Tag Archives: costs

Will outlining the monetary and environmental costs of lawns change behavior?

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Americans may like their green lawns around their single-family homes but they come at a cost:

These days, front lawns cost Americans $40 billion a year to maintain, and are spread over about 50,000 square miles—the land area equivalent of the entire state of Alabama.

This vast swath of ornamentally maintained land is generally bad for the environment. A lawnmower generates more greenhouse gas emissions per hour than 11 cars, according to the Environmental Protection Agency; nitrous oxide emitted by fertilizer has 300 times the warming potential of carbon dioxide, and lingers in the atmosphere for as long as 120 years. Swept into waterways, those fertilizers strip the water of oxygen, causing algal blooms and “dead zones” that kill freshwater and marine life.

Then, of course, there’s water use. Americans consume around 9 billion gallons of water a day on average on outdoor use—most of it watering their lawns. That’s more water than families use for showering and laundry combined. As populations rise, water needs will only get more taxing in many states.

The writer concludes by suggesting that California’s drought and trend-setting may just help limit lawns in the future. However, there are at least two major hurdles to overcome:

1. The cultural importance of a lawn should not be undervalued. The minor connection to nature (or “nature” modified appropriately by humans) is important.

2. Simply citing large numbers or figures like above may not go very far. In the abstract, $40 billion sounds like a lot until you consider what kind of money is spent on other things. Or, what might people do instead with that $40 billion? Even the environmental concerns – and the effects sound quite harmful – are more abstract since the consequences are pushed down the road either in time or place.

Perhaps the best way to combat the American lawn would be to change the American view of nature and what is appropriate around single-family homes. We have seen some of the shaming efforts in California, from overhead photos of celebrity compounds to neighbors reporting each other over water violations. This could be done more positively with incentives (such as being paid to remove turf in Western state) or new trends. What suburban resident would want to be the only one on the block with the green costly lawn if all the neighbors had moved on?

USA Today says American Dream costs $130k per year

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Living the American Dream isn’t cheap, according to calculations from USA Today. Here is what went into the cost:

•Home ownership is central to the American dream. So, we took the median price of a new home ($275,000), subtracted a 10% down payment, then projected the annual cost of a 30-year mortgage at 4% interest. We also added annual maintenance costs of 1% of the purchase price. Total: $17,062 a year.

•We used the U.S. Department of Agriculture’s April 2014 figure of $12,659 for a moderate-cost grocery plan for a family of four.

•In May, AAA estimated it would cost $11,039 a year to own one four-wheel-drive sport-utility vehicle.

•The Milliman Medical Index pegged annual health insurance premiums and out-of-pocket medical expenses at $9,144.

•We used various estimates for the costs of restaurants and entertainment; one family summer vacation; clothing; utilities; cable or satellite; Internet and cellphone; and miscellaneous expenses (see table).

•Total federal, state, and local taxes were pegged at 30% for households at this income level, based on a model developed for Citizens for Tax Justice.

•USA TODAY calculated current educational expenses for two children at $4,000 a year and college savings (all of it pretax, we assumed) at $2,500 per year per child, based on various rules of thumb.

•Finally, the maximum annual pretax contribution to a retirement plan for people under 50 is $17,500. That’s slightly less than 15% of this American dream household’s annual earnings, in line with financial planners’ recommendations.

Total: $130,357.

It sounds like a lot — and it is in a country where the median household income is about $51,000. Add one more child and another vehicle and you could easily reach $150,000.

I can see some places where costs could be trimmed, particularly with the car and a more minimalistic approach to retirement savings. I wonder if the emphasis here should be on the overall cost – which is high and the article notes it can vary quite a bit from region to region – or the assumptions about what the middle class is about. I was recently looking at a classic sociological study Working-Class Suburb written by Bennett Berger in 1960. There is a point in the book where Berger juxtaposes the suburban critic frowning at the ills of suburban life and the suburbanite who is happy with his relative comfort of a car, refrigerator, house, and little patch of lawn. In the decades since, expectations about the good life have increased, as Juliet Schor showed in The Overspent American. If Americans need $130,000 a year to have the basics, many of which are good things, then is being middle-class something completely different today?

New tool from HUD to estimate combined commuting and housing costs

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Opponents of sprawl argue too many people buy cheaper homes further from the city without considering the added transportation costs. Here is a new tool to help address this issue:

More than 3 in 4 home buyers polled in the National Assn. of Realtors’ latest Profile of Home Buyers and Sellers said commuting costs are either “very” or “somewhat” important to their ultimate purchase decisions. After all, the combined cost of housing and transportation consumes close to half of the typical working family’s monthly budget…

The Location Affordability Portal from the Housing and Urban Development Department and Transportation Department enables users to estimate the combined housing and transportation costs for a specific region, neighborhood and even street.

LAP is actually two tools: one, a map-based Location Affordability Index, is a database that predicts annual housing and transportation costs for a particular area. The other, My Transportation Cost Calculator, enables users to customize data for their own household and potential residential locations.

LAP includes diverse household profiles — which vary by income, size and number of commuters — and shows the affordability landscape for each one across an entire region. It was designed to help renters and homeowners — plus planners, policymakers, developers and researchers — get a more complete understanding of the costs of living in a location given the differences between households, neighborhoods and regions, all of which affect affordability. The data covers 94% of the U.S. population.

Use the tool here. Some good info here. I plugged in some quick numbers of our housing and transportation costs and the yearly transportation costs were about 57% of annual housing costs. Driving, even with commutes that aren’t that far, add up quickly. Here is what the Location Affordability Index looks like for much of the Chicago region:

LocationAffordabilityPortalChicagoArea2

On this map with combined housing and transportation costs, I feel like you can quickly see places where the housing is more expensive (some places on the North Shore) and other places where transportation costs are higher (and where there may be fewer jobs – Will County, western DuPage County).

The idea here is that more people need more information about commuting costs when making housing decisions. If they had the commuting costs, they would choose differently. For how many people would this be true? I suspect some Americans would place more emphasis on a cheaper house, even if the commuting costs are higher. In other words, these aren’t equal considerations when Americans, particularly of certain incomes, have to make a choice.

American religious groups don’t pay $72 billion a year in taxes but religion saves America $2.6 trillion a year?

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A study last year claimed governments lose $71 billion a year because of the tax exemptions of religious institutions but a new book by sociologist Rodney Stark suggests religion saves America $2.6 trillion a year:

The biggest by far has to do with the criminal justice system. If all Americans committed crimes at the same level as those who do not attend religious services, the costs of the criminal justice system would about double to, perhaps, $2 trillion annually. Second is health costs. The more often people attend religious services, the healthier they are. However, the net savings involved is reduced somewhat by the fact that religious Americans live, on average, seven years longer than those who never attend religious services.

So then religion in America is worth the money? The math on this would be mighty interesting. But, hopefully this is more information on this in the book.

It does strike me that this is a strange way to talk about religion or any social good: does it really come down to money? This strikes me as a very American conversation where we care about the value of things and bang for our buck.

Driving isn’t cheap: average car costs $9,100 a year

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Americans may love driving but it comes with a price. Here is a new cost estimate per car from AAA:

Owning a car will cost the average American driver more than $9,100 this year, the AAA has revealed.

The automotive club unveiled its annual study of driving costs on Tuesday and found that the average sedan owner will rack of $0.61 for every mile on the road. 

SUV drivers are in for even more pain in the wallet – $0.77 per mile or $11,600 a year.

The AAA estimates include nearly all expenses of taking to the road – from the cost of the car itself to gasoline, tires, insurance and repairs.

The data estimates that Americans drive 15,000 miles a year and drive a standard-size sedan like a Toyota Camry or Ford Fusion…

The survey assumes drivers buy a new car and keep it for five years.

So the figures change a bit depending on what kind of car it is and how old the car is but this is still pretty pricey. The common American cost-benefit analysis might look like this: a car gives me freedom, independence, and the ability to live more where I want to live (based on factors like housing prices and desired community) versus it costs a decent amount to drive. Actually, I suspect few people actually think about the total cost of driving as it tends to be experienced in increments: you fill up for gas here, pay insurance here, pay for repairs another time.

Rationalizing the economic costs of raising children

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Discovery News reports on two recent studies that look at how parents respond to information about how much it costs to raise children today:

New research suggests that people may exaggerate the perks of being parents to rationalize the financial costs of raising children.

Two studies, featured in the journal Psychological Science, measured more than 140 parents’ feelings after being presented with information regarding the hefty bill of raising a child. In the Northeast, raising one child to the age of 18 costs nearly $193,000, according to the research.

In one of the studies, researchers exposed half of parents to the overall costs of raising a child, while the other half received information about the costs as well as information suggesting that children care for and financially support aging parents later in life.

The team discovered that parents who were only exposed to the costs of parenthood (not the benefits) rationalized such costs by reporting a higher intrinsic value of being parents. The other group, which received information regarding the costs and benefits of parenthood, did not show an increase in rationalization…

These findings by no means suggest that parents do not enjoy parenthood or fail to love their children, but rather emphasize that parents are sometimes faced with conflicting feelings regarding the costs and benefits of having children.

It would be interesting to hear what it means to parents when they talk about “a higher intrinsic value of being parents.” Are there certain kinds of behaviors from children or experiences parents have with children where the economic costs end up outweighing “the intrinsic value”? How much can parents openly talk about the economic costs of children when it seems like a crass way to talk about their kids?

Dissenting voices: “There is no college cost crisis”

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So says Stanley Fish in his NYTimes review of economists Robert B. Archibald and David H. Feldman’s new book, “Why Does College Cost So Much?”:

The causes of the increase in college costs (an increase that has not, [Archibald and Feldman] contend, put college “out of reach”) are external; colleges are responding, as they must, to changes they cannot ignore and still provide a quality product. Chief among these is the change in the sophistication and cost of the technology that has at once transformed the setting of higher education and become one of the areas of knowledge higher education must impart to students.

This is an intriguing dissent from what Archibald and Feldman call the “new orthodoxy” or the “dysfunctionality narrative” of spiraling college costs.  As Fish himself opines:

As a dean who encountered the rising costs of personnel, laboratory equipment, security, compliance demands, information systems and much more every day, I knew [my own critiques written in 2003 were] basically right, but I am happy to ride (belatedly) on the coattails of people who really know what they’re talking about.

What do you think?  Is technology the major driver of increased costs in higher education?  Or are other, more relevant factors at work here?

Calculating the costs associated with a murder

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Whenever I see a researcher or lawyer put a dollar figure on a certain act, I’m always curious how they calculate this figure. Here is another example: a sociologist at Iowa State argues the total monetary cost of a single murder is just over $17 million.

Matt DeLisi, an ISU associate professor of sociology and director of the criminal justice program, led a team of five Iowa State graduate students on the study of 654 convicted and incarcerated murderers. Expanding upon earlier monetization estimates, they calculated the costs of five crimes — murder, rape, armed robbery, aggravated assault and burglary — in terms of the victim costs, criminal justice system costs, lost productivity estimates for both the victim and the criminal, and estimates on the public’s resulting willingness to pay to prevent future violence.

The sociologist argues this calculation was undertaken with crime prevention in mind:

“This area of research has really been run with prevention researchers,” he said. “That’s because what they find is that even if a prevention program is very expensive — and most of them are actually shockingly inexpensive — they’re still more cost effective than allowing these careers to unfold.”

Of course, focusing on prevention can be difficult and it may not eliminate all the crimes. But faced with the high costs of dealing with crimes after they are committed, some may take a longer look at preventative measures.

Colleges have debt too

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The New York Times has published an opinion piece by Mark C. Taylor, the chairman of the religion department at Columbia University, that puts a slightly different spin on the perennial college-costs-are-out-of-control argument.  He suggests that the institutions of higher education are themselves as indebted (and troubled) as their students:

There is a similarity between the debt crisis on Wall Street and what threatens higher education. Just as investors borrowed more and increased their leverage in volatile markets, many colleges and universities are borrowing more and betting on an expanding market in higher education at the precise moment their product is becoming affordable for fewer people.

It’s an interesting observation with potentially far-reaching implications.  There is always going to be demand for higher education, but it’s hard to see how a university like N.Y.U. can sustain debt levels higher than its endowment (“a staggering $2.22 billion debt with a relatively modest $2.2 billion endowment,” according to the article) in a world where “four years at a top-tier school will cost $330,000 in 2020, $525,000 in 2028 and $785,000 in 2035” if present trends continue.