    5. Other states will adopt tort reform measures pioneered in Texas. Unlike California and most other states, Texas has been aggressive in minimizing the enormous burden of frivolous lawsuits…
    6. Look to Texas to become a cutting-edge cultural mecca. Houston has always offered a vibrant cultural scene, ever since the Alley theater company was founded there in 1947 by Nina Eloise Whittington Vance. In the 1950s, John and Dominique de Menil moved to Houston with one of the most significant private collections of art in the world and began donating art and money to the Houston Museum of Fine Arts. Both institutions have grown to world-class status since then. In the coming years, this trend will spread to the major cities of Texas (take that, Dallas!), attracting the best talent and money and shifting the cultural balance of the nation away from New York and San Francisco.

    I can personally vouch for #5. I was just visiting my brother out in CA, and a friend of his with a small store was being hit with a large disability discrimination lawsuit for a minor oversight (handicapped parking was marked on the ground and had the requisite walkways and ramps, but lacked a pole sign). Evidently this has become a cottage industry in California, where lawyers guide the disabled through stores looking for very minor violations of a vague law (things like high shelves or tables), then sue (expecting a quick settlement, of course). Under CA law, discrimination guilt is assumed if there’s anything in the store the disabled can’t do that a normal customer can do, regardless of the availability of employees to provide assistance. His friend was clearly exasperated with the unwinnable situation. Just plain nuts.

    As Jim Goode says, "You might give some serious thought to thanking your lucky stars you’re in Texas."

  • Why the feds should stay out of high-speed rail (and most transportation)

    Set aside for a minute whether high-speed rail (HSR) makes sense or not on a cost-benefit basis. Regardless of whether it does or not (and some smart people are arguing not), I’d like to make the argument that federal funding has no place in HSR. Instead, it should be left to individual states or regional state coalitions.

    The federally-funded interstate system was originally conceived for defense purposes – rapid mobilization – after Ike saw the German autobahns. Freight and people movement were obvious beneficiaries, over short, medium, and long distances. It is a comprehensive network that crosses state lines, which argues for federal involvement. The government made the minimal investment it had to make – road beds – and people/companies paid for vehicles and fuel. Fuel was taxed to pay for it all. If EZ-tag technology had been available at the time, I suspect they would have tolled it all instead to pay for it.

    Airports followed a similar arrangement: government provides the landing strips and terminals while private companies provide the vehicles and fuel. Passenger ticket taxes pay for the infrastructure. As airports are a local decision, they are (mostly) paid for locally, although regulated federally for standardization and safety.

    HSR is targeted at medium distances only, making it more of a state/regional decision (i.e. a small collection of states). It also requires huge subsidies, as the government provides the track, cars, and energy. There is nothing directly related that can be taxed to pay for it (like fuel taxes for roads and passenger ticket taxes for airports). You could try to tax the rail tickets, but if they were fully priced they would not attract nearly enough riders. So no matter how you slice it, in the end the government (i.e. taxpayers) will be paying the majority of the cost of moving each passenger. The infrastructure cost cannot be covered by direct user fees, as demonstrated in other countries.

    Rather than compare HSR to the interstate highway system, the better analogy would be airports. Imagine if California said, “Feds, give us money to build a few airports in key CA cities and provide a subsidized government-run airline to provide frequent intra-state service where tickets are priced way below cost.” Put that way, people would recognize the idea as absurd, and tell California to do it themselves if they think it’s such a good idea.

    The problem is that a simple program that made sense at the time – a federal gas tax to build an interstate highway system – has evolved into a Frankenstein monster of massive federal involvement in enlarged urban freeways, local rail transit, and now high-speed rail – areas where they simply do not belong. Local transportation planners have shifted decision making from “What are the best cost-benefit investments we can make to move people in our area?” to “How to do we grab our ‘fair’ share of the federal pie, regardless of whether or not the project is something we would consider with our own money?” And that is leading to a lot of boondoggles being built around the country, culminating recently in the famous Bridge to Nowhere in Alaska.

    The answer? The feds need to get out of the transportation business beyond minimal maintenance of the interstate highway system (the basic four lanes – not the expanded urban freeways). Let local entities make local decisions on transportation investments, including funding, and a whole lot of waste will magically disappear.

    This post originally appeared at Houston Strategies.