Monthly Archives: October 2013

Peak sprawl does not mean the end of suburbs but rather their densification

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One researcher argues the suburbs of the future will be less sprawl and have more density:

Since 2009, 60 percent of new office, retail and rental properties in Atlanta have been built in what Christopher Leinberger calls “walkable urban places” – those neighborhoods already blessed by high Walk Scores or on their way there. That new construction has taken place on less than 1 percent of the metropolitan Atlanta region’s land mass, suggesting a shift in real estate patterns from expansion at the city’s edges to denser development within its existing borders.

“This is indicative that we’re seeing the end of sprawl,” says Leinberger, a research professor with the George Washington University School of Business, who led the study in conjunction with Georgia Tech and the Atlanta Regional Commission. “It does not say that everything turns off. There will still be new drivable suburban development. It’s just that the majority will be walkable urban, and it will be not just in the redevelopment of our downtowns, but in the urbanization of the suburbs.”…

“I think there’s a cause-and-effect issue here,” he says. “I think that when the economy picks up steam, it’s going to be because we learn how to build walkable urban places. Real estate caused this debacle, and real estate has always acted as a catalyst for economic recoveries.”

He figures we’re sputtering along at 2 percent growth precisely because we’re not building enough of the walkable urban product that the market wants. “And it’s signaling with pretty flashing lights,” he says, “to build more of this stuff.”

New Urbanists FTW! The argument here is that the suburbs will continue – with their features of home ownership, cars, local control, autonomy, etc. – but they will look different due to denser designs, feature different kinds of community and social life, and include more features like cultural centers or mixed-use neighborhoods that are more traditionally associated with cities.

One obstacle to this might be how much existing suburbs are willing to increase their densities. This make make financial sense or be good for growth but it could also alter the character of more sprawling communities. For example, many suburbs have already considered or built transit-oriented development where denser housing and space is built near mass transit. But, would they be willing to extend such construction across more of their area?

How much Walter White may have lowered his neighbor’s property values

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Breaking Bad protagonist and meth kingpin Walter White might not have made his neighbors happy:

In his 2011 paper, “The Lasting Effects of Crime: The Relationship of Discovered Methamphetamine Laboratories and Home Values,” Holy Cross econ professor Joshua Congdon-Hohman calculates how much damage meth labs cause to surrounding home values after they’re discovered…Using housing sales data from Akron, Ohio — home to that state’s largest concentration of meth labs  — Congdon-Hohman finds the following:

  • For homes sold within an eighth of a mile after a lab is discovered, there is a 10.5% decline in sales prices.
  • Within the first year of the discovery the decline can be as much as 19%.
  • For homes sold within a quarter of a mile after a lab is discovered, there is a 4.5% decline.
  • The declines persist for at least two years.
  • It didn’t matter if an additional meth lab was discovered — just a single busted cook site can take down several blocks.

Summary: you don’t want meth makers on your street, particularly if you want more money when you sell your house. If reduced property values aren’t enough, I suspect the typical suburbanite also doesn’t want meth makers on their street because they don’t fit the image of a happy, stable, law-abiding neighborhood.

Trader turned sociologist writes book about Goldman Sachs

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A new book on Goldman Sachs is written from an interesting perspective: a trader for the firm turned sociology PhD student.

After writing a paper about organizational change, a professor encouraged him to write about Wall Street.

“He said, ‘No one in sociology understands banks, so you can make a contribution in that area,’ ” Mr. Mandis said…

The essence of his argument is that Goldman came under a variety of pressures that resulted in slow, incremental changes to the firm’s culture and business practices, resulting in the place being much different from what it was in 1979, when the bank’s former co-head, John Whitehead, wrote its much-vaunted business principles.

These changes included the shift to a public company structure, a move that limited Goldman executives’ personal exposure to risk and shifted it to shareholders. The I.P.O. also put pressure on the bank to grow, causing trading to become a more dominant focus. And Goldman’s rapid growth led to more potential for conflicts of interest and not putting clients’ interests first, Mr. Mandis says.

More sociological analysis of the financial industry, particularly from the inside of important firms, is needed. Considering their outsized importance on the global economy as well as global cities, it is a little surprising such books aren’t more common.

The review is fairly favorable, calling the book “accessible” and “clearly written.” However, the review doesn’t hint at criticism of Goldman Sachs. Given the opinions of many sociologists, is that would many sociologists would expect when reading such a book?

When big corporations keep approaching Illinois about tax breaks

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ADM and other large companies in Illinois keep pushing the state to offer more tax breaks:

The company has called Decatur home for more than four decades but said it needs to relocate to make international travel and employee recruitment easier. ADM hasn’t said where its new headquarters will be, but Chicago is the preferred location for an operation that would employ about 100 people, according to knowledgeable sources. The company has said it would also create a technology center at its headquarters site that would employ an additional 100…

The ADM tax package is one of several bills introduced Friday that would give breaks to specific companies or industries. The bills seem likely to reignite the debate over targeted breaks that swirled in 2011 when the General Assembly gave tax relief to CME Group Inc. and Sears Holdings Corp. Both companies had threatened to exit the state…

The proposal also would let the company retain state income tax withholdings that employees would have paid the state. Motorola Mobility, Navistar International Corp. and Ford Motor Co. have received the same tax break to retain jobs…

Separately, two other companies are in line to receive tax incentives. Swiss insurance company Zurich plans to build its new North American headquarters in Schaumburg, where it employs about 2,500 people who would shift to the new facility.

More on the story from yesterday’s paper:

ADM, which said last week it is searching for a new corporate headquarters, wants $1.2 million a year for the next 15 to 20 years, company representatives told a State House Revenue and Finance Committee at a hearing in Chicago on Tuesday…

If lawmakers approve the bill, ADM would join a select number of companies that can retain their employees’ income tax withholdings. That group includes Motorola Mobility, Sears Holdings Corp., Navistar International Corp. and Ford Motor Co.

To get there, companies have lobbied lawmakers to amended the language of the state’s Economic Development for a Growing Economy tax credit program, or EDGE.

The print version also noted that about two-thirds of Illinois companies don’t pay corporate income taxes.

Such requests put politicians in a difficult position – which I suspect is one reason businesses make such requests. The politicians quoted in the stories sound fairly negative about the tax breaks; they think the companies are simply asking to avoid taxes they could afford to pay. At the same time, politicians don’t want to be the ones who are viewed as anti-business (which is related to being anti-growth or anti-jobs) and the ones who let big name companies get away. If other states or localities are offering better tax breaks, they have to compete with tax breaks or highlight other advantages (an educated workforce, access to a global city – Chicago, clusters of other nearby corporations and services, etc.). It can then become a race to the bottom as governments undercut each other to attract corporations which are then less valuable.

Should every home improvement increase the value of your home?

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HGTV host Sabrina Soto discusses five home improvements that might actually lower the value of your home:

Converting bedrooms into other spaces: If potential homebuyers “see it’s a four-bedroom house, they want to go to the open house and see four bedrooms. You have to take the guesswork out,” says Soto. If you do convert a room, there’s one feature you should absolutely never mess with. Watch the video to find out what that is.

Hot tubs: Soto thinks inheriting someone else’s hot tub is a turn-off — and she’s not alone. “You’d be surprised how many potential buyers find them to be a little gross.” And once a hot tub is installed, it’s not an easy feature to remove from a deck or backyard.

Colored trim and textured walls: It seems like any potential homebuyer would see these features and know they can easily paint over them, but not so fast, says Soto. “I would much rather paint walls than trim any day — it’s a beast of a job,” she says. And textured walls are “a mess to sand down and remove. The fad is over anyway, so just let it go.” If you feel your trim is outdated, see the video for Soto’s tips on what to do.

Children’s theme bedrooms: Spending hundreds of dollars on a mural for your child’s wall is throwing money away. Not only will they outgrow it in a matter of years, but “you’re never going to get that money back when you sell, so just keep it neutral,” posits Soto.

Too much landscaping: Conventional wisdom says you want your yard to look as nice as possible, but heed Soto’s warning: you want to “keep up with the Joneses — but don’t exceed them.” To a potential buyer, gorgeous, overdone landscaping screams high-maintenance.

My question after reading this list: what if you simply want these features for yourself and not because it might add to your resale value? Granted, if you are looking to sell your house, you might not want to pursue these options. But, if you are looking to live in your house for a while, you might decide that one or more of these features is what you want.

The bigger issue is this: doesn’t a list like this perpetuate the idea that a home is primarily an investment? That is one way to view things but there are other reasons for owning a home.

The wealthy continuing to give to wealthy universities and colleges

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Gregg Easterbrook, ESPN’s Tuesday Morning Quarterback, continues to highlight a pattern: wealthy donors giving to already wealthy universities and colleges:

Don’t Give to Harvard! A running TMQ cause is that rich people give money to schools such as Harvard, Yale and Stanford, places already possessing gargantuan endowments, rather than to schools where money is needed. The rich underwrite elite schools for ego reasons — at cocktail parties they can say, “I just donated $10 million to Harvard, now a shower stall will be named after me.” At colleges and universities that serve average people, donations can change lives. If you’ve got money, donate to noble Berea College, which accepts only poor students and charges no tuition, or to gallant Bethune-Cookman, a historically black school that mainly serves the underprivileged. Alumnus Charles Johnson just gave $250 million to Yale — which is already sitting on a $19 billion endowment. At a place like Berea College, $250 million would have been a transformative event in the lives of the deserving. At Yale, it’s a rounding error in the lives of the privileged.

Reader Jon Miller of Beaumont, Texas, notes that despite having a world’s-best endowment of $32 billion — nearly double the GDP of Honduras — Harvard just kicked off a capital campaign, asking for another $6.5 billion. Rich people, show a little class: Don’t give to Harvard. Or Yale, Princeton or Stanford. Make your donation count.

This gets back to an old question: do elite universities perpetuate social inequalities? If giving patterns changed as Easterbrook suggests, perhaps there might be a shift…

Can a pleasant suburb like Naperville have medical marijuana facilities?

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Naperville officials are looking into how to regulate future medical marijuana facilities in their community:

Naperville will begin considering zoning regulations for medical marijuana businesses Tuesday night as councilmen review staff recommendations to limit such facilities to industrial parks, set a distance requirement from residential areas and require all medical marijuana operations to be evaluated on a case-by-case basis instead of allowed outright.

The proposed zoning code updates, which also would prohibit medical marijuana cultivation centers or dispensing organizations from opening in downtown and general commercial areas, are set to be considered during a council meeting at 7 p.m. in the municipal center, 400 S. Eagle St…

Naperville’s possible zoning changes are in addition to state restrictions that say cultivation centers cannot be within 2,500 feet of the property line of a school, day care center or residential area, and only one can open in each of the 22 state police districts statewide…

He said keeping dispensaries out of downtown and allowing only one in each strip mall or collection of buildings under the same ownership will help prevent the new businesses from being too widespread…

“The dispensaries are more like a pharmacy and should be allowed in retail areas,” Chirico said. “Legal, prescribed medication shouldn’t be restricted to an industrial park.”

It will be interesting to watch how wealthier suburbs treat medical marijuana facilities which are legal but probably not very desirable in these communities. Are the dispensaries better or worse than tattoo parlors? (If I had to vote, I’d go with better.) The interest in putting a dispensary only in industrial areas certainly would help keep it out view and away from impressionable people.

But, I could imagine a scenario where a resident of such a community is able to effectively tell how they need the marijuana to relieve pain from a life threatening illness and they don’t want to be made to feel like a ne’er-do-well in their own suburb. Telling that story in the right setting might make the community leaders and residents look uncaring and callous.

Durkheim, modern American hyper-individualism, and moral consensus today

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One commentator links Durkheim’s ideas about suicide, anomie, and society to individualism in America today:

Here in the West, we take individualism and freedom to be foundational to the good life. But Durkheim’s research revealed a more complicated picture. He concluded that people kill themselves more when they are alienated from their communities and community institutions. “Men don’t thrive as rugged individualists making their mark on the frontier,” the University of Virginia sociologist W. Bradford Wilcox pointed out recently: “In fact, men seem to be much more likely to end up killing themselves if they don’t have traditional support systems.” Places where individualism is the supreme value; places where people are excessively self-sufficient; places that look a lot like twenty-first century America—individuals don’t flourish in these environments, but suicide does.

Durkheim’s work emphasizes the importance of community life. Without the constraints, traditions, and shared values of the community, society enters into a state of what Durkheim called anomie, or normlessness. This freedom, far from leading to happiness, often leads to depression and social decay (as the “twerking” Miley Cyrus perfectly exemplified recently at the Video Music Awards). Durkheim thought that the constraints—if not excessive—imposed on individuals by the community ultimately helped people lead good lives.

But we live in a culture where communitarian ideals, like duty and tradition, are withering away. Even conservatives, who should be the natural allies of these virtues, have in large part become the champions of an individualism that seems to value freedom, the market, and material prosperity above all else, leaving little room for the more traditional values that well known thinkers like Russell Kirk and Richard Weaver cherished. “Man is constantly being assured today that he has more power than ever before in history,” wrote Weaver in Ideas Have Consequences (1948), “but his daily experience is one of powerlessness. . . . If he is with a business organization, the odds are great that he has sacrificed every other kind of independence in return for that dubious one known as financial.”…

Let’s return to the Google Books Ngram Viewer to illustrate the point. When Twenge, Campbell, and their colleague Brittany Gentile analyzed books published between 1960 and 2008, they found that the use of words and phrases like “unique,” “personalize,” “self,” “all about me,” “I am special,” and “I’m the best” significantly increased over time. Of course, it is not just in our books where this narcissism appears. It is also throughout the popular culture, not least in pop music. When a group of researchers, including Campbell and Twenge, looked at the lyrics of the most popular songs from 1980 to 2007, they found that the songs became much more narcissistic and self-centered over time. In the past three decades, the researchers write, the “use of words related to self-focus and antisocial behavior increased, whereas words related to other-focus, social interactions, and positive emotion decreased.”

Durkheim was very much about social cohesion, moral consensus, and the interdependence of individuals in modern society. Individuals may think that they are self-sufficient or able to do a lot on their own but much of their lives are built on the efforts of others.

Another aspect of this might be the declining participation of Americans in civic groups as outlined by Robert Putnam in Bowling Alone. This doesn’t mean Americans are completely withdrawn but it does suggest they might be more wary of collectives or only choose to participate when it suits them. This is how you can view online social networks like Facebook and Twitter: they enable social interaction but it is at the demand of individual users as they get to decide when and how they interact.

You could flip this this around and ask a different question: what are Americans all committed to? Where do we still have moral consensus? Perhaps in declining trust in institutions. Perhaps in celebrating Super Bowl Sunday. Perhaps the idea that homeownership is a key part of the American Dream. Perhaps in religiosity (even with the rise of the “religious nones,” some of whom still believe in God). Here are a few other things 90% of Americans can agree on:

Yet there are some opinions that 90% of the public, or close to it, shares — including a belief that citizens have a duty to vote, an admiration for those who get rich through hard work, a strong sense of patriotism and a belief that society should give everyone an equal opportunity to succeed. Pew Research’s political values surveys have shown that these attitudes have remained remarkably consistent over time.

The proportion saying they are very patriotic has varied by just four percentage points (between 87% to 91%) across 13 surveys conducted over 22 years. Similarly, in May 1987, 90% agreed with the statement: “Our society should do what is necessary to make sure everyone has an equal opportunity to succeed.” This percentage has remained at about 90% ever since (87% in the most recent political values survey).

It is not that we don’t have zero social cohesion these days. The argument here could be two-fold: (1) social cohesion has declined from the past; (2) social cohesion today has changed – it might be more “alone together” than everything else where we can be around others at times and share some common values but we generally want to follow our own paths, as long as they aren’t impeded too much by the paths of others.

Denver Broncos scoring at 3.13 standard deviations above the NFL average

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Bill Barnwell puts the scoring of the 2013 Denver Broncos in statistical perspective:

That brings us to z-score (or standard score), the measure that analyzes a figure’s distance from the rest of the data set using the mean and standard deviation from the set. By comparing each team’s points scored to the league average (and calculating the standard deviation) for the points scored of each team from that given season, we can get a measure of how much better or worse it was than the average team from that season. Fortuitously, that measure also allows us to compare teams across different years and eras. It’s not perfect, since it can’t account for things like strength of schedule or whether a team let up late in games or not, but it’s a much better measure than raw points scored.

As it turns out, even after we make these adjustments, the 2013 Denver Broncos have still scored points at a higher rate through four games than anybody else since the merger. The Broncos are scoring points on a per-game basis at a rate of 3.13 standard deviations over the mean, which is unmatched over that 43-year run. No team has ever scored more frequently, relative to its peers, than the Broncos have done relative to the rest of the league in 2013.

Because these are standardized figures, it’s possible to translate each team’s scoring rate in 2013 figures and see how close it is to Denver. In this case, after we account for the different populations, a bunch of teams move closer to Denver’s throne. Chief among them is the 1991 Super Bowl–winning team from Washington, which scored 146 points through four games in a league whose teams averaged a mere 72 points through their first four tilts. Washington’s figure placed it 2.85 standard deviations above the mean and translates to 170.9 points scored in 2013, just 8.1 points behind the Broncos. Other famous teams follow: the 2000 Rams, 1992 Bills, 1996 Packers, 1981 Chargers, 2005 Giants …

And you thought standard deviations were good only for statisticians. If you know your normal distribution, that’s way above the league average. I can only imagine how Sportscenter anchors might try to present this information…

Actually, this is quite useful for two reasons: (1) it allows us to look at the Broncos compared to the rest of the league without having to rely on the actual points scored; (2) it allows us to standardize points scored over the years so you can compare figures over a 43 year stretch. Both advantages are part of the wave of new statistical analysis taking over sports: don’t just look at the absolute value of statistics but put them in comparison to others teams or players and also provide statistics that allow for comparisons across time periods.

Wording matters: more Americans oppose and support Obamacare than support and oppose the Affordable Care Act

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This is a good example of how wording questions differently can lead to different results: support of Obamacare versus the Affordable Care Act.

More Americans oppose the health care law when you call it Obamacare—46% of Americans oppose the health care law when it carries Obama’s name, while just 37% oppose the Affordable Care Act.

When dubbed Obamacare, however, the law has more supporters: 29% of those polled in a new CNBC poll said they supported Obamacare; just 22% of those polled said they supported the Affordable Care Act.

CNBC asked half of its poll respondents about the Affordable Care Act and half of them about Obamacare.

There are a couple of possible explanations here: some people react more negatively or positive to Obama while others might be unclear what exactly the Affordable Care Act is.

Given these results, it makes President Obama’s decision to fully own the Obamacare title as opposed to using a more neutral title. While he might feel the legislation is a signature part of his presidency, its attachment to him rather than having a more bland bureaucratic name might be hurting its cause.