Monthly Archives: February 2011

Telling graphs about American infrastructure spending

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A number of commentators in recent years have pointed out the relatively small amount of spending on infrastructure by the American government. Here is another take on this, complete with some handy graphs. Additionally, here is some interpretation about government spending on education and technology:

Productivity-enhancing spending, according to Meeker, comes from three main sources: infrastructure, education and research and development investment. We’ve seen infrastructure spending collapse as a share of the budget since the 1960s. What about education and R&D?

In 1970, the U.S. (at the federal, state and local level) spent twice as much on education as health care. Twenty years later, health care closed the gap, and today, total government spending on health care is about 33 percent higher than education spending, which is more or less even with its 1970s levels.

Second, look at technology. R&D spending exploded in the late 1950s and 1960s on the back of government investments in aeronautics and science. Fifty years later, federal R&D has fallen below 1950s levels as a share of GDP, while the private sector has picked up the slack.

So after looking at figures like this, I want to ask what kind of strategies could be utilized to tackle the issue of infrastructure spending, particularly with budget issues looming all over the country?

Racial makeup of some (read: one) suburbs being changed by foreclosures

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The suburbs are growing increasingly diverse (evidence here, here, here, and here). And this news story shows that foreclosures in the Detroit area may be helping minorities move to suburbia:

The foreclosure crisis made it possible…

Many of the foreclosed upon Southfield [Michigan] homes were going for $40,000 to $60,000. The median home value dropped from more than $190,000 to below $130,000 over the same period, according to Census figures.

With so many empty houses available, rents also dipped by hundreds of dollars. Renters increased from about 13,100 in 2006 to 15,400 in 2009.

The lure of low prices to Detroiters was obvious — as was the likelihood that their arrival would not be without issues.

“Blacks, like all Americans, want good schools and a safe community, and they can find that in the suburbs,” says Richard Schragger, who teaches local government and urban law at the University of Virginia…

Two things irritates me about this story. First, it seems to be based entirely on some anecdotal evidence from Southfield, Michigan. Is what is described in this article taking place in other metropolitan regions? The story provides little insight beyond this one Michigan community.

Second, the headline seems to highlight foreclosures but the real story seems to be about what happens when poorer Blacks move into the suburbs. The article says the result of this may be that more middle- and upper-class Blacks will continue to move to more far-flung suburbs. Should we conclude that foreclosures in certain areas are actually good for some people or do they change communities too much? The original headline, “Foreclosures helping change color of some suburbs,” is more ambivalent but when the AP story gets repeated in other sources, such as the Daily Herald, the headline changes: in the web edition, the headline is “Foreclosures accelerating changes in suburbs,” while the print edition has the headline “Foreclosures changing the suburbs.” The story says little beyond the Detroit area and yet the new headlines suggest foreclosures are leading to these specific changes throughout all (or most) American suburbs.

The location of the actual “Tally’s Corner” is revealed

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Tally’s Corner is a classic ethnographic work:

It’s a remarkable book, an academic work – it grew out of Liebow’s doctoral thesis – that isn’t dry or boring. It’s an in-depth look at a group of men who routinely hung out on a Washington street corner in the early 1960s. These are poor men, flawed men, unemployed and underemployed men. But they are treated with respect. And although Liebow used pseudonyms, giving the men such names as Tally, Sea Cat, Richard and Leroy, they come across as flesh-and-blood individuals. When “Tally’s Corner” was published in 1967, the New York Times called it “a valuable and even surprising triumph.” The late senator Daniel Patrick Moynihan (D-N.Y.) called it “nothing short of brilliant.”…

“Tally’s Corner” remains in print, has been translated into multiple languages, and has sold more than a million copies, an amazing feat for an anthropological text.

But there has been some confusion over the years about where exactly Elliott Liebow interacted with the men who were the focus of his study:

According to many sources, it was Ninth and P streets NW. Except Answer Man happens to know it wasn’t…

Liebow picked a location that would be easy to get to from his office and his home in Brookland: 11th and M streets NW in Shaw, a corner that had a carryout, liquor store, dry cleaner and shoe-repair shop. This is the first time the exact location has been revealed. “I feel free to say that because it’s no longer that street corner,” Harriet told Answer Man. “The carryout’s gone. That whole world is gone from that street corner.

It is often the case that ethnographic works conceal the location of the study as well as the identity of the participants. And it sounds like the location was only revealed now because the area has changed so much that no individuals or businesses could be identified at that corner.

I’ve had discussions with people about the exact location of ethnographic works, as if the location was some mystery that needed to be solved. The authors sometimes do a better job to conceal the location that others – it can often take quite a consistent effort. I feel like I have read some studies that try to use vague terms like “a liberal-arts college in the Midwest” but then later give enough clues (unintentionally?) for the reader to figure it out.

“Five myths about the suburbs”

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From a writer whose first book was titled Bomb the Suburbs (first released in 1994), this might seem like an unusual column title: “Five myths about the suburbs.” But William Upski Wimsatt goes on to lay out five common misperceptions regarding American suburbs:

1. Suburbs are white, middle-class enclaves…

2. Suburbs aren’t cool…

3. Suburbs are a product of the free market…

4. Suburbs are politically conservative…

5. Suburbanites don’t care about the environment…

The first three points in particular line up with research about suburbs: they are government-subsidized communities (highways, mortgages, etc.) that have growing minority and poorer populations as well as increasing cultural opportunities. The last two points might be more contentious: the suburbs are not just conservative though they went conservative in the 2010 elections (see Joel Kotkin’s opinion here). I’ve also seen other analyses suggesting that exurbs, far-flung suburbs, are quite conservative so perhaps they are balanced out by more Democratic-leaning inner-ring suburbs. About environmentalism and going green, there are still seem to be plenty of people who think the suburbs are not green enough (see an example here) or perhaps can never truly be good for the environment.

Wimsatt’s conclusion is also interesting:

Everyone with a prejudice against the suburbs will have to get over it. Even me.

He seems to be suggesting that the suburbs aren’t as bad as some people once thought (and there is a long history of suburban critique). Perhaps this is an honest sharing of a revelation, perhaps it is simply prompted by the fact that a majority of Americans live in the suburbs and this is where the action is taking place.

Hard numbers

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As I’ve mentioned before (including yesterday), everybody seems to be beating up the legal job market these days.  The American Bar Association apparently decided that it was time to inject some actual numbers into the discussion:

[Most prior discussion has] been based in great part on the tools of journalism: anecdote, instinct and the oft-competing wisdom of any experts we can find.

With this issue, however, the ABA Journal is offering our readers a new—and we believe different—view of the business and the profession.

We’ve teamed up with a nationally recognized expert on trends in the legal profession, William D. Henderson of the Center on the Global Legal Profession at Indiana University’s Maurer School of Law. We asked Henderson, a pioneer in the empirical study of the legal industry, to identify and map the movements of jobs and money.

There’s a separate page that allows county-by-county data searching.

Here’s the thing:  based on my look at the publicly available U.S. Bureau of Labor Statistics data, underlying the ABA’s “report”, I’m not quite sure what the ABA has added to the discussion here.  Sure, they’ve generated some colorful graphs and county-by-county maps.  But as far as I can tell, all (and I do mean all) of this data has been around since at least May 14, 2010.  And it’s not like the ABA has done much analysis here; they’ve basically just sorted the size of salaries out by metro region and announced a few “surprises”.

Even more problematically, I’m not sure there are many clear takeaways due to the inherent shortcomings of this data.  Per the bottom of the article’s main page:

The [U.S. Bureau of Labor Statistics] data are a representative sample of employed lawyers. The sample includes lawyers employed in law firms, state and local government, federal government, in-house lawyers in businesses, and nonprofits. Lawyers, as defined by the BLS classification (SOC), “represent clients in criminal and civil litigation and other legal proceedings, draw up legal documents, and manage or advise clients on legal transactions. May specialize in a single area or may practice broadly in many areas of law.” Equity partners and solo practitioners are not included in the survey. [emphasis added]

In other words:

  1. This data leaves out solo practitioners — fully 35% of all lawyers according to Harvard Law School’s research.  Analysis:  these salary numbers skew high.  (I suppose the lack of focus on solos isn’t too surprising since only about 7% of all solos belong to the ABA anyway.)
  2. This data only applies to employed lawyers.  Analysis:  This article tells us nothing about the marginal earning prospects of unemployed lawyers, including recently graduated J.D.’s who are “temporarily” employed in other industries (e.g., as servers in restaurants).

I get that this is “the first installment of a periodic series.”  But come on, ABA.  It’s more than a little disingenuous to claim that “the ABA Journal is offering our readers a new—and we believe different—view of the business and the profession” by “identify[ing] and map[ing] the movements of jobs and money” when you’re simply re-publishing eight month old government data with an arguably misleading slant and without substantive analysis.

Winklevoss twins continue lawsuit against Facebook

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The key conflict in The Social Network (reviewed here and here) is the lawsuit that the Winklevoss twins bring against Facebook founder Mark Zuckerberg. This lawsuit is continuing as the Winklevosses seek a larger settlement:

If they prevail, their legal appeal would overturn the settlement, now worth in excess of $160 million because of the soaring value of the privately held company.

The Winklevosses won’t say exactly how much they would seek in their high-stakes grudge fest with the billionaire Facebook founder, but by their own calculations they argue they should have received four times the number of Facebook shares. That would make any new settlement worth more than $600 million based on a recent valuation of Facebook at more than $50 billion…

Facebook has won multiple court rulings, and legal experts say the Winklevosses are likely to lose this one too…

The controversial origins of Facebook — who actually founded it and how — have been the subject of renewed debate since Hollywood offered its dramatization of the conflicting stories from the Winklevosses, both portrayed in “The Social Network” by actor Armie Hammer, and former Zuckerberg friend and Harvard classmate Eduardo Saverin, portrayed by Andrew Garfield. In 2005, Saverin sued Facebook for diluting his stake in the company and reportedly reaped a $1.1-billion settlement.

Zuckerberg has called the film, which received eight Academy Award nominations including best picture, “fiction.” In it, his character tells the Winklevosses: “If you guys were the inventors of Facebook, you’d have invented Facebook.”

But that’s exactly what the Winklevosses said they did.

The article suggests that the Winklevosses can’t really lose here: if the courts say they shouldn’t receive more money, they still get to receive the initial settlement. We can ask how much The Social Network influenced the decision to seek more money. There were relatively few people in the media who concentrated on the veracity or one-sided nature of this story. For many who saw this Oscar-nominated film, Zuckerberg looks like a jerk.

Of course, this movie and portrayal should have little influence on the courts. And the Winklevosses say they have new evidence for the courts to consider. But I suspect the case was brought in part because of the positive portrayal of the Winkevosses in this film. If this case were in the court of public opinion (and perceptions), would the Winklevosses win?

Chart of total carbon emissions and emissions per capita

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Miller-McCune has put together two charts showing total carbon emissions by country and also emissions per capita by country. See the two charts here.

This is colorful and vibrant. And it is nice to have the charts side-by-side as one can easily make comparisons. For example, the US is #2 in total emissions but #9 in per capita emissions. As The Infrastructurist points out, the chart gives some insights into how many countries might need to deal with per capita emissions rather than point fingers at countries with the largest amount of carbon emissions.

But there is a lot of information compressed in this chart – it is hard to see a lot of the smaller countries with small circles. Additionally, why are the countries in the order they are? It appears that regions are together but the order is not the same for both charts and it certainly isn’t rank-ordered (China and US are on opposite ends of the chart for total emissions). The color and vibrancy seems to be more important to the chart-makers than having a logical order to the countries.

h/t The Infrastructurist

The Chronicle weighs in

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Now comes the Chronicle of Higher Education to sound off on the problems of legal education:

While schools are taking small steps to incorporate more experiential learning and encourage students to broaden their job searches, they remain “remarkably resistant to change,” said Erwin Chemerinsky, the inaugural dean of the University of California at Irvine School of Law….One reason schools are sticking with a familiar playbook: “It’s a cost-effective method of education,” Mr. Chemerinsky said. “Putting one professor in front of a large group of students is very efficient.” Clinical classes and simulations, which require low student-to-faculty ratios, cost more, he said.

This is quickly becoming every journalist’s preferred subject of Monday morning quarterbacking…

Live event tickets and the first sale doctrine

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Daniel Indiviglio over at The Atlantic discusses the potential for eliminating all secondary markets in live event tickets:

If you have ever sold even[t] tickets through the online resale market StubHub, then you may have received an e-mail last week about the dangers of paperless tickets. It cautions that companies “like Ticketmaster” are moving to restrictive paperless ticketing systems, which could kill the secondary market for tickets….According to the Fan Freedom Project, a group speaking out against this product that StubHub links to in its email, there are essentially two kinds:

Restricted transfer (closed-loop system): Primary ticketing agencies have sole control over sales, restricting the transfer of tickets and allowing them to be resold only on their own proprietary exchanges – and with their price restrictions which are often unrelated to the market value of the ticket.

Prohibition of ticket transfer: You purchase paperless tickets with a credit card and must provide the same credit card and a photo ID at the event venue. A swipe of the credit card at the gate produces a slip confirming the location of the reserved seat. The ticket cannot be transferred, sold or given away to another consumer.

Hmm…this sounds suspiciously like book publishers’ plans to undermine libraries and software companies’ recent progress in eliminating the secondary market for software.  Doesn’t anybody want to actually own anything anymore?

Wired’s David Rowan certainly thinks renting rather than owning is the wave of the future, as I discussed in a previous post.  However, Rowan’s analysis focused on the “idling capacity” of personal assets (e.g., a lawnmower that you only use once a week) and how the Internet is helping individuals coordinate more efficient arrangements (e.g., sharing that lawnmower among a wide group of “neighbors”).  The idea here is to increase asset utilization and thus maximize the consumer surplus.  (To round off the example:  lawn mower manufacturers may be upset, but the economy is better off overall since resources are freed for more productive uses than making a ton of lawnmowers that will only be used for 2 hours per week.)

In contrast, eliminating secondary markets in tickets, books, and software only benefits the producer surplus.  It allows de facto monopolies (like Ticketmaster for live event tickets) and copyright monopolies (like those enjoyed by publishers of books and software by virtue of their rightful copyrights) to extend those monopolies over the entire market (since they no longer have to compete with resold tickets, used books, and previously owned software).  Under these circumstances, offering consumers something less than full ownership in their tickets, books, and software doesn’t benefit the economy — it simply increases monopoly, expanding inefficiency and the deadweight loss triangle.

For copyrighted works, the first sale doctrine was supposed to prevent owners from eliminating secondary markets, but that doctrine is under judicial attack.  As for tickets, it remains to be seen whether established industry players like Ticketmaster will be able to further their monopolies by choking off the secondary market.  But it doesn’t look good for consumers — or economic efficiency.

Chicago’s population loss, neighborhood by neighborhood

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After the recent news that Chicago lost about 200,000 residents between 2000 and 2010, the Chicago Tribune takes a look at how the population changed in each of Chicago’s 77 neighborhoods. Here are some of the trends:

Sixty of Chicago’s 77 neighborhoods lost population, according to the 2010 Census. The focus of the population growth was in the Loop, the Near South Side and the Near West Side, areas that experienced a boom in new residential high-rises and loft developments.

The city lost more than 200,000 people during the decade, many from predominantly black neighborhoods hard hit by crime and foreclosures. More than 27,000 non-Hispanic white residents, meanwhile, poured into the city’s downtown and surrounding areas.

On the Southwest Side, the number of Hispanics and Asians grew in historically white ethnic neighborhoods such as Bridgeport, Archer Heights, West Lawn, West Elsdon and Ashburn. White populations in those communities dipped.

So the population growth took place in two places: around the downtown where wealthier whites moved in and on the southwest side where Latinos and Asians moved in. Throughout the rest of the city, the population declined.

As the City of Chicago thinks about how to respond to these figures, should they focus resources on the areas that were growing (particularly the area around the Loop which is likely to get more attention) or figure out some way to boost the prospects of the 60 other neighborhoods that experienced population loss?